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.<p>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").<p>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.<p>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.
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.<p>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".<p>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.
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).<p>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.<p>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)<p>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.
The article has a rather retro take on this, which is usual. But not useful.<p>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.<p>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.<p>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.<p>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.<p>[1] <a href="https://www.uscc.gov/sites/default/files/Research/The%2013th%20Five-Year%20Plan_Final_2.14.17_Updated%20%28002%29.pdf" rel="nofollow">https://www.uscc.gov/sites/default/files/Research/The%2013th...</a><p>[2] <a href="https://cset.georgetown.edu/wp-content/uploads/t0284_14th_Five_Year_Plan_EN.pdf" rel="nofollow">https://cset.georgetown.edu/wp-content/uploads/t0284_14th_Fi...</a>
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.<p>So the minimum you need for a money-free central economy is to allow/force consumers to make <i>tradeoffs in-kind</i> 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.<p>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.
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.<p>Check out <a href="https://theconversation.com/the-reinhart-rogoff-error-or-how-not-to-excel-at-economics-13646" rel="nofollow">https://theconversation.com/the-reinhart-rogoff-error-or-how...</a> 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.<p>Woops guess all the major powers had an oppsie for the last decade.
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.
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.<p>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.
This approach, which is an apparent centerpiece of the debate, has a major flaw:<p>> "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."<p>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.<p>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:<p><a href="https://en.wikipedia.org/wiki/American_Capitalism" rel="nofollow">https://en.wikipedia.org/wiki/American_Capitalism</a><p>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.<p>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:<p>> "...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."
It is rare that something like this gets written with actually correct details, and refreshing when it actually lines up with history correctly.<p>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.<p>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.<p>As a reader, do yourself a favor, and just skip that last conclusion paragraph. Everything else looks mostly correct.
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.
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.<p>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.<p>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.<p>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.
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
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.
It's interesting to me that we debate economic ideas from the mercantile age.<p>Economics is a meta-game, the game has changed significantly over the last 200 years.<p>But we are taught economics in a historical context, not in a future context, so we talk about ideas from generations ago.
I feel like socialism has become <i>really</i> 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.<p>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.<p>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.
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.<p>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.
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.<p>Debating for a centralized economy is as useful as debating that a centralized internet will provide defense of freedom of expression.<p>Only wannabe totalitarians would do that.
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.<p>Everything is slowly centralizing already - some markets remain to provide motivation, but the trend is in the central planning direction.<p>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.
Free markets and capitalism are hardly Siamese twins. Managerial incentives and worker incentives can work under collective ownership too.<p>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", <i>shouldn't</i> it ??!
I was surprised to see no mention of Chile's Project Cybersyn:<p><a href="https://en.wikipedia.org/wiki/Project_Cybersyn" rel="nofollow">https://en.wikipedia.org/wiki/Project_Cybersyn</a><p>There is an argument to be made (and indeed it seems it has already, in this book : <a href="https://en.wikipedia.org/wiki/Towards_a_New_Socialism" rel="nofollow">https://en.wikipedia.org/wiki/Towards_a_New_Socialism</a> ) that with modern networking, data speeds and computing capacity, a centrally-planned economy could work.
Serious question: what would be the disadvantages or repercussions of banning for-profit private/public corporations and replacing them with mutuals and worker cooperatives?<p>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.
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.<p>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.
> 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.<p>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.<p>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?<p>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.<p>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.<p>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.<p>I don't like my odds that I'll get any of the things I want under such a government. No thanks.
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.
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:<p>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.<p>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.
> the idea that economic exchange constitutes a system that autonomously can achieve equilibrium without government intervention.”<p>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.