In 1929, Ludwig von Mises dean of the Austrian School of Economics turned down a job with the Kreditanstalt Bank saying, ''A great crash is coming, and I don't want my name in any way connected with it''.
F. A. Hayek had also written in the Austrian Institute of Economic Research Report, February 1929, that the boom will collapse within the next few months. Economists of the Austrian School (a school of economic thought that has its roots in Austria and was responsible for important breakthroughs like Marginal Utility Theory) had been warning for the last few years that the latest and arguably greatest credit-fuelled bubble was going to burst in a thermonuclear explosion that would be felt around the world.
Despite the fact that Austrian business cycle theory predicted the great crash of 1929; explained the ''stagflation'' of the 1970s; and, predicted the great crash of 2008 as well as the effect of the stimulus packages (all of which the prevailing economic theories failed to do), policymakers, economics commentators and journalists in the mainstream media ignore the very existence of the Austrian heresy.
While Time magazine loudly proclaimed ''We Are All Keynesians Now'', there would be no mention at all of the Austrian School were it not for Kevin Rudd's essay, which ironically accused Mises and Hayek of being the architects of what he disingenuously calls ''extreme capitalism''! Both would of course be horrified to have their names associated with the economics of George W. Bush, Alan Greenspan, John Howard, etc, but my point is that one would expect the name Mises to be at least as famous as John Maynard Keynes, Milton Friedman, or Karl Marx (rather than Ludwig who?), if the Prime Minister was even remotely right.
In Australia, one would struggle to find an example of Austrian economic analysis outside of Gerard Jackson's Brookes News website. Why is this so?
Why do we continue to put our faith in those who have failed so dismally in the past, to fix a crisis that they do not even understand?
D. Zivkovic, Aranda
Living dangerously
I stood in the crowd at the Commonwealth Games torch relay in Canberra and watched the organised thuggery against Tibetan people perpetrated by gangs of Chinese youth bussed in from interstate by the Chinese Embassy.
Foreign Minister Stephen Smith's weak-kneed response was shameful.
Now Chinese Communist Party propaganda chief Li Changchun, is pressuring the ABC for more ''balanced'' reporting of China's human rights abuses in Tibet.
Encouraged by Kevin Rudd's preferential coverage by the Chinese media of his secret lunch at the Lodge with Li and his support for China's global economic position, the Chinese Government must feel confident that Australia is now an ally in global affairs.
Rudd is walking a dangerous tightrope between Australia's economic, political and cultural ties with a superpower government which has no respect for downtrodden minorities.
One has only to contrast China's continuing oppression of the Tibetan people with Australia's efforts to improve the lot of indigenous Australians and our East Timorese neighbours to realise that the two nations have fundamentally opposing views on human rights.
Unless Rudd stands up now and shakes an iron fist of action to back up his minimal rhetoric on the issue of China's rights abuses, Australia will be viewed to be a hypocritical nation.
Rudd must not allow Australia's economic interests to destroy our country's credibility as a defender of global human rights.
John Bell, Lyneham
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