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The socialist calculation debate

• transfire 3y ago
  Ironically over regulation is causing much of the inequality, not the other way around.
  • postpawl 3y ago
    What regulation specifically? From my own experience, Texas power grid deregulation definitely hasn’t made my electric bill go down.
    • artificialLimbs 3y ago
      When you pass new regulation (requirements), you generate new costs associated with providing $service_or_product. When costs go up, they are passed on to consumers. Now that your $service_or_product is regulated by 17 regulations that cost an average of $x each, your product now costs $base_price + ($x * 17) dollars. People with low income are less likely to be able to afford it.
      • AlexandrB 3y ago
        This is extremely context sensitive. Antitrust regulation doesn't require a "compliance" department unless you're already huge and doing things that might be considered anti-competitive. Likewise financial regulations like Glass-Steagal[1] prevent certain types of organizations (in this case hybrid commercial-investment banks) from existing - I don't see how this could result in compliance costs. [1] https://en.wikipedia.org/wiki/Glass–Steagall_legislation https://en.wikipedia.org/wiki/Glass–Steagall_legislation
      • unshavedyak 3y ago
        Is there a better way to implement regulation then? Perhaps i'm unaware of what regulation means in this context, but a lot (not all!) of regulation serves a purpose, or did originally. Ie safety regulation for requiring how your home wiring is done; that builders can't skimp and use thin wiring or etc. Food safety regulation for how long food is allowed out of cooling, temperature requirements for cooling, etc. These obviously serve a goal, but if you're saying that they also cause inequality, what is the better solution? Do we remove all safety rails? Or are some seen as essential, so the debate isn't pro or anti regulation but merely which ones are worth the cost? etc
      • vicktour 3y ago
        The best part about this is removing regulations wont change any prices. They will just keep the profits and continue to raise prices. 1) Company Complains about regulations 2) Gov Removes Regulations 3) Companies do dumb stuff 4) Gov Applies Regulations 5) People forget about dumb stuff 6) Return to step 1. Case In Point: SVB
        • sharemywin 3y ago
          Not too mention that companies consolidate to cartels(I'm looking at you industry trade groups) which have significant pricing power so the cost usually don't end up with the consumer.
      • sharemywin 3y ago
        But a lot of times those regulations are enforcing things like health and safety or other types of cost shifting. where either the there is large differential in the expertise on one side of a transaction or a third party is the one paying the costs of the transaction. EPA - polluting for instance. In 1969, the Cuyahoga River caught on fire in Cleveland just a few miles north of Cuyahoga Valley National Park. When rivers start catching of fire the companies doing the polluting aren't really going to stop doing it and since most consumers live pay check to check they will generally chose the cheapest option available. even if they end up paying 10X the cost down the line.
    • autokad 3y ago
      What exactly does your experience include? because Texas is ranked 9/50 in terms of most affordable electricity at 11.36c/kw. Admittedly cost of electricity is not the strongest of arguments because there is a lot that goes into the cost - such as weather and natural resources available. But its a really week argument to use Texas electricity costs when they are among the most affordable in the nation. edit: source = electricchoice.com
      • postpawl 3y ago
        https://en.m.wikipedia.org/wiki/2021_Texas_power_crisis https://en.m.wikipedia.org/wiki/2021_Texas_power_crisis
    • davidw 3y ago
      I'm not a libertarian, and believe pretty strongly that while it's probably not a good idea to have a "planned economy", you can and should redistribute some from the "winners" to those who the market leaves behind. That said, zoning regulations in particular are a net negative, were mostly born out of racism in the US, and their purported objectives can be achieved better through other mechanisms - actually regulating externalities like noise and smell. https://islandpress.org/books/arbitrary-lines https://islandpress.org/books/arbitrary-lines
      • PrimeMcFly 3y ago
        > you can and should redistribute some from the "winners" to those who the market leaves behind. Personally I'm in favor of wealth and income limits, with anything past a threshold being redistributed or to fund UBI.
  • AlexandrB 3y ago
    Is this inherent to the concept of regulation or is it a consequence of removing many of the guardrails that prevent wealthy interests from influencing legislation?
    • aww_dang 3y ago
      Regulatory authority is a central point of failure. Regulators are only human and as such are fallible and corruptible by definition. There are no effective guard rails which can change this. You cannot regulate away human nature.
  • hotpotamus 3y ago
    Inequality has been a feature of human civilization since long before the modern regulatory state.
  • runarberg 3y ago
    The real irony here is the fact that the author of this article comes from the infamous Chicago school, which as the birthplace of the neo-liberal ideology which would posit precisely this kind of statement, yet the author does not seem to agree with you here, instead seems to think this is still an open question. I however disagree, I think socialism has more than proven its merit, particularly if you—as the author of this article does—look at the history of the USA, beginning with the Gilded Age where laissez-faire capitalism caused an unprecedented inequality and poor labor conditions, only stopped by the great depression and the new deal which followed with its regulations as well as social programs. Now in the wake of Reaganomics (championed by a previous generation of the Chicago school) we seem to be flirting with a similar level of laissez-faire capitalism, deregulations and gutting of the social programs, we seem to be heading straight back to the inequality of the Gilded Age.
    • autokad 3y ago
      the "Gilded Age" was termed after the fact by the same liberal socialists. bringing inequality isn't a bad thing. inequality emerges by necessity from a distribution where people have choice, but that's too long to discus here. what really maters is did the quality of life of everyone go up. For example: The cost of oil was brought down by over 80%, enabling people for the first time to read at night. You are in a comfortable position to benefit from everything that 'the gilded age' brought, but don't have to face the down sides of not having it by being here.
      • runarberg 3y ago
        It can be argued that the benefits of lower oil prices were insignificant next to the benefits of electricity infrastructure which the New Deal brought to the masses. To afford that oil, and to afford that lamp, you still had to labor day and night, even if you were only 12 years old, in such poor working conditions that dying at your job was a serious risk. To enjoy the light from the electricity of the many dams the work project of the New Deal brought, you just had to pay your taxes. The Laissez-faire capitalism of the gilded age came crashing down in a spectacular depressions, the benefits, which only some could afford, were short lived when suddenly there weren’t any jobs. The New Deal gave people back their jobs so we could again afford the luxuries of past inventions. You see. I too can spin a narrative where socialism brings all the good stuff and capitalism none.
• monero-xmr 3y ago
  The arguments for a centrally planned economy have been empirically disproved numerous times as to make the debate moot. But logically it is so clear: It is impossible to assign value to something in any prescribed way, as the value of anything is determined by me. This is why my wedding ring has extremely high value to me, and I would need a lot of money to part with it, well beyond its value as a “generic” gold ring, which is more than its value in atomic gold. You can further extend this to literally anything, but even to commodities, which are theoretically the easiest to assign “value” to as they are fungible. It is a fool’s errand to try and plan an economy, and those who think they can, or believe they are currently doing so in any meaningful way, are mistaken.
  • frgtpsswrdlame 3y ago
    Have they been disproved empirically? I'm well aware of many theoretical arguments against central planning but I'm not aware of empirical work.
    • nyolfen 3y ago
      well, it was tried at scale one time, and the economy it produced lasted several decades, but was sclerotic, dependent on resources extracted by compulsion from its imperial periphery, and ended up literally unable to feed itself
      • deleted 3y ago
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      • malermeister 3y ago
        The same could be said, word for word, for capitalism as the United States are currently demonstrating.
        • nyolfen 3y ago
          this is so false i have a hard time believing you actually think this. that said, i strongly encourage you to put your money where your mouth is and invest accordingly!
• PrimeMcFly 3y ago
  I feel like socialism has become really popular with the younger generation in the last 10 years, to the point where it's now very common to just see capitalism blamed for all sorts of things for which it likely has little to do with. I don't see socialism ever really being feasible or taking off, because capitalism does have so many advantages, and I feel like the pure socialism many advocate for is at odds with human nature. The goal I think should be to try to negate the disadvantages as much as possible through regulation, and this is what places like the Nordic countries, Australia and NZ seem to be doing pretty successfully - not there isn't still mass room for improvement.
  • thatfrenchguy 3y ago
    The thing is that what people call "socialism" in the US is just what most people in Europe would call vaguely center-left "social democracy". There's so many places in the US where the private markets are mis-organized and mis-regulated (healthcare, drugs, transportation and housing being the most obvious four) that's it's pretty obvious to find why younger folks are tending left.
    • webnrrd2k 3y ago
      Don't forget education -- a generation of students have graduated with crushing debt. Is it not hard to imagine why they often support European-style center-left social democracy.
  • baggy_trough 3y ago
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    • malermeister 3y ago
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      • baggy_trough 3y ago
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• NoMoreNicksLeft 3y ago
  > An “administrative economy” in which “money is no longer a driving force,” designed to “promote central control of all efforts and materials…in the interests of the people,” was on the horizon. In this socialized economy, central planners would engage in “calculation in kind,” or the practice of directly judging the value of resources or the desirability of large-scale planning without using any standard unit of accounting. This sounds interesting, but everything I've ever read suggested that this is a bleak landscape that no sane person should want to live in. If I decide I want to dabble in oil painting, I need only stop by Michael's or Hobby Lobby on my way home from work and buy those. If I lived in the socialist paradise, assuming that any were manufactured at all, would I be put on a 3 yr waiting list, only to get three tubes of ugly colors, or would I instead find out that it is rationed out only to those who have (somehow) demonstrated talent in the past? When filmmakers in the Soviet Union were unable to get the resources they needed, it wasn't always just that the communists wanted to carefully control something they saw as propaganda. Sometimes those resources just weren't manufactured. Or allocated sanely. The examples of "total warfare mobilization proves that it is possible" are bizarre, given how awful conditions were for soldiers and civilians alike at those times. Planned economies only seem capable of making just barely enough of the most essential necessities for the groups considered the most important to those in charge. It is difficult to believe that such a system will even perform well enough to make sure one person or another doesn't go without such simple necessities as water, energy, food, and cloth. Let alone the sort of minor luxuries we're all accustomed to. I don't like my odds that I'll get any of the things I want under such a government. No thanks.
• ZeroGravitas 3y ago
  > the idea that economic exchange constitutes a system that autonomously can achieve equilibrium without government intervention.” Please ignore the man enforcing property rights and contract law with a gun behind the curtain. He doesn't count, unless he tries to tax someone. Then he's the bad guy all of a sudden.
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• photochemsyn 3y ago
  This approach, which is an apparent centerpiece of the debate, has a major flaw: > "Assuming that individuals rationally assessed the marginal utility (or simply the benefit gained) of their decisions, the economy could be modeled as a system of functional equations. Using mathematical formulas, these equations could be solved to address imbalances in supply and demand and steer the economy toward equilibrium. In a way, neoclassical ideas suffused socialist rationales for economic planning with a kind of mathematical and scientific authority." Look around. Are individuals rational in their decision making? Are the crypto boom and bust cycles rational? Was the housing market rational? Was the dot-com boom rational? Take away that and there's no longer any foundation for the 'mathematical and scientific authority' - and then, neoclassical economics becomes as nonsensical as Lysenko's 'blank slate' model of plant breeding in the Soviet Union was. In practice socialist ideas and capitalist ideas have value in different contexts. A good balance can be found in John Kenneth Galbraith's work, such as: https://en.wikipedia.org/wiki/American_Capitalism https://en.wikipedia.org/wiki/American_Capitalism There are a couple of basic concepts, such as the fact that markets fail miserably to provide optimal outcomes when there is no real competition ('natural monopoly' situations such as roads, water supplies, electricity grids, fiber optic trunks, etc.), and that business interests as well as labor unions conspire to control prices and wages. If the business interests or the labor unions get the upper hand, you tend towards authoritarian control of the facist or communist form, respectively. The optimal solution is thus a balance of power between competing interests. Over four decades of neoliberal economic policy in the USA has upset that balance and made old-school state socialism much more popular with the general public than it was previously, as Galbraith warned about: > "...private decisions could and presumably would lead to the unhampered exploitation of the public, or of workers, farmers and others who are intrinsically weak as individuals. Such decisions would be a proper object of state interference or would soon so become."
  • xvedejas 3y ago
    The issue isn't even how rational people are. Even if our lack of rationality was no problem, it would still be impossible to get someone to reveal their true preferences without a system where they have to sacrifice value to obtain something. This idea that calculation is the problem with the economy is strange to me, as if there's some algorithm we know to maximize good, that just needs some inputs that people will provide by survey or something, and the only issue is that we can't scale up our computers enough to run the algorithm. What is this algorithm? The truth is that preferences are only revealed when individuals are forced to make difficult and uncomfortable decisions about what's important to them. People simply don't prioritize their needs until they have to. And the nature of humanity is that we are also prone to lying if overstating our preferences has a selfish benefit. Unless socialists seriously consider this, any algorithm is likely garbage-in, garbage-out.
• assbuttbuttass 3y ago
  I can highly recommend "Towards a new Socialism" by Cockshott on this topic. It gets into the details of economic planning from a practical side, and even discusses the computational complexity of different algorithms
  • PM_me_your_math 3y ago
    I'll give it a read. I'm always interested in new ways to starve 300,000,000 people, so we can head it off before it occurs.
    • local_crmdgeon 3y ago
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• motohagiography 3y ago
  I don't see why we even argue about it. The calculation discussion is a begged question, where it accepts that these other ideas are desirable were it not for these implementation details. Reality is, they are a pretext for subordinating and oppressing people by denying their human individuality, and once you have the means to do that, does it really matter if they starve so long as you still hold the reins? Even if you are defending "capitalism," you have already accepted a definition invented by people whose object was to subvert and destroy your civilization so as to rule over the ashes. If we are going to accept that this (objectively, murderous) ideology is topical for serious discussion, registering our disgust with it and the its advocates should be included in the discourse. If only more people understood that the way they feel about conservative and even reactionary beliefs, many others feel about totalitarianism, its polite euphemisms, and its apologists.
  • than3 3y ago
    Moto, I have to point out that line of reasoning is seriously flawed. The assumptions you make at the beginning are just that, assumptions with no rational backing. Communication is necessary to have any kind of intelligent discussion, and taking part in a discussion doesn't accept anything by mere participation. Saying so doesn't make it so, and that argumentation structure tends towards inflexible dogmatic thought and polarizing psychological spirals. At its core, in order to think you must risk being offensive, and in order to learn something you must risk being offended. Anything that interferes with that will often lead you to irrational thought and false conclusions. Additionally, being able to discuss subjects which you do not agree with, while maintaining communication in a rational way is a very good indicator of intelligence, and anyone can do this if they want to. Ideological indoctrination comes in all forms, and most importantly most of us don't have a choice about that since its inherent wherever we grew up. If you can debate the merits and downsides, in an influential way that turns someone to your view point isn't that a win? Aside from this, I agree with your sentiment, but you would have a much stronger argument if you don't give others such easy targets to discredit you. If they can't win on rational grounds, they don't have any legs to stand on. Irrationality is after all not superior in any way to rational thought, and self-interest and necessity are the mother of all invention. History has not been kind to socialism, and its been directly responsible for more death than any other form of economy in recent history.
• cat_plus_plus 3y ago
  There is no serious debate anymore, USSR imploded from impossibility of central planning, even despite attempts to computerize the process. Even if every single factory manager was honest and knowledgeable and even if every single worker put in 100% effort for no extra reward, modern economy is not centrally computable and contains factors not knowable apriori, such is whether consumers will like a certain style of shoes once they are already made and on the store shelves. These things need to be discovered bit by bit through local knowledge and private assumption of risks, which in turn is only possible through incentive of private enjoyment of rewards. However, I am also tired of both sides claiming that labor unions, or social safety net, or some amount of government regulation are socialism and therefore either "see you like it, lets have some more" or "if government provides a health insurance scheme, it's Gulags right away". These things are governments or voluntary organizations of workers leveraging productivity of free market to accomplish some additional tasks deemed to remain unaddressed by market forces. Mind you, I am not a fan of lots of government, especially on central level. There are separate arguments about incentives for providers of aid to remain efficient and for recipients to be grateful and responsible. But let's have intelligent conversations about each thing rather than "Medicare is communism and border control is fascism". There are also objective negative externalities like "if I didn't buy smoke from your factory, you have no right to blow it over my house", where regulation actually advances voluntary free market. Some movements like Georgism have interesting proposals to use mitigation of externalities to fund whatever government is needed while making market more efficient.
  • WalterBright 3y ago
    > if government provides a health insurance scheme, it's Gulags right away The price of health care in the US rose at the same rate as inflation, up until 1968. Then, the price increases tilted upwards, and have not slowed down since. What happened in 1968? Government health insurance.
    • ajross 3y ago
      Also antibiotics, immune control drugs, transplant technology, hearing aids, prosthetics, computer-assisted tomography, MRI scans, cancer treatments that actually work, mental health drugs and treatments likewise, ... This is just wildly wrong. What you're looking at is the "advent of modern medicine". Prior to the middle of the 20th century, doctors were more or less limited to stitching people up after injury. Since then, we can treat... almost everything, honestly. But that's expensive, in particular in regimes like the US that want to provide all that stuff to everyone in the private markets that have the ability to pay for it. It's got absolutely nothing to do with how the payments are handled. That's just silly.
• sebastianconcpt 3y ago
  If you break the pricing system you break the communication that makes possible to efficiently A) get resources allocated B) do it the least unfair way as humanly possible. Debating for a centralized economy is as useful as debating that a centralized internet will provide defense of freedom of expression. Only wannabe totalitarians would do that.
• UncleSlacky 3y ago
  I was surprised to see no mention of Chile's Project Cybersyn: https://en.wikipedia.org/wiki/Project_Cybersyn https://en.wikipedia.org/wiki/Project_Cybersyn There is an argument to be made (and indeed it seems it has already, in this book : https://en.wikipedia.org/wiki/Towards_a_New_Socialism https://en.wikipedia.org/wiki/Towards_a_New_Socialism ) that with modern networking, data speeds and computing capacity, a centrally-planned economy could work.
  • csdvrx 3y ago
    > There is an argument to be made (and indeed it seems it has already, in this book : https://en.wikipedia.org/wiki/Towards_a_New_Socialism https://en.wikipedia.org/wiki/Towards_a_New_Socialism ) that with modern networking, data speeds and computing capacity, a centrally-planned economy could work. With the minor assumption that P=NP
  • WillPostForFood 3y ago
    "with modern networking, data speeds and computing capacity," Sounds like some 5G level hype right there.
  • eestrada 3y ago
    > with modern networking, data speeds and computing capacity, a centrally-planned economy could work. Ludwig von Mises' whole point is that you are working with unknowable inputs, so you can never calculate correctly. This is why a socialist, centrally planned economy can never work. For example, people's preferences are unknowable before a transaction takes place. And, no, surveys don't work because what people say they want and what they actually spend their money on are different things. No amount of computational power can create outputs for unknown and unknowable inputs.
    • littlestymaar 3y ago
      > No amount of computational power can create outputs for unknown and unknowable inputs. That's the entire point of this tiny branch of math called probabilities though …
• than3 3y ago
  It is rare that something like this gets written with actually correct details, and refreshing when it actually lines up with history correctly. It would have been a near perfect piece covering these historic issues, if only .... That last paragraph... If only they didn't falsely asserts a broad generalization that is easily and provably incorrect. Its mistaken in its naivete, and the provided information doesn't support it. Those of limited intelligence, when they can't win an argument on rational grounds tend to fall back to malign influence and flawed thinking and the conclusion is no different from a straw-man. As a reader, do yourself a favor, and just skip that last conclusion paragraph. Everything else looks mostly correct.
• yourmatenate 3y ago
  Whether a centrally planned economy can work or not may be an interesting question, but it is irrelevant to whether Socialism works or not (or even whether it is right or moral or not). Socialism does not require a centrally planned economy. It doesn't even require a centralised state. Socialism is about how workers organise their workplace (owning, managing and sharing the produce and profit of their labour). Having said that several avowed socialist states have attempted to centrally plan the economy, and their success or failure is a matter of highly disputed opinion - depending on what their aims, achievements, and outside opposition (and possible sabotage) were. Some Socialists say it is possible: See "Towards a New Socialism" (1993). Some say that Capitalist corporation like Amazon or Walmart are already effectively achieving this ("The People's Republic of Walmart" (2019) Others suggest models such as "negotiated coordination", "participatory economics", or "market socialism" will be able to accurately account for need, volume, value etc. But there are incredibly powerful interests that oppose any alternatives, and most of us are stuck playing their game by their rules.
  • hospitalJail 3y ago
    >(owning, managing and sharing the produce and profit of their labour). The issue is that leaders and factions always emerge. Even if everyone could 'keep their excess labor', you get groups of people that position themselves to get higher value jobs or easier jobs. As much as people claim this is not inevitable, I've yet to see this happen IRL or in history.
    • yourmatenate 3y ago
      This is veering into a different topic, but I'd encourage you to read "The Dawn Of Everything" (2021) & "The Art of Not Being Governed" (2009) for long term examples of non-hierarchal societies. It may be inevitable that people may rise up to seek power over others, but the question is what is the best way to respond to this? Do we leave them to rule over others without restrictions, or do we limit the damage they can do? Do we reward this impulse of control of the few over the many to their general detriment, or do we treat it as a mental health issue (like sociopathy or hoarding)?
• primer42 3y ago
  Economics claims to be a science, complete with mathematical laws to back up claims. In reality, a huge number of economic papers are cherry picking data to fit their claims. Check out https://theconversation.com/the-reinhart-rogoff-error-or-how-not-to-excel-at-economics-13646 https://theconversation.com/the-reinhart-rogoff-error-or-how... to learn how the 2010 paper that governments around the world have used to justify austerity measures omitted data from Australia, Austria, Belgium, Canada and Denmark. Once those countries are included, the result completely flips. Woops guess all the major powers had an oppsie for the last decade.
  • WillPostForFood 3y ago
    Economics claims to be a science Not really. A social science maybe. Most economics schools sit in the liberal arts departments of universities. Plenty of economists have egos big enough to talk like their work is science, but I'd challenge you to provide a modern example of an economist defending economics as an actual science.
    • littlestymaar 3y ago
      > but I'd challenge you to provide a modern example of an economist defending economics as an actual science. Friedman is the most famous example of that, and he unfortunately managed to convince most of his kind that they were actually scientists. The few Econ PhD I know were definitely holding that view and one even compared people questioning the scientific nature of economic to anti-vaxxers.
• csours 3y ago
  It's interesting to me that we debate economic ideas from the mercantile age. Economics is a meta-game, the game has changed significantly over the last 200 years. But we are taught economics in a historical context, not in a future context, so we talk about ideas from generations ago.
• Jonnston 3y ago
  There's an excellent fictionalized book about this topic called Red Plenty. I just read it recently and found it thoroughly enjoyable. It's a very humanizing account of a potentially dull and abstract idea.
  • mwigdahl 3y ago
    I second the recommendation. It's a great book, and draws much more closely on historical fact than I was aware of when first reading it.
• lamontcg 3y ago
  I call myself a socialist but I wasn't born 100 years ago so I've accepted that absolute centrally planned economies are poor and money and markets will never be abolished. But what I want is more democratically forms of corporations, government policies that produce less income inequality and regulations over business which prevents monopolies and market distortions, along with much stronger unions (ideally a situation where we keep the government, corporations and unions all more or less at odds with each other in order to maximize actual individual liberty--defined to exclude the current contradictory definition of liberty as "wielding as much capital power as you possibly can over other people"). What we have right now is a situation where corporations run the government and are in the process of consolidating every more tightly into monopolistic cabals. That is also the end goal of unregulated free market capitalism, it isn't the optimum allocation of capital, it is the optimum exploitation of labor for profits. Yeah, the magic wand solution of government-run economies and doing away with money and markets doesn't work. Outside of some sophomorically edgy and loud tankies on twitter and reddit nobody really wants to do that, and it wouldn't get anywhere if they tried.
  • RC_ITR 3y ago
    The big propaganda win has always been “it’s either no holds barred free market capitalism or its central planning.” Of those two, free markets lead to better outcomes, but rarely optimal outcomes. There are middle grounds. What’s worse is that America’s markets are already extremely skewed (tax deductible mortgage interest for example), but free market proponents ignore that, since it’s the baseline.
    • dingusdew 3y ago
      [dead]
    • seiferteric 3y ago
      Exactly, I find it funny that people will call themselves socialist, capitalist, communist... these are 19th century ideas or earlier. The reality is none of these ideologies are complete solutions, they are simply tools that can be used in certain cases. Yes it seems that capitalism/free markets works best most of the time (even China knows this) but there are many cases where it does not and something else has to happen (healthcare, housing etc.)
• staunton 3y ago
  It's obviously possible in theory to centrally plan an economy in such a way that it's more efficient than a free market. In practice this is extremely hard and in the few cases where it was attempted it required a huge and extremely corrupt bureaucracy that didn't work. However, we should keep in mind that this was tried in an age where that bureaucracy had to be operated using paper and typewriters. Whether or not you like the idea of a planned economy, you shouldn't ignore the possibility that it might actually be able to sustain itself once, e.g., mass electronic surveillance and AI enter the picture.
  • wrycoder 3y ago
    And you can bet your bippy that AI planning will be tried. At least twice. (“We weren’t doing it right the first time.”) Central planning could work, if exact equality of outcome was the target, the range of commodities produced was restricted, and people were forbidden to trade goods amongst themselves (and very strongly punished for doing so.) But, who wants to live like that?
    • staunton 3y ago
      Who knows if people will get to try it twice. Such a thing might take over the first time and be able to sustain its power indefinitely (until human extinction). I have a lot of hope though that it won't be tried. "It would just fail" is a bad argument against trying it because it sounds like you get another chance to do something else after.
  • revelio 3y ago
    The problem with planned economies is not self-sustainability. The USSR proved it could be done. The problem is that they aren't competitive because their planning process is too low bandwidth to incorporate change of any kind. They're working blind and the only way to make the thing work at all is to simply clone the non-planned economies seen elsewhere, which means they always lag behind. Eventually the citizens tire of their relative poverty even if it may have improved a bit in absolute terms.
    • 3y ago
• throwaway22032 3y ago
  My general opinion on the economic situation in my country (UK) is that capitalism just doesn't work under parameters in which there's no competition. If individuals back themselves into a corner in which they "have" to live in place XYZ and "have" to do career XYZ and so on and so forth, but are relying on others to make this work (e.g. they don't have wealth), then they're going to get nailed because they are working from a really bad negotiating position. I don't see how socialism and unionizing etc fixes this because the prime mover has to be that people actually want to change the situation and put effort in to do so. There needs to be a valve. Like, if I don't get paid enough as X, I go and work as Y. If rent gets too high in A, I go and live in B.
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• andrewflnr 3y ago
  The problem with a centrally planned economy is less one of computational feasibility than that the input data it needs is unavailable. It's weird that no one seems to be mentioning the base case of prices or production levels: consumer preferences. Consumers somewhat famously lie (to themselves and others) about what they want. The truth is revealed in what tradeoffs they make, whether in terms of money, time, mental effort, specific resources, etc. What we're willing to sacrifice. So the minimum you need for a money-free central economy is to allow/force consumers to make tradeoffs in-kind between the products they want (far enough ahead of time for production pipelines to adjust!), in terms of the entire pipeline of resources each involves. This is, among other things, likely to be a UX disaster. Having a single unit, whether you call it money or not, is so much easier. Which is maybe just a long way of saying: a central economy is still going to invent money, as a communication aid if nothing else.
  • chmod600 3y ago
    You assume that preferences are economically important. I'm not saying I disagree, but in theory you could have a central planning department that effectively says "we have calculated what you need for maximum productivity; here you go, like it or not". That, of course, doesn't take advantage of the sensory and compute power of individual humans. You might not need to ship a new hammer from the nearest warehouse if a nearby hunk of metal will suffice. Or if a machine is broken, you might not need a technician to drive from the nearest city if your niece happens to know how to fix it. Also, for central planning to work, it becomes obvious quickly that people need to do exactly what they're told. Ignoring the preferences of people and demanding they do as they are told looks a lot like slavery. Perhaps a comfortable and efficient slavery, but slavery none the less.
    • andrewflnr 3y ago
      > here you go, like it or not It's been tried. It's failed a lot. People find (weird, unpredictable, uncomputable) ways to rebel. Also, you get around to it in your last paragraph, but I was implicitly avoiding designing a system isomorphic to slavery; I guess I'm trying to steelman central planning. Hence the requirement to take consumer preferences into account.
• johngalt 3y ago
  The problem with planned economies is mismatched incentives, not computational capabilities.
• Animats 3y ago
  The article has a rather retro take on this, which is usual. But not useful. If you view capitalism as a feedback control system, it's a system where there are many feedbacks with different lags. Such systems oscillate. They don't converge on some optimal point. That's well known. US capitalism has so many monopolies and oligopolies that it doesn't act much like a free market any more. Three big banks, two big drugstore chains, three cellular providers... None of those look like a competitive market. The European Union did a study that concluded that price competition doesn't appear until there are at least four players of roughly comparable size. If you want a free market, you have to keep the players from becoming too big. On the other hand, central planning within large companies is stronger than ever. WalMart and Amazon are very centrally controlled. This works much better than Gosplan ever did. The data is better and the lag is less. Gosplan had a monthly reporting cycle and an annual plan cycle. WalMart had a daily reporting cycle and a weekly plan cycle, and that was years ago. China uses an opposite extreme - five-year plans. At one time they were mostly political statements. That hasn't been true in years. The 13th Five Year Plan (2016-2020) was pretty much accomplished.[1] The 14th Five Year Plan (2021-2025) is coming along reasonably well. Specific goals include 5G deployment to 56% of the population, and conversion to IPv6. Yes, IPv6 made it to the top level national strategy document. How those get turned into lower level tasks I don't know. [1] https://www.uscc.gov/sites/default/files/Research/The%2013th%20Five-Year%20Plan_Final_2.14.17_Updated%20%28002%29.pdf https://www.uscc.gov/sites/default/files/Research/The%2013th... [2] https://cset.georgetown.edu/wp-content/uploads/t0284_14th_Five_Year_Plan_EN.pdf https://cset.georgetown.edu/wp-content/uploads/t0284_14th_Fi...
  • revelio 3y ago
    Arguably the big trend in recent decades has been the non centrally planned corporation. Google and Facebook are the poster boys for this approach in which managers see themselves primarily as enablers for the workers, in which those workers have a great deal of individual autonomy and there's relatively little central planning except in "wartime". Many other companies have adopted this style to a lesser degree. You can argue it has downsides, Google's brand dilution for example, but these are very rich and successful companies by any metric. The core problem with central planning is handling change. If the requirements placed on an institution never change, then central planning eventually takes over because the plan is so stable that it can be managed centrally, and that may even have economies of scale. Businesses like Walmart are basically giant factories. Supermarkets are not a business that experiences great or rapid change. Tech firms in contrast experience and create change at a much faster rate, so central planning is more harmful there. Economies as a whole are in near constant change. That's why centrally planned economies lose. They're always optimizing for yesterday's goals, like how many tonnes of steel can be produced per day, but can't react to changes like maybe now computers matter more than steel.
• reso 3y ago
  I'm of the opinion that the calculation debate is mostly a misnomer. The information of individuals' preferences simply does not exist to do calculation on, outside of the context of exchange. I also think that exchange itself exposes only a fraction of individuals' possible preferences, which are fleeting and unpredictable, so even market exchange probably does a poor job of this overall.
• chmod600 3y ago
  On HN, we should think about socialism as a startup. Prove it with a small number of loyal customers, listen and learn from them, and then show how it scales to a lot of customers. It seems to be stuck at the "scale it up" stage. Attempts to scale it up are generally non-voluntary, and have bad outcomes. Even keeping a small group of loyal customers is challenging.
  • eestrada 3y ago
    An obscure hippie commune would like to talk to you about an early stage investment opportunity. /s Seriously though, to your point, existing and historical communes require 100% voluntary buy-in to work. That doesn't scale beyond a couple hundred people. So, as you say, it becomes "non-voluntary" beyond a certain size, which is a nice way of saying it is made possible via force.
  • DiscourseFan 3y ago
    We already have all this infrastructure and socially organized modes of production for producing goods and services, it wouldn't make sense not to use them to build a more rational society instead of one based on domination.
    • snapcaster 3y ago
      rational is doing a lot of heavy lifting in this comment
      • DiscourseFan 3y ago
        I'm not sure how you could argue that building a society in service of profit motives is somehow more rational than building a society for the people living in it.
  • Tiktaalik 3y ago
    I feel like the thousands of homeless people in my city would not be "loyal customers" of Capitalism if given the chance.
• ciupicri 3y ago
  > You don't have permission to access /roundtable/socialist-calculation-debate on this server.
• advisedwang 3y ago
  Companies like Walmart are the size of some national economies and seem to centrally manage pretty well.
  • intalentive 3y ago
    Large companies have price signals to work with. Command economies do not.
    • advisedwang 3y ago
      They have price signals at the edge - between the company and the customer or suppliers - but not within. Within walmart, there's no market of logistics options for a store to chose from. There's no market of training providers to decide how new employees are onboarded. There's no market of website admins running walmart.com. The company is run by non-market decision makers.
• nootropicat 3y ago
  The only issue with central planning is making people behave according to its rules - it's a problem of motivation. The calculation side itself is evidently better under central planning. Free market is an optimization algorithm and many other exist. It's extremely unlikely simulating prices is the most effective way to allocate, but even if it is, it can be done more efficiently by simulating the process without real world waste. Everything is slowly centralizing already - some markets remain to provide motivation, but the trend is in the central planning direction. Given better technology, free markets will definitely die. It could be solved as directly as by overwriting the internal motivation through some brain implant, making people happy to work for the good of the system.
• euroderf 3y ago
  Free markets and capitalism are hardly Siamese twins. Managerial incentives and worker incentives can work under collective ownership too. Markets are efficient, and technology for demand awareness and supply management can make them more so. But capitalism (as currently implemented, since the Commies threw in the towel) is IMO increasingly totalitarian. The state religion of the US of A wants to shove its nose into every nook and cranny of everyday life. If there's something that doesn't have a price... well now, to be "realistic", shouldn't it ??!
• hgs3 3y ago
  Socialism is a consequence of unchecked capitalism; if capitalism provided, then socialism would be redundant. Capitalism works best when there is lots of competition and low startup cost to enter a market. Regulation could force this type of environment by capping the number of employees a company has, limiting the radius they conduct business, and preventing them from growing to a point where the startup cost to form a new competing company is too high. The obvious downside of these regulations is they would artificially limit the geographical reach and techno-complexity of products themselves. However, if no action is taken, then you end up with an economy similar to the one we have today and folks clamoring for socialism.
• snapplebobapple 3y ago
  This comment section feels like when a speaker at toastmasters decides to do their own topic because the original topic was obviously so boringly irrelevant that it isn't worth talking about.
• koprulusector 3y ago
  Serious question: what would be the disadvantages or repercussions of banning for-profit private/public corporations and replacing them with mutuals and worker cooperatives? I’m not looking for corporatist or capitalist apologia. I’m looking for honest, good faith arguments against cooperatives and not arguments in favor of capitalism.