“You’re all a bunch of socialists.” With that, Ludwig von Mises stood up in the middle of a session in April 1947 and walked out of the room. The scene, recounted by the Cobden Centre from the conference transcripts, captures what the first meeting of the Mont Pelerin Society was really like: a gathering of free-market thinkers who agreed on little beyond the basics.
Thirty-nine intellectuals from Europe and the United States met at a Swiss hotel at Mont Pelerin over the first ten days of that month. Friedrich Hayek organized it. Among those who came were Mises, Milton Friedman, George Stigler, Frank Knight, Lionel Robbins, Karl Popper and Michael Polanyi. About half were economists. The rest were historians, legal scholars, political philosophers and journalists, according to the Hoover Institution.
Why Hayek called the meeting
Hayek was an Austrian-born economist at the London School of Economics. He had watched socialist planning win favor among British politicians, academics and the public, and he had already attacked the idea in his 1944 book, The Road to Serfdom. After the war, classical liberalism had lost much of its appeal. The Great Depression had shaken confidence in markets, and wartime economies had made government intervention routine.
In late 1946 he began writing to like-minded thinkers, Popper among them, to see whether there was interest in an organization to revive liberalism. The answers were positive, so he set the conference for April 1947.
Ten days of argument
The agenda ran to thirteen substantive sessions, covering free enterprise, the future of Germany, the dangers of Soviet communism, full employment, monetary reform, wage policy, taxation and income distribution. The Cobden Centre counts nineteen sessions over the ten days, with further debate on agricultural support, corporate regulation and European federation. The Hoover Institution says its records show the discussions were “quite lively, and at times were contentious.”
The participants did agree on one thing, in the Cobden Centre’s words: “the vital importance of a decentralized and competitive price system.” The disagreement was over how far to go. The conference sought “a way to make a relatively free and competitive market economy compatible with degrees and forms of government regulation and redistribution.”
Mises argued for strict laissez-faire. Most of the others favored a market economy with a minimal or moderate interventionist welfare state, and the transcripts show, as the Cobden Centre puts it, that “the laissez-faire variation on the liberal theme never really had a chance.” Mises ended up largely isolated.
What came next
Hayek served as the society’s founding president until 1961. As membership grew, the society met regularly in different parts of the world, giving members a place to “exchange ideas about the principles and practices of a free society and the proper function of a market economy,” as the Hoover Institution describes it.
