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The Economists’ Hour

False Prophets, Free Markets, and the Fracture of Society

By Binyamin Appelbaum
15-minute read
Audio available
The Economists’ Hour by Binyamin Appelbaum

The Economists’ Hour (2019) is a compact history of how economists came to dominate our political discourse. This work traces the rise of neoliberal ideology from the 1960s to today.

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Binyamin Appelbaum is the economics and business lead for the New York Times editorial board. His writing has appeared in the Washington Post, the Boston Globe, and the Charlotte Observer and won him a George Polk Award and Pulitzer Prize nomination.

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The Economists’ Hour

False Prophets, Free Markets, and the Fracture of Society

By Binyamin Appelbaum
  • Read in 15 minutes
  • Audio & text available
  • Contains 9 key ideas
Upgrade to Premium Read or listen now
The Economists’ Hour by Binyamin Appelbaum
Synopsis

The Economists’ Hour (2019) is a compact history of how economists came to dominate our political discourse. This work traces the rise of neoliberal ideology from the 1960s to today.

Key idea 1 of 9

Free-market economists advocated for ending the draft – and won.

It’s May 11, 1966. Chaos erupts at the University of Chicago. Hundreds of students storm the school’s administrative buildings. They chant, wave flags, and sing protest songs. Their demand is simple: they want the United States to end the military draft.

Dramatic actions like this often claim much of the credit for the eventual end of military conscription. But they don’t deserve all the accolades. The truth is, behind the scenes, another entirely different group also fought to end mandatory military service.

So, who were these unlikely activists? Right-wing economists. Throughout the 1960s and 1970s, their constant boosting of free-market ideology helped conservative politicians justify ending the draft.

The key message here is: Free-market economists advocated for ending the draft – and won.

In the decades after World War Two, the United States used a draft system to staff its colossal military. This meant that a certain number of fighting-aged men were obligated to enlist, whether they wanted to or not. This arrangement became increasingly unpopular as the Vietnam War ramped up in the 1960s. But politicians were reluctant to end it. They believed that relying on volunteer recruits would be costly and never attract enough men.

An emerging circle of economists had a different opinion. This group included Milton Friedman, Martin Anderson, and Walter Oi. These thinkers believed that compelling men to enlist was an unethical infringement of their rights. They argued that what the government should do was to offer a fair wage for service and only hire those who voluntarily signed up. Essentially, they thought being a soldier should be like any other job on the job market.

They laid out their case in speeches, papers, and books. For them, an all-volunteer system would be fairer, but more importantly, more cost-efficient. Yes, the government would have to pay more to attract recruits, but enlistees would be more motivated and serve longer terms. Critics were worried that a system like that would disproportionately attract poorer individuals with fewer options. But this concern was brushed aside.

These ideas eventually gained traction, especially after Martin Anderson personally delivered a memo about the plan to presidential candidate Richard Nixon. Moved by the argument, Nixon campaigned on ending the draft. And, after being elected in 1968, he pushed for the creation of an all-volunteer army. He succeeded. The draft was abolished in 1971. 

This policy shift was the first big victory for economists like Anderson, Friedman, and Oi. And the decades that followed would bring many more.

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