Deirdre McCloskey speaks to students Tuesday, March 8 on classical liberalism for Praxis.
Eric Ragan | Courtesy
Deirdre McCloskey is a renowned free-market economist, essayist, and professor who has written more than a dozen books and hundreds of scholarly articles. A modern expert in economic history, McCloskey, who worked for several years with Milton Friedman, is a modern expert in economic history and outspoken critic of academic theorists who limit humans based on utility maximization. She is perhaps best known for her groundbreaking work regarding the bourgeois virtues and how they contributed to the rise of an affluent West in history, which is also the topic of her latest book.

You explicitly push back against people who describe you as “conservative,” and opt instead to define yourself as a “literary, quantitative, postmodern, free market, progressive Episcopalian, Midwestern woman from Boston who was once a man.”

That’s absolutely right. I’m a Christian, but a free-market Episcopalian. I was a guy, now I’m a woman. I’m from Boston, but I’ve always lived as an adult in the Midwest. Being postmodern doesn’t mean you have to be left wing. Being postmodern is to say that I don’t believe in the naïve theory of knowledge that facts are just lying out there, we go collect them, and that’s it. We ask human questions. The Danish physicist Niels Bohr said that back in the 1920s. Physics is not just about the world, physics is what we as humans can say about the world. That is the essential message of the Sophists of ancient Greece, and of Montaigne and Shakespeare in the late sixteenth century, and of the ‘crazy,’ postmodern people in English departments. I’m quantitative: So many social and scientific questions depend on how big things are, numbers, quantities. Yet, I believe truth can be found in poetry, theology, philosophy, and history. It is truth that cannot be translated without loss into propositional statements, like E=mc2. But what is human life about? One kind of answer is there was once a babe born in Bethlehem of the house of David. This other kind of knowing is not propositional, but it’s very important to humans. It’s not softer than math. To talk about knowledge as ‘hard’ and ‘soft’ is sexist—it means girls can’t do math. A stupid distinction. The Greek aorist mood is harder to understand than most calculus. Humanities is not easier than physical and biological sciences.

What is the one idea you would like to communicate to someone who never formally studied economics?

The crucial thing is to realize that trade is mutually beneficial. This stupid stuff that Donald Trump comes out with about the Chinese beating us in trade is ridiculous. Are you defeated when you buy some hairspray? Trade deficit talk is silly talk. Both parties are made better by trade. Suppose no one in the United States knew what the balance of payments was with China. No one would know so no one would worry. It’s not like with other things. If there was rampant inflation like in the 1970s, you wouldn’t need government statistics to know it happened. If there was mass unemployment like in 1933, you would see the people and bread lines. When income goes up, if you’re old, you know. You know your house was smaller as a kid and your car is more reliable now. You can see these things. Now suppose we calculated the number of molecules of oxygen in the air in Hillsdale, or something else nitwit. You could print the numbers in a weekly newspaper and get all worried, but it would tell you nothing. I wish the government didn’t collect statistics on the balance of payments. It is a figment. It’s an accounting fact that no one needs to know. It is a silly thing to measure because it gets people worried for no reason. It’s also part of the United States’ xenophobia, which is anti-oriental. Thirty years ago, the concern was the balance of surplus with the Japanese—they were sending us Toyotas and TVs and we were sending soybeans. Now it’s the Chinese. It’s only the orientals we worry about. We’re racist. Hostile. We engage in a straightforward anti-oriental crusade that’s been going on since 1880 with the Oriental Exclusion Act.

Have you always championed the Austrian school of economics?

I was an anarchist, socialist, uneducated Trotskyite. I was Keynesian economist, a social engineer. We weren’t even learning basic economics at Harvard. We were learning a lot of highly technical stuff, and most of it proved worthless. It didn’t amount to anything but a waste of time—and it’s gotten much worse today. I had a roommate in college that was an engineer. Here I was, studying Keynesian economics because that’s what Harvard offered in the early ‘60s. My roommate in college was an engineer who would read ‘Human Action’ by Mises in between solving math problems for his courses. I can still see David sitting there, smoking Gauloises and reading ‘Human Action.’ I thought he was crazy for reading all that conservative crap. David probably ended up knowing more economics than I did when we graduated. Now, I am very suspicious of people who never change their minds—it suggests they aren’t thinking, Gradually through the study of economics, I became a free-market, quasi-Austrian economist with an expertise in economic history. Quasi-Austrian because I don’t read German and you have to read German to be a real Austrian.