The archive.

Reagan's economists announced a miracle: the money supply had climbed in double digits while consumer prices stayed flat, proof that the old laws no longer bound. Rothbard recognizes the boast, because every boom generates it, and answers by prying apart two things the word inflation conflates. Money inflation is an increase in the money supply, counterfeiting that redistributes purchasing power to whoever receives the new cash first, and it works its damage long before any price index moves. Entering through bank loans to business, it over-stimulates capital goods, construction, stocks, and real estate exactly as Misesian cycle theory predicts, so a boom can look healthy while its structure is being falsified. The calm of the 1980s CPI he credits to one-shot offsets, recession, a high dollar, collapsing oil, that were already ending, with price inflation and reckoning to follow.

For monetary inflation is counterfeiting, plain and simple.

Rename it 'desocialization', Rothbard suggests, and privatization stops looking like managerial housekeeping and becomes what it is: the reversal of nearly a century of creeping socialism. His case rests on incentives, private income depending on satisfying consumers while government revenue is secured by taxation or inflation, and it refuses the usual concession that some functions are inherently public. Anything is fair game; every service the state supplies has at some point been supplied privately, the Post Office standing as monument to public monopoly. He then presses the fiscal argument past ordinary deficit pragmatism, casting the federal government as a giant monopolist hoarding land, water, minerals, and forests, and urges selling even its loss-making assets cheaply, brushing aside Keith Joseph's claim that Britain's unprofitable nationalized steel could command no buyer at all.

There is no such thing as no price.

Every so often the recurring monetary crisis flares up, elites propose a new arrangement, and the same contradictions return under a fresh name; this, for Rothbard, is the shell game of twentieth-century money. He refuses the standard quarrel between fixed and floating rates, insisting the real question is whether a currency redeems for a market commodity or merely for state paper, and sorts the options into three: genuine gold, Keynesian world paper money, and national fiat currencies afloat. Bretton Woods he calls a mockery of gold, sustained only by America's privilege of exporting inflation abroad until Nixon shut the gold window in 1971; the Smithsonian Agreement tried vainly to fix prices among irredeemable fiats. Answering 1985 proposals from Kemp and Bradley to refix rates, he holds that neither managed fixity nor clean floating can be sound while the unit itself is fiat.

The world is in permanent monetary crisis, but once in a while, the crisis flares up acutely, and we noisily shift gears from one flawed monetary system to another.

When the Group of Seven moved in 1987 to prop up a falling dollar and revive coordinated fixed exchange rates, Rothbard saw one more attempt to preserve inflationary discretion under a gold-colored disguise. Tracing the line from the classical gold-coin standard through the interwar sterling system, Bretton Woods, and the short-lived Smithsonian Agreement, he argues that fixed rates without genuine gold money become arbitrary political prices, doomed to collapse under redemption pressure and Gresham's Law. He dissects James Baker's proposed scheme, a secret commodity-price index granting gold only a token, formulaic role, and the odd alliance of conservative Keynesians and supply-siders such as Robert Mundell and Jack Kemp who back it. Floating fiat rates are bad, he concludes; fixed fiat rates, which add international price-fixing to paper money, are worse.

Once again, the market proves wiser than economists.

A crime without a victim is how Rothbard characterizes insider trading, and from that provocation he builds a full libertarian defense of profiting from superior knowledge. The 1980s prosecutions of Wall Street financiers, he argues, are not justice but a punitive political campaign that treats speculators as worse than robbers while harming no one who was not already willing to sell. Trading on early information, in his account, is entrepreneurship: it moves capital toward the farsighted and improves the whole economic system. He reads the charge of unfairness as egalitarian resentment of any human superiority, warns that such enforcement chills speech and privacy, and contends that federal attacks on takeover financiers like Drexel Burnham Lambert shield old-line managerial elites against stockholders and market competition.

There is a veritable Reign of Terror rampant in the United States—and everyone’s cheering.

That an administration responsible for the largest deficits in American history should offer a constitutional balanced-budget amendment as the cure strikes Rothbard as image triumphing over substance. The amendment, he argues, would balance only projected budgets, never actual year-end spending, and would fall to accounting tricks, off-budget expenditures, and revenue limits pegged to national income, which he dismisses as a statistical artifact, not a real entity fit for fundamental law. Proposals to exempt government capital spending would simply relabel boondoggles as investment. Since the federal courts that would enforce it are themselves organs of the government being restrained, enforcement is a fiction. He likens the whole scheme to the supply-siders' phony gold standard: the rhetoric of discipline masking undiminished cheap money and deficit politics.

Second, balancing the budget by increasing taxes is like curing influenza by shooting the patient; the cure is worse than the disease.

"The consequences of human action, not human design"—the Ferguson-via-Hayek slogan that casts Austrian economics as the study of unintended outcomes—gets a pointed rebuttal here. Rothbard grants that the market coordinates beyond any single benevolent intention, as with Smith's butcher and baker, but insists the formula collapses once intention is taken seriously: if businessmen learn sound theory and consciously aim at serving consumers, the once-unintended becomes intended. Grounding his case in Misesian praxeology, he treats human action as purposive choice rather than blind response to stimuli. The stakes are political as well as methodological: to describe the growth of the state as nobody's design, he warns, is to disguise the special interests that consciously pursue privilege behind the rhetoric of the public good.

For if actions are largely always unintended, this means that government just grew like Topsy, and that no person or group ever willed the pernicious consequences of that growth.

Millions of tax dollars, mobilized by a propaganda campaign that has suddenly discovered the homeless: this is the spectacle Rothbard sets out to deflate. He argues that "the homeless" and "the hungry" are political labels manufactured in sequence, fracturing a single condition, poverty or lack of money, into discrete emergencies. The fragmentation is not innocent: separate needs create separate constituencies, funneling subsidies to construction firms, agriculture, food distributors, and the social-work bureaucracies that administer them. Concrete images of need, he notes, dramatize far better than cash income. Turning from rhetoric to incentives, he presses the uncomfortable questions the welfare framing avoids: why people lack money, and how permanent public aid erodes work effort, rehabilitation, and private charity.

Money does not have nearly the sentimental value of home and hearth and Christmas dinner.

Defending deregulation on the strength of whichever statistics happen to be convenient, Rothbard warns, invites disaster when the data turn against you. When bankruptcies, mergers, congestion, and delays revived calls to re-regulate the airlines in the late 1980s, he answered that these were the ordinary results of competition, not signs of failure. The old Civil Aeronautics Board, he reconstructs, was a state-enforced cartel that fixed fares far above market levels and rationed choice routes to favored incumbents; falling fares and crowded planes simply mark travel opened to students and families once priced out. The genuine bottlenecks, delays and airport congestion and air-traffic control, remain in government hands. His remedy is not nostalgia for the CAB but fuller deregulation: privatized airports and competitively priced runway space.

Empiricism without theory is a shaky reed on which to build a case for freedom.

Media applause for Bruce Babbitt's courage in demanding higher taxes to shrink the deficit provokes Rothbard to redefine the word. Courage, he insists, once meant battling the powers-that-be, not urging the state to intensify its parasitic plunder of productive citizens, which is precisely what Babbitt, like Walter Mondale in 1984, does. The essay's central move is a class distinction: politicians and bureaucrats are not genuine taxpayers but net tax-receivers, so a public employee who remits part of a tax-funded salary merely reduces his net transfer. Shared sacrifice, on this account, is an accounting fiction that puts officials and citizens on a false common footing. Rejecting both tax hikes and supply-side complacency about deficits, Rothbard prescribes the neglected alternative: drastic, across-the-board cuts in government spending.

The proper answer is: anywhere and everywhere; only wholesale flailing away with a meat axe could possibly do justice to the task.

Judged by their actual policies rather than their campaign imagery, George Bush and Michael Dukakis emerge in Rothbard's account as interchangeable establishment centrists, proof, he says, of George Wallace's jibe that there isn't a dime's worth of difference between the parties. Both are committed to Keynesian spending, deficits, higher taxes by semantic disguise, monetary inflation, and regulation. He marshals the governing record against partisan myth: Reagan's supposedly anti-government years left federal spending higher as a share of private product, complete with protectionism, farm subsidies, and an assault on insider trading. The essay's gravest warning targets James Baker's drive toward coordinated central-bank inflation, a European currency unit, and finally a world central bank issuing world paper money. The one real difference Rothbard allows is that a Dukakis victory might simply lack the connections to advance it.

There would be no remaining checks on any country’s inflation except the wisdom and the will of the World Central Bank.

The most fashionable new mathematics of the 1980s, Rothbard argues, quietly demolishes orthodox mathematical economics from within. Chaos theory cannot be waved off as anti-mathematical, since it comes from the cutting edge, yet its lessons cut against the neoclassical apparatus. Through Lorenz's Butterfly Effect and Mandelbrot's fractals, it shows that tiny causes yield vast effects and that smooth, continuous curves misrepresent a jagged world. Rothbard turns this against calculus-based equilibrium, rational expectations, and the random-walk theory of stock markets, which he finds absurd for making the market omniscient while denying that historical events are causally connected. Careful to reject claims that nature is random or undetermined, he endorses chaos theory only tactically: newer, more advanced mathematics now does to formal economics what Austrian critics long attempted from outside.

Calling it the Butterfly Effect, he pointed out that if a butterfly flapped its wings in Brazil, it could well produce a tornado in Texas.