Herbert Stein

Herbert Stein (August 27, 1916 – September 8, 1999) was a senior fellow at the American Enterprise Institute and was on the board of contributors of "The Wall Street Journal". He was chairman of the Council of Economic Advisers under President Nixon and President Ford. In the 1970s, he was a professor of economics at the University of Virginia.

Stein was born in Detroit, Michigan, but his family moved to New York during the Great Depression. He enrolled in Williams College just before he turned sixteen. After graduating Phi Beta Kappa, he went to Washington, D.C. to work as an economist in various agencies. He received his Ph.D. in economics from the University of Chicago in 1958. He was well-known as a pragmatic conservative and was jokingly referred to as "a liberal's conservative and a conservative's liberal." He was the author of "The Fiscal Revolution in America".

In his article, "Adam Smith did not wear an Adam Smith necktie," Stein wrote that the people who wear the Adam Smith tie do it "to make a statement of their devotion to the idea of free markets and limited government. What stands out in Wealth of Nations, however, is that their patron saint was not pure or doctrinaire about this idea. He viewed government intervention in the market with great skepticism. He regarded his exposition of the virtues of the free market as his main contribution to policy, and the purpose for which his economic analysis was developed. [Adam Smith did not wear an Adam Smith necktie, Herbert Stein, Wall Street Journal, April 6, 1994]

"Yet he was prepared to accept or propose qualifications to that policy in the specific cases where he judged that their net effect would be beneficial and would not undermine the basically free character of the system," wrote Stein. "He did not wear the Adam Smith necktie." In Stein's reading, "The Wealth of Nations" could justify the Food and Drug Administration, The Consumer Product Safety Commission, mandatory employer health benefits, environmentalism, and "discriminatory taxation to deter improper or luxurious behavior."

Stein was the formulator of "Herbert Stein's Law," which he expressed as "If something cannot go on forever, it will stop," by which he meant that if a trend (balance of payments deficits in his example) cannot go on forever, there is no need for action or a program to make it stop, much less to make it stop immediately; it will stop of its own accord. [cite web|title="Herb Stein's Unfamiliar Quotations"|publisher=Slate magazine |author=Herbert Stein |date=1997-05-16|accessdate=2007-09-24|url=http://www.slate.com/id/2561/] It is often rephrased as: "Trends that can't continue, won't."

He was married to Mildred Stein, who died in 1997 after 61 years of marriage, and he is the father of lawyer, author, and actor Ben Stein ("Ferris Bueller's Day Off", "Win Ben Stein's Money") and writer Rachel Stein.

External links

* [http://www.econlib.org/library/Enc/BalanceofPayments.html Article on Balance of Payments by Herbert Stein]
* [http://www.slate.com/id/2143242/ "Watching the Couples Go By". By Herbert Stein. On Slate]

Notes and references