A Primer On Ludwig von Mises’s “Socialism”

Why did Mises write this book?

Mises was attempting a scientific analysis of the socialist program. Much of the early writings on socialism concerned themselves with ideological critiques of the existing capitalist order rather than a scientific exposition of what socialism would put in its place. 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? and, is socialism possible?

 

What the heck is Mises saying?

Some people find Mises’s writing confusing. He uses big words (“panegyrists”) and archaic references, often in foreign or dead languages. Mises possessed a Classical education like many educated Europeans of his time and saw himself as part of a grand Western intellectual tradition that had taken over two millennia to develop, scientifically examining social phenomena by responding to particular people, schools or ideas which were well-known and publicly debated in his day. He was a systems-builder who started with a foundation and then added to it block-by-block, the end result being an intellectual skyscraper.

 

What are the biggest ideas in “Socialism” (Chapters 1-4)?

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.

 

What is “Liberalism”?

Mises’s Liberalism stood for a social order built on respect for private property rights and contractual negotiation of social conflicts, which 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 American Libertarian movement, which was kick-started in large part by the publication of Mises’s “Human Action” in 1949. Since then, Socialists have co-opted the Liberal name, having rightfully seen it as valuable due to its old popularity and intellectual prestige.

 

What is Socialism?

The essential idea is “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. Socialism is Utopian by nature, promising 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.

 

Do Liberalism and Socialism have conflicting ends?

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. 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.

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