Rothbard’s short scholarly comment challenges C. E. Ayres’s review of Ludwig von Mises’s Epistemological Problems of Economics. Its central charge is that Ayres substitutes objections to laissez-faire politics for an account of the book’s methodological achievement. The argument moves from recovering that achievement to challenging appeals to professional consensus, then answers the accusation that Mises’s economics cannot comprehend government intervention.
Against Ayres’s portrayal of the book as a repetition of earlier Austrian arguments directed at forgotten German thinkers, Rothbard emphasizes its treatment of Max Weber, ideal types, rationality, and economic man. He also defends Mises’s criticism of Hahn’s theory of tillage as an argument against exempting primitive societies from considerations of utility. These examples establish the continuing relevance of disputes Ayres treats as obsolete, but Rothbard’s principal claim concerns praxeology: economic theory as logical deduction from universally known axioms, yielding truths whose validity does not depend on historical testing.
It is also the first work in which Mises developed the relationship between this praxeologic economic science and the facts of human history, which cannot be used to "test" the theory, but which can be partially explained by that theory.
The asymmetry is decisive: theory helps explain history, while historical events cannot serve as experiments validating or invalidating theory. Rothbard presents this methodology as an articulated alternative to both institutionalism and positivism. He places the book at the beginning of Mises’s subsequent methodological development in Human Action and Theory and History, and describes Lionel Robbins’s influential methodological essay as an oversimplified variant of Mises’s position. His immediate demand is accurate exposition even from an unsympathetic reviewer.
Turning to political economy, Rothbard argues that Ayres mistakes minority status for intellectual defeat.
It should hardly be necessary to point out to Professor Ayres that fewness of number is not a proof of error, or that almost all ideas—true or otherwise—now accepted by the vast majority, originated with a small band of often-embattled thinkers.
Rothbard also distinguishes laissez-faire as a prospective ideal from restoration of a fully realized past order. Nineteenth-century government intervention was comparatively limited, he maintains, but never eliminated; laissez-faire advocates therefore seek to fulfill an unfinished historical promise. Rejecting Adam Smith’s authority as a sufficient defense of intervention, Rothbard openly offers his own position as a counterexample to Ayres’s claim that no economist has proposed dispensing altogether with government’s economic functions.
The final movement addresses depression, unemployment, and the mixed economy. Rothbard invokes the Mises–Hayek business-cycle theory to show that laissez-faire economists did attempt to explain economic catastrophe, with prescriptions directly opposed to Keynesian remedies. His footnote further stresses the theory’s integration of cyclical disturbances with the general theory of prices and markets. The comment invokes this explanatory framework without developing or demonstrating it.
It is curious indeed that Mises and others who have devoted so many years to combatting the interventionism of our time should be accused by Ayres of ignoring the very existence of this intervention!
Rothbard interprets Ayres’s objection as a recurrence of the German Historical School’s charge that economic theory cannot grasp a regulated economy. Citing Mises’s response, he reverses the accusation: economic theory makes the consequences of intervention intelligible, and that critical capacity provokes resistance. The concluding distinction separates acknowledging the mixed economy’s existence from endorsing its preservation or expansion. The comment’s significance lies in this defense of methodological autonomy alongside radical laissez-faire: Rothbard insists that a theory must be represented on its own terms, and that neither prevailing institutions nor professional consensus settle its explanatory or political claims.
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