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ANY solution that solves the supply-exceeds-demand issue of labor MUST either create leeches (decrease supply) or continuously grow the economy (increase demand

ANY solution that solves the supply-exceeds-demand issue of labor MUST either create leeches (decrease supply) or continuously grow the economy (increase demand). I think it's easier to create the leeches and call them a cost of doing business. There is a second option on the demand side: Instead of trying to grow the economy, hoping that more demand for labor follows indirectly via the private sector, you could just create the demand for labor directly. This is what Job Guarantee-style proposals are about: Creating a virtually infinite demand for labor at a fixed wage. This can unlock the same kind of creativity as BI is supposed to unlock if a wide enough range of things is defined as "work in the public interest" (basically, anything except sit at home and watch TV / browse reddit) and falls under the scheme. There are other advantages (and some disadvantages). In any case, it's good to really keep all the options in mind. I'm not convinced that the USSR failed because of communism/socialism/stalinism/capitalism/whatever. I'm no historian, but it looks like what happened is that the US fought an economic war with the USSR via an arms race. This is a very interesting topic that I would indeed like to know more about as well. The USSR economy grew faster and more consistently over the entire period of communism than both the US (and other Western) economies, and also faster than the economies of less-well developed countries. However, because it started from a much lower base in the early 20th century, they still hadn't caught up when they finally lost this economic war. Objectively speaking, communism worked better for them than capitalism worked for the West. They lost because they failed to call the US' bluff after both of them had already built up nuclear arsenals so large that any further arms race would have been moot. That doesn't mean communism is universally better. In the direct comparison of West Germany vs. East Germany, which started from a comparable position after WWII, West Germany clearly wins, and many East Germans really did want to leave. Still, this all suggests that you can't ascribe it all to "communism bad, capitalism good".

im3w1l 14y ago
Its a lot easier to grow from a lower base, regardless of system. Hence emerging markets investment.
- nhaehnle 14y ago
  That would usually be a fair point, except you missed the point where USSR economic growth also beat the growth rates of less or comparably developed countries that were not communist, e.g. the Southern American countries turned capitalist under US influence. So a point in favor of communism remains. In any case, the true lesson is probably that communism vs. capitalism just doesn't matter as much as people want you to believe. Other factors -- such as whether institutions are inclusive (targeting the welfare of the entire population) or exploitative (transferring wealth towards a small elite) -- simply matter more.
simonh 14y ago
>The USSR economy grew faster and more consistently over the entire period of communism than both the US (and other Western) economies... That's really a problem with measures if economic growth though. Economic production measures are independent if whether that production is efficient or even necessary at all. A bridge to nowhere contributes to growth. The USSR economy was appallingly inefficient. The fact remains that the least worst method we have for ensuring efficiency in an economy is well regulated markets. The further your economy strays from either market forces (e.g. Centeal plannng) or good regulation (banking crisis), the less efficient it gets.
- scarmig 14y ago
  Bringing it back around to the basic income... One of the biggest advantages of the basic income is that it does not run afoul of all the information and computational issues that central planning does. You have no issues trying to balance linear systems with billions of variables, for basic income uses the huge distributed calculation embodied in the market to get to its optimal allocations. You have no issues of deciding what exactly is the objective function to maximize in the linear system: instead of trying to figure out globally what the correct ratio of vacations to medical care to private tutors to gardeners (ad... billionum) is, you let individuals decide that. The only quantity where that comes into play is the ratio of the basic income to overall value of production. And even when that's set either too high or too low, the allocation errors propagated by it do not cascade into disaster the same way underproduction of iron by 3% would be.

im3w1l 14y ago

Its a lot easier to grow from a lower base, regardless of system. Hence emerging markets investment.

nhaehnle 14y ago
That would usually be a fair point, except you missed the point where USSR economic growth also beat the growth rates of less or comparably developed countries that were not communist, e.g. the Southern American countries turned capitalist under US influence. So a point in favor of communism remains. In any case, the true lesson is probably that communism vs. capitalism just doesn't matter as much as people want you to believe. Other factors -- such as whether institutions are inclusive (targeting the welfare of the entire population) or exploitative (transferring wealth towards a small elite) -- simply matter more.

simonh 14y ago

>The USSR economy grew faster and more consistently over the entire period of communism than both the US (and other Western) economies... That's really a problem with measures if economic growth though. Economic production measures are independent if whether that production is efficient or even necessary at all. A bridge to nowhere contributes to growth. The USSR economy was appallingly inefficient. The fact remains that the least worst method we have for ensuring efficiency in an economy is well regulated markets. The further your economy strays from either market forces (e.g. Centeal plannng) or good regulation (banking crisis), the less efficient it gets.

scarmig 14y ago
Bringing it back around to the basic income... One of the biggest advantages of the basic income is that it does not run afoul of all the information and computational issues that central planning does. You have no issues trying to balance linear systems with billions of variables, for basic income uses the huge distributed calculation embodied in the market to get to its optimal allocations. You have no issues of deciding what exactly is the objective function to maximize in the linear system: instead of trying to figure out globally what the correct ratio of vacations to medical care to private tutors to gardeners (ad... billionum) is, you let individuals decide that. The only quantity where that comes into play is the ratio of the basic income to overall value of production. And even when that's set either too high or too low, the allocation errors propagated by it do not cascade into disaster the same way underproduction of iron by 3% would be.