Response to Jehu ReThePeople’s Commentary on Mises’ “Socialism”


With a full understand that the critique occurred on Twitter, I have done my best to grasp the main points of Jehu’s argument. If I have missed anything, Jehu, please inform me right away 😉 Below my response I have copied and pasted the entirety of Jehu’s comments for reference.

–          The early criticism is primarily hermeneutical in nature, yet lacking the interpretive context. Mises was critiquing Socialism, as that was the title of his book as Jehu points out. It was a study of Marxism, or Marx the man himself.

–          According to a friend of mine, Professor in the School of Philosophy at Dublin, Ireland  “This appears to me to be a version of the more or less standard response to criticisms of socialism/communism which says that the critic isn’t really attacking Marx but rather some more or less distorted version of his thought.”

–          So I think we can all agree that “Socialism” was theorized to be inevitable given the preexisting condition of capitalism. The problem Jehu brings up is significant in terms of what Mises is writing about.

–          Jehu’s point is essentially this; That Mises’ failure to recognize the nature of the blind forces that guide human evolution as essentially aimless demonstrates his lack of understanding of Marx. Jehu does provide context in which Marx does reassert his theory that it is only the search for a “higher mode of production” than Capitalism that is the “motive force” behind Socialism, and not inevitable historical evolution.

  • This is dishonest of Jehu. He was reasonable enough at the beginning of his argument to point out that Mises’ publication was entitled ‘Socialism’ and not “The Life and Times of Karl Marx”, but he then accuses Austrians like Mises as focusing too much on the practical realities of human action under Socialist coercion, and not Marx’s theory itself.
  • I, again quote my friend from Dublin regarding the above argument, “It’s a veritable plum pie of words, seasoned with a generous portion of invective but I can’t figure out what the conclusion of this argument is supposed to be, or its premises, or the means by which one is supposed to get from one to the other.”
    • It really helps to read that above passage in a delightful Irish accent if you can imagine it!
  • Upon reexamination of Jehu’s endorsement of Marxist theory, consider the fact that Capitalism has always been referred to by Marxists as a necessary predecessor to a Communist system. Is that not reconcilable with Mises’ point that Socialists argued in the historical inevitability of Socialism, again, given the existence of Capitalism?


–          Next Jehu says this, and I will quote “For Marx, the state was only of secondary significance and capitalism converted it into its own instrument. The state is no longer the state that existed before capitalism, is is converted into a form of capital itself Austrians look at this and declare the state it trying to socialize society, when the opposite is true. Society turns the state into its mere instrument. The state doesn’t determine society, society always and everywhere in history determines the state. It is this absolute dependence of actual existing capitalism on the state the limit the Austrian critique of the state: Austrians can never be anti-statists precisely because should the state ever actually be abolished society would be plunged into depression.”

  • If the goal of Austrians is to eliminate the State entirely, (and at the least from the economy) and therefore if the State ceased to exist, would the Austrian school cease to exist? Obviously not, but the relevant question is whether or not the Austrian “movement” would cease to exist. Let us entertain the idea that the Austrian movement has succeeded in removing the State from the economy and thus ceased to exist. Does this excuse them from the classification of anti-state? Jehu argues that since the movement only exists under the minimum of a minarchist State, Austrians are therefore minarchists. The absurdity of this logic would erase all anti-state movements from history, only after they succeed. This is the kind of twisted logic that confuses people enough to submit, and it is totally nonsense.

–          Next he raises the argument that society no longer “gives a fuck” about Austrian theory.  This is a strategy befitting a Marxist, as if might makes right. No response is necessary, here.

I see nothing else in Jehu’s remarks that are evidentiary of a refutation of anything Mises wrote, or of any Austrian theory. I am not a defender of Mises’ character, although I respect many people who knew, and had the utmost respect and admiration for him. They would, and have laughed at accusations of racism. Jehu attempts to discredit Mises by using quotes outside of the context of the biological racism of the era. Mises might have used objectionable terms but he did so while refuting the notion that race correlated with intelligence. That is hardly objectionable.



Transcript of original commentary on twitter:

Jehu: Ha! To this day Austrians don’t realize Bohm-Bawerk’s criticism of Marx was actually a confirmation of Marx’s argument. Bring on the Austrian critique of Marx’s labor theory.

Adam: Mises successfully refuted Marx in his book “Socialism”.

Jehu: Oh no, you did not go there. Ha! Mises? Okay, Let’s do Mises. I will start my critique of Mises’ Socialism tomorrow morning.  (*Saturday Morning Arrives*). This is demonstrated in Part III of his book, “THE ALLEGED INEVITABILITY OF SOCIALISM”.

Adam: How does a refutation of Marx insist that capitalism is not capitalism?

Jehu: … I will show this using Mises’ own words.

Adam: I do not think you can.

Arbitrary Design: The gauntlet has been thrown.

Jehu: What makes it so interesting to me is that in order to refute Marx, Mises finds himself in bed with Marxists. Ha! According to Mises, “SOCIALISM derives its strength from two different sources.” The first is the moral challenge to capitalism. The second is that, “Socialism is made to appear as the inevitable goal and end of historical evolution. An obscure force from which we cannot escape leads humanity step by step to higher planes of social and moral being.” Mises proceed to critique the latter argument — that socialism is inevitable — but in doing so, he mistakenly argues socialism is a goal or aim of “historical evolution”. By “historical evolution” of course, Mises means the blind working of the laws of capitalist mode of production. However these laws are best characterized as blind forces and, therefore, incapable of directing itself toward any aim or goal. Mises argues socialism is “made to appear as the inevitable goal” of historical evolution and in this I think he is suggesting this is only an appearance — it is not the actual goal of historical evolution, but a spin on “historical evolution” given by socialists. In this argument, he is absolutely correct: “historical evolution”, precisely because it is only the blind working out of laws of capitalist society, has absolutely no goals or aims. For that matter socialism is not and cannot be the aim or goal of society since socialism is only the result of a blind process. If socialism nevertheless appears as the goal or aim of this or that party within society, it would be a mistake to confuse this party’s aim or goal with socialism that result from the blind working out of the laws of the capitalist mode of production. The oddest thing about this confusion is that it led Mises to write the book, SOCIALISM, while Marx wrote CAPITAL. Ha! While Mises preferred to discuss a system of silly ideas held by parties, Marx preferred to look at the actual “historical evolution” itself but this has always been the essential stupidity of the Austrian school: it can get no closer to the actual processes of society than precise textbook definitions of those processes and then ruthlessly engaging in the criticism of tautologies. Austrians are so adept at wrestling with textbook definitions they no longer even notice society doesn’t give a fuck about them.

                The first task Mises must perform is to generalize Marx’s theory — to remove it from its context as a specifically historical analysis of the capitalist mode of production. This Mises thinks he has accomplished by linking socialism as a higher moral state to the religious argument of the Bible. The amateurish attempt falls flat immediately, since Marx himself in his theory reduces communism to a mere economic mechanism: Communism, says Marx, “is, therefore, essentially economic, the material production of the conditions of this unity”. Notice in this passage, taken from the German Ideology, Marx makes no assertion that communism embodies a higher moral state, or anything approaching some Kingdom of God on Earth of the ancient Jews. Communism is a economic mechanism, nothing more — a point Marx had already argued earlier in his career when he stated, “Communism is the necessary form and the dynamic principle of the immediate future, but communism as such is not the goal of human development, the form of human society.” So, in contrast to Mises’ attempt to decontextualize Marx and convert his argument into some religious expression, Marx really did not care much about it, except that he saw it as a necessary basis for society.

                As Marx states near the end of his life and career, it is capitalism — not politics or the state — that gives birth to communism: Capitalism “unconsciously creates the material requirements of a higher mode of production.” Communism, therefore, appears first as a blind process of capitalism’s own development; unconscious, and, therefore, not the aim of society. You can, of course, disagree with this argument — and Mises does — but you cannot say Marx believed something else.

Next Mises turns to the nature of society: “What society is, how it originates, how it changes — these alone can be the problems which scientific sociology sets itself.” Society, says Mises, is division of labor, and our idea of this division of labor must “take into account all the aims which men set themselves and the means by which these are to be attained.” The division of labor results from two facts, says Mises: ‘the inequality of human abilities and the variety of the external conditions of human life on the earth.”

Ha! “No social life could have arisen among men of equal natural capacity in a world which was geographically uniform.” Mises is essentially arguing here that society itself only exists because we are unequal in talents and abilities. If we were equal, we would never have formed a society. Is this true? How might we test this argument? The argument here is not that we are social beings or that we are unequal in talents and abilities, but that we are social because we are unequal. In this argument Mises is importing the concept of inequality as a necessary feature of society — society itself is impossible without it, which explains why he is so disturbed by the fact that clearly inferior “races” like Eskimos and Aborigines have long heads. “More recent measurements have shown that long-headed men are not always blond, good, noble, and cultured, and that the short-headed are not always black, evil, common and uncultured. Amongst the most long-headed races are the Australian aborigines, the Eskimos, and the Kaffirs. Many of the greatest geniuses were round-heads.” (Kaffir BTW means nigger — in case my Austrian friends didn’t realize this. Mises could have just said African or negroes, or even “the coloreds” — but he chose to use the term Kaffir in his scholarly work.) Mises’ argument is the material relations are not the movie force of social development; inequality is.

If you are embarrassed by this offensive argument, you can at any time tell me you reject Mises.

This argument by Mises might explain why the Mises Institute is located in Alabama and has a large following among folks who think the wrong side won the Civil war.

Of course, Mises is entirely correct that differences in natural abilities vary within society — bot not only these: as well interests, etc. However, what he need show is why these differences become the motive force of social development, without touching on the anarchist argument against compulsion. He has to avoid the anarchist argument beacuse he thinks there is a natural order to society and the state enforces this order.

                So we now have to views of social development: Mises and Marx. Mises think the motive force of human history is inequality, while Marx thinks the motive force is material development. This does not mean each does not recognize the assumption of the other: Marx recognizes inequality and Mises recognizes material production.

Arbitrary Design: Why the race comments? Do you think Mises was racist?



Jehu: Of course he was, and an elitist bastard as well.

                Mises’ argument on natural inequality is critical to understanding his critique of Marx, because Mises sees in socialism an attempt to artificially overcome this natural inequality — to forcibly level society. This is for Mises a foolhardy objective and can only lead to a catastrophe. Interestingly enough, Marx also see the leveling tendency at work within society, but from an entirely different social process. In 1851, Marx wrote: “Money, which is the supreme expression of class contradiction, therefore also obscures religious, social, intellectual and individual differences. When confronting the bourgeoisie, the feudal barons for example made futile attempts, by means of luxury laws, politically to check or break this universal levelling power of money.” The differences between Mises’s argument and Marx’s, therefore, is that for Mises the state was the futile means of overcoming natural inequalities, while for Marx the state was the means of enforcing social inequality. For Mises the threat to natural inequality result from political causes, while Marx held the development of the productive forces had already rendered such natural differences negligible.

Adam: If Marx hated the State why did he want to supersize it?

Jehu: Capitalism was already bringing about increasingly cetralized planning of production — it did not need socialists. Every time one company is gobbled up by another, planning is extended to a greater portion of production. Remember, for Marx capitalism was unconsciously creating communism.

Adam: Statism consciously turned Capitalism into Socialism.

Jehu: Yes. This is why ever attempt to refute Marx begin with classes and the state — while Marx began with capital. For Marx, the state was only of secondary significance and capitalism converted it into its own instrument. The state is no longer the state that existed before capitalism, is is converted into a form of capital itself Austrians look at this and declare the state it trying to socialize society, when the opposite is true. Society turns the state into its mere instrument. The state doesn’t determine society, society always and everywhere in history determines the state.

Adam: I disagree. The political class forms the State in spite of society It never represents the interest of the citizenry.

Jehu: Ah! Good argument! We should turn to the heart of Mises’ critique of Marx — the concentration and centralization of capital

Jehu: Since Marx aimed to demonstrate that capitalism itself, not the state, was creating the material basis for communism Mises has to show this is not the case and to do so by denying the capitalist laws of development. As Mises points out, and Marxists deny, “MARX seeks to establish an economic foundation for the thesis that the evolution towards Socialism is inevitable, by demonstrating the progressive concentration of capital.” (Ask any Marxist — except me and a handful of others — if Marx believed capitalism’s demise was inevitable and did not depend working class political action and they will emphatically say no.) Mises dismisses Marx’s argument based on what? On empirical evidence? No — Mises insists: “Let no one suppose that the Marxian doctrine of the concentration of capital can be verified by the simple method of consulting the statistics of establishments, incomes, and fortunes.” Statistics have already conclusively sided with Mises against Marx, he tells us. But Mises is very generous; he offers to set aside the voluminous stats he claims can support his argument and examine the theory itself. Now, why would Mises be so generous? “This can be definitely asserted in spite of all the imperfections of present statistical methods and all the difficulties which fluctuations in the value of money place in the way of using the material.” So, the data was spotty and unreliable, Mises says; and money itself had been replaced by an inconvertible valueless currency. Not only this: the whole of EurAsia had been reduced to rubble and the US alone stood as the industrial superpower after the war. Was this not an example of concentration and centralization of capital? Let’s dismiss it as an act of God. Millions of family farms had gone belly up; and also banks, and also the automobile industry and the steel industry and so on. Austrians who hold to this nonsense have to explain how private labor on farms in the US has, since Mises writing, has contracted to less than one percent of the population. Before the depression it had been almost thriy percent of the population. Fortunately for us, Mises was generous enough to ignore this point also. Mises also explains to us that “the much discussed theory of increasing poverty — in which even orthodox marxists can hardly continue to believe — is incompatible with the results of statistical investigation,” But how does Mises demonstrate this since he has already admitted money no longer expresses the value of things?

Finally, it has to emphasized Mises is making this argument at the point in history when the state has a great role in “the economy” than ever previously in history: a condition he assured us must lead to catastrophe. Mises must argue two contradictory things: things have never been better and increasing state socialization must make things worse Austrians have no idea how this circle can be squared — they ignore it. On the one hand, society is hurtling to collapse; on the other hand, workers — of whom this society is almost entirely composed — have never had it so good. Mises erects a straw man on which to vent his rage at socialism — the mannequin, unsurprisingly, looks a lot like Karl Kautsky. He quotes Kautsky: “‘For the mere approach to this condition must increase the sufferings, conflicts, and contradictions in society to such an extent, that they become intolerable and society bursts its bounds and falls to pieces’ unless evolution has previously been given a different direction.”

Mises interprets this to mean a political revolution — and perhaps Kautsky meant this as well, but Engels was not so limited. Engels explained it could lead either to proletarian revolution or to the state’s assumption of the control of the social capital. Engels wrote in “In any case, with trusts or without, the official representative of capitalist society — the state — will ultimately have to undertake the direction of production. This necessity for conversion into State property is felt first in the great institutions for intercourse and communication — the post office, the telegraphs, the railways.” Despite clearly being “wrong” according to Mises, Engels wrote this in 1880 — 70 years before being refuted by Mises. 🙂 And 50 years before fascism emerged in Europe. A fucking pretty good scientific wild-ass guess, if you ask me. It is therefore, not at all true, as Mises argued, that “according to this view, the transition from ‘High’ Capitalism to Socialism is to be effected only by the deliberate action of the Masses.” The condition had to lead to a a higher mode of production, but this advance could come in the form of fascism, not socialism. As Engels argued, even fasscism would represent an advance over the anarchy of market relations: “only when the means of production and distribution have actually outgrown the form of management by joint-stock companies, and when, therefore, the taking them over by the State has become economically inevitable, only then — even if it is the State of today that effects this — is there an economic advance, the attainment of another step preliminary to the taking over of all productive forces by society itself.” Now, since Mises was completely familiar with labor theory, why did he neglect to mention the fine print on Marx’s argument? Why is that despite this argument does Mises want to deliberately conflate socialism and fascism? What did he think he was achieving by this deliberate conflation? Moreover, even if he disagreed with Marx on this question, did Mises not concede Marx and Engels had been entirely correct in his prediction And why, to this very minute, do Austrians not only deliberately conflate socialism and fascism, but refuse to recognize Marx was right. It is not like Mises could have confused what Engels meant by his prediction of fascism, since he stated: “The modern state, no matter what its form, is essentially a capitalist machine — the state of the capitalists, the ideal personification of the total national capital. The more it proceeds to the taking over of productive forces, the more does it actually become the national capitalist, the more citizens does it exploit. The workers remain wage-workers — proletarians. The capitalist relation is not done away with.” So, the guys who predicted fascism was a possible outcome also predicted this fascism would be the state acting as the national capitalist. But not a word from the Austrian school on this. We can, however, chalk all this up to ignorance on the part of Austrians — Marxists have no possibility of such an excuse. Marxists know socialism can be none other than an association of society – not a state – but they also conflate fascist state with socialism They defend the minimum wage, social security, and the EPA as if these were socialist institutions or could be salvaged for socialism.

Of course, Mises himself actually supports Marx’s argument in his own argument, when he states: “If, then, we consider the effects of monopoly without being biased by popular writers on cartels and trusts, we can discover nothing which could justify the assertion that growing monopolization makes the capitalist system intolerable.” “The monopolist’s scope in a capitalist economy free from state interference is much smaller than this type of writer commonly assumes…” So from Mises own pen we have the source of the fascist state: the growth of monopoly itself leads to the assumption by the state of functions of social capitalist for the reason that monopoly ownership of the means of production alone is insufficient. The interference in the functioning of capitalism by the state is called up the very forces of capitalism itself – concentration and centralization of capital. The concentration and centralization of capital does not surmount the problems of the mode of production that led to this process in the first place, but only necessitates the assumption of the function of social capitalist by the state and the effective expropriation of the capitalists.

In Mises confused description of this process, monopoly is insufficient and therefore cannot take place, yet it does. The fascist state combines enterprises, consolidates banking, bring foreign trade under its control, etc. — all while Austrians can only tell us it could not happen without the state. Ya’ think?

It is this absolute dependence of actual existing capitalism on the state the limit the Austrian critique of the state: Austrians can never be anti-statists precisely because should the state ever actually be abolished society would be plunged into depression. They are by nature, limited, historically obsolete, and ultimately dependent on the state, since the state is necessary for the survival of capitalism. They are minarchist for sure — which is to say, they only want to rid society of those state functions that are not essential for the survival of capitalism. They are not anti-statist — they are GOPoseurs, with a disgusting assortment of “race” theories, and specious, self-contradictory, arguments against the state. I will now turn the floor over to whoever wishes to refute my argument on Mises’ Socialism.

One thought on “Response to Jehu ReThePeople’s Commentary on Mises’ “Socialism”

  1. Mises’ Socialism is not particularly about the Marxist/Communist variant within Socialism. It is an overview and critique of all the various socialist political and economic arguments, including Syndicalism, anarcho-socialism, and fascism. He did address Marxist socialism, but that was not the central focus of his argument. If you want a more thorough Austrian disputation against Marxism in particular the default would be Eugen Bohm-Bawerk (and he was an even more elitist bastard than Mises) and his book “Karl Marz and the Close of His System.”

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