On Gold and Austrian Economists
My friend JG mentioned something about gold hoarding in Britain during the 1930s, and in the course of research, I came across four items of interest:
- Money, Gold, and the Great Depression by Ben Bernanke;
- The gold standard and the Great Depression by James Hamilton;
- The Unknown Max Weber by Paul Honigsheim, edited by Alan Sica; and,
- Café Landmann. Is it the same as Cafe Landtmann?
As you know, I have quoted Weber recently, so the exchange between him and Joseph Schumpeter, described by Felix Somary in his memoirs, was fascinating:
Max Weber had asked me to be present at the discussion he was to have with Schumpeter about the succession to his chair at the University of Vienna. Weber wanted to return to Germany and he was thinking of Schumpeter as his successor, but the two men knew each other only superficially although Schumpeter had written an outstanding history of ideas to accompany Weber’s handbook on social sciences. I was worried about the meeting, because a greater contrast between two personalities was hard to imagine.
Max Weber was a restless, nervous type, full of “drive,” a Huguenot with deeply-held convictions, for which he strove with every atom of his energy. He battled on without letting up, even when only minor issues were at stake. He was explosive in temperament, verging on intolerance; those who did not know him well could easily have been put off or even frightened at first meeting him. Hugo von Hofmannstahl tried to explain him by saying: “He has the gifts of a Caesar who is unable to find a field large enough for his energies.” There was much truth in that observation: Weber was never in his life able to give his tremendous intellectual and spiritual powers full expressions. He took nothing lightly.
Schumpeter, on the other hand took nothing hard. He had been educated at the Vienna Theresianum, where the pupils were taught to stick to subjects and not to get personally involved. The rules of the game in every part and ideology were to be learned thoroughly, but nobody should join a party of subscribe to a dogma….
We met in the Café Landmann opposite the University. Ludo Hartmann, a historian of the Classical world and son-in-law of Mommsen, accompanied Weber, and I came with Schumpeter. I took no notes of our conversation, but can recall the elements of it that impressed me most strongly. The talk turned to the Russian Revolution [whereupon they disagreed about the likely outcome]. Weber said with some heat that communism at the Russian state of development was a crime–he knew the language and followed Russian affairs closely. He added that developments in Russia would lead to unheard-of human misery and end in a terrible catastrophe. [Schumpeter countered that it was "a good laboratory to test out theories."] “A laboratory heaped with human corpses!” Weber replied.
“Every anatomy classroom is the same thing,” Schumpeter shot back…Weber become more vehement and raised his voice, as Schumpeter for his part became more sarcastic and lowered his. All around us the café customers stopped their card games and listened eagerly, until the point when Weber sprang to his feet and rushed out into the Ringstrasse, crying “This is intolerable!” Hartmann followed with Weber’s hat, and vainly tried to calm him down. Schumpeter, who had remained behind with me, only smiled and said, “How can someone carry on like that in a coffee house!”
I felt unhappy about the incident. Here were two individuals of rare gifts, who were not far apart in their fundamental views on the economy, and in their deep intellectual seriousness. But it was the curse of the German and Austrian haute bourgeoisie that its all too few original personalities, if they ever met at all, immediately became deadly enemies. They all had too much temperament to compromise on issues.
Doesn’t this sound like an exchange between, say, me and a gold bug?
Many thanks to member Ron for sending a copy of Felix Somary’s The American and European Economic Depressions and Their Political Consequences. There was no option to buy the article from JSTOR. Much appreciated.
FOR MEMBERS: The Currency Debasement Case for Gold, Part 3
