Perhaps it is best to start at the end instead of the beginning of this book.How is our freedom to choose restricted?1.physical laws, 2.individual disposition,and 3.the interconnectedness between means and ends(praxeological law).The last sentence of the book is very important:"But if they fail to take the best advantage of it and disregard its teachings and warnings,they will not annul economics,they will stamp out society and the human race."Sure,this book is the magnum opus of all his work.Did he take giant steps after the studies of Menger and Bohm-Bawerk or did he rest on the shoulder of giants?The Austrian Subjectivists were descriminated against by the German Historical School for many years academically.What they needed was the power to think clearly and to discern in the wilderness of events what is essential from what is merely accidental.The power of ideas go beyond force and might.Contriving the outcome will make truth temporary for such purposes.It's not just about getting over the uneasiness,but how about just being human?That's really what von Mises is all about here.This applies to everybody from the poorest to the richest.If everybody in between applies to a bell curve,so be it. His initial inclination to government intervention is negative.He views it as propaganda.He also recognizes that if social conventions are such,it is possible that we would tolerate it,albeit,with obvious economic dislocations.Governments have to tax so they can spend.They might support minimum wages and maximum prices so workers and producers make more money.The problems are not only debatable. Postlegislative aftermath is right up many economist's alley.von Mises can answer every argument of Karl Marx except one.When the powers that be in a society thrive on the "accidental,"they will only find the seeds of their own destruction.This will not be economical significant. Utterly unremarkable.He takes less time showing how the fall of the Roman Empire was legislatively enabled than Gibbons did.Then,Italy was predominantly an agricultural power heading for feudalism.Let me get to the best part though.von Mises work here does go head and shoulders above his contemporaries in regards to catallactics.That is commodity prices at both spot and future.To a lesser degree there are also option pricing.You can imagine him inventing a machine that allows you to watch supply and demand interact with prices.Bells and whistles for government intervention,etc.Yes,a finely tuned machine.In addition though,it would be worth mentioning that some of the ideas of "creative destruction" is akin to some of von Mises thoughts and ideas.He would call it exploding the fallacy.This is probably a positive way of lightening up,if you will.I suppose I should also mention the appendix:A Critique of Bohm-Bawerk's Reasoning in Support of His Time Preference Theory.von Mises first mentioned this idea in 1912 in his Theory of Money and Credit.He hadn't thought it through at that time.He likens it to the old adage:"a bird in the hand is worth greater than two or three in the bush."This basically means that something ready to be consumed now is worth more now than in the future.He goes one step further by saying there are no exceptions to this.I really should directly quote him because his logic is excellent:"In acting,one must always value a satisfaction at an earlier point in time more than the same kind and amount of satisfaction at a later time.If this were not so,then it would never be possible to decide in favor of a present satisfaction.Whoever uses or consumes anything,whoever seeks by acting to relieve to a greater or lesser extent a felt uneasiness is always expressing a preference for an earlier over a later satisfaction.Whoever eats and consumes anything is making a choice between a satisfaction in the immediate future and one in a more distant future.If he were to decide differently,if he were not to prefer the earlier to the later satisfaction,he would never be able to consume at all.He could not even eat and consume tomorrow,because when tomorrow became today,and the day after tomorrow became tomorrow,the decision to consume would still call for a valuing an earlier satisfaction more than a later satisfaction.Otherwise,consumption would have to be delayed still further."What sort of economic activity was he talking about.Well,in his time he thought we'd be buying iron and gold.We hadn't really started fighting over oil again for a few thousand years.Examples of commodities for von Mises purposes are just that-examples.
Special note:There are some examples where von Mises used examples that could be considered ethnic derogatory.Some people were so good at doing something,everybody went to them to get it done.This could be broken down on an ethnic basis for that reason alone.Can you imagine what he would of said if he was alive when Tata bought Jaguar from Ford?His use of the term "actor" is even more interesting.An economic actor is somebody that might buy or sell but are we really getting into his or her underlying characteristics?Probably not.The intent is to make a profit.They will act accordingly regardless of success or failure.
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Top reviews from other countries
Gene Balfour
Austrian Economics at it’s best.
Reviewed in Canada on October 20, 2018
Fred
Fantastic book on finance for all generations
Reviewed in Australia on August 25, 2021
