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>Central planning on resources has been especially rife with failed examples (the USSR being the all-in poster child.) This assertion is greatly exaggerated. I

by scythe 3y ago

>Central planning on resources has been especially rife with failed examples (the USSR being the all-in poster child.) This assertion is greatly exaggerated. It's certainly true that the centrally planned economy of the USSR didn't grow as quickly as peer countries with similar levels of economic development. The typical contrast is the much faster growth of Japan versus the Soviet Union in the late twentieth century. (Even the computer knows the story; my phone's predictive text got the countries right!) But the Soviet Union nonetheless grew. Its growth rate was similar to that of the United States, but starting from a lower level (missing out on catch-up growth). It was the contradiction between the government's insistence that the planned economy would outperform the West versus the reality of the situation that led to a death spiral of political dysfunction and "alternative facts". Even though the system was not efficient, it wasn't disastrous by itself, only suboptimal. It's a standard prediction of economic theory that lower risk tolerance comes at the cost of some expected return. But in the case of fields like education and medicine, we might have a lower risk tolerance and be willing to tolerate lower growth to achieve it. In this case, the government stopped subsidizing medical schools. That would seem like what the libertarians want, but the outcomes were not good. Blaming central planning per se doesn't seem like the answer.

bruce511 3y ago
Clearly there are multiple factors in play, and it is simplistic of me to pin all the failings of the USSR on central planning. (Which is the essence if my root post, planning is hard and only one small part of the political environment.) Clearly geographical, climate, and population dynamics (Not to mention war damage) of the US , USSR and Japan post WW2 are enormously varied. >> the government stopped subsidizing medical schools That's part of it, yes. The other part and perhaps more damaging part, is the moratorium on creation of new schools, and the measures to actively reduce the ability of hospitals to offer residency positions. Given a finite money supply the feds have to pick winners and losers for receiving money. However introducing policy, beyond money, has more impact on outcomes. The libertarians would argue that the policies caused the shortage, not the lack of money. (As evidenced by the US citizens training outside the country.)
lr1970 3y ago
> But the Soviet Union nonetheless grew. Its growth rate was similar to that of the United States, but starting from a lower level (missing out on catch-up growth). ... Even though the system was not efficient, it wasn't disastrous by itself, only suboptimal. I am sorry but it is total BS. I grew up in late USSR and can attest that its economy was in free fall. Central planning was one big demotivator and major contributor to the economic disastor. There were no incentives whatsoever to do your job well. Social mobility, career growth depended on factors outside of your direct control. Productivity was a fraction of what it was in the West. Bottom line -- any attempt on economic central planning first has to solve the problem of motivating productivity of human free agents. Otherwise it will fail in a similar way as Soviet Union did.
- biorach 3y ago
  What you're describing sounds suboptimal rather than disastrous
- qwytw 3y ago
  > economy was in free fall In the late 80s.. Before that there was some growth intertwined with stagnation.
  - lr1970 3y ago
    > In the late 80s.. Before that there was some growth intertwined with stagnation. In both 70th and 80th there was no growth. Maybe in 60th there was some but it was before my time. Anyway, it was depressing place. There were some great people there but it was despite the system not because of it.
- pessimizer 3y ago
  It would have been worse as a peasant under the tsar. Communism brought modernity to Russia and made it a world power.
  - lr1970 3y ago
    > It would have been worse as a peasant under the tsar. Communism brought modernity to Russia and made it a world power. Big misconception. Russian Empire just before the WWI (1913) was a dynamic growing economy. It was behind Germany and UK but it was in the middle of the pack of European countries. Bolsheviks totally ruined the country. People paid enormous price for the "modernization" that was already underway during the tsar. Bolshevik revolution of 1917 was a single worst calamity that happened to Russia in 20th century, even worse that nazi invasion of 1941.
transcoderx 3y ago
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by scythe 3y ago

bruce511 3y ago

Clearly there are multiple factors in play, and it is simplistic of me to pin all the failings of the USSR on central planning. (Which is the essence if my root post, planning is hard and only one small part of the political environment.) Clearly geographical, climate, and population dynamics (Not to mention war damage) of the US , USSR and Japan post WW2 are enormously varied. >> the government stopped subsidizing medical schools That's part of it, yes. The other part and perhaps more damaging part, is the moratorium on creation of new schools, and the measures to actively reduce the ability of hospitals to offer residency positions. Given a finite money supply the feds have to pick winners and losers for receiving money. However introducing policy, beyond money, has more impact on outcomes. The libertarians would argue that the policies caused the shortage, not the lack of money. (As evidenced by the US citizens training outside the country.)

lr1970 3y ago

> But the Soviet Union nonetheless grew. Its growth rate was similar to that of the United States, but starting from a lower level (missing out on catch-up growth). ... Even though the system was not efficient, it wasn't disastrous by itself, only suboptimal. I am sorry but it is total BS. I grew up in late USSR and can attest that its economy was in free fall. Central planning was one big demotivator and major contributor to the economic disastor. There were no incentives whatsoever to do your job well. Social mobility, career growth depended on factors outside of your direct control. Productivity was a fraction of what it was in the West. Bottom line -- any attempt on economic central planning first has to solve the problem of motivating productivity of human free agents. Otherwise it will fail in a similar way as Soviet Union did.

biorach 3y ago
What you're describing sounds suboptimal rather than disastrous
qwytw 3y ago
> economy was in free fall In the late 80s.. Before that there was some growth intertwined with stagnation.
- lr1970 3y ago
  > In the late 80s.. Before that there was some growth intertwined with stagnation. In both 70th and 80th there was no growth. Maybe in 60th there was some but it was before my time. Anyway, it was depressing place. There were some great people there but it was despite the system not because of it.
pessimizer 3y ago
It would have been worse as a peasant under the tsar. Communism brought modernity to Russia and made it a world power.
- lr1970 3y ago
  > It would have been worse as a peasant under the tsar. Communism brought modernity to Russia and made it a world power. Big misconception. Russian Empire just before the WWI (1913) was a dynamic growing economy. It was behind Germany and UK but it was in the middle of the pack of European countries. Bolsheviks totally ruined the country. People paid enormous price for the "modernization" that was already underway during the tsar. Bolshevik revolution of 1917 was a single worst calamity that happened to Russia in 20th century, even worse that nazi invasion of 1941.

transcoderx 3y ago

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