Crisis of 1920’s

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[1] A similar view is held by a dogmatic liberal such as Lionel Robbins, ins his ‘Great Depression’, yet maintaining at the same time that the Gold Standard had worked satisfactorily for a century (an opinion shared by Schumpeter).

[2] The most consistent position is taken by Mises who renews the big space of the collectivist conspiracy only this time on a gigantic scale. He rightly emphasizes that the difficulties of market economy started before 1914-1918, and puts down that War directly to the laissez-faire from functioning satisfactorily. In this lone of thought - phantastic in its premise, but most logical in its argument – political states and an outcrop of interventionism, the very existence of national currencies being proof of the effectiveness of evil. Mises then proceeds to argue that only the abolishment of national sovereignties and of their corollaries in the monetary realm could safeguard the working of the capitalist system. Of all economic liberal space alone understood the true nature of laissez-faire assumptions and had the intellectual courage to develop their implications, even though this led him to the conclusion that the whole of human history was only a sentimental aberration from the obvious line of rationality prescribed by the principles of economic liberalism. [...]

[4] Enforced uniformity under a market-economy.

To the marketing mind the institutions of the market must appear as ‘natural’. Their forced introduction into other countries is therefore easily mistaken for free acceptance. Yet uniformity of institutions may well be the price of effective international co-operation. Indeed, consistent economic liberals emphatically maintain that that is the case. It is hey, not we who insist that an international market-economy involves comprehensive standardization of the essential institutions for all nations. Mises remarked that to be able to function, any League of Nations would have to be restricted to ‘liberal’ states only, i.e., such states as adhere to gold standard and free trade. [...]

Mises L. von: Nationalökomie, 1940, p. 627.
Clarence K. Streit: Union Now, p. 68[1]

Editor's Notes

  1. 1939.

Text Informations

KPA: 19/13