Spotlight: Pulling No Punches


Lawrence H. White has the same first and last names as another economist, so he uses his middle initial. Economists can be pretty hard to tell apart—one letter is much to differentiate one economist from another. But White has managed to distinguish himself by taking some of the purest and most radical free-market stands of anyone around.

Other free-market economists often expend the lion's share of their energy debating one another about the first step toward more-reasonable institutions. White, in contrast, takes an abolitionist stand. "I want to shape the intellectual climate," he says, "by pushing and taking extreme positions that no one else will take, following the logic of free trade to its end. Some want to work near center and tug, but I think you should go out to the end. I don't believe in pulling any punches." He asserts, "Gradualism in theory is perpetuity in practice."

One year short of 30, White already has finished two important books, as well as numerous chapters and articles that have brought him into the public-policy debate. He has become one of the most-visible advocates and patient explainers of free banking, wherein there is no government involvement in money matters, from currency to banking. And his name even turned up recently in conjunction with a congressional investigation of copier counterfeiting, a threat to the integrity of currency posed by the development of color-copy machines that can supposedly reproduce better phony bills than most professional counterfeiters.

As White testified before the congressional committee, the solution to monetary problems of all sorts would actually be quite simple: return the functions of money creation to the private sector. White says that federal monetary institutions create the problem of counterfeiting by relying on permanently circulating instead of frequently redeemed notes. "That's not the way it was historically," he explains. "There was no counterfeiting problem in Scotland during the free-banking period in the 18th and 19th centuries." His book Free Banking in Britain: Theory, Experience, and Debate, 1800–1845, published by Cambridge University Press, is the definitive work on the subject.

White has also edited Democratick Editorials: Essays in Jacksonian Political Economy, by William Leggett (Liberty Press). He regards Leggett as the best libertarian writer of his generation. He was an editor of a New York newspaper in the 1830s, and he became known as an advocate of free banking and free trade and an opponent of slavery.

White's special area of research has been the elimination of the government monopoly on the issuance of currency. He figures two stages are necessary to accomplish that goal. The first is deregulation of the banking industry. White is fairly confident that that step, now well under way, will be completed. The second is elimination of government control over the basic money supply. This is politically more difficult, because government profits from the status quo in a number of ways—"bracket creep, eroded debt, and the ability to jazz up the economy for elections," White explains.

White says he has considered himself a libertarian since he graduated from high school. Among his earliest philosophical influences was the Quaker tradition of his hometown, Moorestown, New Jersey. The antiwar tradition of the Quakers, especially during the Vietnam war, helped White form an individual-rights philosophy of civil liberties. But it was not until later, when he was near graduation from high school, that he began to apply the same principles to economic philosophy.

While a senior, he saw a New Republic advertisement for the now-defunct newsletter Books for Libertarians. He ordered it and then some of the books they sold. White was well on the road to challenging the status quo.

He was student-body president at his high school that year and soon dismantled the student government. (It has since been reinstated.) When he participated in a New Jersey YMCA mock legislature called Youth in Government, he ran for governor on a libertarian platform taken from the book Power and Market, by Murray Rothbard.

Being a self-admitted "overachiever type," White decided to get a head start the summer before college. He read another of Rothbard's books, Man, Economy, and State, a treatise laying out the thought of the Austrian School of economics.

In 1973 White entered Harvard University. He says it was a little disappointing to discover that the economics department there did not agree with his newly acquired view of reality. On the other hand, he notes a certain advantage to having "an outsider perspective from the beginning"—he "never had to unlearn" Harvard's economics.

White had planned to go on to law school, but by the time he graduated from Harvard magna cum laude in 1977, he had decided that the way to influence the course of events was not through legal activism. The people who were changing the future, he thought, were people like Austrian economists and free-market advocates Murray Rothbard and Israel Kirzner. So it was off to graduate school at the University of California at Los Angeles for a master's and doctorate in economics.

He now teaches economics at the American "home" of Austrian economics, New York University. Teaching, however, isn't his primary goal. "Some people are influenced through teachers," he says, "but I was not. So I assume that most of the people whose views I influence will be through what I write." He probably assumes correctly.

Patrick Cox is a free-lance writer and a public relations consultant.