The seminar The Austrian School in Historical Context: Its Rebirth and Continuing Relevance presented by the professor and economist Richard Ebeling, is a group of sessions where he discusses the pertinence of the several contributions the Austrian School of Economics made during the 20th century.
In this session, Ebeling talks about the Austrian critique of socialism after the WWI and its application to the Interventionist-Welfare state we have nowadays. Back then, right after the war ended the socialist central planning movement emerged from the defeated countries, were the government would own the means of production and allocate the resources and labor.
All of this was on paper, this was ideals, goals, dreams of the various socialists but it was WWI that brought this possibility to fruition”.
It was in 1920 that Ludwig von Mises gave his criticism on this central-planning system saying it was impossible due to the lack of economic calculation, that serve to entrepreneurs to allocate the resources in the most cost-efficient way and the consumers to express their economic evaluations of what they want.
Ebeling also discusses Friedrich A. Hayek’s perspective on socialism where he ensures that it would be impossible to the planners to be informed of all the different and constant changing layers of knowledge of all the individuals in the society. Ebeling emphasize on the importance of liberty and the institutions of a free market.
We have today the regulated, interventionist controlled economy. We have no true free markets. What we have today is the interventionist welfare state”.
Lastly, he proceeds to talk about the institutions of the regulated, interventionist economy and the forms of government intervention. Friedrich Hayek ensures that competition is a “discovery procedure” that allows the market rewards to those who give their best in order to obtain profit.
Watch the entire collection here!
Author, economist, professor and honorary doctor of UFM
Nuestra misión es la enseñanza y difusión de los principios éticos, jurídicos y económicos de una sociedad de personas libres y responsables.
Universidad Francisco Marroquín