Rebirth of Reason


Toward a Paradigm of Human Nature, Human Action, and Human Flourishing
by Edward W. Younkins

I have written several recent essays in Le Québécois Libre and SOLO in which I have suggested the potential feasibility and desirability of combining and extending doctrines from Austrian Economics and Objectivism in our efforts to develop the strongest possible conceptual and moral case for a free market society. In these essays I argued that Austrian Economics and Objectivism can benefit from each other’s insights and that the two schools have more in common than heretofore has been appreciated.1 My conclusion was that it may be desirable to extract, refine, extend, and fuse together the following components taken primarily from these two schools of thought: (1) an objective, realistic, natural-law-oriented metaphysics as exemplified in the works of Aristotle, Carl Menger, Ayn Rand, and Murray Rothbard; (2) Ayn Rand’s epistemology which describes concepts or essences as epistemological rather than as metaphysical; (3) a biocentric theory of value as appears in the writings of Menger and Rand; (4) Misesian praxeology as a tool for understanding how people cooperate and compete and for deducing universal principles of economics; and (5) an ethic of human flourishing based on reason, free will, and individuality as suggested in the contemporary works of Douglas B. Rasmussen, Douglas J. Den Uyl, Tibor R.Machan, and others.

The purpose of this essay is to provide a clear and accessible diagram of a potential Austrian-Objectivist philosophical foundation and edifice for a free society. This diagram focuses on pertinent factors, relationships, and general principles that define the proposed paradigm. Readers who may be interested in studying the ideas presented in this exhibit in greater depth and detail are encouraged to read my essays in the two journals mentioned above.

An Integrated Framework

Praxeological economics and the philosophy of human flourishing are complementary and compatible disciplines. Economics teaches us that social cooperation through the private property system and division of labor enables most individuals to prosper and to pursue their flourishing and happiness. In turn, the worldview of human flourishing informs men how to act. In making their life-affirming ethical and value-based judgments, men can refer to and employ the data of economic science.

A conceptual and moral defense of a political and economic system must be grounded on the best reality-based ethical system that a reasoning individual can discover. A true paradigm or body of theoretical knowledge about reality must address a broad range of issues in metaphysics, epistemology, value theory, ethics, and so on in a systematic fashion. The concern of the system-builder is with truth as an integrated whole. Such a body of knowledge is circumscribed by the nature of facts in reality including their relationships and implications. When constructing a paradigm, it is legitimate to take a selective approach with respect to existing philosophical positions because a paradigm’s consistency with reality is all that really matters. It is thus appropriate for us to extract what is true and good from the writings of Mises, Menger, Rand, and others and use those components as a basis for a better integration that allows for a deeper understanding of what would constitute a morally right socioeconomic system. By integrating and synthesizing essential elements of the ideas of the Austrian School of Economics with those from Ayn Rand’s philosophy of Objectivism we can come closer to a comprehensive, logically consistent view of the world and a foundation and justification for laissez-faire capitalism.

Austrian-Objectivism would be a systematic philosophy that includes a particular view of reality, human nature, human action, the nature of knowledge, and the nature of value and would include a specific code of morality based on the requirements of life in this world. The integration of the tradition of Austrian Economics and the philosophy of Objectivism would enhance both heritages and provide a more solid foundation and a more unified perspective with respect to understanding the nature and workings of the world.

Menger, Mises, Rand, and Beyond

It is necessary to provide a realistic foundation for a true paradigm for a free society. Therefore, a comprehensive moral defense of individualism and its political implications is founded appropriately on a naturalistic philosophy. An Aristotelian metaphysics such as those supplied by Menger or Rand would be an excellent starting point for a political and economic framework based on the requirements of reality and of man’s nature.

Menger, like Aristotle, claimed that essences exist within entities themselves. For naïve realists such as Menger and Aristotle, essences are embedded in concretes and are assumed to be self-evident. In other words, the mind would tend to be epistemologically passive in arriving at essences, universals, or concepts. Menger speaks in an Aristotelian sense when he explains his exact theory. Although Menger’s value theory was sound, the epistemology on which it rests is not as persuasive as it could have been if he had understood, as did Rand, that concepts or universals are epistemological rather than metaphysical. Menger and Rand’s respective objective approaches to value agree that the ultimate standard of value is the life of the valuer. What Menger needed, however, was to be able to validate his theory of concepts. To do this he would have had to view essences as epistemological and the mind as epistemologically active, but as metaphysically passive. One’s theory of value is underpinned by his theory of concepts and if the latter is flawed then one can question the former.

Mises mistakenly treated the concept of action as a priori and self-evident and deduced all other concepts from it through logic alone. Epistemologically, the dependence on the a priori evidences the effort to avoid the induction of concepts from empirical observation. Mises’ declaration of the a priori negates the functions of a person’s cognition and evaluation of external reality. Mises failed to recognize that to defend concepts such as human nature, individual rights, and value requires the defense of abstractions which are products of a relation between a subject and an object. Concepts enable a person to organize his understanding of the world.

Rand’s theories of concepts, values, and ethics accurately reflect a man’s epistemic nature. Objectivism endorses a theory of objective value and an ethics that reflects the primacy of existence. Because Rand identified and comprehended the epistemological nature of concepts and the nature of the concept of value itself, it is possible for us to understand them and to explain to others the logical steps that were included in their formulation.

Ayn Rand’s conception of universals (or essences) as epistemological is arguably superior to the traditional interpretation given to the Aristotelian or Mengerian idea of universals as being metaphysical. Rand explains that knowledge is acquired by an active, conscious agent through the processes of induction and deduction. In order to deduce from axioms and general statements, we must first have inductive inferences. We can know via the senses, inferences from data supplied by the senses, and introspective understanding. Once it is acknowledged that Mises’ action axiom could be derived through an inductive process, it will then be legitimate to follow and adopt his logical arguments that all the core principles and relationships of economics can be deduced from that axiom. After the free market has been accepted as moral and politically legitimate, it is then appropriate for economists to derive praxeological laws.

Objectivism’s Aristotelian perspective on the nature of man and the world and on the need to exercise one’s virtues can be viewed as synergic with the economic coordination and praxeology of Austrian Economics. Praxeological economics’ doctrines of subjective value and value-freedom are compatible with objective value and value-relevance. Misesian praxeological economics is consistent with a normative perspective on human life. Placing the economic realm within the general processes of human action, which itself is part of human nature, enables theoretical progress in our search for the truth and in the construction of a systematic, logical, and consistent conceptual framework. The Objectivist worldview can provide a context to the economic insights of the Austrian economists. Of course, any paradigm should be open to further intellectual investigations that may enrich it. There is always more to be learned about reality.

An integration, combination, and extension of selected doctrines from the Austrian School of Economics (as exemplified in the writings of Menger, Mises, and Rothbard) and from the Objectivist School can provide a philosophical basis for an appropriate moral and political structure for a free society. A naturalist metaethical perspective provides the foundation for the type of framework that is most supportive and accommodating of the moral nature of human life.

The philosophy of human flourishing does not entail a program of political perfectionism. The end of government is not the promotion of virtue. It is to secure a peaceful and orderly society. This neo-Aristotelian, post-Randian perspective recognizes individual rights and distinguishes between metanorms and norms. Liberty is thus viewed as constitutive of all human acts including acts of flourishing. The human person is involved in the task of self-fulfillment through the rational choices he makes and actions he takes. Through his rational actions, a person objectively changes the world and actualizes his unique and nonduplicable human potential. An ethic of human flourishing is thus objective, inclusive, self-directed, individualized, universalizable, agent-relative, and socially-achieved while remaining personal.

Our goal is to have a paradigm or system in which the views of reality, knowledge, human nature, value, and society make up an integrated whole. The suggested synthesis of Austrian Economics and Objectivism ethics can provide an excellent foundation for such a paradigm. Of course the paradigm will grow and evolve as scholars engage, question, critique, interpret, and extend its ideas. This systematic approach and/or its components have been studied by many modern-day thinkers. This is as it should be because our goal is to have a paradigm that accords with reality. As such, it must be viewed as a vibrant, living systematic framework that aims at the truth.

1 The earliest call for an integration of Austrian Economics and Objectivism that I have encountered came from Larry J. Sechrest in two presentations made at the 1997 Summer Seminar of the Institute for Objectivist Studies (now named The Objectivist Center). The titles of the presentations were “Austrian Economics and Objectives: Values and Valuation” and “Austrian Economics and Objectivism: Methodology.”
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