“The essential characteristic of the imaginary construction of this king’s ideal regime is that all its citizens are unconditionally subject to authoritarian control…”-Mises

Part Five
Social Cooperation Without n Market
XXV. THE IMAGINARY COSSTRUCTION
OF A SOCIALIST SOCIETY

“The essential characteristic of the imaginary construction of this
king’s ideal regime is that all its citizens are unconditionally subject
to authoritarian control. The king issues orders and all obey. This
is not a market economy; there is no longer private ownership of the
mcans of production. The terminology of the markct economy is
retained, but in fact there is no longer any private ownership of the
means of production, no real buying and selling, and no market prices.
Production is not directed by the conduct of the consumers displayed
on the market, but by authoritarian decrees. The authority assigns to
everybody his station in the system of the social division of labor,
determines what should be produced, and how and what each individual is aIlowed to consume. This is what nowadays can properly be
called the German variety of socialist management.l

Now, the economists compare this hypothetical system, which in
their eyes embodies the moral law itself, with the market economy.
The best they can say of the market economy is that it does not
bring about a state of affairs differcnt from that prodnced by the
supremacy of the perfect autocrat. They approve of the market
economy only because its operation, as they see it, ultimately attains
the same results the pcrfcct king would aim at. Thus the simplc identification of what is morally good and econo~nically expedient with the
plans of the totalitarian dictator that characterizes all champions of
planning and socialism was not contested by many of the old liberals.
One must even assert that they originated this confusion when they
substituted the ideal image of the perfect state for the wicked and
unscrupulous despots and politicians of the real world. Of course,
for the liberal thinker this perfect state was merely an auxiliary tool
of reasoning, a model with which he compared the operation of the
market economy. But it was not amazing that people finally raised
the question as TO why one shouid nor: transfer this ideai state from
the realm of thought into the realm of reality.”

Human Action, p, 687, Ludwig von Mises

Book: Human Action, The Scholar’s Edition, by Ludwig von Mises

SEE PRIOR POSTS:

Hegel: The State as God’s Will—Rothbard