Monday, July 10, 2006


Murray Rothbard tackles six myths about libertarianism and overall does a good job [Hat tip: Gaurav]. But there is one statement he makes which I think misses the point.

"Myth #3: Libertarians do not believe in moral principles; they limit themselves to cost-benefit analysis on the assumption that man is always rational.
...There are indeed libertarians, particularly Chicago-school economists, who refuse to believe that liberty and individual rights are moral principles, and instead attempt to arrive at public policy by weighing alleged social costs and benefits."

I think Rothbard is confusing economics and morals. Economists talk about policies that will bring about a certain monetary and financial outcome for a corporation or institution. Economists may or may not believe in morals as human beings in general but as economists their job is only to enumerate the best and most optimal policy. Just because Chicago school economists tout profiit maximization does not mean they don't believe that liberty and individual rights are not moral principles. They simply believe that whether those are moral principles and how they can be incorporated into policy making are issues that society should decide, not economists. As economists, they simply state those policies which will maximize profits. Whether those policies are moral or not with respect to liberty etc. is for society to decide. Economics per se has nothing to do with it. So if I am an economist, I will say that decreasing wages is the best way to increase profit. That statement does not mean anything more than what it says. It is strictly about increasing profits. I may say that decreasing wages is not good for the workers, but that stance has to do with my being a human being, not with my being an economist.

Of course, there may be some Chicago school economists who don't think that individual rights are not moral principles, but it should be emphatically noted that this has nothing to do with their work as economists (although their point of view could be influenced by their work). This is somewhat like saying that physicists who work on nuclear energy don't care about human life. It should be clear that as physicists, their job has nothing to do with morals and principles. As human beings, it certainly has.

I think such distinctions are very important, and I hope Rothbard himself does not perpetuate a myth by stating the above.


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