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Source link: http://archive.mises.org/9840/the-principle-of-methodological-individualism/

The Principle of Methodological Individualism

April 24, 2009 by

Nobody ventures to deny that nations, states, municipalities, parties, religious communities, are real factors determining the course of human events. Methodological individualism, far from contesting the significance of such collective wholes, considers it as one of its main tasks to describe and to analyze their becoming and their disappearing, their changing structures, and their operation. And it chooses the only method fitted to solve this problem satisfactorily. FULL ARTICLE


Barry Loberfeld April 24, 2009 at 8:22 am

From “An Inquiry Concerning ‘Social Justice’ and Its Influence”:

Hayek emphasized another conflict between the two conceptions of justice, one we can begin examining simply by asking who the subject of liberal justice is. The answer: a person — a flesh-and-blood person, who is held accountable for only those actions that constitute specifically defined crimes of violence (robbery, rape, murder) against other citizens. Conversely, who is the subject of “social justice” — society? Indeed yes, but is society really a “who”? When we speak of “social psychology” (the standard example), no one believes that there is a “social psyche” whose thoughts can be analyzed. And yet the very notion of “social justice” presupposes a volitional Society whose actions can (and must) be held accountable. This jarring bit of Platonism traces all the way back to Marx himself, who, “despite all his anti-Idealistic and anti-Hegelian rhetoric, is really an Idealist and Hegelian … asserting, at root, that [Society] precedes and determines the characteristics of those who are [its] members” (R.A. Childs, Jr.). Behold leftism’s alternative to liberalism’s “atomistic individualism”: reifying collectivism, what Hayek called “anthropomorphism or personification.”

Too obviously, it is not liberalism that atomizes an entity (a concrete), but “social justice” that reifies an aggregate (an abstraction). And exactly what injustice is Society responsible for? Of course: the economic inequality between Smith and Jones — and Johnson and Brown and all others. But there is no personified Society who planned and perpetrated this alleged inequity, only a society of persons acting upon the many choices made by their individual minds. Eventually, though, everyone recognizes that this Ideal of Society doesn’t exist in the real world — leaving two options. One is to cease holding society accountable as a legal entity, a moral agent. The other is to conclude that the only practicable way to hold society accountable for “its” actions is to police the every action of every individual.

Lee Kelly April 24, 2009 at 8:40 am

I still do not understand why everyone here loves Mises so much.

Jeffrey Tucker April 24, 2009 at 8:55 am

I’ve read plenty of odd comments here but the one above surely takes the cake.

Jason Gordon April 24, 2009 at 9:39 am

Lee Kelly, it is because we are individuals.

FarSide April 24, 2009 at 9:46 am

I am assuming that was an ironic comment.

I’m not certain it is, but the amount of cognitive dissonance the alternative causes me is making my eyes cross in a painful way.

Keith April 24, 2009 at 10:10 am


My eyes are already half-way there.

Jason Gordon April 24, 2009 at 10:21 am

I didn’t mean to speak for lovers of Mises who are not individuals.

My apology to the collective.

Dennis April 24, 2009 at 11:04 am

“I still do not understand why everyone here loves Mises so much.”

In my case, Mises arguably did more than any other individual in the 20th century to rationally and correctly advance economic science, which is an important foundation of civilization. In addition, he possessed great integrity and courage, and should be an exemplar to us all.

Mario Abbagliati April 24, 2009 at 11:22 am


I’m sure that all the spanish speaking readers of mises.org would benefit from an online spanish version of Human Action. Furthermore, why not consider a mises.org website in spanish? Free market ideas are very much needed in Spain and Latin America.


entrepreneurshipeconomist April 24, 2009 at 12:23 pm

F.A. Hayek warned us about Carl Schramm’s Tyranny: Mises Warned us of Carl Shramm’s Post Office
April 24, 2009 by entrepreneurshipeconomist


“[Socialists] promise the blessings of the Garden of Eden, but they plan to transform the world into a gigantic post office.”” –Ludwig Von Mises predicting what the Kauffman Foundation has become after seven years of tryannical, corporate-CEO, personal-profiteering Schrammenomics

“Those fighting for free enterprise and free competition do not defend the interests of those rich today. They want a free hand left to unknown men who will be the entrepreneurs of tomorrow…” –Ludwig Von Mises talking about why Schramm goes to the $ 3,995.00/head Milken Institute to speak to his fellow corporate-statists on Kauffman’s dime, instead of funding innovators, entrepreneurs, and entrepreneurship, who are losing their homes and businesses as Schramm funnels himself and his growthology buzzword-bloggers millions from the Kauffman endowment (which was meant to go to entreprnuers, true academics who are not afraid to quote Hayek and Mises, and innovators), while pretending to serve the innovators and entrepreneurs Schramm opposes in his characterless actions and by saying one thing while doing another.

I sit on a man’s back, choking him, and making him carry me, and yet assure myself and others that I am very sorry for him and wish to ease his lot by any means possible, except getting off his back. –Tolstoy Writings on Civil Disobedience and Nonviolence (1886)

F.A. Hayek/Mises warned us about Carl Schramm’s Temporal Tyranny

The most important elements in entrepreneurship are character and integrity. The most important elements for Statists/Schrammeconomist are the lack of character and integrity and the ability to use words to mislead and deceive while laying claim to a dead entrepreneur’s estate. While Hayek and Mises used words for truth, Schramm uses words for mere personal profit, and then when his lackluster, anti-intellectual, unscholarly works fall short, he has to try and put all better economists out of business by leveraging his $2.5 billion warchest. Imagine if Hayek and Mises had used a $2.5 billion warchest to put their competitors out of business. They would never do this. For they had character and integrity, which Schramm the self-serving tyrant/Statist completely lacks.

“Reason is the main resource of man in his struggle for survival.” –Mises. Again we see why Schramm never quotes Mises, as Reason is the groupthink statists enemy.

“Whenever lesser men and groupthink, central-planning intellects begin with the idea that they are the best and the brightest, they will advance that notion by any means necessary. All superior competitors will be put out of business by the central planners, and as the groupthinkers congregate to discuss entrepreneurship, they wil inevitably criminalize the individual, innovator, and entrepreneur and seek to persecute and bankrupt him while promoting their own soulless, spirtualless works. They will go so far as to ignore entire bodies of work and Nobel Laureates, replaicing the Greats with a sycophantic corproate groupthink structre which enriches the insiders while preaching the virtues of entrepreneurship, even as the groupthink corporation/buzzword blogfest kills it. They take great pride in their failure to define terms, as their generic “growthology” buzzwords come to mean but one thing–the flow of capital into their own personal pockets.”

Whenever those with a fundamentally socialist, central-planning, bureaucratic mindset approach entrepreneurship, they generally end up creating a groupthink tyranny which kills the spirit of entrepreneurship, while simultaneouly profiting off the fruits of entrepreneurship and free markets, even as such exalted entities wither and die under the Schrammeconomists’ reign of corporate terror, whence a Foundation’s resources are leveraged to put competitors out of business so that the Schrammeconomist’s inferior work might prevail in the dumbed-down market, thusly exlating Schramm as teh eocnomy and academia decline. The study and teaching of entrepreneurship requires a great character and intellect, and an even greater humility. Over the past seven years Carl Schramm has demonstrated that he lacks character, intellect, and humility; and the economy and academy have suffered immensely under is reign.

1) Carl Schramm lacks character: Schramm has beocme famous for syaing one thing while doing another and making promises he never keeps. This has been pointed out elsewhere on the internet, and it is also manifested in that he runs the Kauffman Foundation like a tyrant, pocketing millions of dollars for his inspidid treatises on Capitalism which compeletly ignore the towering giants of the field including Ludwig Von Mises and F.A. Hayek. Not referencing the Greats who have walked before you is a serious sign of unscholarly egomania, ineptitude, and a withered character. Rather than funding true economists and entrepreurs, Schramm actually uses the Kauffman foundation’s funds to oppose them while campaigning for the Nobel in economics, wiring hundreds of millions to Statists and intellectually-indifferent University administrators. Schramm runs the Kauffman Foundation not as a charitable foundation, but as a corrupt corporation which enriches Schramm in a massive manner with millions, while also allowing him to try and put his competitors out of business, funding groupthink growthology bloggers to dumb down the internet. Should a foundation be run by those with lackluster, unscholarly books to promote and a track record for academic irresponsibility? Will they not by and by use the foundation’s resources to try and put their superior competitors out of business in cloaked, obfuscating, unmanly manners, all the while preaching fair markets and free markets? Because Schramm lacks character, integrity, and intellect, he profits not by serving entrepreneurship’s ideals, but by saying one thing while doing another and hiring Dane Stangler to backdate research trying to claim that Schramm was the first to discover/rediscover Austrian economics. Actually the Austrian economists discovered Austrian economics. And Schramm destests them because they call his failed Statist bluff with every word.


Posted by John Bunch, Ph.D., May 03, 2007 8:50AM

It is interesting that Dealbreaker references Carl Shram of the Kauffman Foundation as an authority on ethics. Those of us who live in the Kansas City region know that Carl Schram and been a controversial figure since he was appointed to his post a number of years ago. Board members have resigned in protest of his leadership style and strategic choices. His controversial leadership led to the Missouri Attorney General reviewing the Kauffman Foundation for not staying true to the intent of Ewing Kauffman. The purpose of this review was stated as:

“In light of the public allegations of a departure from Mr. Kauffman’s intent, lack of appropriate oversight by the Board of Directors, and certain instances of conflicts of interest. ” (http://www.ago.mo.gov/newsreleases/2004/kauffmanreport030404.htm#conclusion)

See also this editorial from the Kansas City Business Journal (http://www.bizjournals.com/kansascity/stories/2003/09/15/editorial1.html)

Ewing Kauffman was famous as an ethical leader. Carl Schramm is not.

2. Carl Schramm lacks Intellect: Suppose you were to write a treatise on philosophy and leave out Aristotle, Plato, and Socrates. Suppose you were to write a treatise on physics and leave out Einstein and Newton. Schramm wrote a treatise on kapitalism and he left out Nobel Laureate F.A. Hayek and his teacher Ludwig Von Mises.


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Now Schramm has hired Dane Stangler to backdate Kauffman research to show that really Schramm was thinking about the Austrians all along; and again this ties into Schramm’s complete lack of character and corrupt nature.

3) Carl Schramm Lacks Humility: When one has no achievements other than commandeering a foundation for one’s own personal profit and intellectually-indifferent, vapid, Statist vanity press, one has nothing to be humble about. If Schramm had any humility he would apoligize for what he and his Statist, doublespeaking philosophies have done to academia and the economy, and he would step down.

Hayek reminds us that economics is about values, ethics, and character–not about doublespeaking Schrammenomics:

“I have arrived at the conviction that the neglect by economists to discuss seriously what is really the crucial problem of our time is due to a certain timidity about soiling their hands by going from purely scientific questions into value questions. This is a belief deliberately maintained by the other side because if they admitted that the issue is not a scientific question, they would have to admit that their science is antiquated and that, in academic circles, it occupies the position of astrology and not one that has any justification for serious consideration in scientific discussion. It seems to me that socialists today can preserve their position in academic economics merely by the pretense that the differences are entirely moral questions about which science cannot decide.
Conversation at the American Enterprise Institute for Public Policy Research, Washington, D.C. (9 February 1978); published in A Conversation with Friedrich A. Von Hayek: Science and Socialism (1979) –Hayek

“If man is not to do more harm than good in his efforts to improve the social order, he will have to learn that in this, as in all other fields where essential complexity of an organized kind prevails, he cannot acquire the full knowledge which would make mastery of the events possible. He will therefore have to use what knowledge he can achieve, not to shape the results as the craftsman shapes his handiwork, but rather to cultivate a growth by providing the appropriate environment, in the manner in which the gardener does this for his plants.” Schramm has done more harm than good by placing his campaign for the Nobel Economics and hiring/funding growthology groupthink bloggers, over supporting entrepreneurs, innovators, and entrepreneurship. After seven years of Schrammenomics, look at the economy where millions ar elosing their jobs an dhomes. Look at the academy and the skyrocketing tuitions at the Kauffman campuses which place studnets in massive, unprecedented debt, with Kauffman campuses such as Oberlin and Keynon oft leading the way.


How many more years of Schramenomics will the Kauffman board allow? When Schramm steps down, a thousand flowers will bloom, and the greats such as Ludwig Von Mises and F.A. Hayek will be given theior rightful place in the academy, as opposed to Schramm’s MBA/lawyer groupthink thugs who Schramm handpicked to serve the Schrammenomics tyranny over truth and reason.

Lee Kelly April 24, 2009 at 12:34 pm

Mises was a good economist, but whenever I read his work, I come away disappointed. Perhaps I am just not concerned with the problems which he addresses. The above excerpt, for example, strikes me as verbose, uninteresting, and, in the end, not particularly insightful. I find myself thinking, “well, duh!”

I do not think I would have many disagreements with Mises with regard to economics, at least. And maybe that is the problem: I never feel as though I am learning anything when I read Mises.

Lee Kelly April 24, 2009 at 12:47 pm

In other words, had I read Mises when I first started learning about economics, I’d probably think he was wonderful. But I didn’t, and, instead, came to many of the same views by other means. Reading Mises now feels underwhelming: people say that he was great, but he seems quite ordinary to me.

John Galt April 24, 2009 at 1:03 pm

Great blog!

You should check this one out too: http://riseofreason.com

S Andrews April 24, 2009 at 1:23 pm

Lee Kelly,

First of all the website is hosted by the Mises Institute, and the “About” section of this website states the following among other things:

You have found the world center of the Austrian School of economics and libertarian political and social theory. Founded in 1982, the Mises Institute serves as the world’s leading provider of educational materials, conferences, media, and literature in support of the tradition of thought represented by Ludwig von Mises and the school of thought he enlivened and carried forward during the 20th century, which has now blossomed into a massive international movement of students, professors, professionals, and people in all walks of life.

So, obviously, it should come as no surprise that this website emphasizes the works of Mises. The hosts of this blog has been extremely open to comments from everyone, including those who hold radically oppose the views of Mises and his works; I couldn’t say the same about some of the other commenters here – though vast majority of them are cordial and open to discussion.

If you go to the sidebar of this blog, you will see a lot of blogs listed as links, and now if you click on those links and go to those websites/blogs, you will notice that they have not reciprocated in kind. None of those blog hosts could deny that Mises Institute publishes large volumes of the works of many scholars past and present. Those blogs could have plenty of reasons for not linking mises.org, but one couldn’t blame Mises Institute for being insecure about other schools of thought.

Now, I have also felt that there is an overwhelming number of Rothbardians amongst the contributors at LvMI. However, you will notice that Mises institute publishes large number of the works of Hayek among other scholars.

I am not turned off by the contributors love and respect for Mises, that’s what you would expect from an Institute named after Mises. However, I don’t see any worship or adoration.

Mises institute has also revived many fiction/non-fiction works from earlier part of 20th century, written by lovers of liberty, who may or may not have identified themselves as “Misesian” or even “Austrian” in their economic philosophy. A recent book on Mencken is a prime example of this.

Giyanto April 24, 2009 at 1:37 pm

@ Lee Kelly
Mises is phylosopher, just’n economist. Who can’t understanding about hi’s work, may be not understand with a phylophy problem….

greg April 24, 2009 at 1:54 pm

You can break down the study of economics down to the individual. While interesting, I really has no use for me.

Try watching the trades of a specific stock in real time on E-trade. You see all the individual trades flash across your screen. The question is not what people are paying now, but it is what are people going to be paying two minutes from now. There you need to understand the collective actions of individuals and how their collective actions influence the price.

You can maintain it is the individual actions that set the price and you can tell me why the stock moved in a particular direction. But that analysis is of no good to me, I need someone that can predict the futrue movement. There you need to understand the psychology of the collective to place your investment.

Jason Gordon April 24, 2009 at 2:38 pm

“need to understand the psychology of the collective” LOL!

greg, what use do you have for theory when all you want is a crystal ball?

The economics of liberty are a bit wider than merely helping day traders “read the market.”

Sorry, there are no Austrian quants to lean on.

Maybe this can help:

greg April 24, 2009 at 3:31 pm


What good is an economist that can’t give a prediction? If you can’t do that, then you should be a historian.

And the last person I would get investment advice from is an Austrian because they are very bias, one sided and love to lecture you on the virtue of the gold standard. A good example is Peter Schiff, he takes one side of the trade and stays with it. And the side he takes, he is right 23% of the time.

Use your Austrian economic skills to provide an analysis of current economic conditions to provide a rational explaination of future movements.

Michael A. Clem April 24, 2009 at 3:41 pm

Greg, the future of the market depends heavily on how much the Obama administration and the rest of the politicians and bureaucrats continue to intervene in it. It is precisely for this reason that the economy is unstable and uncertainty is greater than it ought to be: political, non-economic reasons. Perhaps you should a find a psychologist who can analyze Obama for you, instead of an economist.

Inquisitor April 24, 2009 at 3:47 pm

If anyone finds Mises “ordinary” I can only say they must be unaware of how informed and erudite he was, and how carefully he treated philosophical questions. It’s especially evident in HA, perhaps less so in more frivolous works such as Liberalism.

Oil Shock April 24, 2009 at 3:53 pm

Greg says…Use your Austrian economic skills to provide an analysis of current economic conditions to provide a rational explaination of future movements.

Jason is accurate in describing your requirement. What you need is not the help of an economist, but that of a witchdoctor or a psychic.

Economics is useful only in the sense that it can say that certain actions will have certain consequences ceteris paribus, but it is the ‘ceteris paribus’ part that is impossible to achieve. In that sense, there is one major difference between Austrians and others: others pretend that they have psychic powers and have accurate knowledge of the future, where as Austrians have no such Pretense of Knowledge

Barry Loberfeld April 24, 2009 at 4:05 pm

From “Economics: A Trialogue”:

Emma: Look, you know what blows all this talk out of the water? There have been a number of studies that found that they raised the minimum wage and it wasn’t followed by any mass unemployment like predicted.

Adam: I’m not saying an increase in the minimum wage would destroy all or even a majority of low-end jobs, though it might a significant minority. Again, an increase in the cost of living is the main result of the increase in the cost of labor. But the bigger point here is, empirical studies prove nothing — not in economics.

Emma: Theorizing around a table is science, but actually measuring the real-world impact of those theories isn’t?

Adam: Couldn’t have said it better myself!

John: Adam, seriously. What do you mean?

Adam: Science is about nothing if not controls. But the economy isn’t a laboratory, and it doesn’t allow for controls. Do you realize just how many factors other than the wage increase were responsible for the employment rate? We would have to keep all those factors as a constant in order to isolate and gauge the effects of the wage increase. But that’s exactly what we can’t do with the real world. These “studies” aren’t tests that prove or disprove a hypothesis. At best, they’re surveys. Presenting them as experiments demonstrates only the inability to distinguish correlation from causation –- the post hoc ergo propter hoc fallacy.

Emma: So what are we supposed to do with the actual data — dismiss it completely because it contradicts your theory?

Adam: No, not at all. We evaluate it in light of the theory. It simply means that the depressing effect of the wage increase was obviously overcome by the uplifting effect of other, beneficial factors. Of course we should also keep in mind the many below-minimum-wage workers of the “underground” — off the books — economy, who aren’t measured by these studies. Their wages purchase, among other things, the labor of workers in the conventional economy, who are measured.

John: It seems to me that since you have theory as the basis of everything, we have to ask what is the basis of this theory.

Adam: Economic science proceeds from theorems, or “axioms,” as some prefer — I already gave you one: Lower the price, you sell more; raise it, less — that themselves proceed from knowledge that is available to all people everywhere. A man has five dollars: It’s easier for him to buy the one dollar widget than the four dollar one — and impossible for him to buy the six dollar one. Theory is no more an arbitrary construct in economics than in mathematics. One-plus-one-equals-two isn’t merely a “logical” proposition, but something we’ve observed from the result of putting one rock together with another.

John: And it’s by applying these theorems to “economic” questions of production and distribution that we engage in real science?

Adam: Exactly.

Emma: I don’t know, Adam, if you’ve made any converts here, but you’ve certainly given us a lot to think about.

Adam: Which is just what I wanted.

Steve Pilotte April 24, 2009 at 11:40 pm

I thought the following paper made a pretty good case that a better understanding of human action requires a blend of both methodological individualism and methodological collectivism (holism).

Paul Marks April 25, 2009 at 6:28 am

Lee Kelly:

It is often the mark of a great thinker that one comes away from reading his work thinking “but that is obvious – why all the song and dance about this guy”.

Then one remembers that the “obvious” is denied by the vast majority of academics (and those they “educate”).

And not “just” in economics.

The very fact that there is an “I” an agent (that agency means an agent) is denied by many “great philosophers” and scientists.

They seek to explain away individual existance (the fact that we are agents who decide to do or not to do things) – it is an “illusion”.

“But who is having the illusion?”

“Shut up” explain the elite.

Jason Gordon April 25, 2009 at 3:04 pm

The fact that we experience continuity in the self and yet can be so fragmented is the source of many of our emotional difficulties–and most of the problems we encounter in trading. Because of our sense of continuity, we identify with the states we are in; each, we think, is a reflection of reality…

Quite simply, the ‘me’ in us–our sense of who we are–is stronger than our ‘I’–our ability to intentionally guide our actions. To the extent we are divided, we do not have a fully free will. We are at the mercy of environments and events and what those trigger in us…

More from Brett Steenbarger

Paul Wakfer April 26, 2009 at 7:55 pm

Although this quoted excerpt of Mises’ is a strong and important statement about the basis and importance of methodological individualism for any true understanding of human beings, it, nevertheless, exhibits some fundamental flaws that make it far less effective than it could otherwise be. I am not aware of anyone else having pointed these out before, but if there are, then I would welcome a reference to it.

>>Praxeology deals with the actions of individual men. It is only in
the further course of its inquiries that cognition of human cooperation
is attained and social action is treated as a special case of the more
universal category of human action as such.>>

While this is absolutely and importantly correct, unfortunately, Mises’ opening short axiomatic statement is greatly weakened by the fact that Mises himself and all others with the Austrian school (as far as I am aware) did not *develop and extend* praxeology into any area *except* that “special case” relating to the interactions of humans. The best known modern applications of methodological individualism (but not really of praxeology) toward human behavior is to be found in the writings of Ayn Rand and in the psychological writings of Nathaniel Branden. More recently, and not yet discovered by most, is my own more foundational application of praxeological methodology towards individual human action (see my basis of that development starting at: “Social Meta-Needs: A New Basis for Optimal Interaction” http://selfsip.org/fundamentals/socialmetaneeds.html ).

>>This methodological individualism has been vehemently attacked by
various metaphysical schools and disparaged as a nominalistic fallacy.
The notion of an individual, say the critics, is an empty abstraction.
Real man is necessarily always a member of a social whole. It is even
impossible to imagine the existence of a man separated from the rest of
mankind and not connected with society. Man as man is the product of a
social evolution. His most eminent feature, reason, could only emerge
within the framework of social mutuality. There is no thinking which
does not depend on the concepts and notions of language. But speech is
manifestly a social phenomenon. Man is always the member of a
collective. As the whole is both logically and temporally prior to its
parts or members, the study of the individual is posterior to the study
of society. The only adequate method for the scientific treatment of
human problems is the method of universalism or collectivism.>>

These kinds of hyperbole by Mises (frequently used) in attacking the most extreme statements of his opposition are, unfortunately, flawed by a kind of straw man approach. There are many intelligent critics of free market economics who do not hold such extreme collectivist notions. By taking such an approach, Mises fails to address (and thereby misses any chance for his own additional insight and development) any of the valid germs of dissatisfaction of highly intelligent well-meaning individuals who have a sense (correctly) that even if government interference were totally abolished there would still be something “unjust” about some of the methods of operation of the economic system that Mises (and all other Austrians) maintains follows logically from praxeological thinking and, furthermore, appears to maintain are the *optimal* methods of human interaction (optimal by what definition, I do not know).

>>Now the controversy whether the whole or its parts are logically
prior is vain. Logically the notions of a whole and its parts are
correlative. As logical concepts they are both apart from time.>>

Here Mises shows his apparent lack of understanding of logic itself! The notion of coming *logically first* bears no relationship to being prior in any time sense. It is merely related to the natural hierarchy of levels of being, which can be thought of as being described by the word/prefix “meta”. Furthermore, by using the term “parts” rather then “members” Mises confuses the logically different situation where some existing thing can be considered to be composed of parts (portions of the whole which at least have some similar properties) that are also existents. Whereas, a collection or set of individuals or members has none of the properties of its members (which may or may not be themselves existents) most importantly because the collective does not lie within the same meta-reality level as does its members. See the beginning section of definitions within http://selfsip.org/solutions/NSC.html and its annotation for more details on this important point.

>>No less inappropriate with regard to our problem is the reference to
the antagonism of realism and nominalism, both these terms being
understood in the meaning which medieval scholasticism attached to them.
It is uncontested that in the sphere of human action social entities
have real existence.>>

No! This is a fatally flawed statement that effectively supplies to his opposition the basis by which they can ultimately ridicule and dominate him. The error that Mises makes here is to apparently be unaware of the fundamental logical difference in *level* between an existent and its referent, a simple example being the difference between a thing and its name or between a number and a numeral (although this last is actually more complex because a number is already not an existent, but rather a category of existents in meta-reality level 1 – which places a numeral one higher still). “Social entities” are profoundly *not* existents of reality. They have no attributes of anything in reality, most certainly not any attributes of their human members. Rather, social entities are a subclass of “systems”: Information that consists of a Category of Material Existents plus a set of processes between the Members of that Category, which Processes form InterRelationships between sets of Attributes of the Members of the Category (ibid). (Note that all capitalized words are technical terms explicitly defined in the previously given referenced link.) “Social entities” are nothing outside of the actions and interactions of their individual members (as Mises states later in contradiction to the above).

>>Nobody ventures to deny that nations, states, municipalities,
parties, religious communities, are real factors determining the course
of human events.>>

Here Mises confuses the effects of the multiple cooperative actions of individuals with the logically impossible notion that entities in a higher level meta-reality may have direct effects on entities in a lower one. Higher level meta-realities must always be understood as mere organizing tools for human thinking and never as holding real existents with cause and effect relationships on the only true reality (meta-reality zero in my philosophical system).

>>Methodological individualism, far from contesting the significance of
such collective wholes,>>

But “collective wholes” *should* be contested, not merely for their significance but for their very existence! Giving away this fundamental point causes major inconsistencies right from the start and is one of the primary reasons for Mises’ ideas suffering from a lack of acceptance by so many intelligent humans, sincerely and forthrightly seeking a better society.

>> considers it as one of its main tasks to describe and to analyze
their becoming and their disappearing, their changing structures, and
their operation. And it chooses the only method fitted to solve this
problem satisfactorily.>>

This is simply false. Collective wholes are not any necessary part of a complete and consistent methodological individualism. Collective wholes do not “become, disappear, change their structures and their operation”. Only individual actions cause these changes and not to any real existent but merely each to hir own mental constructs which s/he refers to as such collective wholes with various names.

“The hangman, not the state, executes a criminal. It is the meaning of
those concerned that discerns in the hangman’s action an action of the

Absolutely correct! if for no other reason than that there is no such existing entity as “the state” that can pull the necessary lever (or have *any* affect on reality, for that matter). Mises again fails to see the essential need to go further and emphasize more directly that such “discerning” is logically flawed, since “the state” being merely a human construct, does not exist in directly causal human reality, ie. on the same level of existence as do all other things that can have a direct causal effect on humans, but rather “exists” (if one wishes to use that word at all) in a higher meta-reality of human thought.

>>First we must realize that all actions are performed by individuals.
A collective operates always through the intermediary of one or several
individuals whose actions are related to the collective as the secondary
source. It is the meaning which the acting individuals and all those who
are touched by their action attribute to an action, that determines its
character. It is the meaning that marks one action as the action of an
individual and another action as the action of the state or of the
municipality. The hangman, not the state, executes a criminal. It is the
meaning of those concerned that discerns in the hangman’s action an
action of the state. A group of armed men occupies a place. It is the
meaning of those concerned which imputes this occupation not to the
officers and soldiers on the spot, but to their nation.>>

Once again Mises starts a paragraph very strongly and axiomatically, but then immediately proceeds to compromise and destroy the very axiom that he stated so clearly! A collective does not “operate(s) always through the intermediary of one or several individuals”; rather, a collective does not *operate* at all. No collective can emote, think or act in any manner as an individual human emotes, thinks and acts. As Mises himself stated (and promptly then forgot), “all actions are performed by individuals” – and it should be clear that emoting and thinking are types (subcategories) of action.

>>If we scrutinize the meaning of the various actions performed by
individuals we must necessarily learn everything about the actions of
collective wholes. For a social collective has no existence and reality
outside of the individual members’ actions.>>

Once again Mises confuses the clear, black and white logic involved in any truly consistent application of methodological individualism. Scrutinizing the actions of individuals will help one to determine the total effects of many individuals acting together. However that is not the same as any possible action of a “collective whole”, precisely because collections of humans do not exist as entities in human reality (as Mises then states – “a social collective has no existence and reality”, but again compromises with the exception “outside of the individual members’ actions”).

>>The life of a collective is lived in the actions of the individuals
constituting its body.>>

Now this is really bad! To even use the word “life” for a collective is immediately compromising the position of strong methodological individualism and giving heavy ammunition to his opponents. Furthermore, in no manner are individual humans to be correctly thought of as parts of the “body” of a collective! – not even as much as ants are part of the “body” of the colony. Furthermore, if humans really are to be thought of as parts of the body of society, then those who want to direct parts of that body, of which there are also other parts, are entirely correct in this desire just as I would be correct in wanting to direct my digestive system to better serve my brain.

>>There is no social collective conceivable which is not operative in
the actions of some individuals. The reality of a social integer
consists in its directing and releasing definite actions on the part of
individuals. Thus the way to a cognition of collective wholes is through
an analysis of the individuals’ actions.>>

This confuses the whole issue by logically “putting the cart before the horse”. Rather what needs to be done is to simply analyze the sum of the effects of individuals, relegating the notion of any collection of which they are members to its purely organizational role in human thought. Any notion such as a “social integer” makes things even worse by confounding two ideas (integer and social interaction) which have no possible relationship to each other. As for cognition (understanding) of “collective wholes”, since these do not exist in reality, this can only be done within the organizational structure of human thought and description as a meta-reality and any such understanding can only have effects within that meta-reality. In particular, there is no possibility of “collective wholes” being able to “direct and release definite actions on the part of individuals”. All that is possible is that some individuals’ actions may effect the direction and release of the actions of other individuals.

>>As a thinking and acting being, man emerges from his prehuman
existence already as a social being. The evolution of reason, language,
and cooperation is the outcome of the same process; they were
inseparably and necessarily linked together.>>

This is a very confused and misleading way to look at evolution, as if something called “man” was there in existence all the time and slowly changed its characteristics over the eons of time. Instead, it is imperative to correct thinking to both fully understand and hold to the facts of reality, that all lifeforms are individual entities with limited lifetimes, with only the *species germline* so far continuing to exist and to evolve (in the technical Darwinian sense) so that it is distinct within each new representative of it and brings new characteristics (and loses some also) to that representative not previously held by older ones now non-existent (dead) or soon to be. Some of such genetically caused phenotypic change has definitely been instrumental in enhanced reasoning, language and likely as well, cooperative capabilities. However, quite distinct from this Darwinian evolution is the alteration and enhancement of reason, language and cooperation that has been invented, created, discovered and learned by one generation, and then passed on to the next – the ancestral wisdom which has resulted in the accumulating capital assets of information, which most people virtually ignore, not realizing that it is by far the largest capital resource available today.

>>But this process took place in individuals. It consisted in changes
in the behavior of individuals. There is no other substance in which it
occurred than the individuals. There is no substratum of society other
than the actions of individuals.>>

Again the rhetoric is confusing. There are two separate parts of what took place. First, each new individual was a new representative of an evolving germline that expressed itself in hir with phenotypic characteristics altered in some ways from previous representatives. Second and very different, each new representative had the ability to gain from the accumulated wisdom of hir ancestors, but also had the phenotypically expressed ability to analyze and discover new information, which s/he could then pass on to the next germline representatives. Yes, no part of these effects were caused by anything called society, they were all caused by the complex combinatory effects of evolving germlines and the ability of individuals to pass on information to later living humans (whether germline descendants or not).

>>That there are nations, states, and churches,>>

Once again, in reality such things do not exist (of course, churches, as *buildings* certainly do). Rather they are mere constructs of human thought, highly useful as a mental organizing tools.

>>that there is social cooperation under the division of labor, becomes
discernible only in the actions of certain individuals.>>

Exactly! And such social cooperation must be seen as nothing more than the organized and ordered interactions of individuals.

>>Nobody ever perceived a nation without perceiving its members.>>

I have news for Misesians (since Mises is no longer able to receive my news) – “nobody ever perceived a nation” *period*. There is no such entity in reality as a “nation” that is capable of being *perceived* in any manner similar to which one perceives any existent of reality. If an ET arrived on Earth and you said “look, there is a nation” (or a corporation, for that matter), he would strive to “see” it, would be baffled and then would begin to seriously doubt your credibility.

>>In this sense one may say that a social collective comes into being
through the actions of individuals.>>

Of course one *can* say anything (and even “may” in a truly free society), but actually stating any such thing would be a grave philosophical flaw and would immediate compromise any defense of methodological individualism.

>>That does not mean that the individual is temporally antecedent. It
merely means that definite actions of individuals constitute the

Nonsense and horrible confusion! There are merely the total and cumulative results of the actions of many individuals, nothing more.

>>There is no need to argue whether a collective is the sum resulting
from the addition of its elements or more,>>

It is not any such thing because its members are not a *part* of it, but rather merely elements of a system, which system resides in a higher level meta-reality, merely used by human minds for organizational purposes. The sum resulting from the individual actions of such elements of any system is simply another effect within reality stronger than would be the effect from any one individual.

>>whether it is a being /sui generis/, and whether it is reasonable or
not to speak of its will, plans, aims, and actions and to attribute to
it a distinct “soul.”>>

Definitely not any of these.

>>Such pedantic talk is idle. A collective whole is a particular aspect
of the actions of various individuals and as such a real thing
determining the course of events.>>

Absolutely not! Such talk is not only not mere idle pedantry, but it is *essential* to distinguish just exactly about which one is dealing in reality. And to agree even that a “collective whole” is “a real thing determining the course of events” is to so totally compromise the approach of methodological individualism that I am left to wonder why Mises retains so many followers and idolizers, who appear, for whatever reasons, to have refrained from any critical analysis of his writings.

>>It is illusory to believe that it is possible to visualize collective
wholes. They are never visible; their cognition is always the outcome of
the understanding of the meaning which acting men attribute to their
acts. We can see a crowd, i.e., a multitude of people. Whether this
crowd is a mere gathering or a mass (in the sense in which this term is
used in contemporary psychology) or an organized body or any other kind
of social entity is a question which can only be answered by
understanding the meaning which they themselves attach to their
presence. And this meaning is always the meaning of individuals. Not our
senses, but understanding, a mental process, makes us recognize social

Well I must admit, Mises tried very hard here to reach some level of consistency, but still he confusingly failed. Why could he not see that if “collective wholes” cannot be seen or otherwise detected directly by the human senses, as can all other existents of reality, then they simply do not exist in reality? I think that this was perhaps because of a weak and non-understanding background in epistemology, symbolic logic and foundations of mathematics. And why did Mises not see that it is not “the meaning which they themselves attach to their presence” that constitutes anything real about a group of people, but rather the results of the totality of their actions? Meanings, intentions, and even choices have no effect on reality, only actions do.

>>Those who want to start the study of human action from the collective
units encounter an insurmountable obstacle in the fact that an
individual at the same time can belong and — with the exception of the
most primitive tribesmen — really belongs to various collective entities.>>

Unfortunately as well as not understanding the logical basis of members and collections, Mises shows little knowledge of anthropology, since past representatives of the human germline have always lived and operated within social groupings, in general; the more primitive the more they did so, because of survival need if nothing else.

>>The problems raised by the multiplicity of coexisting social units
and their mutual antagonisms can be solved only by methodological

This misstates the nature of the problems of current society, which is *not* related to “the multiplicity of coexisting social units and their mutual antagonisms” but rather to the multiplicity of subjective desires of individual humans and the mistaken view of most such humans that the satisfaction of these desires necessarily involves conflict with other humans. Furthermore by speaking of “social units”, Mises fosters the groupist thinking of “us and them” that methodological individualism seeks to dispel and to eliminate.

>>The /Ego/ is the unity of the acting being. It is unquestionably
given and cannot be dissolved or conjured away by any reasoning or

Even more strongly and clearly, there is simply no other possible form of human action except that by individuals. All strengthening of such actions is merely the resultant effect of more than one individual acting in the same direction.

>>The /We/ is always the result of a summing up which puts together two
or more /Egos/. If somebody says /I/, no further questioning is
necessary in order to establish the meaning. The same is valid with
regard to the /Thou/ and, provided the person in view is precisely
indicated, with regard to the /He/. But if a man says /We/, further
information is needed to denote who the Egos are who are comprised in
this /We/. It is always single individuals who say /We/; even if they
say it in chorus, it yet remains an utterance of single individuals.>>

These are highly significant observations of Mises. I said much the same, but even more strongly, in my essay: “Collectivism in Language: Its Effects on Valid Reasoning” at: http://selfsip.org/fundamentals/we.html

>>The /We/ cannot act otherwise than each of them acting on his own

And it is extremely important to realize that this implies the same for thinking, emoting, desiring, etc, which are all types of *action*, even if only internal to the mind itself.

>>They can either all act together in accord, or one of them may act
for them all. In the latter case the cooperation of the others consists
in their bringing about the situation which makes one man’s action
effective for them too.>>

And fundamental to this is that there are clearly precise instructions and limited permission given by the non-actors to the one acting for them, otherwise s/he ceases to be the effective agent in action of any of those who would not hirself take that exact same action.

>>Only in this sense does the officer of a social entity act for the
whole; the individual members of the collective body either cause or
allow a single man’s action to concern them too.>>

The first part is again a major confusion. An officer of a society does not act for the society as a whole (no such entity exists in reality), but rather s/he is the agent in action of some members of the society – those that agree with hir actions. Some may choose to accept that the officer is acting in their behalf even when they do not agree with hir specific actions, but that is their own problem of inconsistency – it is not part of the nature of joint action through a representative agent.

>>The endeavors of psychology to dissolve the /Ego/ and to
unmask it as an illusion are idle. The praxeological /Ego/ is beyond any
doubts. No matter what a man was and what he may become later, in the
very act of choosing and acting he is an /Ego/.>>

Again Mises makes exaggerated references, this time to a “villainous” psychology, appearing to tar all of psychology and psychologists with one brush. Even stronger than his last statement, during any part of hir existence a human cannot act in any other manner than solely as an Ego.

>>From the /pluralis logicus/ (and from the merely ceremonial /pluralis
majestaticus/) we must distinguish the /pluralis gloriosus/. If a
Canadian who never tried skating says, “We are the world’s foremost ice
hockey players,” or if an Italian boor proudly contends, “We are the
world’s most eminent painters,” nobody is fooled. But with reference to
political and economic problems the /pluralis gloriosus/ evolves into
the /pluralis imperialis/ and as such plays a significant role in paving
the way for the acceptance of doctrines determining international
economic policies.>>

Mises is to be commended here by his rejection of the “/pluralis gloriosus”/ form. However, he appears to miss the fact that the “/pluralis logicus”/ form is, in fact, not logical at all (no “combination of persons … have a logical identity”) unless there is first a clear definition of exactly which individuals are to be included in the “we”, and secondly the “we” does not relate to any action that only one person can possibly perform, such as thinking, emoting and subjective value determination. And that the “/pluralis gloriosus/” is more and more *not* being seen as foolish by everyone even about non-political and economic matters, but instead is fully accepted as meaningful. Together with another usage, the “condescending we”, used by so many writers and speakers to cast their image as being at one with the readers/listeners in having all their same foibles, these usages have pervasive negative effects on the thinking and actions of many otherwise intelligent people in current society. And then there is also the imperative replacement form of we as in: “let’s go do that”, “we should send troops to Iraq”, “we must not terminate the war on drugs”, etc.

In summary, while I am the first to agree that Mises was a significant thinker, writer and a very honorable man to whom we all owe an enormous debt of gratitude, I also refuse to accept him as a “saint” (or anyone else) whose works cannot and should not be analyzed critically. For if one does not analyze critically and learn to do better from such analysis, then one is bound to both repeat the mistakes of the past and to be an easy mark for those whose thinking is grossly and incorrectly opposed. Although I met him once (unfortunately before I knew much economics or philosophy) I cannot be sure, but I sincerely hope that were he alive today, Mises would agree.

–Paul Wakfer

MoreLife for the rational – http://morelife.org
Reality based tools for more life in quantity and quality
The Self-Sovereign Individual Project – http://selfsip.org
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individual responsibility, social preferencing & social contracting

Paul Wakfer April 27, 2009 at 12:57 am


In the following quote towards the end of my (lengthy) comment:

>>And then there is also the imperative replacement form of we as in: “let’s go do that”, “we should send troops to Iraq”, “we must not terminate the war on drugs”, etc.>>

the examples were intended to be from various sides of the political spectrum to show that all sides are guilty of using the imperative “we”. So the last example read: “we must terminate the war on drugs” before my editor (partner, Kitty) thinking that I had inadvertently omitted a “not” (which I sometimes do) placed it there. I did not recheck her editing (mainly just typos) sufficiently and so did not notice this change until now.

BTW, this comment was originally posted on the evening of April 24, so it should have been higher up the blog comments, but unfortunately my submissions kept getting “lost” – the above was the third posting attempt and after emails to Mises.org. Apparently the problem at Mises.org end is now fixed.

prince mike oxygen September 13, 2011 at 5:41 pm

before one believes another mans religion, he or she has to practice what we call EPOCHE.

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