Monday, July 23, 2012

Only Individuals Act - Robert P. Murphy

If we as economists are going to explain an event by referring to a purposeful action, this obviously implies that there is some individual performing the action. After all, to say that a conscious intelligence influenced events, implies that there must be some intelligent being to whom the consciousness belongs.
Now we don’t have to actually know the precise identity of the individual, in order to conclude that an individual has taken a purposeful action. A detective can look at a blood-soaked kitchen and say, “Somebody killed this poor woman—that butcher knife didn’t stab her through some freak accident.” The detective can thus explain the physical arrangement of the kitchen, by supposing that some other, intelligent individual consciously chose to act to kill the victim. This is a perfectly good hypothesis, even though the detective (as yet) doesn’t know anything else about the actual killer. But he does know that the killer had a goal in mind—no matter what the extenuating circumstances may be, nobody is going to believe him if he says, “Sure I was holding the knife when this happened, but believe me it was an accident.”
Just to make sure you really understand the concept, we note that the “individual” behind an action doesn’t necessarily need to be a human being. There are plenty of people who claim that their best explanation for what happened to them was that they were abducted by aliens and subjected to all sorts of unpleasant sensory experiences. Again, our rule holds: These people aren’t blaming “nature” for what happened, they are instead saying that intelligent beings influenced events. For whatever reason, the aliens had the goal of probing Billy Bob as he drove his pickup truck home one dark night, and the aliens acted on that desire. For a different example, a religious person might interpret the sudden remission of her cancer as due to the intervention of God. In this case, she too is explaining events in the physical world by reference to the purposeful action of an intelligent individual—one who in this case doesn’t possess a physical body.
When we decide to interpret an event as a purposeful action, we are necessarily supposing that there must be an intelligent individual carrying out the action. (There can’t be an action without an actor.) So the connection between an action and an actor is a logical one, flowing out of the very concept of “purposeful action” itself. Now in practice, our attempt to link up a specific action with a specific actor is based on more than simple logic. For example, when the detective decides “this is a homicide,” he is logically implying that there must have been (at least one) killer. But he might use faulty DNA tests to end up arresting the wrong guy. So we see, there is more than a logical deduction involved, when trying to arrest the actual killer. But the important point for our purposes is that the detective’s decision to classify a bloody kitchen as a crime scene necessarily means that there must be a killer (or killers). But going from this logical conclusion to the next step of identifying a particular person as the killer, requires more than mere logic.
To drive home the subtle interconnections of logical and empirical reasoning, we can consider a more fanciful example. Suppose a psychiatrist can see the left hand belonging to one of his patients as it grabs a pen and begins spreading ink onto a check. The psychiatrist classifies this as a purposeful action, and thus logically he must also believe that there is some conscious individual performing this action. However, the psychiatrist might think, “That’s my sweet patient Sally paying me for this week’s services as I help her with her split personality syndrome,” when in reality it is Sally’s alter-ego, Snippy, who isn’t filling out the check at all but instead is writing “YOU ARE TOO NOSY!!” on the paper before handing it over to him. In this example, we again have to keep in mind the limits of logical deduction. Once the psychiatrist decides to interpret the movements of the hand and pen as purposeful action—as opposed to a mere reflex—then he logically must conclude that there is an intelligent being with a motive who is moving the pen in order to achieve some goal. However, if the psychiatrist jumps to the conclusion that the intelligent being is the personality he knows as “Sally,” and that she is moving the pen in order to give him payment for his services, then the psychiatrist is going beyond the range of logical deduction, and he might be wrong.
As these examples illustrate, in everyday life we do a lot more than simply rely on logical deductions once we decide to interpret an event as a purposeful action. We use all sorts of empirical evidence to refine our understanding of what we observed. But economic theory focuses on the knowledge we can deduce merely from the fact of purposeful action itself, without the other empirical evidence in a given case that may or may not lead us to a fuller explanation.
Barring odd cases such as multiple personalities or hypnotic control, generally speaking we associate each human body with one specific mind (and vice versa). So when we see the physical body associated with “Bill” pouring a can of soda down its throat, we naturally describe this by saying, “Bill was thirsty so he decided to drink something.” Although we don’t usually stop to think about it, when we talk like this we are referring to an intangible, conscious will called “Bill” that tries to get its way by influencing the components of the glob of cells that we label, “Bill’s body.”
We are brushing up against deep philosophical issues once again, which go far beyond the scope of a book on economics principles. In this section, we only need to make one more point: Because a purposeful action is associated with a single individual (namely, the actor), it means that when an economist tries to explain an event by reference to purposeful actions, he ultimately must break it down into the motivations or goals of the individuals involved. This statement sounds obvious, but it is surprising how casually people—even respected social scientists—ignore the rule.
For example, an historian might write, “In 1941 Japan attacked the United States.” Strictly speaking, this is nonsense. “Japan” isn’t an individual and so can’t take purposeful actions (such as bombing Pearl Harbor). Individual Japanese pilots flew planes and attacked ships belonging to the U.S. Navy. The statement “Stalin occupied East Germany” is at least sensible (since Stalin is an individual), but it’s nonetheless misleading if interpreted literally. Really what happened is that Joseph Stalin gave orders to his subordinates, who in turn relayed them to their subordinates and so on, such that many many soldiers chose to obey those orders and carried out purposeful actions that resulted in a new (and scary) political situation for the people living in East Germany.
In many cases this sloppy use of language is fine; there is no danger of confusion when a sports fan yells out from his office cubicle, “Chicago just kicked a field goal to tie the game!” Everyone knows what he means by that statement; no one will be misled into believing that somehow a lifeless geographical location managed to block burly men long enough to propel a pigskin between two posts.

Only Individuals Act
The first truth to be discovered about human action is that it can be undertaken only by individual “actors.” Only individuals have ends and can act to attain them. There are no such things as ends of or actions by “groups,” “collectives,” or “States,” which do not take place as actions by various specific individuals. “Societies” or “groups” have no independent existence aside from the actions of their individual members. Thus, to say that “governments” act is merely a metaphor; actually, certain individuals are in a certain relationship with other individuals and act in a way that they and the other individuals recognize as “governmental.”
—Murray Rothbard, Man, Economy and State (Auburn, Ala.: Ludwig von Mises Institute, 2004), pp. 2–3

However, in many cases this sloppy use of language is very dangerous, leading people to reach the wrong conclusions about the world. For example, many people would endorse the following statement: “Man our government is so incompetent and dumb! On the one hand it pays farmers to grow tobacco, while on the other hand it pays ad agencies to develop anti-smoking campaigns. Make up your mind!”
In reality, there is no such thing as “the government” that has a mind of its own and can perform purposeful actions. Instead, there are individuals—politicians, judges, bureaucrats, etc.—belonging to the government who enjoy special privileges because of their status. Different combinations of (some of) these individuals make conscious decisions to steer tax dollars toward tobacco farmers and anti-smoking campaigns. The simplistic approach to viewing these programs as actions taken by “the government” is not only technically inaccurate, but it is actually dangerously misleading. After reading the lessons in this book, you will realize that there are perfectly sensible reasons for the actions of government officials. Their actions often don’t make any sense when compared to the official justifications given for the actions, but there’s a simple explanation for that too: government officials routinely lie. (Notice that lying is itself a purposeful action.)

Lessons for the Young Economist

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