Thomas E. Woods, Jr., is the New York Times bestselling author of 12 books, including The Politically Incorrect Guide to American History and Meltdown (on the financial crisis). A senior fellow of the Ludwig von Mises Institute, Woods has appeared on MSNBC, CNBC, FOX News, FOX Business, C-SPAN, Bloomberg Television, and hundreds of radio programs... (Read More)
I talk a lot about the conventional version of history, and the problems with it. I talk about the lack of curiosity on the part of students who simply repeat the conventional version, without bothering to ask simple questions.
We know these myths by heart. Government acts on behalf of the public good. It keeps us safe. It protects us against monopolies. It provides indispensable services we could not provide for ourselves. Without it, America would be populated by illiterates, half of us would be dead from quack medicine or exploding consumer products, and the other half would lead a feudal existence under the iron fist of private firms that worked them to the bone for a dollar a week.
Thus Americans tolerate much government predation because they have bought into the myth that state intervention may be an irritant, but the alternative of a free society would be far worse. They have been conditioned to believe that despite whatever occasional corruption they may observe in politics, the government by and large has their well-being at heart. Schoolchildren in particular learn a version of history worthy of Pravda. Governments, they are convinced, abolished child labor, gave people good wages and decent working conditions; protect them from bad food, drugs, airplanes, and consumer products; have cleaned their air and water; and have done countless other things to improve their well-being. They truly cannot imagine how anyone who isn’t a stooge for industry could think differently, or how free people acting in the absence of compulsion and threats of violence – which is what government activity amounts to – might have figured out a way to solve these problems. The history of regulation is, in this fact-free version of events, a tale of righteous crusaders winning victories for the public against grasping and selfish private interests who care nothing for the common good.
Now watch this 2-minute video by some young student. My parody is his reality. In the old days, we didn’t have the minimum wage [gasp!]. We suffered from “monopoly”! (Really? Has he looked at any data?) Then our wise presidents stepped in, etc. Then we got the Great Depression, which had no cause (but was probably caused by capitalism!), and the Depression in turn was cured by World War II.
Here’s how to reply to much of this:
On “monopoly,” I recommend my article “The Misplaced Fear of ‘Monopoly.’”
On working conditions and the free market, the best analysis is George Reisman’s.
On the Great Depression, which did have a cause after all, see Murray N. Rothbard, America’s Great Depression, or, more briefly, the relevant section of my book 33 Questions About American History You’re Not Supposed to Ask. For the basic gist, see this overview of the Austrian theory of the business cycle.
Finally, World War II did not end the Great Depression. This is not difficult to prove:
I say all this not to make fun of the guy who made the video. I’m writing this for two reasons: (1) to show how easy it is to fall into the “government is the indispensable source of our happy lives” fallacy, since to understand the full picture requires much more knowledge and thought; and (2) to help people equip themselves to answer these common claims.
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