I Chose Liberty - Ludwig von Mises Institute

George Reisman 285
writing my dissertation, I read virtually all of Böhm-Bawerk that I had not previously read,
as well as major selections from other authors whose views concerning the rate of profit/
interest were prominent, such as Irving Fisher, Knut Wicksell, and Frank Fetter, as well as
Smith, Ricardo, other classical economists, and Marx and Keynes.
I began writing the dissertation in May of 1961 and handed in a 625-page typed
manuscript in the fall of 1962. The title was The Theory of Originary Interest. (At this time,
I still followed Mises in describing what businessmen and accountants normally describe
as profit, and which I too now refer to as profit, as “originary interest.”)
In January of 1963, I learned that one of the members of my reading committee had
rejected the dissertation. In order to gain his approval, it was necessary for me to eliminate
well over half of the manuscript I had submitted, and write approximately thirty new pages
at the beginning and thirty more new pages at the end. (On my own initiative, I replaced
“originary interest” with “profit” throughout.) The last time I spoke with this committee
member, he said he liked the new version much better than the original one, except for the
first thirty pages; he also said he had not yet read the last thirty pages. (Sometime later, I
was told that this individual had left the university to write editorials for The Washington
Post.) My dissertation, as finally approved, carries the title, The Theory of Aggregate Profit
and the Average Rate of Profit.
This situation constituted the one time in my life when I was seriously disappointed
in Mises. He told me that he found it amusing that I should receive such trouble from
this particular committee member, whom he regarded as a Marxist, when what I was
providing was a modernized, more scientific version of the very ideas that were the foundation
of the man’s own beliefs. Mises believed that because of my resurrection of the
classical economists, I was indirectly resurrecting Marx. Happily, he changed his mind
on this subject two years later, after hearing my lecture, “A Ricardian’s Critique of the
Exploitation Theory.” (The substance of this lecture was published many years later as
my essay, “Classical Economics Versus the Exploitation Theory,” in The Political Economy
of Freedom Essays in Honor of F.A. Hayek. The same analysis, greatly elaborated, appears
in Chapter 11 of Capitalism. But the same essential material had been available to him
in my original dissertation.)
Looking back over the past and all that has led to the writing of my book, I cannot
help but take the greatest possible pride and satisfaction in the fact that along the way, in
having been the student of both Ludwig von Mises and Ayn Rand, I was able to acquire
what by my own standards at least is the highest possible “intellectual pedigree” that it is
possible for any thinker to have acquired in my lifetime, or, indeed, in any other lifetime.
I can only hope that if they were alive, they would look favorably upon what I have attempted
to build on the foundations they gave me.
George Reisman is professor of economics at Pepperdine University’s Graziadio School of Business
& Management in Los Angeles.