The socialist calculation debate

https://www.laphamsquarterly.org/roundtable/socialist-calculation-debate

by Amorymeltzer • 3 years ago

70 367 3 years ago

transfire• 3 years ago

Ironically over regulation is causing much of the inequality, not the other way around.

postpawl2• 3 years ago

What regulation specifically? From my own experience, Texas power grid deregulation definitely hasn’t made my electric bill go down.

artificialLimbs• 3 years 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.

autokad3• 3 years 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

davidw• 3 years 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

AlexandrB2• 3 years 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_dang6• 3 years 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• 3 years ago

Inequality has been a feature of human civilization since long before the modern regulatory state.

runarberg11• 3 years 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.

autokad3• 3 years 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.

sharemywin3• 3 years ago

here's an article that says we already passed it.

https://news.yahoo.com/super-richs-wealth-concentration-surp...

monero-xmr7• 3 years 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• 3 years 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.

nyolfen2• 3 years 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

aww_dang6• 3 years ago

In the Mises canon, the possibility of effective central planning is debunked from first principles. I wouldn't claim that a triangle having three sides is theoretical or empirical, but YMMV.

asplake2• 3 years ago

As long ago as the 70s and perhaps earlier, the cybernetics community – people like Ashby, Conant, Beer – might have argued its non-viability (I choose that word deliberately) on information-theoretic grounds. The centre has neither the communication bandwidth nor the predictive power to control things for long.

striking2• 3 years ago

What about Walmart? Are corporations not their own little centrally planned economies? https://www.goodreads.com/book/show/38914131-the-people-s-re...

readthenotes1• 3 years ago

What about Kmart? Are corporations not their own little centrally planned economies?

Or take the something like 90% of restaurants that fail within the first year. Are they not..?

You got to talk about the bath water if you want to talk about the baby

HDThoreaun7• 3 years ago

Walmart is literally a market. No one is forcing you to buy things at walmart or work at walmart. No one is telling you which goods you will get and in what quantity. Substituting in the face of scarcity is encouraged on the micro scale. The power of markets is allowing individual consumers to change their consumption habits in the face of scarcity/abundance.

Philorandroid• 3 years ago

It might be "centrally planned" in the most technical sense, but it's a bit of a stretch to compare a government's leverage over a market by threat of force to a private entity planning what to do with the property it owns. How is it meaningfully distinct from an individual (or a family) doing financial planning around their assets?

jl6• 3 years ago

A tempting analogy, but I think there are too many crucial differences to put corporations forward as a model for central planning.

For a start, corporations are very small compared to states. Even Walmart, the world's biggest employer, is less than 1% the size of the US by headcount.

More problematic is that corporations plan to maximize profit. That's it. It's a comparatively trivial optimization goal compared to the multitude of ways of valuing things that exist in wider society - and yet, corporations still frequently fail to be profitable. OP's example about the wedding ring is a case in point. Walmart's Finance department would value that for its raw weight in gold only.

But even more worrying, corporations have a magic tool for maintaining order and efficiency: firing people. States can't do that, or at least, not states that you'd want to live in. Corporations are rigidly hierarchical. Corporations are not democracies. Imagine human rights as implemented by the HR department. Scaling up corporate processes to manage a whole country would result in a terrifying dystopia.

wrycoder3• 3 years ago

What about Sears? What about Polariod? Packard?

At the top of the growth sigmoid, corporations always make the wrong planning choices, to avoid self-cannibalization of existing products and to protect existing internal power structures.

The same thing happens with centrally planned economies.

zzbzq• 3 years ago

Only by straw-manning the idea. What you've written there doesn't disprove anything. We've seen in real life that a large corporation can plan a proportion of an economy. What you have to prove, in order to repudiate central planning, is prove that there exists some maximum proportion of an economy that can be planned. And even then, a simple workaround would be to artificially recreate such maximums within the central structure. I think you're just not very imaginative.

karaterobot• 3 years ago

We've seen in real life that a large corporation can plan a proportion of an economy. What you have to prove, in order to repudiate central planning, is prove that there exists some maximum proportion of an economy that can be planned.

If the examples of large corporations planning a proportion of an economy count as an argument for why central planning could work, then surely the examples of actual, centrally-planned economies failing should count as arguments for why they don't. I mean, don't toss out the actual examples for the metaphorical ones.

foobiekr2• 3 years ago

The difference is that the corporation can die. Not so government programs.

monero-xmr7• 3 years ago

A corporation can execute the creation of consumer or producer goods for sale to the market, earning a profit greater than the sum of the inputs. Corporations execute on that specific mission with a goal of maximizing profit. A side-effect of this (in a truly free market) is to ensure the customer, who should be able to freely to purchase from any producer, is maximally satisfied. It also follows that a corporation will try and reduce their costs on all possible axes - from inputs, to labor, to production time, to tax mitigation, etc.

If you try to extend "producing goods" to "every good possible for all people", it cannot possibly work, because a corporation cannot even satisfy the needs of consumers within their narrow band of production (or else competitors wouldn't exist, and further enhancements of products would be unnecessary).

bretticus• 3 years ago

We've seen in real life that a large corporation can plan a proportion of an economy.

No we haven’t. Look at the list of Fortune 500 companies today vs 50 years ago. The landscape is completely different. IBM was the most innovative company in America and now it's seen as a dinosaur. Corporations die each year. It’s cutthroat; your business is more likely to fail than succeed. The idea that Nancy Pelosi and Mitch McConnell could do a better job planning the economy is laughable

RandomLensman• 3 years ago

Corporations fail a lot in their plans. On top, not certain that the planning aspect is what gives rise to corporations in the first place (vs., e.g, transaction costs between independent actors if there where no corporation).

olalonde• 3 years ago

That's redefining what "centrally planned" means. Corporations are subject to competitive pressures: they rapidly lose their ability to "plan" when they stop "planning" well. There's no comparable mechanism when it comes to top-down government planning.

refurb4• 3 years ago

Considering the number of large corporations that go bankrupt, I think it's pretty good they can't plan a proportion of the economy.

They aren't planing anything, they are responding to the environment. Sometimes they get it right and profit, other times they get it wrong and fail.

harimau7773• 3 years ago

I'm not a fan of forms of socialism revolving around centrally planned economies; however, it seems to me that we also don't have any reason to believe that a market economy can accurately assign prices.

The free market argument that the value of something is equal to it's price seems to me to be begging the question. It's essentially saying "the an object's market price equals it's value because I choose to say that an object's value is it's market price."

kneebonian3• 3 years ago

That's pretty much the only real value though is what someone is willing to pay for it.

To quote the Prince of Egypt "A lake of gold in the desert sand is less than a cool fresh spring, and to one lost sheep a shepherd boy is greater than the richest king."

Ultimately the value of something is what someone is willing to assign to it, nothing has inherent value as far as humanity has been able to determine or agree on, so instead the market allows everyone the freedom to value whatever they would like at whatever they would like.

But if you have an alternative way of reconciling the water diamond paradox I'd be interested in hearing it.

Nasrudith2• 3 years ago

The notion relies upon fundamentally faulty assumptions about universal fixedness to pricing, namely that it exists at all. It is frankly, insane to operate under it but because of Marx's and his disciple's fixation upon labor as a basis of economic value they stalwartly refuse to see what is right in front of their face. Water by the river is far cheaper than water in the Sahara. Hauling the water to the Sahara isn't guaranteed profit however because of the lack of people in the Sahara in the first place to serve the exchange, however.

marcosdumay• 3 years ago

a market economy can['t] accurately assign prices

Well, that is meaningless unless you define what "accurately" means here. This word is carrying a huge amount of weight, and isn't capable of that at all. (And when doing that, keep in mind that "price" is not "value", and there is no reason at all to equate those two.)

cced4• 3 years ago

If anyone is interested in learning more about how Walmart uses central planning today, here’s a Youtube video [1] of it (30 mins)

I would love for OP to explain why central planning seems to work so well for private businesses but has no such hopes of achieving any success for the public.

[1] https://youtu.be/xuBrGaVhjcI

aww_dang6• 3 years ago

https://mises.org/library/planned-economy-and-economic-plann...

mrkeen3• 3 years ago

It is impossible to assign value to something in any prescribed way, as the value of anything is determined by me.

It's like Insulin. It may only be worth $5/vial to drug companies, but it's worth $100/vial to consumers who don't want to die.

kelseyfrog• 3 years ago

That's a really good point in the argument that markets for demand-inelastic goods are amoral at best and unethical at worst. We have choices to make when it comes to which economic systems best solve certain problems.

Organ donation is a good example we're we've said, "we cannot let a market solve this problem." Are there issues, with it? Sure, but only the extreme among us argue that organ markets would be an improvement. Every market is open to this critique to various degrees.

piloto_ciego• 3 years ago

I mean, we have not tried it with modern computers… and he Soviets never even got close as the technology to see literally every non-black market transaction has only existed for a decade or so. Not saying I want to live in 1980s style Soviet bureaucracy (or weird modern Chinese mixed system) - but that doesn’t mean we can’t do immeasurably better than those systems.

I am not sure “8 billion Turing machines” is intrinsically more efficient or accurate than “one really fast one.”

Also, worth mentioning that you would sell your wedding ring in a heartbeat if you needed to pay for food/healthcare/etc. Sentimental value is important you’re right, but in my experience (maybe not yours which is fair) - when the chips are down you do what you have to do to survive. The problem is, in the current system we value human life less and than market equilibrium, and that’s silly. We could feed every starving person on the planet… several times over… but we don’t because it’s not profitable. That’s objectively stupid.

godelski3• 3 years ago

I mean, we have not tried it with modern computers

Sure, but considering all the information you'd need to compute (I'd argue we're close but probably not there yet), is this okay? Are there disadvantages to this data collection? Do these downsides outweigh the upsides? I feel like these conversations are so difficult because everyone comes in with certain assumptions, assumes others have them (even if explicitly stated otherwise), or are dismissive of any other concerns. We need to be on the same page to have real conversations.

godelski3• 3 years ago

The article even starts with a bad premise, claiming we have a laissez-faire system. Don't listen to people that binaryize opposing viewpoints: all forms of capitalism are the same.

arguments for a centrally planned economy

I actually think we're getting close to a point where a planned economy could be feasible. The problem with planned economies is that the economy is naturally chaotic (small perturbations result in large changes in outcomes). So to do this you need a pretty close eye and measurements of the economy. But looking at this requirement, we have to ask what actually needs to be given up. I'd argue that this is the reason that we should never have a planned economy. The solution space is complex and there are no globally optimal systems, so we need to pick what we care about. If you are about reducing harm from potential tyrants from abusing the population (or some subset) and/or privacy and security from governments (not just your own) then this is absolutely not a path we want to go down. Because high levels of surveillance maximize tyrant's power and maximize potential exploitation by adversarial governments.

And there lies the problem. Things that "look good on paper, but don't work in practice" are just things where on paper we haven't been nuanced. It is where on paper we've just had a myopic viewpoint, steamrolling your opinion, not seeking solutions. This is true outside economics and politics, but I think since it is a field that everyone feels qualified participate in and highly encourages blinders. We can't go about solving complex problems this way. We can't solve complex problems pretending all problems are easy and have precise solutions. Life is messy, and so are solutions.

So let's talk about what we actually care about and what our actual objectives are before we even attempt to start optimizing. I rarely see any discussion of objectives. It is fine to assume that people just want a strong economy and well off people, but there are many other variables that we either need to concern ourselves with or not, and we can't have these conversations without establishing our premises. They aren't obvious.

antisthenes2• 3 years ago

If you look closely, you'll see that at its core, this is just another Luddite argument.

While it's true that a centrally planned economy may not ultimately have the same variety of goods, it's important to understand that a planned economy is not optimizing for that, and that parts of a regular economy (especially parts concerning national defense security and energy security) are already very highly planned)

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.

So were the people who thought cars couldn't be faster than horses or that computers couldn't beat humans at chess or generate deceptive but believable text output at a level of a 10-year old.

PrimeMcFly15• 3 years 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• 3 years 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• 3 years 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.

rsynnott• 3 years ago

I mean, I think a lot of it comes down to what people mean by ‘socialism’. Some people would call the regulation you mention ‘socialist’ (this isn’t really correct, but it has become a common usage, so…)

I don’t think that many people are actually arguing for abandoning market economies (some are, but it’s a minority view); the major disagreement is the amount of regulation and social transfer that should be applied to a market economy.

kneebonian3• 3 years ago

My sister recently posted a series of problems she has with "capitalism" on Instagram. They basically all boiled down to "I don't want to have to work" I didn't have the heart to point out that "He who does not work shall not eat." Was said by Karl Marx. I feel that part of the youths obsession with socialism and blaming capitalism is that they have never experienced scarcity to any real degree and because of that do not understand that there are limited resources, and their issue is fundamentally with that concept that they want to blame on capitalism.

selimthegrim2• 3 years ago

Marx kind of borrowed that from the Bible.

mrkeen3• 3 years ago

Are you saying your sister is the straw man in this debate?

dragonwriter3• 3 years ago

I didn't have the heart to point out that "He who does not work shall not eat." Was said by Karl Marx.

The Communist writer known for adopting that passage of II Thessalonians as “the first principle of socialism” is Lenin (in The State and Revolution [1917]), not Marx.

Non-Leninist Marxists tend to not have a very high opinion of Lenin, in general.

antisthenes2• 3 years ago

I feel that part of the youths obsession with socialism and blaming capitalism is that they have never experienced scarcity to any real degree and because of that do not understand that there are limited resources, and their issue is fundamentally with that concept that they want to blame on capitalism.

A very large portion of Gen Z and some Millennials as well legitimately believe we live in a post-scarcity society where work is optional. I'm not sure if this is a result of an extremely privileged upbringing or an education system failure, but they hold these beliefs pretty firmly.

Not sure they can actually empirically justify them to any degree but there it is.

qsort• 3 years ago

It isn't any more or any less popular than it has always been. The same goes for stuff like racists, paleo-conservatives, people who read Ayn Rand, overt nazis and other amusing creatures.

Our media diet has changed substantially, and now any random idiot with a wildly improbable theory can share it with the world with no effort.

Populist stuff that seems to make sense on the surface always has the upper hand in an unmoderated debate.

Nasrudith2• 3 years ago

Socialists are worrying but a noisy minority who never shut up pretending to be far bigger than they are within their bubbles. You can tell this by their complete lack of electoral success. Instead they operate based entirely upon sophistry of some sort or another trying to manufacture a mandate when the numbers just aren't there. It is essentially pure copium mistaken for a tactic. Combine that with the addiction to being the resulting reoccurring self-sabotage like purity spirals and fractal ideological divisions for the sake of their own sense of identity and I don't see them going anywhere.

dexterdog• 3 years ago

Socialism appeals to youth because it emphasizes fairness which is something we stress as important to young people. The problem is that it doesn't work at scale so they have to realize that as they grow. People who pick up on it too soon are selfish and greedy. People who pick up on it too late are just not very bright. Some people appear to be the latter, but just know that the longer they can keep others from picking up on it the more they can fleece them.

intalentive3• 3 years ago

Socialism is popular with the young because what passes for capitalism offers a bum deal. Each generation is poorer than the last — home ownership is out of reach, college debt is high, job prospects are dim.

NoMoreNicksLeft• 3 years 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• 3 years 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.

photochemsyn2• 3 years 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

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• 3 years 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.

assbuttbuttass2• 3 years 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• 3 years 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.

motohagiography• 3 years 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.

than32• 3 years 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• 3 years 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.

WalterBright9• 3 years 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.

ajross3• 3 years 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.

escapedmoose• 3 years ago

Where are you getting this information? I’m unable to verify it.

danaris4• 3 years ago

Are you sure it was 1968? And not, say, 1973? The year Nixon signed the HMO Act into law, and brought about a massive expansion of for-profit health insurance?

Manuel_D3• 3 years ago

It also coincided with lower birth rates, and a greater percentage of elderly population. People seem to forget that retirees account for the significant majority of healthcare costs, but a relatively small percentage of healthcare revenue. Increase the share of elderly, and you get higher effective healthcare costs.

specialist• 3 years ago

Raising the floor without increasing the supply enabled the suppliers to charge more.

testrun2• 3 years ago

Not quite. Since 1968 four things happened in healthcare:

1. A wider range of healthcare issues can be cured or repressed due to advances in medicines. This directly lead to more doctor appointments. 2. People life expectancy increased, but older people need more healthcare. 3. Mental healthcare stigmatization went away (mostly), and therefore more doctor appointments. 4. Due to the higher demand in healthcare and the control over supply, the provider cost is higher than inflation.

umeshunni• 3 years ago

whether consumers will like a certain style of shoes once they are already made and on the store shelves

The key is to reduce the kind of shoes available. Everyone shall wear the state issued formal shoes and when they need to engage in the required daily sporting activity, shall wear the state issued canvas shoes.

spamlettuce• 3 years ago

Ahhh yes reduce everyone into indistinguishable blobs of society

prottog4• 3 years ago

movements like Georgism have interesting proposals to use mitigation of externalities to fund whatever government is needed

I, too, would very much like to see this play out in practice. But I don't think it'll ever actually happen in real life, because it would likely dramatically reduce the size of government (which politicians are loathe to do) and economically hurt wealthy landowners the most.

local_crmdgeon• 3 years ago

Texas is arguably the most Georgist state, and it seems to be going quite well for them.

mempko• 3 years ago

And yet the largest, most successful organizations in the world are centrally planned. The 'markets' don't explain China despite what many those in the west try to believe.

umrcumrcu4• 3 years ago

The organizations were not centrally planned by government officials.

nec4b• 3 years ago

>And yet the largest, most successful organizations in the world are centrally planned.

Which ones? Perhaps you are mixing hierarchical systems with centrally planned ones

sebastianconcpt• 3 years 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• 3 years ago

I was surprised to see no mention of Chile's 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 ) that with modern networking, data speeds and computing capacity, a centrally-planned economy could work.

csdvrx• 3 years 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 ) that with modern networking, data speeds and computing capacity, a centrally-planned economy could work.

With the minor assumption that P=NP

WillPostForFood5• 3 years ago

"with modern networking, data speeds and computing capacity,"

Sounds like some 5G level hype right there.

eestrada2• 3 years 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.

littlestymaar3• 3 years 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 …

than32• 3 years 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.

yourmatenate9• 3 years 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.

hospitalJail3• 3 years 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.

yourmatenate9• 3 years 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)?

int_19h3• 3 years ago

Leaders and factions are not a problem in a system that does not allow them to easily hoard power. Which authoritarian socialism isn't, of course, but that's not the only kind.

If you're wondering why we don't see the other kind much - well, the socialist movements that won back in early 20th century were generally the most ruthless ones, whereas the more democratically minded movements (e.g. Luxembourgism or various anarchist groups) were crushed. So you had a kind of artificial selection for brutality to begin with - but then countries controlled by those winners would also subsidize similar movements elsewhere, and of course they demanded ideological conformance in return. This is largely why stuff like Marxism-Leninism and Maoism is still so pervasive on the left.

greenie_beans3• 3 years ago

this needs to be at the top. the typical american conflates socialism with a centrally planned economy, thanks to the red scare of the 20th century and capitalism's grip on the public's imagination.

chmod6004• 3 years ago

Promises of "socialism" always seem to require granting huge amounts of power to the government, which leads to inefficiency, abuse, and worse.

In theory, perhaps socialism doesn't require huge amounts of government power; or perhaps huge amounts of government power doesn't always lead to horrible outcomes. But that's just a theory and has little evidence to back it up at the scale of millions of people.

Bernie Sanders said "These days, the American dream is more apt to be realized in South America, in places such as Ecuador, Venezuela and Argentina, where incomes are actually more equal today than they are in the land of Horatio Alger. Who's the banana republic now?"[1] in 2011, less than a decade before collapse. If he can't tell the difference between a socialist utopia and a recipe for disaster, how is a layperson supposed to know?

Just like a tech startup: don't call your users stupid and keep pushing your theoretically-good product. Listen and try to understand why it's not working for them.

[1] https://www.washingtonexaminer.com/news/campaigns/sanders-di...

stereolambda• 3 years ago

Well, wait till we try to square what Americans commonly mean by 'liberalism' and 'conservatism' with continental political theory and classic theorists connected to these words. In these cases America is, interestingly, removed to the left.

The man who "hijacked" the word socialism would probably be Marx himself, as he declared his theory to be the (scientific) socialism, as opposed to various (he said) "utopian" and "naive" thinkers who hadn't subscribed to views like historical inevitability of communism, or dictatorship of the proletariat. Then in the Eastern Bloc the local political systems were called "real socialism", i.e. the one put into actual functioning, on the road to future communism. So association of socialism with command economy is well established and not really one-sided ideologically, I think.

The terms to use if you want to distance yourself from that heritage would be 'social democracy' (if you mean the ideas that were partly implemented in capitalist Europe) or 'worker democracy', if you want something more akin to what the GP described. These ideas are easy to sympathize with on many levels, and what passes for "socialism" in the US is often just the not-really-disputed social contract on the other side of the pond.

Ultimately these ideologies advocate for reducing economics, to varying extents, to just democratic politics. Which is kind of boring: not necessarily meaning this as a bad thing. The calculation problem and related issues of organizing true command economy are more interesting as an abstract problems of engineering, organization etc., regardless of actually wanting this politically to happen. (Being formed in part by the Eastern experience, I am very much wary myself.)

cuteboy19• 3 years ago

And most asian would agree with our American friends. That is how we have experienced it.

chmod6004• 3 years ago

"Socialism is about how workers organise their workplace (owning, managing and sharing the produce and profit of their labour)."

That is a nice simplification, but it makes it sound like something that can just emerge gracefully within a market economy. There are employee-owned companies, for instance, and if that's all that's needed for socialism to work, then it would spread and show us all the benefits of socialism.

But the benefits are either not there or not amazing enough to spread. I'm left feeling like you left out the controversial parts, and I suspect that when you get into the details, there's lots of room for complicated power dynamics and ownership rules, perhaps much worse than non-socialist alternatives.

greenie_beans3• 3 years ago

this ignores the systemic and cultural reasons why employee-owned companies haven't spread.

revelio9• 3 years ago

This is conflating cause and effect.

Socialism is just a word, you can define it however you like. In theory it can be some sort of vague co-op of co-ops. In practice it always leads to a centrally planned economy. There's a good reason for that. The ultimate root cause that generates socialist ideals is not the plight of the workers or anything so surface-level, it's the intuition that intellectuals should run society. Thomas Sowell has done a lot of excellent work elucidating this and explaining why it happens.

To try and summarize, socialism appeals to people who like the sound of the abstract ideas of intellectuals. If an intellectual posits a clever-sounding reorganization of society justified by high minded ideals, then this feels right to the socialist mind. The sort of people who most aggressively promote socialism are the sort of people who think society is ultimately pretty simple - after all, the way to cure all social ills is so simple it can be summed up in a single book or set of pamphlets. It can be understood and reorganized by a single mind. Marx was famously averse to detail about how communist societies would actually work in practice, as were all other socialists, but this didn't bother them because it didn't seem like you needed a lot of detail. Hence the "calculation debate" the article discusses, which kicked off only after communists gained power.

If you intuit that society is simple and the best minds can understand and reorganize it for the greater good, then a planned economy is the obvious next step. Why would you not plan it? The only possible justification would be if the planning process was too hard, but that would imply that society was too complex for any one mind or even a committee of minds to fully understand, and if you believed that, you wouldn't be a communist to begin with.

So socialism or communism invariably always leads to top-down authoritarianism in practice. Revealed preferences > stated preferences.

csb62• 3 years ago

The ultimate root cause that generates socialist ideals is not the plight of the workers or anything so surface-level, it's the intuition that intellectuals should run society.

This is not the case. Marx and other writers repeatedly emphasize that the working class itself must take power and begin the process of getting rid of social classes altogether. They definitely did not advocate for a society run by highly educated intellectuals from the top-down. See “The Civil War in France”, where Marx discusses the Paris Commune - a working class uprising that was not lead by intellectuals.

socialism appeals to people who like the sound of the abstract ideas of intellectuals. If an intellectual posits a clever-sounding reorganization of society justified by high minded ideals, then this feels right to the socialist mind.

This is just a description of zealotry and overoptimism in general - attitudes than can be found among proponents of any framework. Marx himself criticized earlier utopian socialist thinkers for trying to plan out an idealized society from their armchairs, rather than actively organizing with workers to create a better one. He saw theory and practice as deeply connected, and he definitely was not a utopian thinker.

the way to cure all social ills is so simple it can be summed up in a single book or set of pamphlets. It can be understood and reorganized by a single mind.

Marx didn’t believe this. He was a prolific author and corresponded with many other contemporary socialist writers. He published a whole series of books just focused on analyzing capitalism, and he died before completing them. There is a wealth of Marxist writing and many conflicting strands - there is no “one mind” or “one committee” with the final say.

Why would you not plan it? The only possible justification would be if the planning process was too hard, but that would imply that society was too complex for any one mind or even a committee of minds to fully understand, and if you believed that, you wouldn't be a communist to begin with.

There is a whole area of thought known as market socialism that rejects both capitalism and central planning. Central planning is not fundamental to socialism; it is simply one kind of economic strategy that could be used by a socialist society.

I would encourage you read accounts of socialist thought besides those written by a deeply conservative economist. Marx himself can be challenging to read, but David Harvey has a book called “A Companion to Marx's Capital” that helps explain some of the context.

ModernMech5• 3 years ago

It's quite easy to conclude that the "sorts of people" who don't share your beliefs are fundamentally deluded or so narcissistic, naïve, and simplistic that they think they should be planning everything.

However, if you'll notice, here on HN a lot of people calling themselves socialists don't believe in the idea of central planning, so maybe there's more to it than socialists are just a sort of person.

peterashford5• 3 years ago

That is a rank ad hominem.

hbrn8• 3 years ago

Socialism is about how workers organise their workplace (owning, managing and sharing the produce and profit of their labour)

That's a sugarcoated way of saying "imposing restrictions". You're not allowed to have private ownership of means of production. You're not allowed to just sell your labor without taking on risks.

You can practice socialism in a capitalistic society. You are forbidden to practice capitalism in a socialistic one.

yourmatenate9• 3 years ago

To me this is like saying: You don't have the freedom to be a slave, therefore your system isn't really free.

primer42• 3 years 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... 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.

WillPostForFood5• 3 years 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.

littlestymaar3• 3 years 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• 3 years 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• 3 years 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• 3 years 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.

lamontcg5• 3 years 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_ITR4• 3 years 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.

seiferteric2• 3 years 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.)

fallingknife4• 3 years ago

Interest expenses are deductible from all businesses taxes. (Wouldn't make sense if they weren't, as a money losing company could still be forced to pay income tax.) So If I build an apartment building and rent out the units, my interest expenses are deducted, and nobody is arguing with that. So if I buy a house and live in it, why shouldn't I be able to deduct the same?

GauntletWizard• 3 years ago

Tax deductible mortgage interest is a favorite whipping boy, but consider the alternative - It would be more effective for corporations to buy properties and rent them out, because corporations could still charge the mortgage payments as operating loss. I would gladly incorporate a C-Corp and rent my house at market rate to myself.

WalterBright9• 3 years ago

where corporations run the government

Are you sure about that? In this state, at least, a politician cannot get elected without union endorsement.

t-3• 3 years ago

Why do you think seem to think unions are independent from corporations? The regulations on unions and corporate capture of union executives make them little more than external HR departments. The strike suppression and sheer number of sellout contracts pushed through in the past few years under the "most pro-union president" should make it abundantly clear that unions in the US are a total joke.

pcthrowaway• 3 years ago

I feel pretty much the same way; is there a better name for this besides democratic socialism?

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.

While I agree the "socialists" who want full-blown (central, government run with no free market elements and no money) socialism are the minority, it's frustrating that good conversation around socialism is hard to find because detractors specifically attack this extreme side of the dichotomy.

hospitalJail3• 3 years ago

I'm a moderate/independent and probably a capitalist due to the pragmatism. However, I tell people that I would be a radical socialist if it worked.

I might be okay with inefficiencies if we really could get rid of class, or that we could keep our excess value of labor. That puts me on the extreme side.

The less extreme side just seems inefficient and creates a class of government workers/politicians who control resources are the new upper class.

It really sounds like you want capitalism with some sort of redistribution or better taxation. I most recently found Green Capitalism as a word I could likely get behind, but it still suffers from the issue of resources going through government workers/politicians.

lamontcg5• 3 years ago

https://en.wikipedia.org/wiki/Market_socialism might work.

nivenkos• 3 years ago

Income inequality is good, and fighting markets is like trying to stop the tide.

It's accumulated wealth that is the problem (and leads to the corruption of free markets and democracy).

Policies should be focused on that - taxing wealth rather than work, and encouraging profitable investments rather than sitting on assets.

Whereas now the so-called "left-wing" policies are awful - rent control is popular in Europe despite being an unfair disaster in Sweden. There are high taxes on income and high VAT, whilst inheritance, land and wealth taxes have been abolished, greatly hurting social mobility while benefiting established, inherited wealth.

Same with a lot of focus on patching up symptoms - like not prosecuting low-value shoplifting, allowing squatting on "empty" properties, etc. rather than trying to improve market conditions, education and training and the housing market, etc. to ensure that everyone could get a much better salary to begin with.

danaris4• 3 years ago

Income inequality is good

[Citation needed]

To be clear, I'm not implying that it would be good to have absolutely everyone make exactly the same amount. I'm saying that income inequality at high levels is bad, demonstrably so, and inevitably leads to concentrations of wealth.

I'm also not sure why you think that high VAT and lack of inheritance and wealth taxes are "left-wing" policies. Those are all regressive, and exactly the kinds of things that the right wing is pushing for here in the US. At most, I would think that such policies would be compromises between a left wing that wants progressive income taxes alongside inheritance and wealth taxes, and a right wing that wants VAT and basically nothing else.

PrimeMcFly15• 3 years ago

We need wealth limits for companies (which should be more like co-ops), proportional to the size of the company, with everything pasta threshold going back into UBI or something. Same for individual wealth accumulation.

People could do more projects/start more companies to earn more, but no one should be accumulating millions by doing almost nothing as is the case now.

prottog4• 3 years ago

encouraging profitable investments rather than sitting on assets

A difficult distinction to make, since profitable investments are also assets that one would presumably like to sit on for a while.

lamontcg5• 3 years ago

Income inequality is good,

Yeah I don't agree with that.

It's accumulated wealth that is the problem

I do agree that wealth inequality is the bigger problem, and I should have used that term instead.

r00fus3• 3 years ago

Income inequality is good

I agreed with the rest of your comment but this is... strange. You might agree if it's rephrased as "extreme income inequality" is bad?

"Harrison Bergeron" was a straw man argument posing as a short story - don't let the similar strawman of "no income inequality" overshadow the more present and real threat to society of growing extreme income inequality. Some twitter posts accurately phrase this as the "too expensive to live" problem for some.

over_bridge• 3 years ago

Your comment is quite a ride to read. I, like some other commenters, had an immediate negative reaction to the 'income inequality is good' statement.

Having read the whole thing a few times I generally agree with your position. Differences in salary reflect differences in demand for certain roles, or the value you can bring to them. It's a real time signal. They can act as an incentive to draw more people to that position or signal when one is saturated. The system is abused a bit when finance jobs pay a lot despite dubious value to society, and teachers are underpaid relative to their importance, but as a general rule it works.

Wealth inequality is the major issue. It might be 'natural' in the sense that each generation of parents passes advantages to their kids, but I also think its a mark of civilization to be able to keep it in check. If you earned it, great, but when you die lets not burden the future with your family dynasty of rich but useless descendants.

All people can't be born equal if your financial situation is determined five generations before you were conceived.

randomcarbloke5• 3 years ago

Income inequality isn't good or bad, it doesn't necessarily imply a working model as I gather you believe...nor does it suggest extractive behaviours, and people's aversion to it is absurd and ideological - see other replies to you.

Absolute poverty is the real enemy, but it is possible to have high inequality and low poverty.

Where I disagree with you is in accumulated wealth being the problem...it isn't generally bad or unproductive, but this is asset dependent, land-wealth is a sink and Georgist measures could significantly improve productivity and capital acceleration.

But the so called "left-wing" you describe seems intent on punitive taxation as opposed to productive...

int_19h3• 3 years ago

https://en.wikipedia.org/wiki/Market_socialism

reso2• 3 years ago

It's unfortunate that "socialism" came to mean "central planning" in the 20th century. It didn't mean that before the Bolsheviks and Marxist-Leninism out-competed (and then destroyed) the other socialist movements in the 1920s and 30s.

By first principles socialism == worker control of the means of production, or the idea that the people who do labour should have a major stake in the decision making surrounding it.

This general idea of worker control is entirely compatible with markets and with price-discovery as a coordination mechanism between firms and localities. There's even partial examples of this in many "capitalist" economies today. Volkswagen is required to have union reps on their board of directors. That's socialism!

asdff6• 3 years ago

There is socialism in the U.S. too. If you work for the government in some capacity you are participating in the socialist side of our nation in practice. IMO the US military especially is a model of what a fully socialist US would look like, if it were allowed to scale to all sectors. WWII with the socialist centrally planned economy was an interesting case study for the U.S.; it showed how this manner of socialism can reorient an otherwise depressed labor economy into the dominant world power in a few short years.

bart_spoon4• 3 years ago

The problem with socialism is that it is seemingly impossible to define. I have yet to hear a cogent definition of what socialism actually is. Like major world religions, there are hundreds if not thousands of sects, all with their own, often conflicting dogma, and in cases where the warts of socialism pop up, there is inevitably a chorus of “well that wasn’t actually socialism!” Even religions like Christianity can largely be boiled down to basic tenets such as “a belief in the divinity of Jesus Christ”, which seems far more concrete and consistent than any explanation of socialism I’ve heard.

- I’ve heard people say that socialism is simply representation to and protection of workers from the company they work for. But that exists in many industries and nations, including the US which socialists consider highly capitalistic.

- Others seem to describe socialism as redistribution of wealth, and often point to countries like those in Scandinavia, which sounds great to me except those countries are very much capitalist, and their economies seem more like “capitalism with sensible guard rails” (aka Social Democracy) than “socialism” as defined by many socialists themselves.

- Perhaps the closest thing to a concrete definition of socialism is “social ownership of the means of production”, but even that is far too vague to be helpful. What does “social” mean in this context? What does “means of production” mean here? If it’s “workers have ownership of a businesses capital”, then FAANG companies like Amazon paying huge amounts employee compensation in the form of equity are among the most socialist companies in the world. Obviously I don’t think anyone would agree with that.

- I’ve heard socialism (although this perhaps dips more into communism, as if the distinctions there are any less indecipherable) differing from capitalism in how they answer the question, “Can someone sell use of their possessions (ie capital, such money, equipment, or land) to someone else?” In capitalism the answer is yes (therefore giving birth to landlords, shareholders, boards, etc) and in socialism the answer is no. That actually seems to me like a pretty solid definition to go off of. But in that case, we have to ask how companies can actually get the capital they need to get going. In ventures like smaller cooperative communities, and in industries like agriculture, it seems more feasible. But think about how much capital is required for something like a pharmaceutical company, or a tech startup. Millions and millions of dollars in cash are required, and it is not feasible for workers to simply pool resources and bootstrap. It would seem like the only solution would be to have some entity, like the government, redistribute societies capital to those entities they see as most deserving. But now you are back at the central planning model many bemoan as being the flawed, “no-true-Socialism” incarnations of the 20th century.

I’m not an expert, and so I recognize my understanding could be flawed. And I am in no way at in love with capitalism. But it seems to me like the best we can hope for is Social Democracy style capitalism with guardrails as opposed to pie-in-the-sky socialism which seems to mean everything and nothing at all depending on the situation and who you are asking.

testrun2• 3 years ago

I think this is the core of the problem with the socialism vs capitalism debate. Everybody has a different idea what socialism is.

AndrewKemendo4• 3 years ago

Thank you!

The way out of this mess is worker controlled non-stock cooperatives

intalentive3• 3 years ago

A fish rots from the head. Any talk of reform must begin with price fixing in the capital markets.

kwere• 3 years ago

regulations over business which prevents monopolies and market distortions, along with much stronger unions

monopolies can be the "natural" outcome of market forces or economic realities. Like having the best product by far or owing the only possible railroads tracks. The solution would be to cap ownership/voting rights to make shareholding as decentralized as possible and having a progressive tax rate on ROA or similar metrics

Unions have shown time and time again to not be able to scale efficiently, shifting power from the "people" to the secretariat when becoming a mass organization. Secretariat that engage in political squabble to enlarge its own power and those of its associates. Unions become a tool for societial corruption.

I consider also the concept of antagonistic union a somewhat relic of the past (at least in europe) and will much more appreciate organizations acting more like consortiums of workers and getting consulative seats in the boards of the target industries akin to german unions

Kbelicius3• 3 years ago

Unions have shown time and time again to not be able to scale efficiently, shifting power from the "people" to the secretariat when becoming a mass organization. Secretariat that engage in political squabble to enlarge its own power and those of its associates. Unions become a tool for societial corruption.

Isn't this true of corporations or any other mass organization? Unions, AFAIK, are at least democratic.

wesapien• 3 years ago

Treat every corporate criminal like criminal and maybe they will leave the US. Then treat those criminal corporations as terrorist orgs if they continue to do criminal things overseas.

mech765• 3 years ago

It is perfectly legal to start a company as a co-op, or as any other non-traditional structure. There's an argument to be made that corporations have a growth advantage because their profit motive makes them grow faster than other structures. How would you propose balancing that?

staunton3• 3 years 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.

wrycoder3• 3 years 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?

staunton3• 3 years 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.

revelio9• 3 years 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.

asdff6• 3 years ago

It just needs to be married with a research and development program. Today in the U.S., most research is done with public grant support. The government puts out a call for proposals in a given area, researchers submit their ideas, their peers evaluate them and decide which should get funding relative to others, and private companies take advantage of these findings with more translational work (or the researchers themselves form a startup or license a patent). In a sense, we have a "communist" system of allocating research money to novel ideas already in the U.S., and it works so well that other nations try and replicate the grant funding models of our NIH, NSF, USDA, DOD, DOE, or other agencies. Of course, these systems were very nascent compared to what they are today back before the 1990s during the cold war, but today, I would think the context today is different than a soviet union facing global embargo half a century ago, especially with all of this published information being available to anyone with an internet connection and not those with physical access to well funded university libraries.

littlestymaar3• 3 years ago

In fact, USSR was very competitive in most domains until ww2, and in fact, the ability to conduct dramatic changes at an insanely high pace is probably the biggest strength of a centrally planned economy (though if the underlying idea is bad, then the change become literally dramatic, see the great leap forward).

What made the USSR fall behind was the cold war, meaning very little foreign trade and too much emphasis on military (and in the end, the gerontocracy, with people in charge all being too old to do anything, but this is related to their dictatorial nature, and not to the central planning).

throwaway22032• 3 years 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.

andrewflnr2• 3 years 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.

chmod6004• 3 years 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.

andrewflnr2• 3 years 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• 3 years ago

The problem with planned economies is mismatched incentives, not computational capabilities.

Animats• 3 years 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...

[2] https://cset.georgetown.edu/wp-content/uploads/t0284_14th_Fi...

revelio9• 3 years 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.

ChadNauseam• 3 years ago

Three big banks, two big drugstore chains, three cellular providers

Costs associated with banking, drugstore purchases, and cell service make up an tiny proportion of total spending. Compare that to housing, education, and healthcare, which are the main drivers of inflation despite having many more than four players of comparable size.

People say healthcare and housing is expensive because you need it to live. You need food to live too, but food is so cheap as to be basically free in the US. (Food as in rice and beans, not Uber Eats.)

I'm not saying central planning is bad necessarily, but can it be a coincidence that healthcare, housing, and education are so expensive and also hugely "centrally planned"?

The government determines how many apartments get to be in your city (and they usually decide on a laughably small number).

The government decides who gets to practice medicine (and they make sure that the number is not very high [0]). They even decide to not let doctors in countries like India do radiology work in the US, just to boost American radiologist's pay.

As for education, most people go to public colleges where the government literally decides the prices! Not only that, but they generously offer "need-based scholarships" to people, after determining their willingness to pay by getting their family income.

So maybe central planning is the move, but it would be more compelling if the biggest expenses of American life didn't all seem to be caused by at-best incompetent central planning.

[0] https://www.washingtonian.com/2020/04/13/were-short-on-healt...

csb62• 3 years ago

can it be a coincidence that healthcare, housing, and education are so expensive and also hugely "centrally planned"?

How are you defining central planning? It seems like you mean “extensive government intervention and involvement”, which I don’t think is an accurate definition.

Using that definition, then food is also a “centrally planned” industry, since governments heavily subsidize dairy producers and farmers, leading to cheaper food products. Governments also are deeply involved in regulating and intervening in the banking and telecommunications industries, which you seem to imply are not “centrally planned” and so are more affordable.

hbrn8• 3 years ago

If Amazon and Walmart are so great at being centrally controlled, why did both of them introduce third-party sellers to the platform?

reso2• 3 years 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.

chmod6004• 3 years 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.

eestrada2• 3 years 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.

DiscourseFan2• 3 years 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.

snapcaster3• 3 years ago

rational is doing a lot of heavy lifting in this comment

Tiktaalik2• 3 years ago

I feel like the thousands of homeless people in my city would not be "loyal customers" of Capitalism if given the chance.

ciupicri• 3 years ago

You don't have permission to access /roundtable/socialist-calculation-debate on this server.

advisedwang2• 3 years ago

Companies like Walmart are the size of some national economies and seem to centrally manage pretty well.

intalentive3• 3 years ago

Large companies have price signals to work with. Command economies do not.

advisedwang2• 3 years 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• 3 years 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• 3 years 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• 3 years 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• 3 years 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• 3 years 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.

The socialist calculation debate

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