Being an Austrian Economist

"For many years I had been an Austrian economist without knowing it. But when I did discover Austrian economics, I was amazed, because economics appeared as it ought to be: not as a patchwork of partial theories, of different fields of thought without any link between them, but as a logical process of thought founded on realistic assumptions about individual action. Economics became coherent. As Mises rightly wrote, "There are no such things as 'economics of labor' or 'economics of agriculture.' There is only one coherent body of economics.""

This is a quote that might as well have been mine. Pascal Salin recently spoke these words. Sometimes there are uncanny similarities in thought. This is one of those times.

Austrian economists don't claim to be doing empirical science. Keynesians do. What is ironic to me as an empirical scientist, is that it is the Austrians who get their predictions right, while Keynesians seem to have been caught like deer in the headlights.

This pattern is nothing new to the current crisis. It was Ludwig von Mises who predicted the Great Depression, while Irving Fisher, still highly revered by the Keynesians, proceeded to lose his fortune.

It was the Keynesians who assured us that we were headed for a severe recession (which never materialized) after World War II if the government cut back on its spending.

It was Fed chairman Arthur Burns who assured Murray Rothbard that a continuation of the inflationary recession was impossible.

Time after weary time, it is the mainstream and Keynesian economists (who ridicule and ignore Austrian economics as unscientific) whose predictions are utterly refuted by the events of history. Yet they continue to propound their eternal nonsense and use government coercion to force their bankrupt ideology on everyone else. As Paul Feyerabend said, "I have no objection to incompetence but I do object when incompetence is accompanied by boredom and self-righteousness."