The archive.

Calling entrepreneurs short-sighted leaves a crucial comparison unresolved: are political decisionmakers better able to plan ahead? This question anchors Roger W. Garrison’s review of the ecological capital modelling developed by Malte Faber, John Proops, and Stefan Speck with Frank Jöst. Garrison distinguishes models that track production through time from Austrian explanations rooted in participants’ subjective purposes. He credits the authors’ methodological self-awareness but challenges the move from continually revised entrepreneurial plans to environmental accounting rules intended to correct market outcomes. His review exposes the institutional assumption beneath that move: governmental foresight must be demonstrated, not presumed. The result is a compact examination of what formal models of capital and pollution can—and cannot—establish about the case for intervention.

Relative to what other decisionmakers are the entrepreneurs supposedly myopic?

Globalization, its critics charged, destroys jobs, exploits the poor, degrades the environment, and hands the world to big business. Against that indictment this polemic defends global commerce as peaceful, voluntary cooperation—made possible by falling trade barriers, post-Soviet liberalization, and capital mobility—while locating the real threat in protectionism and international management. Sennholz champions multinational corporations for raising wages and productivity abroad, denies that human rights and property rights are enemies, and rebuts Marxian exploitation theory by insisting that market alternatives, not political controls, are what shield workers from domination. His targets cut both ways: anti-globalists who would throttle trade, and the IMF, WTO, NAFTA, and EU insofar as they preserve subsidies and privilege behind liberal rhetoric. The closing warning invokes Hawley-Smoot and the Depression, when moralized attacks on trade hardened into ruinous economic nationalism.

Three market features negate any such power: competition among employers, the mobility of labor itself, and the freedom of self-employment.

How could the dollar stand so strong while America ran its largest trade deficits on record? That apparent contradiction opens a July 2000 diagnosis that credits neither American productivity nor Federal Reserve mastery, but capital inflows that can reverse. Reaching for Böhm-Bawerk's analysis of the passive trade balance, Sennholz shows how an incoming capital account can sustain imports, asset markets, and a firm exchange rate at once—until it doesn't. He reads Southeast Asia's 1997 collapse as the template: pegged currencies, central-bank credit, real-estate speculation, and sudden foreign withdrawal. Rapid M3 growth, record current-account deficits, borrowed share buybacks, unprecedented margin debt, and derivatives concentrate leverage until the Fed is trapped between defending the currency and cushioning recession. The maladjustments of years of monetary manipulation, he concludes, must be liquidated, not gently unwound.

Political intervention is ill-designed for soft landings.

By the 1980s, foreign observers held up Japanese manufacturing, management, and export prowess as proof of superior institutions—until land and share values collapsed and a decade of stagnation set in. This Austrian-style reckoning refuses the flattering reading in both directions: if ministries and industrial policy are credited for the boom, they must be blamed for the bust. Japan's real gains, Sennholz insists, came from saving, enterprise, and capital formation; the late-1980s asset mania was a creature of cheap money and guided lending, malinvestment already built into the boom. The response after 1990—public works, bank rescues, deposit guarantees, near-zero rates—treated a structural and monetary disease as a demand-management problem, keeping insolvent banks alive and postponing the reckoning. Falsified interest rates, he warns, misprice saving, investment, and public finance alike, converting correction into malaise.

A financial bubble is a manifestation of inflation and credit creation, insubstantial, groundless, and ephemeral, that comes to nothing.

Mises insisted that unhampered market prices clear supply and demand, then turned around and called those same prices "false," the residue of entrepreneurial error under uncertainty. To a reader schooled only in mainstream economics this looks like contradiction. The resolution, Kirzner argues, lies in Mises's plain state of rest — distinct from the final state of rest and the evenly rotating economy — which means only that all currently perceived exchange opportunities have been exhausted, not that anyone commands perfect knowledge. Actual prices can thus be optimal relative to present information yet false relative to what competition will reveal. From here the essay reaches Menger's vision of higher-order goods, the doctrine of consumer sovereignty, and monopoly price as the lone case where private ownership can defy the consumer.

The tension in Mises is quite imaginary; it is perceived—quite understandably and reasonably perceived—only as a result of reading Mises through the spectacles acquired in studying mainstream economics.

Sennholz opens this November 2000 essay by dismantling the very concept that fuels the alarm: for an individual, double-entry bookkeeping means the balance of payments can show neither surplus nor deficit, and national balances are mercantilist artifacts that serve collectivism and nationalism. America's record current-account deficits—$331 billion in 1999, an estimated $425 billion in 2000—do not stem from the Asian crisis, he insists, for Thailand and South Korea were far too small. The cause is domestic and monetary. Because the dollar has displaced gold as world money, the Federal Reserve can conjure fresh dollars, export money claims, and import goods, financing the current account through capital inflows. Yet fiat world money holds only while foreigners trust it. Should confidence break, the flow reverses—dollar falling, capital fleeing, interest rates rising—into an inflationary crisis.

The risk of a painful readjustment of both the American economy and the global economy is growing rapidly with the growth of American debts and deficits.

Blame the speculators: that was the official explanation for the currency collapses that swept Southeast Asia in the late 1990s. This hard-money post-mortem turns the charge back on the governments themselves, which pegged their currencies to the dollar while inflating domestic money and credit. The crisis, Sennholz argues, springs from the standing conflict between the market rate of a currency and the official rate—between economic principle and government edict. Pegs attract foreign capital and mute exchange risk, but they store instability rather than remove it; when the peg snaps, dollar- and yen-denominated debts turn crushing, banks buckle, and asset inflation is exposed as malinvestment. He rejects the IMF's faith in dollar pegging and warns a complacent United States against assuming immunity. The turmoil, he concludes, is the making of governments and their central banks.

Fixed exchange rates act like "coiled springs;" growing compression finally releases the energy.

Fiscal legerdemain is the charge at the heart of this November 2000 polemic: the celebrated Clinton-era surpluses, Sennholz contends, are an accounting illusion produced by counting Social Security and other trust-fund inflows as current revenue while the national debt keeps climbing. He separates genuine debt reduction from mere debt shifting, retiring bonds held by the public by drawing on obligations owed to future retirees, and treats the Treasury's reliance on trust funds and Federal Reserve remittances as circular, costless-seeming finance that conceals an inflationary base. Behind the arithmetic lies a hard-money conviction that the power to create money is a coercive privilege silently depreciating the dollar. The forecast is bleak: demographic pressure from Social Security and Medicare will convert today's paper balances into tomorrow's large deficits.

The power to print money and force it on the people is the power to engage in inflation, which is one of the political evils of our time.

If buyers and sellers already know everything relevant, what remains for competition to discover? In these four essays, first published in 2000 and republished here in 2016, Israel M. Kirzner makes that explanatory gap the starting point for his account of Austrian economics. He accepts supply and demand but asks how people recognize opportunities they previously overlooked. Drawing on Mises’s account of human action and Hayek’s dispersed knowledge, he locates market adjustment in entrepreneurial discovery rather than perfect information. This distinction gives readers a precise way to examine his more contentious arguments: that competition depends on freedom of entry rather than powerless firms, and that administrative prices cannot reproduce entrepreneurial coordination. Kirzner’s defense of markets rests on their capacity to correct mistakes, not on any claim that they have eliminated them.

Written in the shock after September 11, this essay treats the attacks as a declaration of war not on the United States alone but on civilization itself, on the peaceful exchange and association Sennholz equates with civilized life. The enemy is new because he is faceless and stateless, linked to regimes yet fighting as none. Sennholz traces the anger to Islam's fusion of faith and rule, to the Taliban, and pointedly to American blowback: the money and intelligence that once armed anti-Soviet jihad, a bitter harvest whose seeds Washington helped sow. He roots much of the hatred in U.S. support for Israel and prescribes a libertarian peace of secure property, privatization, and open land markets. Against calls for expeditionary war he warns of another Vietnam, rejects nuclear vengeance absolutely, and urges intelligence-led self-defense: detection, pursuit, arrest, and trial.

To wreak a nuclear holocaust on any Muslim city would be a crime against humanity and the start of a hundred-year-war between Islam and the West.

Kirzner presents his old teacher not as a libertarian icon but as a working economist whose political reputation grew from a single connected scientific vision. Tracing Mises from Lemberg and his transformative reading of Menger's Grundsätze through Böhm-Bawerk's seminar, the Vienna Privatseminar, exile in Geneva, and lonely years at New York University, the book reads a life as one long confrontation with historicism, socialism, and inflationism. The economics is set out in turn: the market as an open-ended entrepreneurial process rather than equilibrium; the regression theorem and the rejection of neutral money; the trade cycle as malinvestment bred by credit pushing interest below time preference; and the socialist-calculation argument that without private ownership of the means of production there are no money prices for capital goods, and hence no rational planning.

The standards of intellectual integrity which Mises represented are simply inconsistent with any hagiographic treatment.

Framed against recessionary anxiety and White House warnings that a light was flashing on the economy's dashboard, President Bush's 2001 proposal to cut taxes by $1.6 trillion is weighed here and found wanting, not because lower taxes are undesirable but because a cut that leaves spending, debt, and monetary intervention intact is no reform at all. The critique targets the plan's Keynesian defense as consumer stimulus and the supply-side hope that lower marginal rates alone constitute fiscal repair. Child credits, marriage-penalty relief, and estate provisions look attractive yet economically thin, while projected surpluses dissolve once trust-fund accounting is stripped away. If recession is the painful readjustment after prior distortion, consumption cannot restore sustainable production, and unfunded cuts merely shift burdens onto borrowing, future taxation, and the Federal Reserve.

It is significant that the tax plan makes no mention whatever of any need for a reduction in government spending.