Machlup retorted by describing as "romantic" Rappard's vision of responsible union leaders restraining their wage increases simply because somebody had taken the time to educate them (Graham 1947, 215). Machlup was also troubled by those who placed their faith in industrial peace: "Industrial peace is something we should be afraid of, as it can only be bought at the cost of further distortion of the wage structure. I am most afraid of Professor Iversen's proposal for wage determination by State, and consider it to be the end of democratic government" (Graham 1947, 215).

Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, loc. 969