Moneybox: What Is Austrian Economics?

Now playing: Slate V, a video-only site from the world's leading online magazine. Visit Slate V at www.slatev.com.
Moneybox What Is "Austrian Economics"? And why is Ron Paul obsessed with it? By Matthew Yglesias Posted Friday, Jan 06, 2012, at 09:16 PM ET As he declared quasi-victory in Iowa following a third-place finish, Ron Paul puzzled cable news watchers across the country by proudly proclaiming, "We are all Austrians now." The average Republican presidential candidate would sooner officiate a gay marriage than praise Europe, yet here was Paul pledging allegiance to Vienna. What did he mean? Why would we all be Austrians? Paul's statement was crystal clear to those familiar with the internecine controversies of the libertarian movement. He was referring to so-called "Austrian economics," an idiosyncratic passion of his and a set of beliefs that put him at odds with the vast majority of well-known economists of all ideological inclinations. For starters, it's important to note that the term has something of a double meaning. The Austrian school originally referred to a set of classical liberal thinkers with diverse interests who came out of the Austro-Hungarian Empire. Many of these thinkers are obscure today, but the most distinguished member of the group, Friedrich Hayek, is anything but. By the same token, an appreciation for Hayek's work by no means makes you an "Austrian." Hayek, who died in 1992, won the Nobel Prize, and mainstream economists thoroughly embraced his important work explicating the role of the price system in conveying information. His ideas undergird everything from carbon taxes to wireless spectrum auctions and thoroughly permeate policy throughout the Western world. But "Austrians" in Paul's sense refers to something narrower, specifically the thought of Ludwig Von Mises and his student ... To continue reading, click here. Join the Fray: our reader discussion forum What did you think of this article? POST A MESSAGE | READ MESSAGES Also In Slate Kaplan: The Coming Pentagon Cuts Will Change the Very Nature of the Army and Marines Is Obama About To Repeat FDR's Big Economic Mistake of 1937? Yglesias: The Addition of 200,000 New Jobs Last Month Is Not Something To Celebrate	Advertisement
Manage your newsletters subscription: Unsubscribe | Forward to a Friend | Advertising Information
Ideas on how to make something better? Send an e-mail to slatenewsletter@nl.slate.com. Copyright 2011 The Slate Group | Privacy Policy The Slate Group | c/o E-mail Customer Care | 1350 Connecticut Ave NW Suite 410 | Washington, D.C. 20036