The Global Currency Plot

This short appendix aims to address an important issue: How is it possible that the a priori categories of human action derived from human cognitive faculties (mind or spirit) coincide with the real world? In other words, how can the categories of human action provide insights into the real world? After all, they are only insights into the human mind itself.130 Why do things in experienced reality, for example, obey the cause-and-effect relationship (causality) when that is a category designed by the human mind? Is it not necessary to conclude that the human mind creates reality, and would that not be a rather questionable idealistic assumption?

One possible answer to these important questions can be developed as follows: The a priori categories of action are derived from the human cognitive faculty. Human action is undoubtedly bound to physicality, to human physical existence in the real world. Human action is, so to speak, always and everywhere physically or bodily; one can also speak of the a priori of corporeality. For example, if you say something, you have to make your vocal cords vibrate; if you walk from here to there, you have to use your legs; if you think, you have to let your brain work.

The a priori categories of action of the actor, his spirit and his mind, have an essential connection with the physical world via physicality or corporeality: the categories of action logic that claim to provide knowledge about the real world (like the sentence “Humans act”) follow from the interaction of the physical corporeality of the actor (Körperlichkeit) with the real world.131 The categories of action are thus not only mental, spiritual states, but they are at the same time always connected with the qualities of the real world in which action is taken; they can be traced back to them.

What needs to be clarified now is how the interaction of the actor with the physical world produces a cognitive faculty useful for the real world. Ludwig von Mises offers a theoretical evolutionary explanation: The mind categories have developed over the course of evolution.132 Those people who were successful were those whose minds were able to correctly grasp, interpret and respond to the real world. Their characteristics prevailed in evolution. Those who were unable to do so perished. We can therefore speak of a feedback process that has taken place between the mind of the actor and the real world: the a priori categories of action that the actor has at his disposal determine the view, the perception of the real world. And the real world determines, namely through the successes and failures of action, the conditions under which the actor perceives and looks at the real world.

The doctrine of human action, based on the undeniably true statement that humans act, opens up the possibility of effectively countering the fundamental and stubborn criticism of idealism (as the antithesis to realism) and above all of Immanuel Kant’s “transcendental idealism.” This criticism is roughly as follows: the denial of a subject-independent world is untenable, and Kant’s transcendental idealism is contradictory. Idealism means that reality, as perceived by the actor, is nothing other than the content of human acts, that reality is exclusively a human-cognitive product. Realism, on the other hand, believes that the real world, its concrete existence, is independent of the mental states of those acting.

Immanuel Kant, however, is not an idealist in the sense mentioned above. A concluding attempt will be made to justify this statement. Kant argues that there is the “thing in itself” (he speaks of “noumenon”: the imagined thing, the ideas of nonexperienceable objects) as opposed to an appearance (which he calls the “phenomenon”). According to Kant, we experience things as our cognitive faculty makes them appear to us, and from them the mind forms insights. We attribute qualities to the things of the real world that we experience, qualities that go back to exercising our cognitive faculty.

A central thought in Kant’s “Critique of Pure Reason” is that our insight is not directed toward the objects of the real world, but the objects of experience are directed toward our capacity for insight. For example, time and space are not characteristics that “things in themselves” have, but they are “pure forms of perception;” they go back to the exercise of our cognitive faculty: the human cognitive faculty perceives things in space and time.

Now, it seems to be idealistic to say that things are not really as they are experienced by us, but that we experience things only as our cognitive faculty allows—and Kant argues this way. But he combines this view with an important insight. It is this: the fact that we do not experience things as they really are, but only as they appear to us, opens the possibility that there are true synthetic judgments a priori about the objects of experience.

The question in Kant’s transcendental philosophy is: How are synthetic judgments possible a priori? The answer is as follows: if an object without the condition F, which in turn is based on the exercise of our human cognitive faculty, can never be the content of an objectifiable insight of experience, then the statement “All objects of experience necessarily fulfill the condition F” is a synthetic judgment a priori. The principle of transcendental philosophy is: “Conditions of the possibility of objective experience, which derive from our cognitive faculty and its exercise, are conditions of the experienced objects themselves and are a priori asserted by these objects in synthetic judgments.”133

If one agrees up to this point, then the sentence “Humans act” can be understood as a synthetic judgment a priori in the Kantian sense: No objectified experience can be made that could contradict the sentence “Humans act” and the categories it contains. All experience about human action is bound to the (praxeo)logical categories of action; it is only possible through its application. And as shown above, no idealistic assumption is required to show that the phrase “Humans act” and the categories it contains (as pure concepts of understanding) provide true knowledge about the physical world.

Let us conclude with Ludwig von Mises: The “real thing” with which praxeology has to do is human action, that shares a root with human reason. That reason is able to fathom the essence of action through mere thought is due to the origin of action from reason. The propositions of praxeology obtained through consistent and error-free thinking are not only completely certain and indisputable like the propositions of mathematics; they refer with all their certainty and indisputability to action as it is practiced in life and in reality. Praxeology therefore conveys exact knowledge of real things.134

• 130On this point, see Hans-Hermann Hoppe, Economic Science and the Austrian Method (Auburn, AL: Ludwig von Mises Institute, 2007), pp. 17–22.
• 131See Höffe, Immanuel Kant, p. 43, who uses this phrase; see also Peter Janich, who points out that one mostly speaks of the body (Körper) when actually corpus (Leib) is meant: “The difference is easy to point out: a part of a body is also a body; a part of a corpus (Leib, TP) is not itself a body, because it is not viable if it is separated.” (Janich, Handwerk und Mundwerk: Über das Herstellen von Wissen , p. 227).
• 132See also Mises, Nationalökonomie, pp. 36 ff.
• 133Tetens, Kants “Kritik der reinen Vernunft,” p. 113.
• 134Mises, Nationalökonomie, p. 20.