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Omnipotent Government

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The specific purpose of this book is to refute the mythology of an omnipotent dictator, who guides better than can markets. Unlike his other books, Mises relies more on history than theory to make his case. Omnipotent Government examines modern European history in an effort to explain the problems of twentieth century Europe.

Understanding the problems of Europe requires inquiry into the history of events and the history of ideas both. Liberalism is the policy of international peace, yet somehow people came to embrace particularly aggressive forms of nationalistic socialism (i.e. Nazism). Since the free trade policies of Europe are central to peaceful international relations, hostility between socialist nations (i.e. the Nazi and Soviet nations) is hardly surprising.

The productivity of modern industry hinges upon the international division of labor. Without international trade, productivity would fall to the point where only a fraction of the world population could survive. The consequences of National Socialism, and even protectionism, are therefore dire. The analysis in this book is not entirely new. Mises got into some of this material in his 1922 book Socialism, and Economic and Sociological Analysis. Lionel Robbins also did similar work in his Economic Planning and International Order.

Omnipotent is the most historical of Mises' books. This book is important as a historical work. It is also important because it explains the international aspects of the calculation critique of socialism better than his other works. Omnipotent Government also shows that Mises was not anti-empirical. Mises stressed the importance of theory because he rejected empirical analysis. Mises stressed the need for logically valid theory as the means of understanding history. As Mises notes towards the end of this book, the Classical Liberal program of free trade was rejected because people did not understand the importance of international division of labor.

This book will dispel any illusions that government can solve all our problems. Here government is the problem. It should be added to every High School summer reading list.