Postmodernism and Austrian Economics – Opting Out


Reflections on Debate Between Bob Murphy and Thaddeus Russell

Should libertarians be interested in postmodernism? A minority of libertarians and libertarian-adjacent folks believe so.

Nick Gillespie of Reason magazine is one prominent postmodernist sympathizer of libertarian analysis of the state. Thaddeus Russell, iconoclast historian and author of The Renegade History of the United States caused consternation after an appearance on the Joe Rogan Experience in which he defended postmodernism against critics within the broad counter-establishment. That includes Jordan Peterson, Stephen Hicks, and a large number of libertarians.

Postmodernism is seen as the grounding for the social justice warrior movement that is rife on college campuses, and an enemy of libertarianism. Bob Murphy, Christian economist in the Austrian tradition and a radical libertarian, isn’t quite ready to embrace “pomo” either. He debated Thaddeus in his Renegade University live stream on this topic.

Russell sees postmodernism as intellectual humility, or as a comprehensive agnosticism. This part many will appreciate. Russell clarifies that it’s an agnostic, not an atheistic position on the existence of any kind of objective truth. There may very well be an objective reality of God, or law of nature, or definition of male and female, but we’re not sure that there is.

This is a helpful clarification, because the atheistic position cannot work – “there is no objective reality” is a meta-narrative in and of itself.

These constructs are human-made, but not necessarily arbitrary or meaningless. In fact, Russell believes categories can be highly meaningful. Yet they can cause great harm. The reason why postmodernism should be the friend of libertarians, Russell says, is that these man-made categories have been a major tool with which states oppress the individual. Being skeptical of these categories then is a tool for libertarians to wrestle freedom back from authority.

Russell playfully challenges Murphy on libertarian grounds. Murphy’s main line of questioning or critique was in “the fact of the matter.” We don’t deny an individual the right to identify as the planet Jupiter if they want. But it’s still important for us to consider whether it is actually the case.

I want to focus on one aspect of the debate. I believe Murphy missed an opportunity to push back, or at least provide a counterpoint for further discussion and elaboration. Namely, how skepticism or rejection of categories might also undermine the case for liberty.

Even Russell would admit that amongst the various philosophical groundings or values that libertarians hold that ultimately justify their beliefs, postmodernism is not the most common. The most popular may be utilitarian (in their positivist or teleological forms) or deontological. Common between them is an appeal to some kind of objective truth claim.

Utilitarians will appeal to the increase of general welfare to humanity that is achieved by protection of individual liberty. Yet statist postmodernists might challenge that category of “general welfare” completely, argue either on what counts as a “benefit” or which unit, the individual or “society,” is benefited.

Deontologists appeal to natural inviolable rights, at minimum a duty of individuals not to violate the rights of others. The concept of natural rights is a meta-narrative that can easily be dismissed on postmodernist grounds – who says that you can’t be violated, abused and have your property stolen? Who are you to say that I can’t view you as my property? The very categories of individual, free will and autonomy we can be agnostic about, and we therefore cannot make any absolute claims in favor of them.

The debate takes a strange turn when Russell brings up economics, particularly the Austrian tradition in which Bob Murphy is working. Ludwig von Mises, Russell says, was a postmodernist before postmodernism. Murphy goes for a refutation of that idea, but that disagreement is not the strange part. After Russell digs a bit deeper, Murphy actually tries to make a point in Russell’s favor, but Russell thinks he ends up doing the exact opposite. I think Murphy’s point may be even more subtle and profound.

Russell cites Ludwig von Mises’ Human Action as a great liberatory statement against the progressive social engineering schemes of the 1940s, lead by people supposedly informed by “the science,” peddling the idea of enforced household diet plans. Mises came back and said, “No, these values are subjective. We can’t say someone is wrong for choosing an ‘unhealthy diet,’ keep your science to yourself.”

Murphy retorts that Mises’ grounding was in reason and science. His economic conclusions were derived by statements of logic. He believed you could make true claims about the way people behave. His main critique of the interventionists was that it was profoundly unscientific. To the progressives, he claimed their grounding in scientific positivism is inappropriate and inapplicable to the field of economics. To the Marxists, he argued polylogism (the idea that different classes of people can hold different kinds of logic) is irrational. Mises certainly thought what he was doing was science.

Russell asked if Mises had written anything in particular about science. Bob then, in apparent contradiction to what he was just talking about, thought he was giving a hand-out to Russell by bringing up Mises’ battle with the positivists, but Russell disagreed, paraphrasing, “You’ve actually done the opposite, showing that Mises wasn’t challenging science, but challenging people doing science incorrectly.”

This is fascinating. There might be more to this connection. It mirrors late Enlightenment discourse around rationality. When you look at the foundations of Mises’ belief system, you can find at least a thin thread to postmodernism, at least in the eyes of writers like Stephen Hicks.

Austrian school subjectivism derives from a long German rationalist tradition. Mises did something radical, novel and genius: Apply Immanuel Kant’s categorization, if you will, of a priori synthetic propositions to inform the whole academic subset of economics. Widespread allusions to empirical economic models and other positivistic thought is rife within economics these days, but subjective value is now accepted by all mainstream economic thought.

Mises was not questioning the entire category of science, but questioning the genre of scientific inquiry. It’s positivism he was against, not science. It’s trendy to smirk at anything which isn’t purely falsifiable these days, but the a priori method was considered science in the tradition within which Mises was working and drawing from.

Now to Stephen Hicks and his critique of Immanuel Kant. In sum, he’s not a fan:

“[Kant’s] attack on Enlightenment reason more than anyone else’s opened the door to the nineteenth century irrationalists and idealist metaphysicians. Kant’s innovations in philosophy were thus the beginning of the epistemological route to postmodernism.”

From Explaining Postmodernism.

Hicks does not consider him a true student of the Enlightenment, and a poor advocate of reason and science. “Kant was in favor of science, it is argued,” says Hicks, “he emphasized the importance of rational consistency in ethics,” but in Kant’s positing of a noumenal realm of reality that reason can not access, reason is limited to understanding itself (the phenomenal realm), and that’s it. Kant had thus handed a philosophical precedent to postmodernists.

Mises’ subjectivism then, with its focus on internal logical extrapolation, a priori reasoning that doesn’t require empirical verification or falsifiability, might be what Hicks will consider “reason understanding itself” in the Kantian sense. 

There may or may not be more to see in this connection with the Austrian school of economics. The reason I bring it up is because I’ve never seen it been made in this context. There is certainly more to explore in this line of thought.

All that said, apart from politics and economics, libertarians are other things as well. They’re parents, employees, business owners, scientists, or simple people who are interested in these things. In these capacities, it’s relevant whether we can make truth claims or not.

Then to the debate over gender identification, or the hypothetical person who believes themselves to be the planet Jupiter. All libertarians agree that we don’t want to force that person to not identify as Jupiter. Now that we’ve got that question out of the way, it still might be interesting to libertarians whether this person is actually the planet Jupiter or not. I don’t believe that this question is necessarily an act of imperialism.

It’s one thing to be yucking it up with other libertarians simply because we share the same values. It’s another thing to chuck out the entire concept of reality. We have other things we are interested in on a pure quest for knowledge.

That said, I don’t meant to trivialize the concept of two people who share the same values trying to create a deeper and more profound understanding with each other. This is an important conversation and credit to Thaddeus Russell for attempting to bridge this gap in a climate where postmodernism is under attack from libertarians.

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James Smith

Writer and film-maker from the United Kingdom. Digital nomad. Author of 'The Shy Guy's Guide to Travelling'.