What if Stalin had computers?

Interesting article pointed by Matt McCaffrey of Mises Blog.

The article is another take on end of Capitalism.

When will capitalism end? It’s not a new idea, and even the capitalists suspect it will happen. After all, every other mode of production has fallen, and capitalism isn’t a steady-state system. It simply isn’t built to stay the same. As firms incorporate new technologies, capacity increases per-capita, and jobs change, so too does the nature of commodities and consumption. It happened with the assembly line, and it’s happening again with information technology. In 1930, John Maynard Keynes famously predicted these trends would reduce everyone’s daily toil to part-time by now, while Karl Marx thought the same developments would compel workers to seize the whole system and abolish wage-labor in general. But the system still lives.

If the history of postcapitalism so far is a repeating chorus asking “Are we there yet?”, then the new book from Channel 4 economics editor Paul Mason, Postcapitalism: A Guide to Our Future, is a reassuring “Almost!” from the front seat. Like a good co-pilot, Mason keeps his eyes on his indicators, and he has the end in sight. Or at least on his graphs. How the transition might occur is less important than that it must.

……

The book really comes into its own when Mason addresses the possibilities of contemporary planning. He does not go as far as to endorse “cyber Stalinism” but at the very least poses its thesis: What if the problem with the Soviet Union was that it was too early? What if our computer processing power and behavioral data are developed enough now that central planning could outperform the market when it comes to the distribution of goods and services?

If you raised your hand and said this in an American ECON100 class, you’d be laughed out of the room, so Mason as prominent public employee deserves a lot of credit for bringing it this far into the English-speaking mainstream. The possible socialized uses of technology is an exciting can of worms. Using large sets of behavior and population data, capitalist firms like Amazon and Google have developed predictive capacities that would make Soviet cyberneticians weep with joy. Capitalism says that the best use of this capacity is to sell people stuff, but parts of this process are so socially unproductive and unnecessary—we don’t just have clickbait sites, we have third-rate clickbait sites—that it can’t possibly be the case.

“Imagine if Walmart or Tesco were prepared to publish their customer data (suitably anonymized) for free,” Mason writes. “Society would benefit: everybody from farmers to epidemiologists could mine the data, and make more accurate decisions.” This is just the beginning; remaking productive machinery in the collective interest means driving necessary labor down as far as possible with data analytics and self-management. Why can’t a meatpacking factory function like a web startup, with room for autonomy and achievement targets instead of required hours? It’s fun to imagine how we could do better than capitalism if we all decided to, especially if no one had to worry about creating and maintaining false scarcity around info-tech goods.

To this, McCaffrey responds it as old talk:

The failures of socialist states are obvious and horrifying, yet there never seems to be a shortage of intellectuals eager to churn out new schemes for central planning. Malcolm Harris discusses the latest of these suggestions, which claims that the traditional economic problems of socialism can be resolved by harnessing the power of modern data collection and computing, through a kind of “cyber Stalinism.”

As it happens, this argument is not new. It was first made in the early days of computing by the market socialist Oskar Lange, whose followers revive it from time to time. In all its forms, however, it remains unconvincing.

The idea is simple enough: even though central planners face serious problems when it comes to gathering data about preferences, production plans, and technology, these problems can be overcome through computers, which make it possible to instantly collect and transmit an enormous amount of data. Relevant knowledge can thus be made available to guide the planners, who are then able to figure out what people need and how best to use scarce resources in order to produce it.

Despite its optimistic outlook, however, this blueprint for successful techno-socialism only serves to highlight the importance of Mises’s arguments about the impossibility of central planning. Sadly, although his work initially defined the economic debate over socialism, today Mises’s contributions are sometimes overlooked, or are conflated with other critiques. However, his treatment remains the most vital criticism of socialism in all its forms.

Mises argued at length that the fundamental problem under socialism is a lack of monetary calculation. Under socialism, entrepreneurs do not own the factors of production, and thus cannot exchange them. They are therefore unable to appraise the value of the factors in money terms, and thereby generate a system of market prices. Without a price system created by entrepreneurs, rationally allocating resources becomes impossible

Fascinating debates…Going back to one of the central questions of economics..

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: