A Critic of Socigism - THIS is a translation of
the second edition (published in 1932) of Professor Mises' celebrated diatribe Die Gemeinzoirtshaft (first published in 1922). It is certainly a remarkable work. "My book," Professor Mises tells us in the preface, is a " scien- tific inquiry, not a political polemic." Yet later on we read that "Socialism is the expression of the principle of violence crying from the workers' soul, just as- Imperialism is the principle of violence speaking from the soul of the official and the soldier " ; and that -the "Socialist idea is nothing but a grandiose rationalisation of petty resentments." There is a long section on "Socialism and the sexual problem," which should ensure the book a wider circulation than is customary with such works. There is also a section called " destruction- ism" ; and the various forms of " destructionism " include the legal protection of labour, compulsory social insurance, trades unions and unemployment insurance. Professor Mises finally reaches his zenith of hilarious unreality when he tells us that because "being ill is not a phenomenon independent of conscious will," such institutions as health insurance "promote accidents and illness, and hinder recovery." "By weakening or completely destroying the will to be well and able to work, social insurance creates illness . . . In short it is an institution which tends to encourage disease, not to say accidents . . ." It would be uncharitable not to admit that these portions of Professor Mises' work are extremely entertaining.
Hidden away beneath pages of turgid extravagance, how- ever, there are items of serious criticism which English Social- ists ought not to ignore. One need not bother much about the refutation of the vulnerable parts of orthodox Marxism, or about syndicalism, Christian Socialism, " Solidarism " and so forth. Professor Mises' important contribution to the debate is his contention that economic calculation is impossible in a Socialist community. If there is no private ownership of the means of production, he maintains, there can be no price of land and capital goods; and if there is not, there can be no rational calculation of the cost of producing different coin. modities.
. In reply to the suggestion that the State might lend savings and rent land to the Socialist trusts in the ordinary way, and that the trusts might buy and sell capital goods among them- selves, he would reply first that if the trusts own the capital goods, it is not Socialism anyway ; and secondly, that if the managers are not in effect part owners of the business, they will not conduct their business efficiently. The first point seems to be largely a matter of words, since Socialists would not object to a Socialist trust owning capital goods if no indi- vidual drew a large unearned income from its shares. And secondly, Professor Mises is in effect fallir g back on the merely empirical judgement that the Managers will not be efficient unless they hold shares. Here experience seems to be against him ; and there is in any case no fundamental reason why the managers should not be allowed to hold a few shares if the effect proved to be salutary. Similarly, there is no reason why a Socialist State should not pay the market rate of wages and supplement incomes by social services.
The other subjects discussed by Professor Mises are com- monplaces of controversy in this country, and he adds little to them. His account of monopolies ends with the consoling thought that permanent capitalist monopolies generally occur in mining industries, and that their inevitable tendency to
restrict production is consequently beneficial since it results in the preservation of precious ores for posterity. He makes no serious attempt to relate the working of the price system td the realities of demand, and his attack on taxation as a means of socialism is not seriously argued. The book as a whole, in fact, adds practically nothing .to the recent compilation,: Collectivist Economic Planning, which contained extracts front Professor Mises' work. As a fair statement of the facts of the controversy, "Socialism is much inferior to Professor Ilayek's concluding chapter (" The Present State of the Debate ") in Colle,clivist Economic Planning. •
Nevertheless, at the end of Professor Mises' 500 pages, one can scarce forbear to cheer. It is indeed wonderful that so much subtlety, so much learning, so much intellectual vigour and ruthlessness, can give birth to so much unreason.
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