Liberalism and Individualism

Mises’ brand of individualism is known as utilitarian individualism. Although he makes no explicit reference to utilitarianism or individualism in Liberalism, this doctrine is implicit in every aspect of Mises’ argument. Elsewhere he has defined the essence of utilitarianism to be “the cognition that action pursues definite chosen ends and that consequently there can be no other standard for appraising conduct but the desirability or undesirability of its effects . . . By its recognition that social cooperation is for the immense majority a means for attaining all their ends, it dispels the notion that society, the state, the nation, or any other social entity is an ultimate end and that individual men are the slaves of the entity. It rejects the philosophies of universalism, collectivism, and totalitarianism. In this sense it is meaningful to call utilitarianism a philosophy of individualism.” (Theory and History, pp. 5758)

One finds Mises’ utilitarian individualism at work throughout his discussion of the connection between liberalism’s advocacy of private ownership of the means of production and its demand for limited functions of government, and in his analysis of the relation of the state to the individual. But his perspective is most evident in his refutation of the charge by antiliberals that capitalism is a threat to social cooperation.

Mises was aware of the claim that individualism pits the individual against society; he was also aware of the antiliberal progression from an attack on autonomy and privacy to an attack on private property. Thus, he begins the section on “Property” with an assertion that is the under lying theme of his entire enterprise: “Human society is an association of persons for cooperative action. As against the isolated action of individuals, cooperative action on the basis of the principle of division of labor has the advantage of greater productivity. If a number of men work in cooperation in accordance with the principle of the division of labor, they will produce (other things being equal) not only as much as the sum of what they would have produced by working as self-sufficient individuals, but considerably more. All human civilization is founded on this fact.” (p. 18)

He boldly argues that “private property creates for the individual a sphere in which he is free of the state. It sets limits to the operation of the authoritarian will.” As an intermediary between the individual and the state, “it allows other forces to arise side by side with and in opposition to political power. It thus becomes the basis for all those activities that are free from violent interference on the part of the state. It is the soil in which the seeds of freedom are nurtured and in which the autonomy of the individual and ultimately all intellectual and material progress are rooted.” (pp. 6768)

Certain doctrinaire individualists take the view that any social cooperation entails the compromise of individual autonomy and the sacrifice of self-interest to the interests of social groups and institutions, and is therefore altruistic, hence immoral.

Actually, what Mises describes is not a sacrifice at all. Sacrifice involves the renunciation of a greater value for a lesser one. While individualism does not pit self-interest against social cooperation, as anti-liberals claim, it does assign a greater value to self-interest than to social cooperation. But it recognizes that in certain social contexts cooperation may be in the individual’s interest, while in others it would not be. If it is in the interest of the individual’s well-being and prosperity, then no sacrifice is involved. The antiliberal interventionist state certainly does require sacrifices of the individual which it justifies in the name of social cooperation. But as Mises demonstrates in his discussion of price controls and minimum wage legislation, this kind of government interference in the market not only requires the sacrifice of the interests of merchants, manufacturers, employers and employees; it also creates social disorganization and is therefore self-defeating.

Many defenders of liberalism try to make their case either by obscuring individualism’s value of autonomy or by bypassing it altogether. When they do address it, they too often concede to antiliberals their typical contrast of individualism with the ideal of cooperative social order. The significance of Liberalism for advocates of individualism is that it is an exemplification of how one can make the case for individualism without making this concession. As Mises’ argument demonstrates, antiliberal ideologies have no monopoly on the goals of association, social cooperation and harmony.

In fact, in Mises’ view, antiliberal ideologies often mask profoundly antisocial assumptions. There is no need at all to defend liberalism’s value of autonomy by placing the self-sufficient individual in opposition to man as a social being. Thus, in Mises’ approach to autonomy and privacy, he makes a valuable contribution to the conceptualization of individualism by presenting an exposition of the proposition that individualism is the best basis for a cooperative social order.