Ludwig Von Mises

[Lolumad273]

I've read a bit about this man, and apparently he believed that Socialism would fail because it was impossible to calculate future consumption of goods. That was proven mostly false. But I'm sure that he had a bunch of other reasons to believe socialism would fail.

Some opinions on this man would be pretty cool to read! So if anyone wants to post some thoughts on his theory, maybe give a basic overview of what he theorized, that would be nice.

Thanks,

[Deicide]

I've read a bit about this man, and apparently he believed that Socialism would fail because it was impossible to calculate future consumption of goods. That was proven mostly false. But I'm sure that he had a bunch of other reasons to believe socialism would fail.

Some opinions on this man would be pretty cool to read! So if anyone wants to post some thoughts on his theory, maybe give a basic overview of what he theorized, that would be nice.

Thanks,

Read this. This is probably better than any quick summary anyone could give you.


The economic calculation argument (ECA) has to do with the claim that, in the absence of market prices, a socialist economy would be unable to make rational choices concerning the allocation of resources and that this would make socialism an impracticable proposition. Tracing the historical development of this argument, this article goes on to consider some of its basic assumptions about how the price mechanism actually works in practice; in so doing, it attempts to demonstrate that the argument is based upon fundamentally shaky foundations. A rational approach to the allocation of resources in a socialist economy is then sketched out. Such an approach is predicated on a particular view of socialism as entailing a largely decentralised – or polycentric – structure of decision-making in contrast to the view typically held by proponents of the ECA that socialism would entail central – or society-wide – planning. Applying a decentralised model of socialist decision-making, this article identifies a number of key components of such a model and goes on to show how, through the interactions of these key components, the objections to socialism raised by the ECA are decisively overcome.

http://www.cvoice.org/cv3cox.htm - for the full article.

[Sperm-Doll Setsuna]

Some opinions on this man would be pretty cool to read!

Scum of the earth along with all his repulsive dreg followers. :)

[Vyacheslav Brolotov]

Another libertarian, reactionary capitalist, Milton Friedman, talking bad about Ludwig Von Mises:

According to him, von Mises was inflexible in his thinking and basically could not ever accept that other people can have different opinions. Typical psycho Austrian (as in the school, not the nation:)) economist.

"The story I remember best happened at the initial Mont Pelerin meeting when he got up and said, 'You're all a bunch of socialists.' We were discussing the distribution of income, and whether you should have progressive income taxes. Some of the people there were expressing the view that there could be a justification for it."

"Another occasion which is equally telling: Fritz Machlup was a student of Mises's, one of his most faithful disciples. At one of the Mont Pelerin meetings, Machlup gave a talk in which I think he questioned the idea of a gold standard; he came out in favor of floating exchange rates. Mises was so mad he wouldn't speak to Machlup for three years."

Full article: http://reason.com/archives/1995/06/01/best-of-both-worlds

[eric922]

Another libertarian, reactionary capitalist, Milton Friedman, talking bad about Ludwig Von Mises:

According to him, von Mises was inflexible in his thinking and basically could not ever accept that other people can have different opinions. Typical psycho Austrian (as in the school, not the nation:)) economist.

"The story I remember best happened at the initial Mont Pelerin meeting when he got up and said, 'You're all a bunch of socialists.' We were discussing the distribution of income, and whether you should have progressive income taxes. Some of the people there were expressing the view that there could be a justification for it."

"Another occasion which is equally telling: Fritz Machlup was a student of Mises's, one of his most faithful disciples. At one of the Mont Pelerin meetings, Machlup gave a talk in which I think he questioned the idea of a gold standard; he came out in favor of floating exchange rates. Mises was so mad he wouldn't speak to Machlup for three years."

Full article: http://reason.com/archives/1995/06/01/best-of-both-worlds
Okay, when your such an ass that even Milton Friedman doesn't like you, you have problems.

[GoddessCleoLover]

Mises was the epitome of a reactionary bourgeois economist. Even worse than Friedman. Sad commentary that he is more popular among conservative young economists than is Friedman. Mises was strictly a class enemy as far as I am concerned.

[PC LOAD LETTER]

Don't forget Mises liked fascism. Well, kinda. He was an apologist, but not a proponent.

[hatzel]

Just to buck the trend, I felt obliged to find something good about the guy. One valuable idea or something like that. So I checked his Wikiquote page...first entry:


A free man must be able to endure it when his fellow men act and live otherwise than he considers proper. He must free himself from the habit, just as soon as something does not please him, of calling for the police.
Guy's a genius praise him hosannah in the highest.

[Bronco]

I haven't read a lot of Mises but this thread encouraged me to go and read the introduction to his Socialism and it seems one of his key problems is that Socialists have never really envisaged what a future society would look like, and how exactly it would be preferable to the current one based on private property, and thought the reasons for Socialism avoiding this question was that such a study would show it to be impractical


The purpose of the prohibition to study the working of a socialist community, which was justified by a series of threadbare arguments, was really intended to prevent the weaknesses of Marxist doctrines from coming clearly to light in discussions regarding the creation of a practicable socialist society. A clear exposition of the nature of socialist society might have damped the enthusiasm of the masses, who sought in Socialism salvation from all earthly ills. The successful suppression of these dangerous inquiries, which had brought about the downfall of all earlier socialistic theories, was one of Marx's most skillful tactical moves. Only because people were not allowed to talk or to think about the nature of the socialist community was Socialism able to become the dominant political movement of the late nineteenth and early twentieth centuries...

...In this way Socialism was able from year to year to win more and more ground without anyone being moved to make a fundamental investigation of how it would work. Thus, when one day Marxian Socialism assumed the reins of power, and sought to put its complete programme into practice, it had to recognize that it had no distinct idea of what, for decades, it had been trying to achieve.

He also criticises Socialism for describing itself as a science when the basis for judging a scientific method should be its success. He basically seems to be saying that it's all well and good for Socialists to criticise the private property system and Capitalism but if they cannot put forward a practical alternative that would be preferable than it loses a lot of weight.

[robbo203]

I've read a bit about this man, and apparently he believed that Socialism would fail because it was impossible to calculate future consumption of goods. That was proven mostly false. But I'm sure that he had a bunch of other reasons to believe socialism would fail.

Some opinions on this man would be pretty cool to read! So if anyone wants to post some thoughts on his theory, maybe give a basic overview of what he theorized, that would be nice.

Thanks,


This is not quite accurate. The central argument of Mises was not really about consumption goods as such but what he called *higher order" producer goods. Mises contended that the economic calculation problem for a socialist society would be that it unable to to select from a "bewildering array" of technical possiblities the least cost combination of inputs. In order to maximise benefits and mimimise costs you need to be able to compare, or make these inputs commensurable, in terms of a single unit of accounting which was provided by money or market prices. For a system of market prices for producer goods to exist presupposed a system of private property which is precisely what socialismn sought to do away with

The so called "market socialist" response to Mises was provided by people like Oskar Lange who argued that market prices could indeed function without private property. Lange was just and advocate of state run capitalism really.

The revolutionary socialist response, on the other hand, was in part provided by Otto Neurath who argued instead that a socialist society could calculate in kind without using one single unit of accounting like money . e.g. tonnes of steel or litres of milk. Once you combine this idea with the idea of self regulating system of stock control (think of the way in whuich a modern supermarket physically montors and replenishes stock on its shelves on a more or less automatic basis) then the whole Misesian argument collapses.

You can certainly identify stock levels of various inputs and select combinations that reflect the relative scarcities of these inputs as identifed via this self regulating system of stock control. This is very far removed from the claim that a socialist society would just be "groping in the dark".

The Misean paradigm was probably on course to end up as some obscure footnote in the history of economic thought. The collapse of soviet state capitalism which of course the Miseans, like others, misidentifed as "socialism", lead to a revival of this paradigm and its advocacy of the free market. But I suspect the way things are panning out these days, this will prove to be just a brief interlude in its journey to well deserved obscurity

[Klaatu]

I do not see how capitalism can "calculate future consumption of goods" either. In fact, this very failure is an inherent fault of capitalism... we overproduce and than cannot sell the all of the junk we produced (especially food) and then it goes to waste... what a fucking shame that in the U.S. we discard probably more food that it would take to feed the world's hungry, at least in part...

[Lolumad273]

Thanks for all the opinions, and explanations. That Cvoice article is very interesting, as is Robbo's post.

To Klaatu: I fear that under the market system we suffer from quite a bit of Under Consumption. It's certainly true that a lot of food goes to waste, and that could be attributed to overproduction, but in reality there are 1 billion people who will not eat today, but are too poor to participate in the market for food. This is true for most consumer goods that end up in landfills... also housing.

[Klaatu]

To Klaatu: I fear that under the market system we suffer from quite a bit of Under Consumption. It's certainly true that a lot of food goes to waste, and that could be attributed to overproduction, but in reality there are 1 billion people who will not eat today, but are too poor to participate in the market for food. This is true for most consumer goods that end up in landfills... also housing.

Americans overconsume food and poor countries underconsume food.

"consumer goods ending up in landfills" is due to the fact that things break (in fact they are designed to break just after the warranty expires)
In the old days, things were built to last. Now we just waste things, and exploit people. See this site:

Story of Stuff
http://www.storyofstuff.org/movies-all/story-of-stuff/

[robbo203]

Thanks for all the opinions, and explanations. That Cvoice article is very interesting, as is Robbo's post.

To Klaatu: I fear that under the market system we suffer from quite a bit of Under Consumption. It's certainly true that a lot of food goes to waste, and that could be attributed to overproduction, but in reality there are 1 billion people who will not eat today, but are too poor to participate in the market for food. This is true for most consumer goods that end up in landfills... also housing.

Interestingly, a ten year study conducted by Timothy Jones, an anthropologist at the University of Arizona, which examined practices on farms and orchards, as well as such areas as food processing, retailing, consumption and waste disposal, concluded that between forty to fifty per cent of all food ready for harvest in America never gets eaten (25 November 2004, http://www.foodproductiondaily.com/Supply-Chain/Half-of-US-food-goes-to-waste


On housing one of the most remarkabble facts Ive come across is rthat in China alone, according to one Hong Kong-based real estate analyst, Gillem Tulloch, there are an astonishing 64 million empty apartments!!! According to Tulloch housing units are priced well above what an average Chinese person can afford and while it might promote GDP it "doesn't add to the betterment of people's lives" (http://www.grist.org/cities/2011-03-31-chinas-ghost-cities-and-the-biggest-property-bubble-of-all).

The main point about waste in relation to a market economy is the huge amount of invisible structural waste internal to the system itself - the vast numbers of occupations that are essentially only needed to keep the money system ticking over and that produce nothing of any real benefit to people themselves. At least half of the work done today in the formal sector of the capitalist economy will simply disappear in a non market moneyless communist society - or to put it differently, we could double output of useful goods with the same amount of labour and material inputs we use today

[Ostrinski]

Seems like Friedman's criticism of Mises was more of a criticism of character than theory.