The Recession Reader

September 12, 2008

Someone once remarked that the best indicator of a recession is the number of times “Mises” “Hayek” or “Austrian” appear in the newspapers. During the boom, no one wants to listen to the lessons of the Austrian economists. No one wants to hear that we need to live within our means – that the Federal Reserve does not have the power to print us into prosperity by artificially creating credit. So while the writers of LewRockwell.com were warning against the housing bubble and the inflationary nature of the Fed, the mainstream was touting the economic wisdom of Bernanke and Greenspan. When this recession hit, it seems everyone except the Austrians was caught off guard. Commentators, bureaucrats, and politicians began panicking, “Something must be done! This is Something…therefore it must be done!”

Instead of looking to the mainstream for answers to this crisis, why not look to those who saw it coming?

For those new to Austrian economics, this reader will offer an introduction to this unique school of thought. It is unlike any other school of economics you have likely come across. Instead of focusing on unrealistic mathematical models, the writers here build their thinking on human action and observations of how the economy actually runs.
What’s important is not necessarily the specific political opposition to this bailout, but rather educating people about the dangers of nationalization, central banking, and government regulation. Only when people recognize the dangers of the government’s “socialism for the rich” will we be able to get back on the road to prosperity. Unfortunately, a correction is necessary. There is no such thing as a free house. The more the government intervenes, the longer and more painful it will be. But this crisis gives the country a chance to rethink its previous assumptions about the economy and the government’s role in it. Hopefully, this reader will be a first step for many into an exciting, growing branch of economic thought.