Marx Madness is Back

“Capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine democratic societies.” — Thomas Piketty, “Capital in the 21st Century” (2014)

The Economist magazine rightly called French professor Thomas Piketty the new Marx, although a watered down Marx. His bestseller (rated #1 on Amazon and the New York Times) is a thick volume with the same title as KCapital in the Twenty-First Centuryarl Marx’s 1867 magnum opus, “Kapital.” The publisher, Harvard University Press, appropriately designed the book cover in red, the color of the socialist workers’ party.

Piketty cites Karl Marx more than any other economist, even more than Keynes. He barely mentions Adam Smith. Instead of the modern scientific name “economics,” he prefers the old term “political economy,” a favorite of radical professors. [Read more…]

The Rise of the Commercial Society: The Business Leader as Hero

By Mark Skousen
Editor, Forecasts & Strategies

Keynote Address at Annual International Assembly for Collegiate Business Education (IACBE), April 18, 2013, Orlando, Florida

“It is business that creates wealth, not countries or governments.  It is businesses that decide how well or poorly off we are.”   —Shlomo Maital, MIT managerial professor

Tomorrow my wife Jo Ann and I celebrate our big 40th (ruby) anniversary. We were married on April 19, Patriot’s Day, in 1973 in Utah.

Last week we went to Hawaii to celebrate.  When we arrived at the Marriott Waikiki Beach Resort in Honolulu, we were given a small room with only a queen size bed and no view of the famous Waikiki Beach.  I asked the desk clerk if there was any chance we could have a room with a king bed.  He said nothing was available.

I suspect he knew that we used Priceline to get a discount on the room. [Read more…]

A Visit to Morocco

On April 19, my wife and I flew to Morocco for the Mont Pelerin Society meetings, the first to take place in an Arab country.  We stayed at the Le Royal Mansour Meridien in downtown Casablanca, a first class hotel with great service, but surrounding the hotel was a lot of dust, litter, and construction.  The city of 6 million did not live up to its romanticized exotic reputation, and was quite “Third World.”  

That evening we went to Rick’s Café for our wedding anniversary.  The restaurant, named after the famous Humphrey Bogart film, is eloquent and first class:  When we arrived the maitre d’ announced, “best table in the house for the Skousens!”  We were placed right next to the piano, where the piano player played tunes such as “As Time Goes By.”  We had a great meal, and a wonderful evening.  Highly recommended.  [Read more…]

Making of Modern Economics #2 in Ayn Rand Institute’s Top-Ten Must Read Books in Economics

Good news.  My book, The Making of Modern Economics, now in its second edition, won recognition from the Ayn Rand Institute, which published its first “top ten must-read books in economics,”  The Making of Modern Economics was ranked second, right behind Henry Hazlitt’s classic Economics in One Lesson. I’m not complaining, since Steve Mariotti, president of the Network for Teaching Entrepreneurship (NFTE), recently wrote that “Mark Skousen is the Henry Hazlitt of our time who can explain complex issues in a clear way.”

My book tells the bold story of economics, with free-market economist Adam Smith as the heroic figure who comes under attack by the Marxists, socialists and Keynesians, but triumphs in the end with the help of the Austrians, Chicagoans, and supply-siders. It recently won the Choice Book Award for Outstanding Academic Title, and is highly popular among students and intelligent laymen who love a good story with lots of anecdotes and pictures. As John Mackey, CEO of Whole Foods Market, says, “I’ve read Mark’s book three times. It’s fun to read on every page.”

It is available on Amazon, including an audio version, but you can get the book cheaper by calling Eagle Publishing at 1-800/211-7661. The price is only $49.95 for hardback (code ECONH3), $29.95 for paperback (ECONP3), plus $5 for shipping and handling ($10 if outside of the United States).

Hillsdale College Lecture: Will the Real Adam Smith Please Stand Up?

Was Adam Smith, the founder of modern economics, a libertarian, conservative, or radical democrat? Traditionally, free-market economists such as Milton Friedman, Ludwig von Mises, and Friedrich Hayek, have defended Smith as a great free-market economist, while Emma Rothschild, Gordon Brown, and yes, even Murray Rothbard, have demurred, suggesting that Smith was an interventionist who should not be considered a hero of free markets.

Who’s right?

Recently I was invited to Hillsdale College for its annual Center for Constructive Alternatives conference on “Adam Smith, Free Markets and the Modern World.” The other speakers were P. J. O’Rourke, Nicholas Phillipson, James R. Otteson, Roy C. Smith, and John Steele Gordon. My lecture was entitled “The Centrality of Adam Smith’s Invisible Hand.” Click here to read the lecture and see how I come down on the debate on Adam Smith and how the debate influenced my work “The Making of Modern Economics.”

I present my case for the centrality of the invisible hand in Adam Smith's work at Hillsdale College in January 2012

Click here to read the lecture “The Centrality of the Invisible Hand” by Mark Skousen

The Centrality of the Invisible Hand

By Mark Skousen
Lecture, Center for Constructive Alternatives
Hillsdale College, January 31, 2012

“Adam Smith had one overwhelmingly important triumph: he put into the center of economics the systematic analysis of the behavior of individuals pursuing their self-interest under conditions of competition.”– George Stigler[1]

A major debate has flared up recently about Adam Smith. Was he the father of free-market economics and libertarian thought, or some kind of radical egalitarian and social democrat?

Adam Smith as a Free-Market Hero

The traditional view, held by Milton Friedman, is that the Scottish philosopher was “a radical and a revolutionary in his time–just as those of us who preach laissez faire are in our time.”[2] He lauded Smith’s metaphor of the “invisible hand,” the famous Smithian idea that “by pursuing his own self interest, [every individual] frequently promotes that of the society.”[3] According to Friedman, “Adam Smith’s flash of genius was his recognition that the prices that emerged from voluntary transactions between buyers and seller — for short, in a free market — could coordinate the activity of millions of people, each seeking his own interest, in such a way as to make everyone better off.”[4] Other defenders of free-enterprise capitalism describe the invisible hand as “gentle,” “wise,” “far reaching,” and one that “improves the lives of others.”[5]

[Read more…]