Review of Austrian Economics, Volume 6 by Murray N. Rothbard

Author:Murray N. Rothbard
Language: eng
Format: mobi
ISBN: 9781610165426
Publisher: Ludwig von Mises Institute
Published: 1992-05-09T05:00:00+00:00

Mises and Maximization

We can now address the question of whether Mises was a utilitarian in the maximizing, comparative sense or whether he was a categorical harmonist. In this section I argue that the evidence clearly indicates that he was not a maximizer, and in the next section I take up the question of whether he can more properly be classified as a categorical harmonist.

Now it may seem that when Mises says that laissez-faire liberalism promises “the most abundant possible satisfaction of all those desires that can be satisfied by the things of the outer world” (1927, p. 4), he does not leave much doubt that he is a moral utilitarian of the maximizing variety. But as was pointed out in the first section, when the issue is an agreed-upon policy goal, e.g., prosperity, then Mises can as a value-free economist recommend certain liberal policies as the best means for accomplishing this goal. In any case, one should not read too much into such statements. After all, natural rights liberals also believe that laissez faire will lead to a better world. More relevant are statements such as “the only yardstick that must be applied to [law and legality, the moral code and social institutions] is that of expediency with regard to human welfare” (1966, p. 147). Here Mises leaves no doubt that he is advocating a moral doctrine, not functionalism in general, and this moral doctrine seems to imply the maximization of social welfare. But compare this passage to a very similar passage: “The ultimate yardstick of justice is conduciveness to the preservation of social cooperation. Conduct suited to preserve social cooperation is just, conduct detrimental to the preservation of society is unjust” (1957, p. 54). No categorical harmonist would have problems with this passage. Furthermore, in the former passage the very next sentence reads, “The utilitarian economist does not say: Fiat justia, pereat mundus. He says: Fiat justia, ne pereat mundus.” This is one of Mises’s favorite points: the utilitarian rejects “Let justice be done, though the world perish” for “Let justice be done, lest the world perish.” The contrast is between destroying and preserving the social order, not between maximizing and failing to maximize utility. Or consider the following passage, “The policy of liberalism is the policy of the common good, the policy of subjecting particular interests to the public welfare” (1922, p. 456). Taken out of context, this is the kind of statement that one would typically attribute to a social harmonist concerned with maximizing utility. Mises immediately adds, however, that this is “a process that demands from the individual not so much a renunciation of his own interests as a perception of the harmony of all individual interests” (1922, p. 456). What Mises clearly means is that in order for social harmony to be possible, individuals cannot completely ignore other individuals. This is fully consistent with the categorical harmonist’s argument for rights.8

It becomes even more difficult to attribute a maximizing interpretation to these passages in the light

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