MACH AND ROBBINS

How can a Wittgensteinian language-game be fitted to human reality? Conversely put, how
can human reality be made to fit into a Procrustean language-game such as "economic
science"? The idealist "separation" (Plato's chorismos denounced by Nicholas of Cusa) of
Subject and Object - starting from Berkeley through to Mach and then the Wittgenstein of the
Tractatus - is the fateful precursor of Neoclassical Economics. The genealogy of this forma
mentis is illustrated in and exemplified by Lionel Robbins's epistemological mise en scene of
economics as "the science of choice". Yet far from being scientific, the Robbinsian definition
of the economic problem rapidly degenerates into logical formalism, into yet another
language-game far removed from the reality of human pro-duction. Any economics worthy of
the name must become a "critique of political economy", that is to say, it must acknowledge
its political essence, and then seek to overcome the real antagonism of its object of study - the
capitalist economy and the society of capital. Cheers.

Even the wildest dream is a fact as much as

any other. If our dreams were more regular, more connected,
more stable, they would also have more practical
importance for us. In our waking hours the relations of
the elements to one another are immensely amplified in
comparison with what they were in our dreams. (p.11)
The ego is not
sharply marked off, its limits are very indefinite and
arbitrarily displaceable. Only by failing to observe this
fact, and by unconsciously narrowing those limits, while
at the same time we enlarge them, arise, in the conflict
of points of view, the metaphysical difficulties met with
in this connexion. (p.13) (Mach, Antimetaphysik in The Analysis of Sensations)

Machs theory of sensations is pure Schopenhauer. It contains therefore an implicit and

stinging critique of Kantian metaphysics. To be sure, already the Kantian thing in itself had
removed the relation between Subject and Object to one of mere transcendence, to the
realm of idealism however critical Kant intended these to be. And yet Kants notion of
intuition, although it made human objective reality unknowable, still retained that

indissoluble material link between human thought and its object between fact and
concept, between Object and Subject. The Kantian universe is still Galileo-Newtonian in the
sense that it is something that can be com-prehended and en-compassed by human beings
through the faculty of Reason by means of which the universe acquires an order and a
reason that can be uni-versally recognized by all human beings that can lead to a
convergence or con-sensus over ultimate human goals and values. It is not that dreams are
neglected because they have less practical importance to us as scientists! than waking
reality: rather, it is because they have less importance for the business of scientists! The
con-nection empirical! between the rise of capitalism and that of science is undeniable.

For us, therefore, the world does not consist of

mysterious entities, which by their interaction with
another, equally mysterious entity, the ego, produce
sensations, which alone are accessible. For us, colors,
sounds, spaces, times, . . are provisionally the ultimate
30 THE ANALYSIS OF SENSATIONS
Elements [sensations], whose given connexion it is our business to
investigate. 1

Such empirical formalism simply obliterates the role of human goals in the pursuit of science,
the search for a shared reality of human values.
With Mach and then Wittgenstein, Kantian rationalism gives way to pure empiricist
positivism. There is no substance behind concepts; there are no things behind facts; there
is no reality behind sensations. The task of science is merely to con-nect these sensations or
facts by means of hypotheses whose guiding principle must be that of economy.

But anyone who takes his stand as I

do on the economic function of science, according to which nothing is
important except what can be observed or is a datum for us, and
everything hypothetical, metaphysical and superfluous, is to be
eliminated, must reach the same conclusion. (fn1 at pp.27-8)

But what is a datum? Mach is deceived by the given-ness of facts as data, which are not
given at all but found in the sense of searched for by the scientist, in-vestigated like
vestigia (tracks), hunted for. The tragedy of positivism is to forget the activity (auctor,
auctoritas), the exercise of decision and power behind the data or facts (from facere, human
action) that are found or ascertained. Certainly, anything superfluous can be neglected
because it is superfluous. But what is superfluous relates to a particular line of research
and then we must ask, Who decides what to research? Similarly, the hypothetical cannot be
abandoned because all science starts with hypotheses. And the drives, the human needs
that lead to hypotheses can reflect meta-physical goals. What, then, can be the economic
function of science?

Robbins:

But when time and the means for achieving ends

are limited and capable of alternative application,
then behaviour necessarily assumes the form of choice.
Every act which involves time and scarce means for
the achievement of one end involves the relinquishment
of their use for the achievement of another. It
14 SIGNIFICANCE OF ECONOMIC SCIENCE OH.
has an economic aspect.1

But economic science cannot prescribe what particular choice an individual must make
scientifically for it to be economic, because from an individuals point of view the
choice cannot be dictated by considerations other than the choice itself. Given a
choice, its implementation is a matter for engineering, not for economics. Clearly then,
economics intervenes only when individual choices are in conflict (scarcity) with the choices
of other individuals (Hayek on Walrasian equilibrium). There must be the possibility of
exchange of goods. But this presumes the prior existence of goods as individual products hence, the division of social labour into individual labours and then the prior
existence of property rights.

There is a tautology of choice here in that choice is reduced to science, and an oxymoron in
the sense that choice cannot be scientific and science is objective, that is, it is

independent of choice. This applies to societies as well because it is impossible to

determine what the scientific way of maximizing choices is without first knowing what
these choices have in common their interest, perhaps a market mechanism to reach
equilibrium (Hobbess paradox how can self-interested individuals agree to form a
society or set up a market?)

Choice necessarily involves scarcity that is why a choice must be made. But this
choice is not economic because there are no parameters by which the choice can be
graded apart from, outside of, the choice itself! If I specify what my parameters for my
choice are. then I do not have a choice! My choice becomes a mere calculus. Both
logic and mathematics are just calculi that do not involve choice. Choice is ineluctably
political, it involves many individuals. But then economics must become political
economy and can never be a science of choice.

Economics is the science which studies human behaviour

as a relationship between ends and scarce
means which have alternative uses.1
1

Cp. Menger, Orundstze der Vlkswirtschaftslehre, lte aufl, pp. 51-70;

Mises, Die Gemeinwirtschaft, pp. 98 seq.; Fetter, Economic Principles, ch. i.;
Strigl, Die 'lconomischen Katagorien und die Organisation der Wirtschaft,
passim; Mayer, op. cit. (Robbins, p.15)

By rejecting the classificatory definition of economics, which refers to material welfare,

Robbins espouses the analytical formalism of Mach and Wittgenstein (p.16). But by so
doing he completely dis-embodies economics, divorcing it even from its most fundamental
political element one that even Menger could not ignore: - the exchange of goods (p.16-7).
One may realise completely the implications
for oneself of a decision to spend money in this way
rather than in that way. But it is not so easy to trace
the effects of this decision on the whole complex
of "scarcity relationships"on wages, on profits, on
prices, on rates of capitalisation, and the organisation

of production. On the contrary, the utmost effort of

abstract thought is required to devise generalisations
which enable us to grasp them. For this reason
economic analysis has most utility in the exchange
economy. It is unnecessary in the isolated economy.
It is debarred from any but the simplest generalisations
by the very raison d'etre of a communist society. (Robbins cites Misess
Gemeinwirtschaft, p.18)

[I]t is clear that the phenomena

of the exchange economy itself can only be explained
by going behind such relationships and invoking the
operation of those laws of choice which are best seen
when contemplating the behaviour of the isolated
individual.2(p19)

For it is not
the materiality of even material means of gratification
which gives them their status as economic goods;
it is their relation to valuations. It is their form
rather than their substance which is significant. The
"Materialist" conception of economics therefore misrepresents
the science as we know it. (p.20)

Economics is not concerned at

all with any ends as such. It is concerned with ends

in so far as they affect the disposition of means. It

takes the ends as given in scales of relative valuation,
and enquires what consequences follow in regard to
certain aspects of behaviour. (P.29)

It is obvious that this ends-means definition of economics can stand its ground if it breaches
the condition of universality that Robbins seeks to ascribe to it: if it is empirically and
positivistically confined to the effects of human behavior under specific conditions of
exchange but not to the totality of exchanges - then economics becomes pure engineering or
technique as Robbins calls it in this chapter on Ends and Means. But if it seeks to extend
to all combinations of ends and means, then it is clear that economic science must also be
able to prescribe the ends that are economic or affordable which contradicts his
categorical exclusion of ends from economic analysis earlier in the chapter: Robbins is then
forced to amend his definition to include not just the choice of scarce means with regard to
known or given ends, but rather also the choice of combinations of all ends and means:

[Th]e problem
of technique arises when there is one end and a
multiplicity of means, the problem of economy when
both the ends and the means are multiple.1(p.31)

In fact, the problem arises when the ends are given, not when there is only one end! If
the ends being pursued by agents are known or given (as in Walrasian equilibrium
where utility schedules are common knowledge), then the economic problem does not
exist and the solution is pure engineering technical. But where the ends are not
discernible, then the problem becomes at once political and economic it becomes
political economy, never economic science!

Robbins is confusing a technical problem the choice of appropriate means to given ends with the essentially political nature of economics: the social relations behind capitalist
production. This is why, from the piecemeal viewpoint of exchange transactions only, where
it remains a technical tool, his definition of economic science misses out on the essential
political characteristic of capitalism the accumulation of social power as value, as
command over living labour by means of its exchange with dead labour. It is the
impossibility of this exchange that inspired Marxs critique. Thus, value in economics

what lies behind market prices and is embodied in money is an entity that cannot have
a scientific or technical meaning, but one that is intrinsically political. His failure to
understand this vital point is why Robbins entirely misunderstands the function of money,
leaving out entirely its role as a store of value in a capitalist economy:

Money-making in the normal sense of the term is

merely the intermediate stage between a sale and a
purchase. The procuring of a flow of money from the
sale of one's services or the hiring out of one's property
is not an end per se. The money is clearly a means to
ultimate purchase. It is sought, not for itself, but for
the things on which it may be spentwhether these
be the constituents of real income now or of real
income in the future. Money-making in this sense
means securing the means for the achievement of all
those ends which are capable of achievement by the
aid of purchasable commodities. Money as such is
obviously merely a meansa medium of exchange,
an instrument of calculation. For society, from the
static point of view, the presence of more or less money
is irrelevant. For the individual it is relevant only
in so far as it serves his ultimate objectives. Only the
miser, the psychological monstrosity, desires an infinite
accumulation of money. (P.30)

Money is much more than just a means of exchange and a unit of account a means of
calculation as Robbins clumsily puts it. Money is above all a store of value: it is the
necessary expression of political relations pertaining to the exchange of living with dead

labour (pro-ducts or goods or commodities). And the aim of capitalism is precisely the
infinite accumulation of money as the embodiment of political power through the
exchange of dead labour with dead labour! The miser Robbins has in mind the
psychological monstrosity intends precisely to reach the Nirvana that is the satisfaction of
all needs through the renunciation (Schopenhauers Entsagung) of present consumption!
This is the crucial point behind the theory of capital in both Menger and then Bohm-Bawerk.