Why Jack and I Will Write About the Austrian School for Money
EDIT: Text of a Twitter DM exchange where Jack and I accidentally started hashing out the essay appended to the bottom.
The Neoreaction a Basilisk Kickstarter is presently having its second-best day so far, meaning that it’s stormed through the “Theses on Trump” threshold, and we’re now looking at the $8000 stretch goal of me and Jack writing an essay on Austrian School economics. (Also, there’s now a Twitter poll for what the order of the next two stretch goals should be. And a $7000 mini-stretch goal on the Kickstarter to check out.) Unlike “Theses on Trump” and “The Blind All-Seeing Eye of Gamergate,” there’s no demo of the Austrian School essay written – it doesn’t even have a for-certain title yet. But I can at least talk a little about why it’s a thing, and why I asked Jack to write about it. (And Jack will be along later to add his perspective.) And if it sounds interesting, well, the link’s at the top of the post.
So, first of all, why this goes in a book with everything else. Which is pretty simple – the Austrian School is a tremendously influential school of thought within libertarianism. Moldbug’s a huge fan. So is Vox Day. So were Ted Cruz’s advisors, hence his insane plan to go back to the gold standard. So like Trump and Gamergate, it’s firmly in the alt-right constellation. But that’s why it’s relevant, not why I’m doing it.
The thing that doesn’t come up a lot with the Austrian School is that they’re insane cranks. And I mean that in an almost good way, because I’m an occultist and have a soft spot for lunatic crackpots. But there’s no question that’s what the Austrian School is. They reject the utility of both empiricism and mathematics to economics, instead building their entire system out of what they call “praxeology,” which is a narrative-based approach whereby the entire system of economics is derived as a set of supposedly necessary implications of the allegedly self-evident premise “individual human beings act.” They are not taken seriously by any actual reputable academic economists – their influence is entirely down to the fact that their conclusions flatter libertarianism, so their obvious methodological madness is largely overlooked or, even more humorously, adopted in spite of its flaws.
One of the things Neoreaction a Basilisk definitely is is a critique of the entire model of philosophy from first premises, so this sort of “start from an axiom and build an entire theory of how the global economy should function” argument is a particularly apt target. But I’m also fascinated because one of the default positions of libertarians tends to be that Marx is an economic crank. And there are certainly ways you can argue this – he’s not working in any traditionally mathematical/empirical mode either, after all, and has a similar tendency towards narrative approaches. As I said, I don’t think being a crackpot is a problem. But it’s definitely weird that they dismiss Marx out of hand as a crank while taking Mises and Rothbard seriously.
But economics aren’t a field I have a ton of knowledge of, and so interesting as this seemed, it wasn’t an essay I felt equipped to write. Thankfully one of my best friends is an avid Marxist more than equipped to tackle the business of comparing and contrasting Mises and Marx as economic systems while I muck around with subjecting them to textual analysis. So I asked him if he’d be willing to co-write a stretch goal essay, and now here we are just $1750 from having to actually do the thing.
Or at least, that’s my understanding. Like I said, Jack will be along later to explain why he agreed to do such a silly thing. (And it apparently wasn’t because I’m going to pay him, as he didn’t realize I intended to give him a cut of this next stretch goal until recently. This is why you should always employ Marxists. They’re always so happy to find out that you only intend to mildly exploit their labor.)
EDIT: Jack’s in the comments, and here’s he and I goofing off on Twitter about the topic:
Jack: Well, I worship Shelley’s Demogorgon, who explodes into the two chariots of revolution – beautiful and terrible
Phil: OK – here’s a very pragmatic question for my life. Three books by or related to Marx you wish I had read. Go.
Phil: I think the goal should be something fairly readable. Just with a starting approach that’s completely not that.
May 5, 2016 @ 8:24 pm
Moldbug’s Austrianism shines through. Remember how he proposed that the problem with cancer research was that it wasn’t run like the software industry, and even Hacker News weren’t convinced?
“The treatment of Steveoma is effective if Steve gets better. If not, it isn’t. The sample size is 1 by definition.”
That post and the comments are fractal not-even-wrongness. From Mises to Carlyle via Hoppe indeed.
Roderick T. Long
May 5, 2016 @ 9:02 pm
As a member of the Austrian School and a defender of praxeology, I look on this project with concern. It looks like a plan for a smear or hit piece rather than a serious attempt to engage with our ideas.
a) The fact that Republican politicians mouth Austrian ideas as cover for their actual, quite different policies is hardly the Austrians’ fault. And of course we on the libertarian left argue that Austrian ideas actually support free-market anti-capitalism better than they do the neoliberal capitalist agenda.
b) “They are not taken seriously by any actual reputable academic economists”: Well, F. A. Hayek — whose “Facts of the Social Sciences” and “Counter-revolution in Science” are based on Mises’ praxeology — won a Nobel prize. I would think that makes him a reputable academic economist. Lionel Robbins — whose “Essay on the Nature and Significance of Economic Science” was likewise based on Mises’ praxeology — was the head of the London School of Economics, which I likewise think would make him a reputable academic economist. Israel Kirzner — whose work is likewise heavily based on Mises’ praxeology — is a member of the NYU econ dept., which is fairly reputable I would think. Etc. Calling economists non-reputable doesn’t make them so.
c) Praxeology doesn’t reject empirical data; but it does make the fairly common philosophical point that there are conceptual constraints on what interpretations of data are possible. See my article on praxeology here:
May 5, 2016 @ 9:24 pm
The goal is roughly “serious attempt at an engaging hit piece,” but obviously we’ll see how we do. It’s also mostly not researched yet, so many thanks for the points in #2, which I imagine would have surfaced when I got around to more than absolute top level research, but is still a useful starting point that probably sped research up a good deal.
I imagine the existence of a left-libertarian approach will at least come up. Certainly it’s something I’m interested in, as my own politics lean that way. (Jack’s less so, I think, but I’ll not speak for him.) I don’t know how much of a focus it’ll be, because this is fundamentally a book that’s coming at the topic via people like Moldbug and Beale instead of via intelligent and interesting people, but there’s an obvious analogy to draw between that approach and looking at Marxism via Tankies, and that’s something to at least acknowledge.
Put another way, this comment probably reduced the odds that this will be a cheap smear considerably, but it’s probably still not going to be your favorite thing I’ve ever written either.
May 5, 2016 @ 10:31 pm
You might be interested in Theodore Burczak’s attempt to develop a Hayekian socialism. His book is here.
Different from Roderick’s sort of left-Austrianism, but there is overlap.
May 5, 2016 @ 10:34 pm
Yeah. Obviously there’s some “this needs to be an essay not a book” trimming of the topic to do (as well as some “make sure we stay in our lane” trimming), but yeah.
May 5, 2016 @ 10:18 pm
“As a member of the Austrian School and a defender of praxeology”
“we on the libertarian left”
what the fuck is that supposed to be “left” of
May 5, 2016 @ 10:24 pm
Nah, left-libertarianism is totally a thing. Socialist anarchism is very closely related. It’s probably the conventional political ideology I’m most sympathetic to, inasmuch as I retain any fondness for the utopian project.
May 5, 2016 @ 10:51 pm
Left-libertarianism is very much a real thing in the real world outside the US. Go look at Ken Macleod, the British SF writer and former Marxist/libertarian, for one example.
In the US, the label libertarian is automatically assumed to mean ‘Republicans who smoke pot’ and if you present yourself online as a libertarian, you’ll be automatically attacked as a rightist by the brain-dead, who are ignorant of all else but the American Culture Wars.
Nevertheless, as Phil suggests, left-libertarian in the rest of the world probably equates to anarcho-syndicalist. Figures like Chomsky and Murray Bookchin — as far as I understand Bookchin — would not be unrepresentative.
May 5, 2016 @ 10:56 pm
To be fair, if you identify as a libertarian online you’ve also chosen to pick a label that has particular valences, presumably for the specific passions it inflames, so you can hardly complain when people make the assumptions you’re consciously setting them up to make.
May 7, 2016 @ 12:42 pm
I mean specifically “Austrian school” being combined with “left libertarian” was what I was WTFing about.
May 6, 2016 @ 1:54 pm
It’s definitely a real movement, and one of my old classmates from college was heavily involved here in the states. I don’t know how convinced I am about the utility of their tactics, but I think it’s an interesting.
You can find more info here: http://bleedingheartlibertarians.com/
May 5, 2016 @ 10:41 pm
The Austrian School rejects the utility of both empiricism and mathematics to economics.
Mainstream economics on the basis of mathematics and empiricism accepts the Black-Scholes equation.(*)
The Austrian School frankly looks entirely sane by comparison.
So do Marx and Keynes look entirely sane. I have no idea whether if you read only one book on the subject you should read Economics: The User’s Guide by Ha-Joon Chang, as I have only read four books on economics. It would however be my pick.
(*) The Black-Scholes equation is the result of mathematically and empirically grounded research and can be used to determine the price at which investing in a financial product is free of risk. Myron Scholes won the Nobel Prize for it. He subsequently ran a hedge-fund. The hedge fund collapsed spectacularly.
The Black-Scholes equation was widely used by investment banks. You may remember investment banks collapsing the economy spectacularly.
The Black-Scholes equation is still as far as I can tell widely accepted among mainstream neoclassical economists as empirically and mathematically grounded.
May 5, 2016 @ 11:24 pm
The reason I’m doing this really is, essentially, because Phil asked me to. And because it seemed like a laugh.
Phil doesn’t really need me for this job. You don’t need a Marxist to attack the Austrian School. Non-Marxists have done so quite successfully, on their own terms. RationalWiki does a pretty good job.
Also, I am not an economist and i make no claim to be.
But then Marx too, in a very real sense, wasn’t an economist. He was a critic of political economy. As Eagleton says, Marx is, like Derrida, an anti-philosopher rather than a philosopher – in the sense of being opposed to the mainline philosophical project of his epoch.
All the same, Phil clearly wants a Marxy critique of the economics, so I’ll do my little best… heavily cribbing the work of finer Marxists than I.
I suspect that the finished product of my collaboration with Phil could potentially be as much a debate between the two of us as it is an argument of the two of us against the Austrian School.
That could be interesting.
May 6, 2016 @ 4:58 am
Jack, this is slightly unrelated, but thanks for talking about the two natures of Shelley’s Demogorgon – Shelley’s weird approach to violence and philosophical necessity in that mid period of his poetry is hugely fascinating to me. For a supposedly non-violent poem, “The Masque of Anarchy” sure has a lot of blood. The seemingly celebratory “Prometheus Unbound” is strangely violent, too, at least in a natural way, and it ends with Demogorgon echoing Jupiter’s cry of “victory.”
So what I’m saying is you should somehow manage to fit this minor point that I’m obsessed with into this completely unrelated essay on economics. Thanks in advance.
May 6, 2016 @ 7:32 am
I don’t think there’s any good reason for saying Marx isn’t an economist. As far as I can see all such reasons boil down to: if you support the interests of power you’re objective but if you oppose the interests of power you’re ideological.
As far as I can see, Marx has as good a claim to the true heir of classical economics, that is, the tradition of Adam Smith, Malthus, et al, as modern mainstream neoclassical economics does. The labour theory of value was an entirely orthodox concept within classical economics. From an economics standpoint, the differences between Marx and contemporary classical economists is that Marx tries to take into account phenomena (such as industrialisation and profits and why business cycles seem to happen when the theory predicts they shouldn’t happen) that seem to fall squarely into the remit of classical economics.
May 6, 2016 @ 9:05 am
Oh don’t get me wrong, I’m not saying Marx didn’t know his shit, or practice economics. I’m saying that to call him ‘an economist’ in any simple way is to elide him with the discipline he was actually trying to explode.
May 6, 2016 @ 12:24 am
With regards to the left-libertarian angle and the relationship between Marxism and the Austrian School, you might want to check out the work of Kevin Carson; the first chapter of Studies in Mutualist Political Economy, for instance, is dedicated to trying to square praxeology with the Labor Theory of Value. I don’t find it particularly successful mainly becaues I don’t think anything good can come from praxeology (and I think he misses several parts of the thrust of Marx’s theory of value, but given that his political project is different from Marx’s, that’s to be expected), but he proves that he’s at least read the people he argues with. And the leftist in me finds his work unusually likeable for a pro-market background—he is emphatically in favor of unions and worker control of business, for instance.
Mind you, I don’t know that his work is taken seriously by much of the world at large, but at worst he’s still less of a crank than, e.g., Rothbard or Herman-Hoppe. (And I suspect he is in fact a helluva lot better but I haven’t read closely enough to vouch for this.)
I honestly don’t know how relevant this might be to your interests; somehow given your general approach I doubt it will, but it’s an unexpected connection that might be at least worth checking out?
May 6, 2016 @ 9:26 am
I realised why I didn’t understand “That’s just an is implies ought fallacy” – for some reason I was reading ‘ought’ as ‘outright’.
It was late.
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