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David Gordon

Articles by David Gordon

Rothbard: The Constitution Was a Coup d’État

2 days ago

[Conceived in Liberty: The New Republic, 1784–1791. By Murray N. Rothbard. Edited by Patrick Newman. Mises Institute, 2019. 332 pages.]
We owe Patrick Newman a great debt for his enterprise and editorial skill in bringing to publication the fifth volume, hitherto thought lost, of Murray Rothbard’s Conceived in Liberty. The details of his rescue of the lost manuscript are indeed dramatic, but rather than recount them here, I should like to concentrate on a theme central to the new book.
It is well known that Rothbard took the American Revolution to be mainly libertarian in its inspiration. The libertarian impulses of the Revolution were betrayed by a centralizing coup d’état. As Rothbard puts it:
Basically, urban merchants and artisans, as well as many slaveholding

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Money, Inflation, and Business Cycles: The Cantillon Effect and the Economy

27 days ago

Money, Inflation, and Business Cycles: The Cantillon Effect and the Economy
by Arkadiusz Sieroń
Abingdon: Routledge, 2019
x + 162 pp.
Abstract: Austrian economists hold that money matters a great deal in concrete terms in the immediate short run and has permanent long-run effects. Sierońs book investigates the Cantillon effect, which indicates that money is not neutral because inevitabily it is injected unevenly, creating economic distortions. These distortions are important to the long run and the Austrian theory of the business cycle.
Quarterly Journal of Austrian Economics 22 no 3 2019.pdf
inflation    interest rate    central bank    money neutrality    cantillon
Economists agree that money matters, but that agreement stops when it comes to how money matters.

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Luck and Taxes

29 days ago

“Luck egalitarianism” is a philosophical fad, and in the past I have had some characteristically unkind things to say about it. I’d like today to discuss a new argument that concerns luck and government.
The economist Robert H. Frank says in Under the Influence,
Because successful people often fail to appreciate the importance of seemingly minor random events in life, they tend to develop an exaggerated sense of entitlement to the enormous material rewards they command in the marketplace. To be sure, most successful people work hard and are highly talented. But at critical junctures, they must also have been lucky. There are plenty of others, after all, who were equally talented and hardworking, yet didn’t earn nearly as much. The problem is that when people think

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Economist: Your Freedom Is Dangerous Because You Might Set a Bad Example

January 14, 2020

Last week I discussed a new argument against paternalism in the important book of Mario Rizzo and Glen Whitman, Escaping Paternalism. Today I’d like to give the other side a chance.
Robert H. Frank is an economist at Cornell University, well-regarded for his work on the emotions and usually anxious to stress the flaws of the free market. In his just-published Under the Influence, he offers, among many other things, a defense of high taxes on cigarettes, and this is what I’m going to talk about today. Frank’s argument, I hope to show, rests on some fundamental confusions.
Frank acknowledges that taxes on cigarettes, like other “sin taxes,” must overcome a powerful objection. Shouldn’t people be able to decide for themselves what goods they wish to consume? Even if

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Why Paternalists Keep Calling Us “Irrational”

January 6, 2020

Some economists, such as the 2017 Nobel Laureate Richard Thaler and his colleague Cass Sunstein, have proposed an unusual justification for government interference with people’s choices. They do not intend, they say, to override the preferences that people have. They don’t want to tell people what they “should” want, according to an external standard that people don’t accept.
They claim, however, that accepting the actual preferences people have still leaves room for government intervention. How is this possible? Their answer is that people often choose in an irrational way. They make mistakes in reasoning and choose impulsively. People don’t “really” want what they choose irrationally, so government intervention that pushes people to choose rationally is

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Is Greater Productivity a Danger?

January 3, 2020

It is bad enough that opponents of the free market wrongly blame capitalism for environmental pollution, depressions, and wars. Whatever the failings of their causal theories, at least they are focused on undoubtedly bad things. We have really gone beyond the pale, though, when the market is blamed for something good.
Tim Jackson, a professor of sustainable development at the University of Surrey, does just that in his article. “Let’s Be Less Productive,” which appeared in the New York Times on May 26, 2012.
Jackson suggests that greater productivity may have reached its “natural limits.” By productivity he means “the amount of output delivered per hour of work in the economy.” He acknowledges that as work has become more efficient, substantial benefits have

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Failing to Emigrate Does Not Mean You Give Consent to the State

December 24, 2019

Eric Nelson, a Professor Government at Harvard, has published this year a brilliant and imaginative book, The Theology of Liberalism (Harvard University Press, 2019). Nelson, it should be said, is no leftist, despite what you might expect from his Harvard affiliation. To the contrary, he is a conservative and favors, though not to the fullest extent, the free market and private property rights. I hope to address on future occasions his penetrating and original views on the theological roots of “luck egalitarianism” and on libertarian theories of property acquisition and rectification.
For now, though, I propose to consider two arguments that Nelson gives in favor of tacit consent as a basis for political sovereignty. In the first of these arguments, Nelson with

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Yes, Taxation Is Theft

November 17, 2019

Libertarians think that taxation is theft. The government takes away part of your income and property by force. Your payments aren’t voluntary. If you think they are, try to withhold payment and see what happens.
An influential book by Liam Murphy and Thomas Nagel, The Myth of Ownership, tries to show that this view of taxation is wrong. Many people, they say, foolishly resent taxes. By what right does the government take away part of what we own? Isn’t this legalized theft? The government may claim that it needs the funds to provide essential social services: are the poor to be left to starve? But these assertions do not justify its policy of forcible seizure. Isn’t it up to each owner of property to decide what, if anything, he wishes to donate to charity and

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