Mises was attempting a scientific analysis of the socialist program as a philosophical and economic doctrine. Up until this point in the development of ideas (1922), most writings on socialism concerned themselves with ideological propaganda and sloganeering, with socialist supporters actively trying to prevent people from a scientific examination of social problems and the socialist response. Mises wanted to explain: what is socialism? how does it compare to capitalism? what claims does socialism make about society? are they true? what can we expect the world to look like under a socialist order?
Some people find Mises’s writing confusing. He uses big words (“panegyrists”) and archaic or seemingly obscure references (quotes in Latin, nods to long-extinct philosophical schools). Mises possessed a Classical education like many educated Europeans of his time. He saw himself as part of a grand intellectual tradition and sought to make his own contribution to a shared Western civilization that had taken over two millennia to develop. He saw himself as a scientist of social phenomena responding to important debates and schools of thought of his era. He was often speaking TO a particular person, school or idea which was well-known and publicly debated in his day. Finally, he is a systems-builder. He always starts with a foundation, then adds a block, adds a block, adds a block. At the end one finds oneself standing atop an intellectual skyscraper they didn’t realize they were building when they started reading.
If you remember only a few things from the first hundred pages of Socialism, remember these quotes and try to think about their significance:
“The word Capitalism expresses, for our age, the sum of all evil. Even the opponents of Socialism are dominated by socialist ideas.”
“To drink coffee I do not need to own a coffee plantation in Brazil, an ocean steamer, and a coffee roasting plant, though all these means of production must be used to bring a cup of coffee to my table. Sufficient that others own these means of production and employ them for me.”
“If the State takes the power of disposal from the owner piecemeal, by extending its influence over production… then the owner is left at last with nothing except the empty name of ownership, and property has passed into the hands of the State.“
Mises’s Liberalism stood for the essential social principle of a social order built on respect for private property rights and contractual negotiation of social conflicts. In other words, peace abroad, freedom at home and an economic system consisting of nothing more than “consumer sovereignty” over the productive process and voluntary exchange within the confines of the marketplace. This was once an intellectual project of thinkers of all nations and ethnicities participating in “Western civilization”. Today, Liberalism lives on most strongly in the ideas of the Libertarian movement, which was originally a mostly American project ironically kick-started in large part by the publishing of Mises’s “Human Action” in 1949. Today, socialists have co-opted the Liberal name, having rightfully seen it as valuable due to its old popularity and intellectual prestige.
The demands of the socialist program have changed over time but they have come to settle, as Mises said, on the idea of “a policy which aims at placing the means of production in the hands of the State.” It is the antithesis of the private property order of Mises’s much-cherished Liberalism, and diametrically opposed to the “consumer sovereignty” of the marketplace, replacing it with production, organization and exchange according to the “will of the people.” But how, and why, could these two concepts be different? That is the heart of Mises’s book-length analysis. According to Mises, Socialism is Utopian by nature. It promises to deliver a perfect economic, political and social environment where all inequalities and disputes are resolved forever and the end of history, in the sense of a constantly-evolving, ever better social order, arrives.
No! And this is the most fascinating part of the analysis. Socialist propaganda strives endlessly to create contrast between the goals of Liberalism and the goals of Socialism. And while it is true that Liberalism does not share all the concerns of Socialism (mostly because it has deemed these concerns to be impossible or nonsensical), the goal of both is to raise the material standard of living of humanity as a whole. The only thing that differs is the means chosen to secure those ends. But it is that choice which ultimately makes all the difference.
A House Rises 