Mises, Ludwig von. Theory and History: An Interpretation of Social and Economic Evolution

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232 EPISTEMOLOGICAL PROBLEMS OF HISTORY

signs.

It is an instrument of thinking and acting. Its vo-

cabulary and grammar are adjusted to the mentality of

the individuals whom it serves. A living language-

spoken, written, and read by living men—changes con-

tinually in conformity with changes occurring in the

minds of those who use it. A language fallen into desue-

tude is dead because it no longer changes. It mirrors

the mentality of people long since passed away. It is

useless to the people of another age no matter whether

these people are biologically the scions of those who

once used it or merely believe themselves to be their

descendants. The trouble is not with the terms signify-

ing tangible things. Such terms could be supplemented

by neologisms. It is the abstract terms that provide in-

soluble problems. The precipitate of a people's ideolog-

ical controversies, of their ideas concerning issues of

pure knowledge and religion, legal institutions, political

organization, and economic activities, these terms re-

flect all the vicissitudes of their history. In learning then-

meaning the rising generation are initiated into the

mental environment in which they have to live and to

work. This meaning of the various words is in continual

flux in response to changes in ideas and conditions.

Those who want to revive a dead language must in

fact create out of its phonetic elements a new language

whose vocabulary and syntax are adjusted to the con-

ditions of the present age, entirely different from those

of the old age. The tongue of their ancestors is of no

use to the modern Irish. The laws of present-day Ire-

land could not be written in the old vocabulary; Shaw,

Joyce, and Yeats could not have employed it in their

HISTORICISM 233

plays,

novels, and poems. One cannot wipe out history

and return to the past.

Different from the attempts to revive dead idioms

are the plans to elevate local dialects to the position

of a language of literature and other manifestations of

thinking and acting. When communication between the

various parts of a nation's territory was infrequent on

account of the paucity of the interlocal division of labor

and the primitiveness of transportation facilities, there

was a tendency toward a disintegration of linguistic

unity. Different dialects developed out of the tongue

spoken by the people who had settled in an area. Some-

times these dialects evolved into a distinct literary lan-

guage, as was the case with the Dutch language. In

other cases only one of the dialects became a literary

language, while the others remained idioms employed

in daily life but not used in the schools, the courts, in

books, and in the conversation of educated people. Such

was the outcome in Germany, for instance, where the

writings of Luther and the Protestant theologians gave

the idiom of the "Saxon Chancellery" a preponderant

position and reduced all other dialects to subordinate

rank.

Under the impact of historicism movements sprang

up which aim at undoing this process by elevating dia-

lects into literary languages. The most remarkable of

these tendencies is Felibrige, the design to restore to

the Provencal tongue the eminence it once enjoyed as

Langue d'Oc. The Felibrists, led by the distinguished

poet Mistral, were judicious enough not to plan a com-

plete substitution of their idiom for French. But even

234 EPISTEMOLOGICAL PROBLEMS OF HISTORY

the prospects of their more moderate ambition, to cre-

ate a new Provencal poesy, seem to be inauspicious.

One cannot imagine any of the modern French master-

pieces composed in Provencal.

Local dialects of various languages have been em-

ployed in novels and plays depicting the life of the un-

educated. There is often an inherent insincerity in such

writings. The author condescendingly puts himself on

a level with people whose mentality he never shared

or has since outgrown. He behaves like an adult who

condescends to write books for children. No present-

day work of literature can withdraw itself from the im-

pact of the ideologies of our age. Once having gone

through the schools of these ideologies, an author can-

not successfully masquerade as a simple common man

and adopt his speech and his world view.

History is an irreversible process.

7. Undoing Economic History

The history of mankind is the record of a progressive

intensification of the division of labor. Animals live in

perfect autarky of each individual or of each quasi

family. What made cooperation between men possible

is the fact that work performed under the division of

tasks is more productive than the isolated efforts of au-

tarkic individuals and that man's reason is capable of

conceiving this truth. But for these two facts men would

have remained forever solitary food-seekers, forced by

an inevitable law of nature to fight one another without

pity and pardon. No social bonds, no feelings of sym-

HISTORICISM 235

pathy, benevolence, and friendship, no civilization

would have developed in a world in which everybody

had to see in all other men rivals in the biological com-

petition for a strictly limited supply of food.

One of the greatest achievements of eighteenth-cen-

tury social philosophy is the disclosure of the role

which the principle of higher productivity resulting

from division of labor has played in history. It was

against these teachings of Smith and Ricardo that the

most passionate attacks of historicism were directed.

The operation of the principle of division of labor

and its corollary, cooperation, tends ultimately toward

a world-embracing system of production. Insofar as the

geographical distribution of natural resources does not

limit the tendencies toward specialization and integra-

tion in the processing trades, the unhampered market

aims at the evolution of plants operating in a compara-

tively narrow field of specialized production but serv-

ing the whole population of the earth. From the point

of view of people who prefer more and better merchan-

dise to a smaller and poorer supply the ideal system

would consist in the highest possible concentration of

the production of each speciality. The same principle

that brought about the emergence of such specialists as

blacksmiths, carpenters, tailors, bakers and also physi-

cians,

teachers, artists and writers would finally result

in the emergence of one factory supplying the whole

oecumene with some particular article. Although the

geographical factor mentioned above counteracts the

full operation of this tendency, international division of

labor came into existence and will move forward until

236 EPISTEMOLOGICAL PROBLEMS OF HISTORY

it reaches the limits drawn by geography, geology, and

climate.

Every step on the road toward intensification of the

division of labor hurts in the short run the personal in-

terests of some people. The expansion of the more effi-

cient plant hurts the interests of less efficient competitors

whom it forces to go out of business. Technological in-

novation hurts the interests of workers who can no

longer make a living by clinging to the discarded in-

ferior methods. The vested short-run interests of small

business and of inefficient workers are adversely affected

by any improvement. This is not a new phenomenon.

Neither is it a new phenomenon that those prejudiced

by economic improvement ask for privileges that will

protect them against the competition of the more effi-

cient. The history of mankind is a long record of obsta-

cles placed in the way of the more efficient for the ben-

efit of the less efficient.

It is customary to explain the obstinate efforts to stop

economic improvement by referring to the "interests."

The explanation is very unsatisfactory. Leaving aside

the fact that an innovation hurts merely the short-run

interests of some people, we must emphasize that it

hurts only the interests of a small minority while favor-

ing those of the immense majority. The bread factory

certainly hurts the small bakers. But it hurts them solely

because it improves the conditions of all people con-

suming bread. The importation of foreign sugar and

watches hurts the interests of a small minority of Amer-

icans.

But it is a boon for all those who want to eat

sugar and to buy watches. The problem is precisely

HISTORICISM 237

this:

Why is an innovation unpopular although it favors

the interests of the great majority of the people?

A privilege accorded to a special branch of business

is in the short run advantageous to those who at the

instant happen to be in this branch. But it hurts all

other people to the same extent. If everybody is priv-

ileged to the same degree, he loses as much in his ca-

pacity as a consumer as he wins in his capacity as a

producer. Moreover, everybody is hurt by the fact that

productivity in all branches of domestic production

drops on account of these privileges.

To the extent that

American legislation is successful in its endeavors to

curb big business, all are hurt because the products are

produced at higher costs in plants which would have

been wiped out in the absence of this policy. If the

United States had gone as far as Austria did in its fight

against big business, the average American would not

be much better off than the average Austrian.

It is not the interests that motivate the struggle

against the further intensification of the division of la-

bor, but spurious ideas about alleged interests. As in

any other regard, historicism in dealing with these prob-

lems too sees only the short-run disadvantages that re-

sult for some people and ignores the long-run advan-

tages for all of the people. It recommends measures

without mentioning the price that must be paid for

them. What fun shoemaking was in the days of Hans

Sachs and the Meistersinger! No need to analyze criti-

cally such romantic dreams. But how many people went

barefoot in those days? What a disgrace the big chemi-

See above, pp. 32 f.

238 EPISTEMOLOGICAL PROBLEMS OF HISTORY

cal concerns are! But would it have been possible for

pharmacists in their primitive laboratories to turn out

the drugs that kill the bacilli?

Those who want to set the clock of history back

ought to tell people what their policy would cost. Split-

ting up big business is all right if you are prepared to

put up with the consequences. If the present American

methods of taxing incomes and estates had been adopted

fifty years ago, most of those new things which no

American would like to do without today would not

have been developed at all or, if they had, would have

been inaccessible to the greater part of the nation. What

such authors as Professors Sombart and Tawney say

about the blissful conditions of the Middle Ages is mere

fantasy. The effort "to achieve a continuous and unlim-

ited increase in material wealth," says Professor Taw-

ney, brings "ruin to the soul and confusion to society/'

No need to stress the fact that some people may feel

that a soul so sensitive it is ruined by the awareness

that more infants survive the first year of their lives and

fewer people die from starvation today than in the

Middle Ages is worth being ruined. What brings con-

fusion to society is not wealth but the efforts of histori-

cists such as Professor Tawney to discredit "economic

appetites/* After all it was nature, not the capitalists,

that implanted appetites in man and impels him to sat-

isfy them. In the collectivist institutions of the Middle

Ages,

such as church, township, village community, clan,

family, and guild, says Sombart, the individual "was kept

R. H. Tawney, Religion and the Rise of Capitalism (New York,

Penguin Books, n.d.), pp. 38 and 234.

HISTORICISM 239

warm and sheltered like the fruit in its rind."

Is this

a faithful description of a time when the population

was harassed again and again by famines, plagues, wars,

the persecution of heretics, and other disasters?

It is certainly possible to stop the further progress of

capitalism or even to return to conditions in which small

business and more primitive methods of production pre-

vail. A police apparatus organized after the pattern of

the Soviet constabulary can achieve many things. The

question is only whether the nations that have built

modern civilization will be ready to pay the price.

W. Sombart, Der proletarische Sozialismus (10th ed. Jena,

1924),

1, 31.

Chapter 11. The Challenge of Scientism

Positivism and Behaviorism

WHAT differentiates the realm of the natural sciences

from that of the sciences of human action is the cate-

gorial system resorted to in each in interpreting phe-

nomena and constructing theories. The natural sciences

do not know anything about final causes; inquiry and

theorizing are entirely guided by the category of

causality. The field of the sciences of human action is

the orbit of purpose and of conscious aiming at ends;

it is teleological.

Both categories were resorted to by primitive man

and are resorted to today by everybody in daily think-

ing and acting. The most simple skills and techniques

imply knowledge gathered by rudimentary research

into causality. Where people did not know how to seek

the relation of cause and effect, they looked for a tele-

ological interpretation. They invented deities and devils

to whose purposeful action certain phenomena were

ascribed. A god emitted lightning and thunder. An-

other god, angry about some acts of men, killed the

offenders by shooting arrows. A witch's evil eye made

women barren and cows dry. Such beliefs generated

definite methods of action. Conduct pleasing to the

deity, offering of sacrifices and prayer were considered

suitable means to appease the deity's anger and to

240

THE CHALLENGE OF SCIENTISM 241

avert its revenge; magic rites were employed to neu-

tralize witchcraft. Slowly people came to learn that

meteorological events, disease, and the spread of

plagues are natural phenomena and that lightning rods

and antiseptic agents provide effective protection while

magic rites are useless. It was only in the modern era

that the natural sciences in all their fields substituted

causal research for finalism.

The marvelous achievements of the experimental nat-

ural sciences prompted the emergence of a materialistic

metaphysical doctrine, positivism. Positivism flatly de-

nies that any field of inquiry is open for teleological

research. The experimental methods of the natural sci-

ences are the only appropriate methods for any kind of

investigation. They alone are scientific, while the tra-

ditional methods of the sciences of human action are

metaphysical, that is, in the terminology of positivism,

superstitious and spurious. Positivism teaches that the

task of science is exclusively the description and in-

terpretation of sensory experience. It rejects the intro-

spection of psychology as well as all historical disci-

plines. It is especially fanatical in its condemnation of

economics. Auguste Comte, by no means the founder

of positivism but merely the inventor of its name, sug-

gested as a substitute for the traditional methods of

dealing with human action a new branch of science,

sociology. Sociology should be social physics, shaped

according to the epistemological pattern of Newtonian

mechanics. The plan was so shallow and impractical

that no serious attempt was ever made to realize it. The

first generation of Comte's followers turned instead