Hayek, Friedman, Mises, & Rothbard on The Political Economy of Free Speech
To most people the issue of freedom of speech is a constitutional issue and a civil liberties matter. But a number of free-market economists have written about it while insisting that one cannot separate political and economic freedom when it comes to freedom of speech. Among them are F.A. Hayek, Milton Friedman, Ludwig von Mises, and Murray Rothbard.
In a 1979 article entitled “The Economics of Free Speech” Milton Friedman declared that “there is a clear and direct relationship between economic arrangements, on the one hand, and free speech on the other.” In a very Austrian-sounding argument, Friedman begins by noting the importance of property rights, the first prerequisite for economic freedom. In a totalitarian socialist system, he said, a “small group” that wanted to advocate capitalism would run into such problems as, who would rent them a hall if all halls are owned by the government? How would they find a printing press if all printing presses are owned by the state? If all paper were sold by the government printing company, would there be a problem in procuring paper as well? And, where would the money come from if all income drives from government paychecks? The government certainly will not pay for “subversive doctrines.”
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This is all obvious today, but in 1979 there will still many academic defenders of Soviet socialism who would have argued with Friedman about this, perhaps even Paul Samuelson who, in the 1988 edition of his famous textbook predicted that by the year 2000 Soviet GDP would be larger than U.S. GDP.
What Friedman called “the relationship between economic arrangements and free speech” is close long before one is trapped in a full-blown socialist society. He pointed to “businessmen” who have been denied free speech rights in the U.S. because of the explosive growth of government regulation over the decades (See “Ten Thousand Commandments,” published annually by the Competitive Enterprise Institute). Fear of “bureaucratic strangulation” as revenge for criticizing government is one thing that Friedman points out, along with a similar fear of IRS audits and antitrust lawsuits.
Government does indeed have hundreds of weapons with which it can attack American citizens who criticize its declarations, mandates, taxes, policies, and corruption. It has been honing these tools of oppression ever since the beginning of the republic. The Adams administration outlawed free political speech altogether with its “Sedition Act” when the ink was barely dry on the Bill of Rights. It imprisoned journalists who criticized the administration and even imprisoned a congressman, Mathew Lyons of Vermont, for criticizing Adams on the floor of the House of Representatives. That ended when Thomas Jefferson replaced Adams.
Lincoln imprisoned tens of thousands of Northern-state citizens without due process for merely criticizing him and his administration; shut down some 300 opposition newspapers; censored telegraph communication, and deported his biggest congressional critic, Rep. Clement Vallandigham of Ohio. This made it easier for Woodrow Wilson, in the next century, to bring back another Sedition Act and imprison people for merely reading the Bill of Rights in public and opposing military conscription and American entry into World War I. More than 2,000 Americans were imprisoned, some sentenced to twenty years, for “disloyal” speech during the manufactured panic that was drummed up to support the war.
Indeed, a major theme of Robert Higgs’s Crisis and Leviathan is that “emergencies” – real and fabricated – have always been used as excuses to abolish civil liberties, first among them being freedom of speech. The state always keeps these tools of oppression ready to go at a moment’s notice, as it did during the recent phony and politically-orchestrated “pandemic.” All of this makes Friedman’s comments about threats to freedom of speech by mealy-mouthed business executives seem trivial in comparison.
There may be a few businessmen who criticize government, said Friedman, but “the public statements of business leaders are almost always bland. They talk in general germs about the evils of government regulation and about the importance of free enterprise, but . . . they are very careful not to be too specific.” Indeed, “We have to do business with these people” is a common refrain from business people who are routinely threatened or extorted by regulators and tax collectors and who do not wish to attract the state’s ire.
It is ironic that Friedman gave this speech in the same year that he and his wife Rose published their iconic book, Free to Choose. That book includes several lengthy discussions of the Chicago School capture theory of regulation as applied to the railroad, trucking, and airline industries. It apparently did not occur to Friedman that if rent-seeking corporations (and their unions) could “capture” government agencies that regulate railroads, trucking, and airlines, they could also capture at least part of the state’s censorship apparatus, perhaps starting with its Federal Communications Commission.
This was of course on display in spades in recent years with the nearly airtight censorship of any criticisms of the pharmaceutical industry during the “covid pandemic,” not to mention the defense contracting industries. It was not full-blown totalitarian socialism, as Friedman said, but rather a form of fascism with government and businesses “collaborating” to create profits for themselves at the expense of the public, all in the name of “public health,” the latest fascist euphemism for “the public good.” No government agencies are more “captured” in this sense than the Centers for Disease Control and the National Institutes of Health.
Friedman also discussed how government funding corrupted his “colleagues” in the medical school at the University of Chicago, “most of whom are supported in their research by grants from the National Institute of Health,” and his economics department colleagues “who are receiving grants from the National Science Foundation.” That was in 1979. Government funding – and control – of research and publication in all academic disciplines is many orders of magnitude greater than it was in 1979 and so, necessarily, is de facto censorship of views that are disapproved by government-funding agencies.
It was a scandal of monumental proportions that only a few physicians in the entire United States spoke up against the fraudulent PCR tests that were used to grossly inflate the number of covid “cases,” and worse yet, the conflating of “death from covid” with “death with covid” on death certificates. They did so because the hospitals there are affiliated with received tens of thousands of dollars from the government for each death associated with covid. (Jump out of an airplane and your parachute doesn’t open, and you will declared to have died from covid if it is detected in the autopsy).
In 1977 Michael Jensen and William Meckling published an article entitled “Between Freedom and Democracy” which was complementary to Friedman’s analysis in which they discuss how the growth of government corrupts journalism and leads to censorship of “unpopular” ideas. Their thesis was straightforward: Since government regulations, controls, mandates, and spending are so pervasive in so many areas, your typical journalist relies crucially on information from government agencies to do his job. An environmental reporter must have access to the Environmental Protection Agencies and federal and state levels. A foreign policy reporter relies on information from the Pentagon, and so forth.
What this means is that journalists are threatened with being shut out of their main information sources – and their careers ruined – if they are too critical of the government agencies that they cover. In this way the growth of government destroys honest journalism and breeds censorship. That was written in 1977. This phenomenon has metastasized since then to the point that the “mainstream media” is essentially, with very few exceptions, the propaganda arm of the Washington establishment, primarily the Democrat party and the militaristic wing of the Republican party (which is almost all of that party).
The eleventh chapter of The Road to Serfdom is entitled “The End of Truth” and discusses the historical imperative on all planned, totalitarian states throughout history to destroy freedom of speech as much as possible so that the only “truth” is that which is announced by the state. Persuasion, research, scholarship, debate, and discussion are replaced by “official” government announcements. Like Friedman, Hayek describes full-blown totalitarianism but the whole point of the book is to warn that the democratic countries of his time seemed to be on the road to totalitarianism, whether they recognized it or not.
Again, today’s America seems much further down that road than it was in 1943 when The Road to Serfdom was first published. The Left all over the world is the cultural Marxist Left and it refuses to seriously debate. Disagree with them, and you are “cancelled,” libeled, slandered, and there may be calls for you to be fired from your job, thrown out of school, and vanished from acceptable society. It is what Jeff Deist calls a “post-persuasion society.”
Hayek’s analysis is deeper than Friedman’s. He points out, for example, that the consequences of such totalitarian behavior are profound because abandoning the search for truth is “destructive of all morals” since it “undermines one of the foundations of all morals: the sense and respect for the truth.” He also points out that for centuries “various theoreticians of the totalitarian system” have made the-ends-justify-the-means-style arguments by constructing mountains of “social myths.” Hayek could have been referring to 2023 instead of 1943 when he wrote that to totalitarians, “minority opinions must be silenced” and “every act of government must become sacrosanct and exempt from criticism.”
Preceding Friedman by almost four decades, Hayek remarked that academe must also be corrupted, for “the disinterested search for truth cannot be allowed in a totalitarian system.” This is especially true in the disciplines of history, law, and economics, he wrote. All three of these disciplines are thoroughly statist with powerful left-wing biases.
Anticipating Herbert Marcuse and his “repressive tolerance” doctrine that seems to completely dominate academe today, Hayek also wrote that in totalitarian societies “intolerance . . . is openly extolled.” (Marcuse’s now wildly-popular and heavily enforced theory is that only the “oppressed classes” deserve to have freedom of speech, not the “oppressor class.” Today’s cultural Marxists have defined the “oppressor class” as white heterosexual males of European descent, with just about everyone else being oppressed by this “class.” It is all thoroughly collectivist and Marxist, with behavior being determined by one’s “class.” Methodological individualism in particular, and individualism in general, are ignored or denigrated. The poorest white people who live in plywood shacks in the Louisiana Bayou are said to “oppress” black Wall Street and Beverly Hills millionaires, millionaire athletes, and the Obama family, by definition, because of the racial class they belong to.
In Liberalism: In the Classical Tradition, Ludwig von Mises wrote in section 12 on “Tolerance” that “The burning of heretics, inquisitorial persecutions, religious wars” all “belong to history.” Writing in the early twentieth century, Mises declared victory for classical liberalism over the idea that the church had “the right to regulate . . . affairs of this world” and not just “the relationship of man to the world to come . . .”
This victory has obviously been overturned in today’s world. While there are no burning of heretics (so far), there have been thousands of ritualistic persecutions of people with the “wrong” ideas, predominantly classical liberal ideas. There are organizations such as the Southern Poverty Law Center, the recipient of many millions in government grants and an advisor to the Department of Homeland Security and other government agencies, whose primary function is apparently to libel and smear prominent critics of “progressivism,” the latest shady euphemism for totalitarian socialism.
There may not be “religious wars,” as Mises said, but there is a war on religion because religion, like the nuclear family, stands between the individual and the state and the latter’s compulsion for totalitarian power. This section of Liberalism is entitled “Tolerance” but it in fact calls for a type of intolerance: “Liberalism . . . must be intolerant of every kind of intolerance,” wrote Mises, for if “one considers the peaceful cooperation of all men as the goal of social evolution, one cannot permit the peace to be disturbed by priests and fanatics.” In today’s world the “priests” are the high priests of the cult of progressivism or cultural Marxism who dominate the academic world and much of politics.
In his essay “Anatomy of the State” Murray Rothbard explained that mere bribery or payoffs to political supporters is never enough to secure enduring political power. The majority of the population must be bamboozled into believing that “their government is good, wise, and, at least, inevitable . . .” Pounding this into the heads of the populace, wrote Rothbard, is the task of “intellectuals.” As a class, such government propagandists are “court historians” whose job is to portray the state as essentially divine, while warning of the evils and dangers of the civil society, private enterprise, and social cooperation.
So the state’s own glorious portrayal of itself is preached far and wide by the “intellectuals” who are in turn paid for their efforts with government funding, jobs, and prestige. The greatest danger to the state is “independent intellectual criticism” which must therefore be stamped out. That is another job of the “intellectuals” – the censorship of criticisms of government actions.
History plays an important role here, as states write and rewrite national histories to portray their predecessors as super virtuous and God-like. The Lincoln myth would be a good example of this phenomenon. I consider this to be the ideological cornerstone of American statism. Once such myths are invented and the population is indoctrinated in them, then “any raiser of new doubts” and “any isolated voice” must be attacked as “a profane violator of the wisdom of his ancestors.”
Another tactic of censorship, said Rothbard, is to “deprecate the individual and exalt the collectivity of society.” Hayek would have agreed with this statement, having written in The Constitution of Liberty that individual responsibility – facing the consequences of one’s actions – is a prerequisite for a free society. It is also something that totalitarians everywhere work mightily to denigrate and destroy, said Hayek. Any new ideas that challenge the state-as-deity idea must always be nipped in the bud by harsh ridicule, wrote Rothbard.
Writing decades before hardly anyone in America had heard of Anthony “I am Science” Fauci, Rothbard wrote that another tool of censorship is the result of the theory of “the divine right of the state” of medieval times being replaced by “a new god,” namely, “science.” “State rule is now proclaimed as being ultrascientific,” he says, leading to greater and greater assaults on common sense. He cites Keynesian economics as Exhibit A in this regard. A thief who “justifies” his theft by arguing that when he spends the money it will stimulate the local economy would be ridiculed by anyone with an ounce of common sense, said Rothbard. But if the theft (aka taxation) is hidden behind the language of “multiplier effects,” “stimulus packages,” “stabilization policy,” “injections and leakages,” and other scientific-sounding macroeconomic lingo the public will acquiesce.
For about the past half century now, American youth (and youth of other countries as well) have been indoctrinated in the idea that they are taking the moral high road by participating in campus riots, shouting and screaming demonstrations, and other efforts aimed at censoring any and all libertarian or conservative speech. They are the intellectual sons and daughters of the old communist theorist, Herbert Marcuse, and his doctrine of “oppressive tolerance.”
This has occurred because there was very little intellectual pushback in terms of education about the virtues of freedom of speech. Even the American Civil Liberties Union long ago abandoned its defense of civil liberties in favor of promoting “progressive” politics.
The defense of freedom of speech is not the exclusive domain of legal or constitutional scholars; prominent free-market economists have made powerful cases for freedom of speech for decades, and they are in dire need of being expanded and taught far and wide — before it’s too late.
 Kurt R. Leube, editor, The Essence of Friedman. Stanford, CA: Hoover Institution Press, 1987, pp. 9-17.
 Ibid, 9.
 Thomas DiLorenzo, The Real Lincoln. New York: Three Rivers Press/Random House, 2002.
Robert Higgs, Crisis and Leviathan: Critical Episodes in the Growth of American Government. New York: Oxford University Press, 1987.
 Ibid., 11.
Robert F. Kennedy, Jr. The Real Anthony Fauci. New York: Simon and Schuster, 2022.
 Friedman, p. 11.
 Michael Jensen and William Meckling, “Between Freedom and Democracy.” The Banker. October 1977, pp. 39-49.
 F.A. Hayek, The Road to Serfdom. Chicago: University of Chicago Press, 1976 edition.
 Herbert Marcuse, “Repressive Tolerance” (https://www.marcuse.org/herbert/publications/1960s/1965-repressive-tolerance-fulltext.html).
 Thomas DiLorenzo, “Racial Racketeering for Fun and Profit” (https://www.lewrockwell.com/2011/06/thomas-dilorenzo/racial-racketeering-for-fun-and-profit/).
 F.A. Hayek, The Constitution of Liberty. Chicago: University of Chicago Press, 1960, Chapter 5, “Responsibility and Freedom.”
Article posted with permission from Thomas DiLorenzo