Differences: Epistemological and other

People can disagree with each other for various reasons. What concerns us here are disagreements that stem from differences in epistemology and methodology. Whether one's motives are noble or ignoble, it is critical that one is cognizant of reality. Deceiving others may be immoral but deceiving oneself is impractical. Unwittingly deceiving oneself by utilizing unsuitable epistemological methods may be unavoidable as long as men are fallible and time-constrained. It is not necessarily careless to be unaware of different methodologies. However, the consequences of unsound reasoning, drawing false conclusions and accepting erroneous "common sense" are not always minor. Before we scoff or attribute sinister motives to people who make claims that are counter-intuitive, we ought to remember that "common sense tells us that the world is flat, that the sun goes around the earth, that heavy bodies always fall faster than light bodies, that boats made of iron will sink." (Chase 1956, 4) Theory and Data The late Nobel-Prize winning economist James Buchanan made a stunning confession. Speaking at a conference, he said, "I have suggested that the principle of spontaneous order is 'scientific' in the sense that it embodies a logically coherent argument. But does the economist who considers his main role to be that of teaching this principle to his students necessarily plead guilty to the charge that he is imposing an ideology? In one sense the answer is yes." (Buchanan 1979, 89) "Ideology" ... "impose." To the unsympathetic, this must sound conspiratorial. Ideology is a word that can have negative connotations. It can conjure up images of vested interests using propaganda to manipulate the public. Ideologue is not today usually a term of approbation. Referring to oneself as one is done with misgivings. "Ideology" in the sense that cynics use the word is what we want to avoid. Marxists believe in class struggle. Part of this class struggle involves intellectuals who preach doctrines for the sake of the capitalists. According to the Marxist Ernest Mandel, "If we consider objectively the entire realm in which ideas are shaped and defended, we shall not be able to deny that a fair number of cynics and careerists are to be met therein, people who sell their pens and their brains to the highest bidder, or who subtly modify the direction taken by their thought if it risks prejudicing their promotion." (Mandel [1962] 1968, 13 & 14) The charge that what is taught is taught because it aids the powerful is a familiar one. Professor Noam Chomsky insinuated this: Pursuit of what Adam Smith called the "vile maxim of the masters of mankind" ["All for ourselves, and nothing for other people."] has followed much the same course over and over again in (the last two centuries), always suffused with self-righteousness, inspired by the holy doctrines of a version of economic theory that is immune to abundant - one might perhaps argue, consistent - empirical refutation, and that has the miraculous

quality of invariably benefitting the masters, who are also the paymasters, a suggestive fact that is rarely explored. (Chomsky [1994] 1996, 5 & 118) If "moneybags" (to borrow a term from Marx) is influencing which theories are being disseminated amongst the people then this complicates matters. Of course, whether a theory is palatable to the oligarchs or not has no bearing on whether the theory is true. How beliefs came to be canonical or why they remain so should not concern us. If a doctrine is true then it cannot be rejected on scientific grounds. Our challenges are distinguishing science from non-science and selecting the appropriate methodology for our chosen inquiry. Turning now to the substance of the quotation from Chomsky, we should take note of two subjects: theory and empirical data. He says that data can refute theory. John Maynard Keynes argued this way. He wrote, "Professional economists ... were apparently unmoved by the lack of correspondence between the results of their theory and the facts of observation." (Keynes [1953] 1964, 33) Nearly two hundred years ago, William Godwin called experience "the pole-star of truth" and was hesitant about using complicated chains of reasoning. He wrote, There are two principal methods according to which truth may be investigated. The first is by laying down one or two simple principles, which seem scarcely to be exposed to the hazard of refutation; and then developing them, applying them to a number of points, and following them into a variety of inferences. From this method of investigation, the first thing we are led to hope is that there will result a system consentaneous to itself; and, secondly, that, if all the parts shall thus be brought into agreement with a few principles, and if those principles be themselves true, the whole will be found conformable to truth ... An enquiry thus pursued is undoubtedly in the highest style of man. But it is liable to many disadvantages; and, though there be nothing that it involves too high for our pride, it is perhaps a method of investigation incommensurate to our powers. A mistake in the commencement is fatal. An error in almost any part of the process is attended with extensive injury; where every thing is connected, as it were, in an indissoluble chain, and an oversight in one step vitiates all that are to follow. The intellectual eye of man, perhaps, is formed rather for the inspection of minute and near than of immense and distant objects. We proceed most safely when we enter upon each portion of our process, as it were, de novo; and there is danger, if we are too exclusively anxious about consistency of system, that we may forget the perpetual attention we owe to experience. (Godwin 1797, v -vi) The economist Stuart Chase identified six methods for obtaining knowledge. They are: 1. Appeal to the supernatural 2. Appeal to worldly authority - the older the better 3. Intuition

4. Common sense 5. Pure logic 6. The scientific method He wrote that "only the last furnishes a cumulative storehouse of dependable and consistent knowledge." (Chase 1956, 3) Let's assume he is correct. This presents us with a problem: How can we do experiments in the social realm? The social sciences present us with difficulties. According to Ernest Nagel, "Perhaps the most frequently mentioned source of difficulty is the allegedly narrow range of possibilities for controlled experiments on social subject matter." In a controlled experiment, the experimenter can manipulate at will ... certain features in a situation (often designated as "variables" or "factors") which are assumed to constitute the relevant conditions for the occurrence of the phenomena under study, so that by repeatedly varying some of them (in the ideal case, by varying just one) but keeping the others constant, the observer can study the effects of such changes upon the phenomenon and discover the constant relations of dependence between the phenomenon and the variable. (Nagel 1979, 450 & 451) According to Nagel, John Stuart Mill, the nineteenth century philosopher, "was a foremost advocate ... for employing the logical methods of the natural sciences in social inquiry." However, "he was convinced that experimentation directed toward establishing general laws was not feasible in the social sciences ... His contention is based in part on the supposition that controlled experimentation ... requires the occurrence of variation in just one (relevant) factor at a time." According to his Method of Difference, "two situations are required, the phenomenon being present in one and not in the other, that are alike in all respects but one (which may ... be identified as the "cause" or "effect" of the phenomenon)." (Nagel 1979, 454) Nagel conceded that controlled experiment can apparently be performed at best only rarely in the social sciences, and perhaps never in connection with any phenomenon which involves the participation of several generations and large numbers of men ... Since a given change introduced into a social situation may produce (and usually does produce) an irreversible modification in relevant variables, a repetition of the change to determine whether or not its observed effects are constant will be upon variables that are not in the same initial conditions at each of the repeated trials. In consequence, since it may thus be uncertain whether the observed constancies or differences in the effects are to be attributed to differences in the initial states of the variables or to differences in other circumstances of the experiment, it may be impossible to decide by experimental means whether a given alteration in a social phenomenon can be rightly imputed to a given type of change in a certain variable. (Nagel 1979, 451) Because time travel is not an option, "no laboratory experiments can be performed with

regard to human action. We are never in a position to observe the change in one element only, all other conditions of the event being equal to a case in which the element concerned did not change." (Mises [1949] 1998, 31) If the scientific method is not useful when studying social phenomena, it is because, as Ludwig von Mises demonstrated, "all knowledge of human action rests on methodological dualism, on a profound difference between the study of human beings on the one hand, and stones, molecules, or atoms, on the other." von Mises used a methodology that Godwin was dismissive of. He started with the "axiom of action". The axiom of action simply means that "individual human beings are conscious, that they adopt values and make choices - act - on the basis of trying to attain those values and goals." This axiom is self-evident because it "cannot be refuted without selfcontradiction; that is without using the axiom in any attempt to refute it." As Murray Rothbard, an economist in the Misesian tradition, explains, "since the axiom of action is self-evidently true, any logical deductions or implications from that action must be absolutely, uncompromisingly, 'apodictically,' true as well." Recall how Keynes and Chomsky said that economic theory had been contradicted by the facts. Rothbard, however, believed that the body of economic theory that derived from the self-evident axiom of action is "absolutely true" and that "any talk about testing its truth is absurd and meaningless. Moreover, no testing can take place since historical events are not, as are natural events in the laboratory, homogenous, replicable, and controllable. instead, all historical events are heterogeneous, not replicable, and the result of complex causes." (Holcombe 1999, 158) According to Hans-Hermann Hoppe, another Misesian economist, "true synthetic a priori propositions are grounded in self-evident axioms and ... these axioms have to be understood by reflection upon ourselves rather than being in any meaningful sense 'observable'." These propositions "can be validated independently of observations and thus cannot possibly be falsified by any observation whatsoever." (Hoppe [1995] 2007, 20 & 24) The science of human action, according to von Mises, is called praxeology. Praxeology, according to Hoppe, says that "all economic propositions which claim to be true must be shown to be deducible by means of formal logic from the incontestably true material knowledge regarding the meaning of action ... Provided there is no flaw in the process of deduction, the conclusions ... must be valid a priori because their validity would ultimately go back to nothing but the indisputable axiom of action." (Hoppe [1995] 2007, 25 & 26) As briefly noted, according to the Misesian method, "economic theories cannot be 'tested' by historical or statistical facts ... There are always many causal factors impinging on each other to form historical facts. Only causal theories a priori to these facts can be used to isolate and identify the causal strands ... The only test of a theory is the correctness of the premises and of the logical chain of reasoning." Rothbard's defense of praxeology is an essential tool in our toolkit and deserves to be quoted at length. Suppose a theory asserts that a certain policy will cure a depression. The government, obedient to the theory, puts the policy into effect. The depression is not cured. The

critics and advocates of the theory now leap to the fore with interpretations. The critics say that the failure proves the theory incorrect. The advocates say that the government erred in not pursuing the theory boldly enough, and that what is needed is stronger measures in the same direction. Now the point is that empirically there is no possible way of deciding between them. Where is the empirical "test" to resolve the debate? How can the government rationally decide upon its next step? Clearly, the only possible way of resolving the issue is in the realm of pure theory - by examining the conflicting premises and chains of reasoning. (Rothbard [1963] 2000) Bibliography Buchanan, James. (1979) "What Should Economists Do?" Chase, Stuart. (1956) "The Proper Study of Mankind" Revised Edition Chomsky, Noam. ([1994] 1996) "World Orders: Old and New" Godwin, William (1797) "The Enquirer" Holcombe, Randall G., ed. (1999) "15 Great Austrian Economists" Hoppe, Hans-Hermann. ([1995] 2007) "Economic Science and the Austrian Method" Keynes, John Maynard. ([19530 1964) "The General Theory of Employment, Interest, and Money" Mandel, Ernest. ([1962] 1968) "Marxist Economic Theory" von Mises, Ludwig. ([1949] 1998) "Human Action" Nagel, Ernest. (1979) "The Structure of Science" Rothbard, Murray ([1963] 2000) "America's Great Depression" Fifth Editio