Academic socialism is no homogeneous ideology. In the way syndicalism stands alongside socialism, although they often are not differentiated distinctly, there are two schools of thought in Socialism of the Chair: the Socialist School (state socialism or etatism), and the Syndicalist School (at times called “social liberalism”).

Heinrich Herkner, president of the Association for Social Policy, recently published his autobiography under the sub­title “The Life of a Socialist of the Chair.” In it he made it his task “to facilitate an understanding of the closing era of German academic socialism.”1 ,

Considering the dismal intellectual poverty and sterility of nearly all books and papers defending interventionism, we must take notice of an attempt by Schmalenbach to prove the inevitability of the “hampered economy.”

Schmalenbach starts from the assumption that the capital intensity of industry is growing continuously. This leads to the inference that fixed costs become ever more significant while proportional costs lose in significance.

With a few exceptions contemporary commentators on economic problems are advocating economic intervention. This unanimity does not necessarily mean that they approve of interventionistic measures by government or other coer­cive powers. Authors of economics books, essays, articles, and political platforms demand interventionistic measures before they are taken, but once they have been imposed no one likes them. Then everyone—usually even the authori­ties responsible for them—call them insufficient and unsat­isfactory.

Misunderstandings about the nature and significance of economics are not due exclusively to antipathies arising from political bias against the results of inquiry and the conclusions to be necessarily drawn from them. Epistemology, which for a long time was concerned solely with mathematics and physics, and only later began to turn its attention to biology and history as well, is presented with apparently insuperable difficulties by the logical and methodological singularity of economic theory.

1. Origin in the Historical and Normative Sciences

It is in accounts of history that we find the earliest beginnings of knowledge in the sciences of human action. An epistemology that is today rejected required of the historian that he approach his subject matter without theory and simply depict the past as it was. He has to describe and portray past reality, and, it was said, he will best succeed in doing this if he views events and the sources of information about them with the least possible amount of prejudice and presupposition.