“The Crisis in International Economic Relations” by Hans F. Sennholz – Imprimis, March 1973

A series of short posts summarizing my thoughts as I work my way through the archives of the Imprimis newsletter from Hillsdale college.

In the March 1973 issue of Imprimis Dr. Sennholz (Wikipedia) asserts that the United States is on a path towards self-destruction. He provides three particular sets of political and economic thought that are the primary reasons for this.

1. “the continuous growth of socialist and, in particular, Marxian economic thought has led to a renewed attack on private property and the profit motive”

2. Economic nationalism.

3. “the rise of governmental planning and control has given birth to an age of world-wide inflation that threatens to disrupt the international monetary system”

Dr. Sennholz died in June of 2007 but some of his recent writings can be found here. The same site contains a page with some quotes (worth a peek) from Sennholz. This one is from his book ‘The Politics of Unemployment’.

“While governments and unions are forever raising labor costs and causing unemployment, business is forever adjusting to prevent the unemployment. When the federal government raises its Social Security exactions and state governments boost unemployment compensation taxes, which may significantly raise labor costs, business is straining to prevent the unemployment through cost adjustments. It may seek to offset the mandated costs with other cost reduction. In particular, it may reduce fringe benefits, delay inflation adjustments, elicit greater effort on the part of workers, and otherwise use labor more productively. Whenever and wherever business is successful in offsetting the boost in labor costs, it succeeds in preventing threatening unemployment. If laws, regulations, and work rules prohibit the necessary cost adjustment, business has no choice but to discharge loss-inflicting workers. If it is unable to remove the employment obstacles erected by government or union, it is forced to dismiss the labor that fails to surmount the obstacles.”

The most rewarding benefit of reading these old articles has been the joy of discovering men like Dr. Sennholz. I am most frustrated to discover the message that many of these men trumpeted thirty years ago is still falling on deaf ears.

This obituary by Gary North is also worth reading. Sennholz is a man of from the Austrian school of economics which is something I have just begun to learn about. If you would like to learn more then I suggest heading over to the Mises Institute. There is an enormous wealth of material there.

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