What's Up With Ron Paul's 'Austrian' Ideas?

Republican candidate trumpets strict libertarian philosophy
By Neal Colgrass,  Newser Staff
Posted Jan 8, 2012 4:54 PM CST
Republican Candidate Ron Paul Trumpets 'Austrian' Economic Ideas
Ron Paul answers questions at a town hall meeting at Church Landing at Mill Falls , January 8, 2012 in Meredith, New Hampshire. The New Hampshire primary is scheduled to be held January 10, 2012.   (Getty Images)

Just what did Ron Paul mean when he finished third in Iowa and said, "We are all Austrians now"? Republican candidates don't often celebrate European economic policies, but this is different, Matthew Yglesias writes in Slate. Those familiar with the inside baseball of libertarianism know that Paul is referring to two thinkers, Ludwig Von Mises and Murray Rothbard, whose idea of capitalism "is even more libertarian and anarchic than that espoused by many libertarians," writes Yglesias.

"Austrian economics" rejects all government regulation and intervention to help the poor, and considers the tweaking of short-term interest rates a mistake that lures investors into doomed enterprises. Yglesias mounts a counter-argument, noting that the "Austrian" view doesn't explain the effectiveness of post-Great Depression fixes or the spending habits that fuel recessions. Yglesias sees an economic recovery around the corner, but if there isn't one, "these faddish views may gain more steam and perhaps we really all will be Austrians someday soon. But let’s hope not." (Read more Ron Paul 2012 stories.)

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