"Purposiveness" and Austrian economics

Rob Schaap rws at comedu.canberra.edu.au
Mon Mar 5 08:05:47 PST 2001


Absolutely wonderful post, Ted!

Weber wrote of medieval monasticism: "In that epoch, the monk is the first human being who lives rationally, who works methodically and by rational means toward a goal, namely, the future life." (*General Economic History* Collier:NY 1966: 267) - taking into account Keynes's observation about the long run, we are obliged to arrive at the conclusion that von Mises's Mont Pelerin mob can only be considered rational if it can rationally be established that there is (a) an eternal afterlife that (b) is conditioned by one's self- and life-denying actions on this mortal coil.

The economist is truly the new priest, eh?

Cheers, Rob.


>The psychopathological "purposiveness" described by Keynes seems to be taken
>in Austrian economics as the essence of human "action".
>
>In the online material recently pointed to by Daniel Davies, Mises
>identifies human "action" solely with instrumental action i.e. with action
>whose end lies outside itself.
>
>What Keynes and Marx describe as the truly human realm, the realm of
>freedom, lies, according to Mises, entirely outside the "science of action"
>which "is concerned only with acting men" and "can say nothing about
>plant-like beings living with no thought of tomorrow, whom we can scarcely
>consider as human."
>
>"The most general prerequisite of action is a state of dissatisfaction, on
>the one hand, and, on the other, the possibility of removing or alleviating
>it by taking action. (Perfect satisfaction and its concomitant, the absence
>of any stimulus to change and action, belong properly to the concept of a
>perfect being. This, however, is beyond the power of the human mind to
>conceive. A perfect being would not act.) Only this most general condition
>is necessarily implied in the concept of action."
><http://www.mises.org/epofe/c1p2sec1.asp>
>
>"We can imagine beings similar to men who would want to extinguish their
>humanity and, by putting an end to all thought and action, to attain to the
>unthinking, passive, vegetative existence of plants. It is doubtful whether
>there are or have ever been such men. Even St. Aegidius, the most radical
>advocate of asceticism, was not altogether consistent in his zeal for
>austerity when he recommended the birds and the fish as a model for man. To
>be entirely consistent, together with the Sermon on the Mount, he would have
>had to extol the lilies of the field as the embodiments of the ideal of
>complete abandonment of all concern for the improvement of one's lot.
> "We have nothing to say to men of this kind, consistent ascetics who by
>their self denying passivity give themselves up to death, just as they would
>have nothing to say to us. If one wishes to call their doctrine a world
>view, then one must not forget to add that it is not a human world view,
>since it must lead to the extinction of mankind. Our science sees men only
>as acting men, not as plants having the appearance of men. Acting man aims
>at ends, i.e., he wants to overcome dissatisfaction as far as possible. Our
>science shows that aiming at ends is necessary to existence and that human
>ends, whatever they may be, are better attained by the social cooperation of
>the division of labor than in isolation. (It is worthy of note that no
>historical experience has been found in conflict with this proposition.)
>Once one has appreciated this fact, one realizes that no standard of value
>of any kind is contained in the system of economic or sociological theory or
>in the teachings of liberalism, which constitute the practical application
>of this theory to action in society. All objections to the effect that
>economics, sociology, and liberalism are predicated on a definite world view
>prove untenable once it is recognized that the science of action is
>concerned only with acting men and that it can say nothing about plant-like
>beings living with no thought of tomorrow, whom we can scarcely consider as
>human." <http://www.mises.org/epofe/c1p3sec2.asp>
>
>Keynes makes very different use of the idea of "the lilies of the field":
>
>"I see us free, therefore, to return [at some point in the distant future]
>to some of the most sure and certain principles of religion and traditional
>virtue - that avarice is a vice, that the exaction of usury is a
>misdemeanour, and the love of money is detestable, that those walk most
>truly in the paths of virtue and sane wisdom who take least thought for the
>morrow. We shall once more value ends above means and prefer the good to
>the useful. We shall honour those who can teach us how to pluck the hour
>and day virtuously and well, the delightful people who are capable to taking
>direct enjoyment in things, the lilies of the field who toil not, neither do
>they spin." (vol. IX, pp. 330-1)
>
>Marx also identifies truly human activity with activity which is an end in
>itself i.e. with "art" in Kant's sense of "production through freedom".
>Such action is not, as Mises seems to suggest it must be, thoughtless. It
>is production "through a will that places reason at the basis of its
>actions." (Kant, Critique of Judgement, p. 145)
>
>"man produces even when he is free from physical need and truly produces
>only in freedom from such need" (Economic and Philosophic Manuscripts)
>
>"The realm of freedom really begins only where labour determined by
>necessity and external expediency ends; it lies by its very nature beyond
>the sphere of material production proper." (Capital, vol. 3)
>
>"In a higher phase of communist society ... labour has become not only a
>means of life but life's prime want" (Critique of the Gotha Programme)
>
>Austrian economics also seems to misidentify "individualism" with atomism
>and "reason" with deduction.
>
>Keynes has the latter misidentification in mind when he says of Hayek's
>Prices and Production that
>
>"The book, as it stands, seems to me to be one of the most frightful muddles
>I have ever read, with scarcely a sound proposition in it beginning with
>page 45, and yet it remains a book of some interest which is likely to leave
>its mark on the mind of the reader. It is an extraordinary example of how,
>starting with a mistake, a remorseless logician can end up in Bedlam."
>(vol. XII, p. 252)
>
>In the General Theory, "foolish consistency" of the same kind is attributed
>to another "Austrian", Lionel Robbins. (vol. VII, p. 20, note 2)
>
>Ted
>--
>Ted Winslow E-MAIL: WINSLOW at YORKU.CA
>Division of Social Science VOICE: (416) 736-5054
>York University FAX: (416) 736-5615
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