This section is pretty understandable, after the spadework we did earlier.
Mises: Prerequisites for a person acting:
1. He thinks things could be better than they are. If he is perfectly content as is, he will leave things alone.
2. He thinks he can do something about it. If he thinks there is nothing he can do about things, he won’t do anything.
3. He has a brain to think about these matters. If he is so mentally challenged he cannot do the previous two things, he can’t act.
Only when those three things are in place will an action happen.
DA: Simple Enough.
Now Mises talks about Happiness. You could say that “Human Action” is another phrase for the “Pursuit of Happiness”. But, just as every other aspect of economics, it always comes back to the individual. What is Happiness? Every person has his own answer, and it’s what he pursues.
DA: So when someone says, “You should only be happy if you do so and so, like feeding the homeless,” that may be right or not, but it has nothing to do with economics.
Mises: Economics does not take a stand on what Happiness really is, or should be. It merely says the obvious, that when you get to actions, people will do what actually makes them happy, not what someone else thinks should make them happy.
DA: What if it makes them happy doing what someone else tells them?
Mises: Then that’s what they will do. It takes all kinds to make a world. Some people are happy eating and drinking and carousing. Others are happy doing more spiritual things.
DA: Does economics make any distinction between them?
Mises: No. Because economics is not about what people want, what makes them happy, but about how they act to get what they want. And the rules of economics will apply to all actions, no matter what brand of happiness the actions are going after.
DA: Time to impress us with some big words, prof.
Mises: OK, how about Eudaemonism, Hedonism, Epicurean àτapaξίa, and Utilitarianism, not to mention “heteronomous”.
Eudaemonism. The theory that the final goal of all human action is happiness.
Hedonism. The theory that the final goal of all human action is pleasure, or rather happiness.
Epicureanism. The Greek school of thought founded by Epicures (342-270 B.C.) that held that the joys of the mind are superior to the pleasures of the body.
àτapaξίa, (Ataraxia, Greek). Complete peace of mind.
Utilitarianism. A school of thought, neutral as to ends, that holds that social cooperation, ethical precepts and governments are, or should be, merely useful means for helping the immense majority attain their chosen ends. It holds that the ultimate standard of good or bad as to means is the desirability or undesirability of their effects. It rejects the notions of human equality, of natural law, of government as an instrument to enforce the laws of God or Destiny; and of any social entity, such as society or the State, as an ultimate end. It recommends popular government, private property, tolerance, freedom and equality under law not because they are natural or just but because they are beneficial to the general welfare.
Heteronomous. Not self-determining; subordinate to something else; opposed to autonomous.
DA: How do you know all that stuff?
Mises: Simple. I just consult the webpage Mises Made Easier.
DA: How did all those things sneak into this discussion?
Mises: They all were saying what I’m saying, that the goal of all actions is what makes the individual Happier, as he defines happiness. I think they had it right, though they were misunderstood, poor things.
DA: What about hypostasis, which you mention a bit later?
Mises: Hypostasis. Assignment of substance or real existence to concepts or mental constructs.
[At this point, William McDougall enters, smoking a big cigar].
William McDougall: Sorry to disappoint you, Prof, but I’ve refuted your book before you’ve even begun.
Mises: How so?
WMcD: Your whole book assumes people think things through. Means and ends and rationality is what your book is about. But I have discovered that man is an animal, ruled by deep, mysterious, animal instincts. All your rationality has nothing to do with it. You can toss your whole book away. It’s nothing but a tissue of false conclusions drawn from false psychological assumptions. Thank you.
Mises: So if Jones’s deep mysterious call of the wild tells him to rob a bank, he will do it?
Mises: Even if there are armed guards ready to shoot him down the moment he tries anything?
WMcD: In that case, he’ll try to sneak in at night, or something.
Mises: So once Jones has an end in mind, robbing the bank, which makes him happy because it satisfies some deep instinctual urge, he will then plan the best way to do it? He won’t just make like the Hulk and smash, if it means getting himself killed?
Mises: My book is about the plans he will make. It’s about the actions people make to get what they want, not about why they want what they want. For all I care, it may well be some call of the wild that decides what he wants. But how he will try to get it is what economics is about.
WMcD: OK, let’s move on to Section Three.
The other parts of this epic attempt can be found here: https://smilingdavesblog.wordpress.com/2014/07/26/human-action-smiling-dave-style-toc/