Bryan Caplan  

Block, Hazlitt, DeLong, Me, and the Noble Lie

Who is Advising these Guys?... More Appreciation of Hazlitt...
Walter Block has written a new intro to Henry Hazlitt's Economics in One Lesson:
Writing this introduction is a labor of love for me. You know how women sometimes say to each other "This dress is you!"? Well, this book is me! This was the first book on economics that just jumped out and grabbed me. I had read a few before, but they were boring. Very boring. Did I mention boring? In sharp contrast, Economics in One Lesson grabbed me by the neck and never ever let me go.


There is nothing that pleases a teacher more than when that expression of understanding lights up a student's face. The cartoons depict this phenomenon in the form of a light bulb appearing right above the depiction of the character. Well, let me tell you: I have gotten more "ahas" out of introductory students who have read this book than from any other. I warrant that there have been more conversions to the free-market philosophy from this one economics book than, perhaps, from all others put together. It is just that stupendous.
In writing this intro, Block has confirmed Brad DeLong's worst fears:
Hazlitt doesn't recognize any of these ifs. And that is what makes his book very dangerous indeed to a beginner in economics, because the ifs are, all of them, important qualifications and caveats. I gather that Tyler read it relatively early, and I am amazed that he has escaped with so little permanent neurological and ideological damage.
If I know Walter, he'll be delighted to confirm Brad's fears - and frankly, I largely take Walter's side on this.  Brad's worried that people will ignore the ifs; I'm worried that people won't understand that the ifs themselves require "important qualifications and caveats."  As I write in my book:

Even among economists, market-oriented policy prescriptions are often seen as too dogmatic, too unwilling to take the flaws of the free market into account.  Many prefer a more "sophisticated" position: Since we have already belabored the advantages of markets, let us not forget to emphasize the benefits of government intervention.  I claim that the qualification needs qualification: Before we emphasize the benefits of government intervention, let us distinguish intervention designed by a well-intentioned economist from intervention that appeals to non-economists, and reflect that the latter predominate.  You do not have to be dogmatic to take a staunchly pro-market position.  You just have to notice that the "sophisticated" emphasis on the benefits of intervention mistakes theoretical possibility for empirical likelihood.

Under the circumstances, it's usually best to teach Hazlitt "straight" to intro students - not, contra Levy, as a "noble lie," but as a solid first approximation to economic truth.

Comments and Sharing

COMMENTS (14 to date)
Ann Gallagher writes:

My dad gave me a copy of Economics in One Lesson when I was in high school. A great way to introduce economics, and also to engage a teenager in a worthwhile discussion.

Greg Ransom writes:

Another example of how economists often know less about the economy than do non-economists.

Bryan wrote:

"You do not have to be dogmatic to take a staunchly pro-market position. You just have to notice that the "sophisticated" emphasis on the benefits of intervention mistakes theoretical possibility for empirical likelihood."

KipEsquire writes:

So Hazlitt's EIOL is "very dangerous indeed to a beginner in economics" ... but Keynes' GTEIM isn't?

And which, incidentally, is more dangerous in the hands of a duplicitous politician?

Michael Thomas writes:

When I read this book for the first time I got the feeling that it captured the dirty little secret that was not in my textbooks. The world makes more sense in Hazlitt than in the stylized context of "ifs" found there.

I get a similar feeling feeling when reading Caplan. Some good sense is just too hard to ignore.

For all the flaws that can be pointed out in writing, the deep insights make it worth while to continue the search. Hazlitt is full of such motivation.

JP writes:

Bryan -- When you say "my book" above, what book are you referring to? "The Myth of the RV"?

Niccolo writes:

I agree with about 85% of Economics in One Lesson ideologically - I disagree with much more of it academically too - but I think Delong misunderstands the purpose of the book. I don't think this book was meant to be anything more than ideological. After all, Hazlitt and much of the new "Austrian school" isn't really made up of Delong's type of economist - if it isn't an introductory economist at the Mises Institute, it's a historical one or an amateur. I don't see any reason to expect much more from Hazlitt's book than what is offered.

I think something the "Austrians" are successful at is painting ideology as economics, which is actually good. After all, outside of public policy - which I think is wasteful, like all government work - what do you economists actually do? If you're an economics major, you're either going to work for the government or the fed, sometimes you'll work for companies, but only if you're an applied business economist. All of this political economy stuff, which is what Hazlitt's book focuses on, is just rubbish that happens to exist and probably wouldn't if there were no policy to publish.

Grant writes:

I prefer the term "heuristic" over "dogma". I personally believe that institutions formed by consenting parties are more likely to serve the interests of those parties than institutions imposed on them by a third (government) party. I haven't seen, read, or heard anything in economics that would make me seriously reconsider this heuristic. I don't find this stance dogmatic.

Most policy recommendations by economists seems besides the point to me. Comparing a free market to a market with certain political interventions is already assuming the answer to a very important question that is rarely asked and even more rarely answered: can political processes improve market conditions more rapidly than markets can improve themselves? Markets and politics are mutually-exclusive processes which produce outcomes. Comparing one of those process to an outcome of another is like comparing the taste of peanut butter to the color purple. It doesn't make a lot of sense to me.

Blackadder writes:

This year for Christmas I got all my friends copies of Nariman Behraves's book Spin-Free Economics. Now that I've read DeLong's warnings about how dangerous One Lesson is, I'm kicking myself that I didn't give that to people instead.

Sukrit writes:


Clearly, you live in some sort of bubble world where Mises, Hayek and Rothbard didn't spend years pointing out that all the math in the world (as used by mainstream economists) can still be used to diguise ideological assumptions. So if you're Austrian economists ideological, and saying the mainstream is not, you are either ignorant or yourself ideologically motivated, or both.

Greg Ransom writes:

Nicollo? I vote ignorant.

The Sheep Nazi writes:

Economics in One Lesson is online here and here.

Niccolo writes:


Hayek was not really all that opposed to mathematics. I don't know about Mises, I think he could be somewhat whacked too, on occasions.

Rothbard simply frightens me, and that is coming from an Anarchist who used to adore him.

No one said that mainstream economics was not ideological either. I said that the "Austrians" were more dogmatists than economists. Subsequently they have become pretty good at spreading their dogma around the web.

I think that's a better strategy for them than the opposite, honestly. It is ideology and emotion, not facts and science that move the world.

happyjuggler0 writes:

the "sophisticated" emphasis on the benefits of intervention mistakes theoretical possibility for empirical likelihood.

Where have I heard that before?

"It is not sufficient to contrast the imperfect adjustments of unfettered enterprise with the best adjustment that economists in their studies can imagine. For we cannot expect that any State authority will attain or will ever wholeheartedly seek that ideal. Such authorities are liable alike to ignorance to sectional pressure and to personal corruption by private interest." — Pigou A. Wealth and Welfare 1920 p. 296

[Online: The Economics of Welfare par. XX.4, by Arthur C. Pigou.--Econlib Ed.]

Sebaneau writes:

This is what Mises had to say about mathematics:

And of course, the very idea of "market failure" is a gross logical fallacy hidden behind the hocus-pocus of mathematical formulae, for it necessarily involves the possibility of a certain, guaranteed profit and of interpersonal comparisons of utilities as well as a denial of property rights without which no utility maximization is even thinkable : not one, not two but three essential contradictions.

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