One of the most important books of the 20th century, not yet as influential as it deserves to be.
I was brought to this book in 2009 after a growing feeling of dissatisfaction with “expert” explanations being offered for the various financial and economic calamities that seemed to be happening worldwide. Economic commentary by journalists and pundits struck me as being opaque, partisan, and contradictory. Gradually I had become interested in the ideas of the so-called Austrian school of free-market economics, and eventually I decided to take the plunge and read its principal text, Human Action.
I was bowled over. In the first place, the title, Human Action, intrigued me. As a category this seemed to extend far beyond the bounds of what I thought of as economics, and indeed I was right. Von Mises founds his argument on a little-known 19th-century discipline called praxeology, or the science of human behavior. While psychology is the study of human thoughts and feelings, praxeology is the study of human actions. To be alive is to be continually in action, doing things. Why do we do what we do? What guides our actions? What motivates us?
At the bottom of all our actions lies a specific feeling: a “felt unease” that prompts us to seek its lessening, its amelioration. It was easy for me to assent to this idea, since it accords well with my Buddhist training. Indeed, “human action” is a passable translation of the Sanskrit term karma, which according to Buddhists is the mechanism of action and reaction in which we all engage due to duhkha, usually translated as “suffering”, although “felt unease” is probably a better translation. It is usually subtle and underlying rather than something that is consciously felt, and I think von Mises put his finger on this quality of experience, and it was a mark of his genius to do so and to build his analysis from it.
Part 1 of the book, the first 140 or so pages, deals only with the theory of human action and the categories intimately associated with it, such as time and uncertainty. Our lives are short, and therefore time presses and we have to choose some things and forgo others; the future is uncertain, so we have to use our experience and our smarts, whatever those might be, to make the best choices we can. Each one of us is in this situation, even as we are also unique individuals in unique circumstances. This uniqueness of constitution and circumstance means that we value things differently: differently from each other, and differently ourselves from day to day or moment to moment. Nothing whatsoever has any intrinsic, fixed value: all is subjective and situational.
Building out from these ideas, von Mises goes on to explain, logically and systematically, how the free actions of subjective individuals necessarily develop into the phenomena we call markets, and how, if allowed to follow their own course, material and social benefits necessarily flow from them.
I don’t doubt that some people regard von Mises as dogmatic, and he does write in a forceful, declarative style, but it is not dogma any more than Euclid’s Elements is dogma–and for the same reason. For von Mises insists that the fields of praxeology and catallactics–its extension into the realm of production and consumption–are purely logical: their laws, based on irreducible constants of experience such as time and uncertainty, are inexorable and not falsifiable by experiment. Praxeology and catallactics are built up by theorems, exactly like geometry.
Again and again while reading this book I found myself confronted with new, provocative ideas. In this respect von Mises has few peers. In my own reading I can think of only maybe Northrop Frye or Eric Hoffer or Erich Neumann as offering such a density of surprising ideas per page.
Is von Mises a capitalist? Absolutely. Capitalism, in its pure state, is the condition of free individuals engaging with each other without coercion. Von Mises deplores violence, and for him socialism is intrinsically violent and should be shunned because it leads inexorably to poverty and slavery–things that no human being seeks. At the same time, he’s well aware that there is plenty of coercion and fraud in supposedly capitalist societies, and to the extent that this is the case, those societies are materially poorer and less free than they might be.
I do not feel competent to argue with anything that von Mises is saying, since the depth and range of his thought in these areas is so vastly greater than my own. But I did have a couple of questions or proto-critiques. One was in von Mises’ assertion that military conscription is a justifiable intrusion on the liberty of individuals. Since this to me is a form of slavery, I find it hard to square with his dedication to individual liberty. Another issue was in his assertion that all values are subjective; he takes it as an axiom that no absolute value can be found. My intuition is that this point of view is one that ignores the spiritual dimension of human life. In Buddhism, for example, duhkha or “felt unease” is not the last word; in a sense it’s only the first word. For like von Mises, the Buddha started there–but he took that notion in a much different, and a much deeper, direction. The Buddha taught liberation from that unease; von Mises is only teaching us how to get along with it.
But in all, my considered opinion is that Human Action is one of the greatest works of literature of all time. And as such it is, I believe, worthy of your time and attention.