Forget Ronald Reagan; Henry Hazlitt was the true "great communicator". Especially in his classic work Economics in One Lesson, Hazlitt brought to bear his prodigious writing talents, honed through his long career as a journalist, to make the case for the free market to the lay reader. Ludwig von Mises was a master theorist who made hugely important contributions to economic science. Yet, he too was a master communicator. Especially in his popular essays and in his speeches, he explained the wondrously beneficial workings of the market economy with clarity and force. This course will be an exploration of how capitalism lifts men from poverty to plenty, using a selection of Hazlitt's and Mises's best writing.

In Omnipotent Government (p. 268) Ludwig von Mises wrote that “the adversaries of the trend toward more government control describe their opposition as a . . . contest of states’ rights versus the central power.” To Mises, centralized governmental power was the greatest threat to liberty. And as Edmund Wilson once noted, no one is more responsible for the birth of the centralized, bureaucratic state that Americans slave under than Abraham Lincoln, the “Great Centralizer.” This course will apply Austrian economics and Austrian social theory to understand the economic and political legacies of the real Lincoln, the man who waged total war on his own citizens, killing some 350,000 of them; who shredded the Constitution and essentially declared himself dictator; who suspended Habeas Corpus and imprisoned political opponents by the thousands; who shut down opposition newspapers by the hundreds; who intimidated federal judges and deported an opposition member of Congress; who ignored how most of the rest of the world ended slavery peacefully; who destroyed the voluntary union of the founding fathers that was based on states’ rights and federalism; and whose regime introduced America to income taxation, military conscription, decades of protectionism, corrupt corporate welfare, the internal revenue bureaucracy, and transformed the country from a republic to an empire.

This course will use some of the best writing of Henry Hazlitt and Ludwig von Mises to study state intervention into the market and its pernicious effects.

This course covers both the theory and history behind the Federal Reserve, the central bank of the United States. Instructor Robert Murphy details the theory of free-market banking, and contrasts it with the distorted banking sector resulting from special government privileges. Murphy relays the sordid tale of how the Federal Reserve Act was designed on Jekyll Island in a secret meeting of government officials and international bankers. He also covers the mechanics of modern Fed operations and the commercial banking sector. The course also applies Austrian business cycle theory to the stock market crash of 1929 and the recent housing bubble. The goal of the class is to provide a solid introduction to both the theory of free-market versus cartelized central banking and the day-to-day mechanics of the Federal Reserve in action. After explaining how money and banking would develop in a free-market economy, we explain central banking from a theoretical perspective. Specifically, we see that central banking — that is, a government-sponsored cartel of banks with one privileged bank sitting atop the pyramid — serves to circumvent the market's natural checks on credit expansion. In addition to increasing the money supply and prices, central banking also fosters the boom-bust cycle. After reviewing the theory of free versus central banking, we explore the historical origins of the Federal Reserve. We study the institutional structure of the Fed and learn how to read its balance sheet in real time. We walk through conventional and unconventional Fed operations, studying not just the theory but also the implementation. (For example, exactly how does the Fed go about buying an extra $600 billion in Treasury securities? Are the cuddly bears being paranoid or not?) Finally, we wrap up the course by connecting the operations of the Fed — and its predecessors — with financial crises from US history. These will include the Fed-induced crises of the Great Depression and the housing bubble, but also earlier panics attributable (at least partially) to the swings in credit engineered by earlier incarnations of the US central bank.