Th e Great Fiction Th e Mises Institute dedicates this volume to all of its generous Supporters and wishes to thank these, in particular: Benefactors Susan B. McNiel, Mr. and Mrs. Donald M. Rembert, Sr., Steven R. Berger Mr. and Mrs. Gary J. Turpanjian, Juliana and Hunter Hastings Ryan Schmitt in Memory of William Norman Grigg Yousif Almoayyed and Budoor Kazim Patrons Anonymous, Behfar and Peiying Bastani in honor of those known and unknown who fi ght for liberty, Wayne Chapeskie, Carl S. Creager Th omas and Lisa Dierl, Reza Ektefaie, Willard and Donna Fischer Kevin R. Griffi n, Jeff and Jamie Haenggi, Jule R. Herbert, Jr. Albert L. Hillman, Jr., Hunter Lewis and Elizabeth Sidamon-Eristoff Arnold Lisio, MD in Memory of Margit von Mises, Arthur L. Loeb David McClain, Joseph Edward Paul Melville, Michael L. Merritt Gregory and Joy Morin, James Nardulli, Chris and Melodie Rufer, Leif Smith Dr. Th omas L. Wenck, Brian J. 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Roof Patrick Rosenwald, Dr. Murray Sabrin, Th ad and Cyndy Salmon Dr. John H. Scacchia, John L. Schroeder, Butler and Jane Shaff er, John P. Sharkey Henri Etel Skinner, Mr. and Mrs. Dennis A. Sperduto, Steve Th eodorou Richard Timberger, Pavel Tolkachev, Mitchell A. Vanya, William E. Waldschmidt Mark Walker, J. Stanley Warford, Alice and Wayne Whitmore Rich and Janny Wilcke in loving memory of their sons Billy and Benny Edgar H. Williams, William B. Zieburtz, Jr. Th e Great Fiction Property, Economy, Society, and the Politics of Decline Hans-Hermann Hoppe Second Expanded Edition M ISESI NSTITUTE AUBURN, ALABAMA Published 2021 by the Mises Institute. Th is work is licensed under a Creative Com- mons Attribution-NonCommercial-NoDerivs 4.0 International License. http://creativecommons.org/licenses/by-nc-nd/4.0/ Mises Institute 518 West Magnolia Ave. Auburn, Ala. 36832 mises.org [email protected] ISBN 978-1-61016-728-4 To Gülçin Contents Foreword by Jeff Deist ix Preface. .xiii Part One: Human Development, Property, and Politics 1 Th e Role of Intellectuals and Anti-intellectual Intellectuals . 3 2 Th e Ethics and Economics of Private Property . 9 3 Th e Origin of Private Property and the Family . 27 4 From the Malthusian Trap to the Industrial Revolution: An Explanation of Social Evolution. 63 5 Of Common, Public, and Private Property and the Rationale for Total Privatization . 85 6 Natural Order, the State, and the Immigration Problem. 99 7 Th e Case for Free Trade and Restricted Immigration. 119 8 On Man, Nature, Truth, and Justice . 133 9 On Democracy, Redistribution, and the Destruction of Property 147 Part Two: Money, State, and Defense 10 Why the State Demands the Control of Money . 163 11 Entrepreneurship with Fiat Property and Fiat Money . 171 vii viii Th e Great Fiction 12 Th e Yield from Money Held. 179 13 State or Private-Law Society? . 187 14 Th e Private Production of Defense . 201 15 Refl ections on State and War . 227 Part Th ree: Economic Th eory 16 On Certainty and Uncertainty . 245 17 Th e Limits of Numerical Probability. 279 18 In Defense of Extreme Rationalism . 303 19 Two Notes on Preference and Indiff erence . 345 20 Property, Causality, and Liability . 357 Part Four: Th e Intellectuals and Intellectual History 21 M. N. Rothbard: Economics, Science, and Liberty 369 22 Coming of Age with Rothbard 389 23 Hayek on Government and Social Evolution . 403 24 Th e Western State as a Paradigm: Learning from History . 433 25 Th e Libertarian Quest for a Grand Historical Narrative . 471 Part Five: Autobiographical 26 Interview with Th e Daily Bell . 503 27 Interview with Philosophie Magazine. 519 28 Th is Crazy World . 525 29 My Life on the Right . 531 30 My Path to the Austrian School of Economics . 545 31 Th e In-Depth Interview . 555 Afterword . 569 Index. 577 Foreword Congratulations! You hold in your hands one of the best collections of essays from one of the most vital and challenging thinkers on the planet. Th is book is a compendium of sorts, a cross section of Professor Hans- Hermann Hoppe’s best work across several decades arranged in one acces- sible volume. It originally was published by Laissez Faire Books in 2012, but languished without the audience it deserved. Th is volume rejuvenates that work with no less than six new chapters and more than a hundred new pages not found in the earlier version, along with some much-needed pub- licity and promotion. Academics and social scientists today tend toward hyperspecialization, but Dr. Hoppe does not make this mistake. In this approach he joins a long line of important thinkers who did not confi ne themselves to a narrow academic discipline and did not care to “stay in their lane.” We forget that many twentieth century economists, for example, capably applied knowl- edge in history, philosophy, logic, anthropology, sociology, epistemology, politics, and ethics to their work—including Ludwig von Mises, Hoppe’s inspiration, and Murray N. Rothbard, Hoppe’s mentor. In that very impor- tant sense Hoppe continues and builds on the work of both men. If you are new to Hoppe’s work, this is an excellent introduction and survey to his syntheses of history, anthropology, property, ethics, and state. If you already know and enjoy Hoppe, you will fi nd here a “Hoppe reader”: many of his best and most representative articles across a range of topics in one accessible volume. Consider it almost a reference guide, from which readers can guide themselves back to his lengthy books and articles. But this book has something for everyone, from his rigorous yet often overlooked ix x Th e Great Fiction implications of capitalism and socialism to his broadside against democracy on property rights grounds. Even the new or casual reader will come away with an excellent understanding of Hoppe’s work and worldview. Th e title of course comes from Claude-Frédéric Bastiat, the great nineteenth-century French economic journalist and liberal. Bastiat gave us “Th e Great Fiction” to describe the government mechanisms by which people attempt to live at the expense of others. Th e state is always present in Hoppe’s work, whether front and center or lurking in the background. Hoppe’s subtitle, Property, Economy, Society, and the Politics of Decline gives an unsubtle clue as to what readers should expect: a damning indictment of the political world and its twenty-fi rst-century managerial superstates. In Hoppe’s world, the state is a wholly decivilizing institution: a predator rather than protector, a threat to property and peace. Markets and entre- preneurs produce goods, governments produce “bads”: taxation (theft), regulation (semi-ownership, thus semi-socialism), devalued money (central banks), war (defense), injustice (state courts and police), and the ruinous eff ects of high time preference (democracy). Like Bastiat, Hoppe has no patience for obscuring or soft pedaling the realities of our political world. Part one of the book deals with the development of human society and the concomitant rise of two often opposing forces, namely property and states. Here Hoppe explains civilization rising against a backdrop of greater productivity enabled by the painfully slow shift from nomadic to agrarian living. Once suffi cient calories could be yielded from land, concepts of fam- ily and ownership come into greater focus. Th e Enlightenment and Indus- trial Revolution create more and more prosperity, a proto-middle class, while feudal and monarchical arrangements face pressure from subjects developing greater wealth and literacy. Th is pressure explodes in the nine- teenth century, as groups of largely decentralized kingdoms, principalities, territories, and city-states come under the full sway of national boundaries and governments. Th e twentieth century ushers in the era of full democratic government in the West: the Great War washes away the last vestiges of Old Europe, while growing economic and military power places the United States squarely at the helm of an international order. Hoppe, of course, does not accept at face value the notion of the twen- tieth century as “liberal,” and in fact fi nds much of it illiberal. A particular favorite from part one is a chapter from Democracy: Th e God Th at Failed titled “On Democracy, Redistribution, and the Destruction of Property.” Th is essay beautifully encapsulates all of his fundamental critiques of mod- ern mass democracy, namely that it produces bad, shortsighted politicians Foreword xi who care nothing about their nation’s capital stock; bad, shortsighted voters who care nothing about future generations; bad, expansionary economic and foreign policy; and bad, central bank money to pay for it all. Citizens, unlike subjects of yesteryear, enjoy the illusion that government is “us.” But an illusion is all it is, and Hoppe enjoys slaying this most sacred of cows.