Edited and written by David Gordon, senior fellow of the Mises Institute and author of four books and thousands of essays.

The Limits of Grace

Spring 2003


John Milbank, "Politics: socialism by grace" in Being Reconciled: Ontology and Pardon, Routledge, 2003, pp. 162-186.


I expected better of John Milbank. He is a theologian of great distinction, the leading theorist of the influential Radical Orthodoxy movement. Would not so profound a thinker offer us illuminating ideas on economics? Alas, it was not to be; and Mises's skepticism about the pronouncements of theologians on economic affairs once more finds confirmation.


In Human Action, Mises locates the key fallacy in the arguments of theologians who demand that the market be replaced by a more "moral" alternative: "In urging people to listen to the voice of their conscience and to substitute considerations of public welfare for those of private profit, one does not create a working and satisfactory social order. It is not enough to tell a man not to buy on the cheapest market and not to sell on the dearest market. . . One must establish unambiguous rules for the guidance of conduct in each concrete situation."(Human Action, Scholar's Edition, p.721)


Milbank perfectly exemplifies the pattern that Mises has set forward. He claims that capitalism disrupted the lives of people living peacefully in communities. Early nineteenth-century socialism was in essence a religious movement that aimed to restore the lost values of these communities: Socialism was "an originally mainly Christian concept, arising first in France and Britain and then Germany. . . it was concerned with re-establishing, albeit in a more egalitarian mode, bonds of fraternity and solidarity which transcended a mere formalistic respect for the freedom and happiness of the other person, and was grounded in a shared vision of the substantive Good which the first socialists often assumed would be a religious one"(pp.162-163)


Here a question arises. Suppose you want to a community of just the kind Milbank describes. Why should you oppose capitalism? Does not a system of free exchange of goods, founded on individual property rights, permit people to form whatever communities they wish?


Milbank fails entirely to grasp this point. He defines capitalism as an abstract system, inimical to respect for the value of persons and their concrete activities: "[T]he untrammeled free market. . . is clearly an expression of an Enlightenment commitment to the fully universal, the clearly comprehensible and the exhaustively justifiable, since only an empty consistency is able to meet these criteria."(p.163)


Where does Milbank get such nonsense? Capitalism does depend on the rule of law, which is indeed formalistic and abstract; but how does this in any way require that all activities of people living under the rule of law be likewise abstract? Quite the contrary, just the fact that the legal system leaves people largely to their own devices permits them to establish communities along the lines they wish.


One suspects that this for Milbank is just the problem. In his preferred plan, people are not free to do as they like: "Thus every member of a group of producers or retailers should first be initiated into a certain mystique of his calling. . .No one not in some way initiated and trained after this fashion would be allowed to operate in business or production."(pp.185-186)

Milbank thus wants a certain kind of community, but he does not trust people to live voluntarily within the guidelines he favors. Instead, those who might---what a thought! ---wish to pursue profit without regard to mystique must be forcibly prevented from doing so.


But suppose that we grant Milbank all the coercive powers he wants. He has still failed to address Mises's point: How exactly would his system set prices? Our author fails to grasp the magnitude of the problem that confronts him.


He appeals to a phenomenon found in many primitive societies: gifts play a major role in economic life. Rather than exchange apples for oranges, someone in possession of apples will give them to another. In doing so, he will expect to get a return gift---but what he will receive is unspecified.


If you are a prisoner of abstract, Enlightenment reason, you may wonder why Milbank likes this system. Does it not render life drastically uncertain? You do not know whether you will receive oranges if you give up apples; instead, you must surrender your possessions and hope for the best.


Milbank finds in this odd approach an escape from market impersonality: "Hence for these [primitive] societies, a thing exchanged is not a commodity, but a gift; and it is not alienated from the giver but expresses his personality, so that the giver is in the gift, he goes with the gift. Precisely for this reason a return on the gift is always due to the giver, unlike our modern 'free gift'."(p.167)


Better "personality" of this sort than the assurance you will get in trade what you want. I suspect that few will share Milbank's preference; but this is not to the point here. Rather, to reiterate, Milbank needs to answer Mises's question; how would his economy of reciprocal gifts set prices? Without prices, his system would collapse into chaos. It is no coincidence that only primitive societies operate through gifts rather than through "abstract" exchange.


At one place Milbank comes close to recognizing the issue at stake. He is aware that central state planning will not work: "Hayek was right about this", he informs us. (p.185) But he fails to see that the calculation argument applies to the syndicalist measures he favors as well as to centralized socialism. He nowhere realizes the vital necessity for prices. Our author is a scholar of great learning, but he needs to read Mises and Rothbard as well Catherine Pickstock and Georges Bataille.


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