This is the second blog entry on Hazlitt’s book, Economics in One Lesson. In the first entry we discussed the general format of the work, and some of the basic principals and high points of the first half. In this entry I aim to highlight only a few more points, discuss some of the recommended reading and credit given by Hazlitt, include some quotes that deserve memorization, and talk about why this book is important and what place and function it will hold in my personal library.
Working through the rest of part 2 of Economics in One Lesson, wasn’t difficult, but it was more involved. The principles build on each other in some chapters, demanding a little more patience than the beginning of the book. Even so, it is probably still the most concise text your going to find on the particular economic questions it discusses. There are several chapters that highlight current issues facing the United States and other countries around the world today. The chapters on minimum wage and tariffs come to mind. The chapter on the price system is very understandable, and praised by Milton Friedman in a quote on the back cover (current edition). Hazlitt explains why the free market is, “incomparably better than any group of bureaucrats,” at solving questions surrounding the needed amount of commodoties and services in a society, and he explains why the price system shouldn’t be, “vilified.” There are so many great gems and quotes in the book that it’s difficult to even get started on them. He discusses the historical, landmark work from Adam Smith, The Wealth of Nations, and has a great excerpt from Grahm Sumner’s essay, The Forgotten Man.
As soon as A observes something which seems to him to be wrong, from which X is suffering, A talks it over with B, and A and B then propose to get a law passed to remedy the evil and help X. Their law always proposes to determine what C shall do for X or, in the better case, what A,B and C shall do for X. …What I want do do is look up C….I call him the Forgotten Man. He is the man who never is thought of. He is the victim of the reformer, social speculator and philanthropist, and I hope to show you before I get through that he deserves your note both for his character and for the many burdens which are laid upon him.
The references Hazlitt makes always translate clearly back to his original thesis from part 1, encouraging long-term consequences, and all parties of an economic system be given their due consideration, instead of only looking at one group over the short term. It makes for a clear message and also provides the reader with a spark of inquiry into further exploring different authors discussing similar economic logic.
I think his chapter on tariffs, Who’s “Protected” By Tariffs? pairs well with Bastiat’s, The Candle Maker’s Petition. Reading both, the later a satire, gives a more complex understanding of the issue, which is today so very relevant. One of the beauties of the Austrian School of economics is how simply it can be explained and how it can expound to the most complex of market understandings. The book helps develop the basic lexicon it takes to discuss free market economics with all your classical-liberalism loving friends, or those who opinions differ. Since reading the book, I have found myself better able to convey a particular point in an economic debate, which I previously believed, but lacked the prowess to properly articulate.
In the final part of the book, The Lesson After Thirty years, Hazlitt takes quick aim at inflation, and insists, “[It] is not only a policy imposed for its own sake, but an inevitable result of the other interventionist policies.” He questions why modern politicians embrace Keynes’ General Theory, despite its having been, “thoroughly discredited by analysts and experience,” and compares American pressures on other countries to adopt the same inflation inducing policies to, “Aesop’s fox, who, when he had lost his tail, urged all his fellow foxes to cut off theirs.” He provides some basic figures and calculations which relate to his lessons in a, “I told you so,” succinct finale, but he does it without being condescending.
Ultimately Economics in One Lesson, will take a permanent fixture in my library. It will serve as a primer-reference text. By that, I mean if a particular economic subject arises or becomes the target of conversation or topical interest, I will find the corresponding chapter and get Hazlitt’s take. It will serve as a more than adequate primer to reintroduce the specific topic and provide, not only a basic understanding, but also a further interest and ability to digest more elaborate and involved texts on the subject. Reading Economics in One Lesson, will make you a more critical thinker in the realms of current economic policy, and you will enjoy the way such an often dry subject is presented by Henry Hazlitt with basic language and relatable, understandable examples.