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Omnipotent Government
by Ludwig von Mises

(Table of Contents)






This Nazi goal does not differ in principle from the aims of the earlier German nationalists, whose most radical group called them- selves in the thirty years preceding the first World War Alldeutsche(Pan-Germans). It was this ambition which pushed the Kaiser's Germany into the first World War and—twenty-five years later— kindled the second World War.















THE present crisis of human civilization has its focal point in Germany. For more than half a century the Reich has been the disturber of the peace. The main concern of European diplomacy, in the thirty years preceding the first World War, was to keep Germany in check by various schemes and tricks. But for German bellicosity, neither the Czars' craving for power nor the antagonisms and rivalries of the various nationalities of southeastern Europe would have seriously disturbed the world's peace. When the devices of appeasement broke down in 1914, the forces of hell burst forth.

The fruits of the victory of the Allies were lost by the short- comings of the peace treaties, by the faults of the postwar policies, and by the ascendancy of economic nationalism. In the turmoil of these years between the two wars, when every nation was eager to inflict as much harm on other nations as possible, Germany was free to prepare a more tremendous assault. But for the Nazis, neither Italy nor Japan would be a match for the United Nations. This new war is a German war as was the first World War.

It is impossible to conceive the fundamental issues of this most terrible of all wars ever fought without an understanding of the main facts of German history. A hundred years ago the Germans were quite different from what they are today. At that time it was not their ambition to surpass the Huns and to outdo Attila. Their guiding stars were Schiller and Goethe, Herder and Kant, Mozart and Beethoven. Their leitmotiv was liberty, not conquest and oppression. The stages of the process which transformed the nation once styled by foreign observers that of the poets and thinkers into that of ruthless gangs of the Nazi Storm Troops ought to be known by everybody who wants to mold his own judgment on current world political affairs and problems. To understand the springs and tendencies of Nazi aggressiveness is of the highest importance both for the political and military conduct of the war and for the shaping of a durable postwar order. Many mistakes could have been avoided and many sacrifices spared by a better and clearer insight into the essence and the forces of German nationalism.

It is the task of the present book to trace the outlines of the changes and events which brought about the contemporary state of German and European affairs. It seeks to correct many popular errors which sprang from legends badly distorting historical facts and from doctrines misrepresenting economic developments and policies. It deals both with history and with fundamental issues of sociology and economics. It tries not to neglect any point of view the elucidation of which is necessary for a full description of the world's Nazi problem.


IN the history of the last two hundred years we can discern two distinctive ideological trends. There was first the trend toward freedom, the rights of man, and self-determination. This individualism resulted in the fall of autocratic government, the establishment of democracy, the evolution of capitalism, technical improvements, and an unprecedented rise in standards of living. It substituted enlightenment for old superstitions, scientific methods of research for inveterate prejudices. It was an epoch of great artistic and literary achievements, the age of immortal musicians, painters, writers, and philosophers. And it brushed away slavery, serfdom, torture, inquisition, and other remnants of the dark ages.

In the second part of this period individualism gave way to another trend, the trend toward state omnipotence. Men now seem eager to vest all powers in governments, i.e., in the apparatus of social compulsion and coercion. They aim at totalitarianism, that is, conditions in which all human affairs are managed by governments. They hail every step toward more government interference as progress toward a more perfect world; they are confident that the governments will transform the earth into a paradise. Characteristically, nowadays in the countries furthest advanced toward totalitarianism even the use of the individual citizen's leisure time is considered as a task of the government. In Italy dopolavoro and in Germany Freizeitgestaltung are regular legitimate fields of government interference. To such an extent are men entangled in the tenets of state idolatry that they do not see the paradox of a government-regulated leisure.

It is not the task of this book to deal with all the problems of statolatry or etatism. Its scope is limited to the treatment of the consequences of etatism for international relations. In our age of international division of labor, totalitarianism within several scores of sovereign national governments is self-contradictory. Economic considerations are pushing every totalitarian government toward world domination. The Soviet government is by the deed of its foundation not a national government but a universal government, only by unfortunate conditions temporarily prevented from exercising its power in all countries. Its official name does not contain any reference to Russia. It was the aim of Lenin to make it the nucleus of a world government; there are in every country parties loyal only to the Soviets, in whose eyes the domestic governments are usurpers. It is not the merit of the Bolsheviks that these ambitious plans have not succeeded up to now and that the expected world revolution has not appeared. The Nazis have not changed the official designation of their country, the Deutsches Reich. But their literary champions consider the Reich the only legitimate government, and their political chiefs openly crave world hegemony. The intellectual leaders of Japan have been imbued at European universities with the spirit of etatism, and, back home, have revived the old tenet that their divine Emperor, the son of Heaven, has a fair title to rule all peoples. Even the Duce, in spite of the military impotence of his country, proclaimed his intention to reconstruct the ancient Roman Empire. Spanish Falangists babble about a restoration of the domain of Philip II.

In such an atmosphere there is no room left for the peaceful cooperation of nations. The ordeal through which mankind is going in our day is not the outcome of the operation of uncontrollable natural forces. It is rather the inevitable result of the working of doctrines and policies popular with millions of our contemporaries.

However, it would be a fateful mistake to assume that a return to the policies of liberalism abandoned by the civilized nations some decades ago could cure these evils and open the way toward peaceful cooperation of nations and toward prosperity. If Europeans and the peoples of European descent in other parts of the earth had not yielded to etatism, if they had not embarked upon vast schemes of government interference with business, our recent political, social, and economic disasters could have been avoided. Men would live today under more satisfactory conditions and would not apply all their skill and all their intellectual powers to mutual extermination. But these years of antagonism and conflict have left a deep impression on human mentality, which cannot easily be eradicated. They have marked the souls of men, they have disintegrated the spirit of human cooperation, and have engendered hatreds which can vanish only in centuries. Under present conditions the adoption of a policy of outright laissez faire and laissez passer on the part of the civilized nations of the West would be equivalent to an unconditional surrender to the totalitarian nations. Take, for instance, the case of migration barriers. Unrestrictedly opening the doors of the Americas, of Australia, and of Western Europe to immigrants would today be equivalent to opening the doors to the vanguards of the armies of Germany, Italy, and Japan. There is no other system which could safeguard the smooth coordination of the peaceful efforts of individuals and nations but the system today commonly scorned as Manchesterism. We may hope— although such hopes are rather feeble—that the peoples of the Western democratic world will be prepared to acknowledge this fact, and to abandon their present-day totalitarian tendencies. But there can be no doubt that to the immense majority of men militarist ideas appeal much more than those of liberalism. The most that can be expected for the immediate future is the separation of the world into two sections: a liberal, democratic, and capitalist West with about one quarter of the total world population, and a militarist and totalitarian East embracing the much greater part of the earth's surface and its population. Such a state of affairs will force upon the West policies of defense which will seriously hamper its efforts to make life more civilized and economic conditions more prosperous.

Even this melancholy image may prove too optimistic. There are no signs that the peoples of the West are prepared to abandon their policies of etatism. But then they will be prevented from giving up their mutual economic warfare, their economic nationalism, and from establishing peaceful relations among their own countries. Then we shall stand where the world stood in the period between the two world wars. The result will be a third war, more dreadful and more disastrous than its precursors.

It is the task of the last part of this book to discuss the conditions which could preserve at least for the Western democracies some amount of political and economic security. It is its aim to find out whether there is any imaginable scheme which could make for durable peace in this age of the omnipotence of the state.


THE main obstacle both to every attempt to study in an unbiased way the social, political, and economic problems of our day, and to all endeavors to substitute more satisfactory policies for those which have resulted in the present crisis of civilization, is to be found in the stubborn, intransigent dogmatism of our age. A new type of superstition has got hold of people's minds, the worship of the state. People demand the exercise of the methods of coercion and compulsion, of violence and threat. Woe to anybody who does not bend his knee to the fashionable idols!

The case is obvious with present-day Russia and Germany. One cannot dispose of this fact by calling the Russians and the Germans barbarians and saying that such things cannot and will not happen with the more civilized nations of the West. There are only a few friends of tolerance left in the West. The parties of the Left and of the Right are everywhere highly suspicious of freedom of thought. It is very characteristic that in these years of the desperate struggle against the Nazi aggression a distinguished British pro-Soviet author has the boldness to champion the cause of inquisition. -Inquisition,” says T. G. Crowther, -is beneficial to science when it protects a rising class.”[2]For -the danger or value of an inquisition depends on whether it is used on behalf of a reactionary or a progressiving governing class.”[3] But who is -progressive” and who is -reactionary”? There is a remarkable difference with regard to this issue between Harold Laski and Alfred Rosenberg.

It is true that outside of Russia and Germany dissenters do not yet risk the firing squad or slow death in a concentration camp.[4] But few are any longer ready to pay serious attention to dissenting views. If a man tries to question the doctrines of etatism or nationalism, hardly anyone ventures to weigh his arguments. The heretic is ridiculed, called names, ignored. It has come to be regarded as insolent or outrageous to criticize the views of powerful pressure groups or political parties, or to doubt the beneficial effects of state omnipotence. Public opinion has espoused a set of dogmas which there is less and less freedom to attack. In the name of progress and freedom both progress and freedom are being outlawed.

Every doctrine that has recourse to the police power or to other methods of violence or threat for its protection reveals its inner weakness. If we had no other means to judge the Nazi doctrines, the single fact that they seek shelter behind the Gestapo would be sufficient evidence against them. Doctrines which can stand the trial of logic and reason can do without persecuting skeptics.

This war was not caused by Nazism alone. The failure of all other nations to stop the rise of Nazism in time and to erect a barrier against a new German aggression was not less instrumental in bringing about the disaster than were the events of Germany's domestic evolution. There was no secrecy about the ambitions of the Nazis. The Nazis themselves advertised them in innumerable books and pamphlets, and in every issue of their numerous newspapers and periodicals. Nobody can reproach the Nazis with having concocted their plots clandestinely. He who had ears to hear and eyes to see could not help but know all about their aspirations.

The responsibility for the present state of world affairs lies with those doctrines and parties that have dominated the course of politics in the last decades. Indicting Nazism is a queer way to exculpate the culprits. Yes, the Nazis and their allies are bad people. But it should be the primary aim of politics to protect nations against the dangers originating from the hostile attitudes of bad people. If there were no bad people, there would not be any need for a government. If those in a position to direct the activities of governments do not succeed in preventing disaster, they have given proof that they are not equal to their task.

There was in the last twenty-five years but one political problem: to prevent the catastrophe of this war. But the politicians were either struck with blindness or incapable of doing anything to avoid the impending disaster.

The parties of the Left are in the happy position of people who have received a revelation telling them what is good and what is bad. They know that private property is the source of all ills, and that public control of the means of production will transform the earth into a paradise. They wash their hands of any responsibility; this -imperialist” war is simply an outcome of capitalism, as all wars have been. But if we pass in review the political activities of the socialist and communist parties in the Western democracies, we can easily discover that they did all that they could to encourage the Nazi plans for aggression. They have propagated the doctrine that disarmament and neutrality are the best means to stop the Nazis and the other Axis powers. They did not intend to aid the Nazis. But if they had had this intention, they could not have acted differently.

The ideals of the Left are fully realized in Soviet Russia. Here is Marxism supreme; the proletarians alone rule. But Soviet Russia failed even more lamentably than any other nation in preventing this war. The Russians knew very well that the Nazis were eager to conquer the Ukraine. Nevertheless, they behaved as Hitler wanted them to behave. Their policies contributed a good deal to the ascendancy of Nazism in Germany, to the rearmament of Germany, and finally to the outbreak of the war. It is no excuse for them that they were suspicious of the capitalist nations. There is no excuse for a policy harmful to one's own cause. No one can deny that the agreement of August, 1939, brought disaster for Russia. Stalin would have served his country far better by collaborating with Great Britain than by his compromise with the Nazis. The same holds true for the conduct of all other European countries. One could hardly imagine a more fatuous policy than that of Poland, when in 1938 it annexed a part of Czechoslovakia, or that of Belgium, when in 1936 it severed the ties of the alliance which linked it with France. The fate of the Poles, the Czechs, the Norwegians, the Dutch, the Belgians, the Greeks, and the Yugoslavs deserves profound pity. But one cannot help asserting that they helped to bring their misfortune upon themselves. This second World War would never have broken out if the Nazis had expected to encounter on the first day of hostilities a united and adequately armed front of Great Britain, France, Russia, the United States, and all the small democracies of Europe, led by a unified command.

An investigation of the root causes of the ascendancy of Nazism must show not only how domestic German conditions begot Nazism but also why all other nations failed to protect themselves against the havoc. Seen from the viewpoint of the British, the Poles, or the Austrians, the chief question is not: What is wrong with the Nazis? but: What was wrong with our own policies with regard to the Nazi menace? Faced with the problem of tuberculosis, doctors do not ask: What is wrong with the germs? but: What is wrong with our methods of preventing the spread of the disease?

Life consists in adjusting oneself to actual conditions and in taking account of things as they really are, not as one would wish them to be. It would be more pleasant if there were neither germs nor dangerous barbarians. But he who wants to succeed has to fix his glance upon reality, not to indulge in wishful dreams.

There is no hope left for a return to more satisfactory conditions if people do not understand that they have failed completely in the main task of contemporary politics. All present-day political, social, and economic doctrines, and all parties and pressure groups applying them, are condemned by an unappealable sentence of history. Nothing can be expected from the future if men do not realize that they were on the wrong path.

It is not a mark of hostility to any nation to establish the fact that its policies were entirely wrong and have resulted in a disastrous failure. It is not a sign of hostility to the members of any class, pressure group, or organization to try to point out wherein they were mistaken and how they have contributed to the present unsatisfactory state of affairs. The main task of contemporary social science is to defy the taboo by which the established doctrines seek to protect their fallacies and errors against criticism. He who, in the face of the tremendous catastrophe whose consequences cannot yet be completely seen, still believes that there are some doctrines, institutions, or policies beyond criticism, has not grasped the meaning of the portents. Let the example of Germany stand as a warning to us. German Kultur was doomed on the day in 1870 when one of the most eminent German scientists—Emil du Bois-Reymond—could publicly boast, without meeting contradiction, that the University of Berlin was -the intellectual bodyguard of the house of Hohenzollern.” Where the universities become bodyguards and the scholars are eager to range themselves in a -scientific front,” the gates are open for the entry of barbarism. It is vain to fight totalitarianism by adopting totalitarian methods. Freedom can only be won by men unconditionally committed to the principles of freedom. The first requisite for a better social order is the return to unrestricted freedom of thought and speech.


WHOEVER wishes to understand the present state of political affairs must study history. He must know the forces which gave rise to our problems and conflicts. Historical knowledge is indispensable for those who want to build a better world.

Unfortunately the nationalists approach history in another temper. For them the past is not a source of information and instruction but an arsenal of weapons for the conduct of war. They search for facts which can be used as pretexts and excuses for their drives for aggression and oppression. If the documents available do not provide such facts, they do not shrink from distorting truth and from falsifying documents.

In the early nineteenth century a Czech forged a manuscript in order to prove that his people's medieval ancestors had already reached a high stage of civilization and had produced fine literary works. For many decades Czech scholars fanatically asserted the authenticity of this poem, and for a long time the official curriculum of the Czech state gymnasiums of old Austria made its reading and interpretation the main topic in the teaching of Czech literature. About fifty years later a German forged the Ura Linda Chronicle in order to prove that the -Nordics” created a civilization older and better than that of any other people. There are still Nazi professors who are not ready to admit that this chronicle is the clumsy forgery of an incompetent and stupid backwoodsman. But let us assume for the sake of argument that these two documents are authentic. What could they prove for the nationalists' aspirations? Do they support the claim of the Czechs to deny autonomy to several million Germans and Slovaks, or the claim of the Germans to deny autonomy to all Czechs?

There is, for instance, the spurious dispute as to whether Nicholas Copernicus was a Pole or a German. The documents available do not solve the problem. It is at any rate certain that Copernicus was educated in schools and universities whose only language was Latin, that he knew no other mathematical and astronomical books than those written in Latin or Greek, and that he himself wrote his treatises in Latin only. But let us assume for the sake of argument that he really was the son of parents whose language was German. Could this provide a justification for the methods applied by the Germans in dealing with the Poles? Does it exculpate the German schoolteachers who—in the first decade of our century—flogged small children whose parents objected to the substitution of the German catechism for the Polish catechism in the schools of Prussia's Polish provinces? Does it today entitle the Nazis to slaughter Polish women and children?

It is futile to advance historical or geographical reasons in support of political ambitions which cannot stand the criticism of democratic principles. Democratic government can safeguard peace and international cooperation because it does not aim at the oppression of other peoples. If some peoples pretend that history or geography gives them the right to subjugate other races, nations, or peoples, there can be no peace.

It is unbelievable how deep-rooted these vicious ideas of hegemony, domination, and oppression are even among the most distinguished contemporaries. Señor Salvador de Madariaga is one of the most internationally minded of men. He is a scholar, a statesman, and a writer, and is perfectly familiar with the English and French languages and literatures. He is a democrat, a progressive, and an enthusiastic supporter of the League of Nations and of all endeavors to make peace durable. Yet his opinions on the political problems of his own country and nation are animated by the spirit of intransigent nationalism. He condemns the demands of the Catalans and the Basques for independence, and advocates Castilian hegemony for racial, historical, geographical, linguistic, religious, and economic considerations. It would be justifiable if Sr. Madariaga were to refute the claims of these linguistic groups on the ground that it is impossible to draw undisputed border lines and that their independence wouldtherefore not eliminate but perpetuate the causes of conflict; or if he were in favor of a transformation of the Spanish state of Castilian hegemony into a state in which every linguistic group enjoyed the freedom to use its own idiom. But this is not at all the plan of Sr. Madariaga. He does not advocate the substitution of a supernational government of the three linguistic groups, Castilians, Catalans, and Basques, for the Castile-dominated state of Spain. His ideal for Spain is Castilian supremacy. He does not want -Spain to let go the work of centuries in one generation.”[5] However, this work was not an achievement of the peoples concerned; it was the result of dynastic intermarriage. Is it right to object to the claims of the Catalans that in the twelfth century the Count of Barcelona married the King of Aragon's daughter and that in the fifteenth century the King of Aragon married the Queen of Castile?

Sr. Madariaga goes even further and denies to the Portuguese the right of autonomy and statehood. For -the Portuguese is a Spaniard with his back to Castile and his eyes on the Atlantic Sea.”[6] Why, then, did not Spain absorb Portugal too? To this Sr. Madariaga gives a strange answer: -Castile could not marry both east and west at one time”; perhaps Isabel, -being a woman after all, . . . preferred Ferdinand's looks to Alfonso's, for of such things, also, history is made.”[7]

Sr. Madariaga is right in quoting an eminent Spanish author, Angel Ganivet, to the effect that a union of Spain and Portugal must be the outcome -of their own free will.”[8] But the trouble is that the Portuguese do not long for Castilian or Spanish overlordship.

Still more amazing are Sr. Madariaga's views on Spain's colonial and foreign affairs. Speaking of the American colonies, he observes that the Spanish monarchy organized them -faithful to its guiding principle—the fraternity of all men.”[9]However, Bolivar, San Martin, and Morelos did not like this peculiar brand of fraternity. Then Sr. Madariaga tries to justify Spanish aspirations in Morocco by alluding to Spain's “position which history, geography and inherent destiny seemed obviously to suggest.”[10] For an unbiased reader there is hardly any difference between such an -inherent destiny” and the mystical forces to which Messrs. Hitler, Mussolini, and Stalin refer in annexing small countries. If -inherent destiny” justifies Spanish ambitions in Morocco, does it not in the same way support Russian appetites for the Baltic countries and Caucasian Georgia, German claims with regard to Bohemia and the Netherlands, Italy's title to Mediterranean supremacy?

We cannot eradicate the past from our memories. But it is not the task of history to kindle new conflicts by reviving hatreds long since dead and by searching the archives for pretexts for new conflicts. We do not have to revenge crimes committed centuries ago by kings and conquerors; we have to build a new and better world order. It is without any relevance to the problems of our time whether the age-old antagonisms between the Russians and the Poles were initiated by Russian or by Polish aggression, or whether the atrocities committed in the Palatinate by the mercenaries of Louis IV were more nefarious than those committed by the Nazis today. We have to prevent once and for all the repetition of such outrages. This aim alone can elevate the present war to the dignity of mankind's most noble undertaking. The pitiless annihilation of Nazism is the first step toward freedom and peace.

Neither destiny nor history nor geography nor anthropology must hinder us from choosing those methods of political organization which can make for durable peace, international cooperation, and economic prosperity.

[1]The term -etatism” (derived from the French état—state) seems to me preferable to the newly coined term -statism.” It clearly expresses the fact that etatism did not originate in the Anglo- Saxon countries, and has only lately got hold of the Anglo-Saxon mind.

[2]Crowther, Social Relations of Science (London, 1941, p. 333.)

[3]Idem, p. 331.

[4]Fascism too is a totalitarian system of ruthless oppression. However, there still are some slight differences between Fascism on the one hand and Nazism and Bolshevism on the other hand. The philospher and historian Benedetto Croce has lived in Naples, carefully shadowed by the police, but free to write and to publish several books imbued with the spirit of democracy and with the love of liberty. Professor Antonio Graziadei, a communist ex-member of the Italian Parliament, has clung unswervingly to his communistic ideas. Nevertheless he has lived in Italy and written and published (with the most eminent Italian publishing houses) books which are orthodox Marxian. There are still more cases of this type. Such exceptional facts do not alter the characteristic features of Fascism. But the historian does not have the right to ignore them.

[5]Madariaga, Spain (London, 1942), p. 176.

[6]Idem, p. 185.

[7]Idem, p. 187.

[8]Idem, p. 197.

[9]Idem, p. 49.

[10]Madariaga, op. cit., p. 200.

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