Author:Gareth Blore（garreth bloor）
law & liberty, August 14, 2020.
Translation: Society for Humanistic Economics Saving the brick-and-mortar bookstore
In his book Socialism: An Economic and Social Analysis, Ludwig von Mises laid out his arguments against socialism and its various forms. Mises's focus on the human individual and its wide range of motivations set him apart in his 1922 research methodology.
Nearly a century later, most mainstream economists still fail to fully recognize that their discipline should be based on a more complex understanding of human nature. While we might expect Mises to back up his arguments with a more nuanced moral outlook, he nevertheless helps us see the complexity of human behavior and the continued missteps in the revelation of the socialist dream.
Practical Learning and Order
According to Mises, pragmatism is the foundation of all social sciences, "which is based on the fundamental principle that individual human beings are capable of action, that is, individuals act consciously to achieve specific goals." ”
Thus, for Mises, "all rational action is first and foremost an individual action." Only the individual thinks. And, "all rational action is economic action." ”
Economics, and indeed all social sciences, are concerned with individual choices and preferences that are independent of society. Society is primarily a consequence, not a cause, of our individual realities.
At the most basic level, Marxism subverts this order. The Marxist side of dialectical materialism seeks to show how society develops and responds in a highly constrained economic environment, and how history itself – especially capitalism – inevitably moves towards communism.
In contrast, Mises argues that society is formed through the sum total of the actions of all rational individual human beings, each with their own motivations, status, and relative power. By looking at the individual human being in this way, Mises established his approach as an individualist – that is, he believed that understanding individual behavior was central to the work of good social science, while at the same time forming an understanding without negating the role of external factors.
In stark contrast to contemporary "capitalist economics," Mises does not limit economic behavior to profit-driven behavior. From day-to-day experience, we know that the response of a signal in a buying decision can be guided by a non-economic goal:
Buying for the benefit of others can be seen as a market decision oriented towards a non-economic end goal (i.e., profit is not the only goal). Non-profit organizations can purchase goods and services for those in need, and this requires a profitable system to make the first purchase; Although profit is not the end goal, it is essential to the means.
In Mises's view, this philanthropic decision-making is entirely in line with economic principles, as his description of the human individual allows for a richer assessment than the prevailing profit maximization or "homo economicus" economic perspective.
Anthropology of real humans
As contemporary scholar Samuel Gregg has written, the fundamental error of Marxism lies in anthropology. Fang ** and anthropology are inseparable. By adopting a formula that denies the primacy of subjectivity, Marxist thought fundamentally ignores the dignity of the human being**: according to Maxes, according to Max, the political beliefs of the individual depend on the class to which he belongs. ”
Because ideas are determined by class, we have "a very convenient theory that saves the Marxists the trouble of arguing with them (their opponents)." "Some contemporary arguments on issues of race, nationalism, and gender, for example, show how old Marxist logic can be applied far beyond the realm of traditional class analysis. Some classical liberals who wish to better understand the reality of power relations are seriously working on relatively new theories, such as the theory of intersectionality, that offer an alternative to the appropriated Marquetian premise.
In contrast, Mises elevates the constituent elements of each group – the individual – to a higher status, not by denying the many influencing factors such as racial constructs or nationality, but by understanding them from an individual perspective.
While Mises rejects natural law or any moral basis that attempts to assert that his side is superior to Max, his side still operates within the confines of natural law theory.
In Socialism, Mises seeks only utilitarian arguments for the free market, but his prescription assumes certain facts about the nature of the human being, giving it a normative component of an anthropological nature. Mises's insistence on utilitarianism may be based on a narrow view of natural law as a "religion."
* The natural law of the Christian tradition and the "morality of autonomous reason" identified by Aristotle are different, even if they are complementary in ways that he does not fully recognize.
Praxism demands that kind of autonomous moral reality, whereas utilitarianism cannot provide that kind of fully developed moral system. To some extent, the argument for Socialism contains the substance of a deeper moral justification, a goal that Mises does not set himself in the book.
The Kingdom of Targets
"All economic activity depends on goals" that "dominate the economy, give it meaning," Mises noted. "Socialism seeks to be coordinated through the state bureaucracy in order to replace social relations in conditions of economic freedom.
The free market relies on a freely set ** that provides us with a measure against which we determine human needs and desires. Without profit indicators, moral means to improve one's own and one's family's situation cannot achieve mutual benefit and win-win results with others in a system of free exchange.
Mises's rejection of socialism is not contrary to extreme Randian individualism, but to a just system of social cooperation within society: "Because the Marxists talk so much about the expression of the will of society, without giving the slightest hint of how 'society' can form a will and act." ”
Mises' use of the word "social" about 1,000 times in the book, but the absence of any mention of socialism, suggests that he is concerned with the market as a social system that achieves just economic cooperation and clarifies that it does not simply serve the purpose of profit maximization.
Mises does not ignore the effectiveness of the institutions created by individuals in freely chosen collectives to act through the community, working as a team to achieve common goals – and pragmatology helps us understand them as social and economic activities.
Socialism is nothing
Given the pejorative use of the term "socialism" by some contemporary right-wingers (whom Mises would vehemently oppose) in the current discourse, it is important to understand his definition: "The essence of socialism is that all the means of production are under the exclusive control of the organized community." This is the only one that is socialism. All other definitions are misleading. ”
For Mises, socialism was all-encompassing, and for the proto-Marxists it was an inevitable historical stage.
Contemporary American socialism shows the flaws of Marxism: a classical liberal stance that rejects the market as a social system, and attempts to use the totalitarian state to suppress the individual – despite preaching a commitment to liberal individualism on specific social issues such as race and gender.
The shortcomings in the square are not limited to the left, as evidenced by the slide of nationalism into National Socialism. Mises abhorred racism – a social tendency that could easily be prompted by the socialist assumption that the collective should be in charge of individual destiny.
Contemporary importance
Mises explained, "Socialist policy takes two approaches to achieve its ends; The first method is directly aimed at transforming society into socialism. The second approach is to achieve this transformation only indirectly by disrupting the social order based on private ownership. It is the second form, Mises argues, that is more secretive, cunning and destructive.
Variants of the vicarious control of ownership and primitive notions of class conflict are characteristic of the new socialism. It seeks to acquire wealth through state control, not through state ownership of the means of production. The instruments of control are the numerous regulatory and legislative options held by the monopoly of state power.
In his chapter "A Special Form of Socialism," Mises alludes to some of the phenomena of his time, namely the problem of small property holders. These "peasants and craftsmen" could keep the property they owned and integrate in such a way that "the mechanism of the socialist community that the production and evaluation of their products would be regulated by economic management, while their property would remain nominally theirs." ”
Only a staunch support for the morality of the market can resist this phenomenon, because the appeal of socialist rhetoric lies in its ability to convince society that it can provide greater benefits for all. The loss of this belief would mean the end of socialism. Mises's core moral point is that the common good can only be respected if all individuals are respected, and that socialism inevitably destroys individuals.
Mises is still relevant today, as his approach is not just about calculating the utilitarian effect of the whole in building a just society. His pragmatism offers a way of understanding everyone in our society that goes deeper than the "profit motive." You can read "Socialism" to understand this.