Theory and History

1. Theory and History David Gordon Mises University July 2014

2. Philosophy of History • There are two meanings to “philosophy of history”, corresponding to the two meanings of “history.” • “History” refers both to the events that have happened in the past and the historian’s study of these events. • In like fashion, the philosophy of history means both theories of a general pattern in history and the study of how historians know the past.

3. Praxeology and History • The historian can use praxeology to help explain historical events. • Rothbard in America’s Great Depression uses the Austrian Business Cycle Theory to explain the onset of the Great Depression in 1929. This praxeological theory influences which events he stresses, e.g., the expansion of the money supply by the Fed in the late 1920s

4. The Fall of Rome • Another example of applying praxeology is Mises’s brief account in Human Action of the decline of the Roman Empire. • Mises emphasizes the fall in trade between the parts of the empire and also the effects of inflation and price control. He is applying economic theory to history. • He relies on the work of the historian Michael Rostovtzeff, Social and Economic History of the Roman Empire.

5. Rothbard versus Friedman • Historians who rely on different theories will have different accounts of the same events. • Milton Friedman doesn’t accept ABCT. In his account of the Great Depression ( in Friedman and Anna Schwartz, A Monetary History of the United States ), he emphasizes a decline in the money supply in the early stages of the Depression, not the expansion in the late 1920s.

6. Fascism • Another case where economic theory can influence the interpretation of history concerns fascism. • Marxists viewed fascism as the political form of monopoly capitalism. • Mises rejected this view. In fascism and Nazism, the state runs the economy, even though it is ostensibly private.

7. The Historian and Science • Mises says that a historian’s account cannot contradict the results of modern science. • As an example, a contemporary historian writing about witchcraft would not say that the accused witches had really made a pact with the devil. • Oddly, one of the leading 20th-century historians of witchcraft, Montague Summers, did say that.

8. Limits of Praxeology • We can’t deduce particular events from the laws of praxeology. Praxeology just gives us the general form any action has. It says nothing about the content of particular actions. • As an example, Rothbard uses ABCT to help explain the effects of the expansion of the money supply, but he can’t deduce that this expansion took place.

9. Limits of Explanation • Mises here in part agreed with the logical positivists. They said that a priori truthsdon’t tell you anything about contingent events, i.e., events that might not have happened. • Mises said that you can’t deduce that particular events took place from these truths, but they can help you explain what happened

10. Other Kinds of Law • If praxeology doesn’t account for the content of human acts, can there be other sorts of law that does? These laws wouldn’t be a priori; they would be inductive generalizations • Mises didn’t think so. He said there are no constants in human action. There is nothing like a historical law of gravitation, that would enable a historian to calculate what people will do. • Human free choice is an ultimate given.

11. Specific Understanding • If there are no general laws of history, it does not follow that a historian can’t explain individual events. • He can do so through a grasp of the event that makes no appeal to generalizations. In other words, we understand the individuality of the event, rather than what it has in common with other events.

12. Specific Understanding Continued • Mises calls this grasp of the individual event “specific understanding”. He also uses the German word verstehen and sometimes uses the term thymology for this kind of knowledge. • How does specific understanding work? We make judgments about the goals and beliefs of particular persons, based on our own knowledge and experience. • Specific understanding makes judgments of relevance about particular events.

13. Example of Specific Understanding • Suppose a historian is trying to understand Lincoln’s policy in 1861. He will use evidence about Lincoln’s ends, e.g., his desires to resist secession and to prevent the further spread of slavery and his beliefs, e.g., that he had the military power to force the South to give up, to explain what he did. • He isn’t appealing to general laws: he is trying to understand directly the particular actions Lincoln took.

14. Mistakes About Specific Understanding • Specific understanding does not imply sympathy or empathy with what you understand, unlike appreciating art. • Kripke thinks it does, and suggests that a biographer of Hitler who followed Collingwood’s advice might end up sympathetic to Hitler. • If you are studying the value judgments of others, you are making descriptive statements, not evaluative statements. History can be written in a value-neutral way.

15. Another Mistake • Specific understanding does not imply taking the historical subject’s words at face value, or not comparing them with “hard” facts. It also does not imply that the historian can know the truth by instinct or intuition. • Mises in “The Treatment of ‘Irrationality’ in the Social Sciences” criticized the great medievalist Ernst Kantorowicz for taking the symbolism of the Holy Roman Empire to be a true description of who held power.

16. Mises and Collingwood • Mises was influenced in his treatment of specific understanding by the British philosopher and historian R. G. Collingwood. (1889-1943). • Collingwood said that the historian should recollect the thoughts of the people he studied. In doing so, the historian and the subject have the identical thoughts. Mises doesn’t go this far. • Other writers who wrote about a special way the historian gets knowledge include Windelband, Dilthey, Rickert, and Croce

17. The Positivist Response • Philosophers sympathetic to positivism such as Ernest Nagel said that verstehen or specific understanding might be a useful way to generate hypotheses. But specific understanding could do no more. It didn’t give us knowledge. • We can only judge a case of specific understanding by how convincing we find it.

18. Positivism and Historical Laws • The positivists thought that historical explanation takes place through appeal to laws of history. The most important defense of this view is Carl Hempel, “The Function of General Laws in History” (1942) • This is usually called the covering-law model, following W.H. Dray.

19. Criticism of the Positivist Position • Such laws don’t exist. If we are trying to explain why Caesar crossed the Rubicon, there aren’t laws that say, “Ambitious generals faced with an order that they take to detract from their honor will, under such-and-such conditions, disobey the order.”

20. Ideal Types • Historians also use a technique that resembles specific understanding, the construction of ideal types. • The most famous proponent of ideal types was Max Weber. • “Ideal” here doesn’t mean perfect, It means “not found in the real world”. You construct an ideal type by bringing together certain characteristics, such as personality traits.

21. Ideal Types Continued • For example, you could have the ideal type of the bourgeois. You would postulate someone who was motivated exclusively by certain goals, not a real-world mix of goals. • Ideal types are assemblies of characteristics. They don’t have strict definitions. • Weber took the rational actor to be an ideal type. Mises disagreed.

22. Methodological Individualism and the Philosophy of History • A basic principle of praxeology is that only individuals act. • Many philosophies of history, i.e, doctrines that say there is a meaning to the whole of history, violate this principle. • Hegel’s Geist, Marx’s forces of production, and Spengler’s cultures are examples, and Mises rejected all of these philosophies.