Magic Words and False Gods

Any productive action requires clear thinking on the part of the acting person. This is particularly true of communication. In The Ultimate Foundations of Economic Science (1962), Ludwig von Mises remarked that the “worst enemy of clear thinking is the propensity to hypostatize, i.e. to ascribe substance or real existence to mental constructs or concepts." 
In other words, there’s no such thing as “society.” 
Mises continues:
Hypostatization is not merely an epistemological fallacy and not only misleads the search for knowledge. In the so-called social sciences it more often than not serves definite political aspirations in claiming for the collective as such a higher dignity than for the individual or even ascribing real existence only to the collective and denying the existence of the individual, calling it a mere abstraction.
The fallacy of hypostatization, however, is not confined to people holding collectivist views. It is also practiced by people who stress the importance of individual liberty.
If the so-called collectivist falls into hypostatization fallacy in using the magic word society (“it's society’s fault”; “society will intervene”) the so-called individualist employs the same fallacy when he uses the magic word market.

When people use the terms “society” and “market” it would seem there is an overarching almighty entity that has a life of its own. This entity is supposed to do everything, to redress any tort, to administer justice, to increase well-being on earth, and lead us to the Promised Land.

Hypostatization should therefore be carefully avoided, because the fallacy is unreal, ambiguous, and divisive. It’s unreal because it is devoid of a proper empirical foundation that could clarify, with a certain exactitude, the features and sphere of reference of the hypostatization. It’s ambiguous because it signifies different things to different people; conflicting meanings could be attributed to the same hypostatization. So clearly it is also divisive. It can be taken up by politicians and demagogues in order to invent fake agents and fake enemies that become the convenient scapegoats of those in power.

One should: Replace sloppy uses of “the market” with the concrete expression people engaged in free exchanges; and then operationalize the expression by measuring the effective level of freedom (accessibility, universality, etc.) on the one hand, or impediments to those concrete exchanges (tariffs, quotas, etc.) on the other—noting any corresponding growth or diminishment in wealth.

Source: Gian Piero De Bellis, “Magic Words and False Gods,” The Freeman, Aug. 29, 2013.