Gary North

Sept. 7, 2010

Irving Fisher was a Yale economist. In 1911, he offered a supposedly scientific defense of the quantity theory of money in his book, The Purchasing Power of Money.

His great rival intellectually was Ludwig von Mises, who replied the following year in The Theory of Money and Credit.

Fisher's quantity theory is familiar to first-year economics students: MV=PT. This became the intellectual foundation of Milton Friedman's monetarism.

This is extracted from his son's biography. The father gave a speech to the Yale Socialist Club in 1941.

I believe [William Graham Sumner] was one of the greatest professors we ever had at Yale, but I have drawn far away from his point of view, that of the old laissez faire doctrine.

I remember he said in his classroom: "Gentlemen, the time is coming when there will be two great classes, Socialists, and Anarchists. The Anarchists want the government to be nothing, and the Socialists want government to be everything. There can be no greater contrast. Well, the time will come when there will be only these two great parties, the Anarchists representing the laissez faire doctrine and the Socialists representing the extreme view on the other side, and when that time comes I am an Anarchist."

That amused his class very much, for he was as far from a revolutionary as you could expect. But I would like to say that if that time comes when there are two great parties, Anarchists and Socialists, then I am a Socialist. [Fisher, Irving Norton. 1956. My Father, Irving Fisher. New York: Comet Press, p. 44].