Comment by Jim Campbell, Citizen Journalist and Patriot.
There can be little doubt why socialism as a pure economic model, the teachings of Karl Marx, and the failure of the U.S.S.R. with its supposed communism have failed.
Left to his own design, man will look out for his own self-interest, and working for the collective has never fit with mans human nature.
That is why when we hear the blather about the 99% and the so-called “Occupy Movement,” it’s just that, nonsense and blather.
Only those ignorant of economics and world history would say otherwise.
That’s my story and I’m sticking to it, I’m J.C. and I approve this message.
The Birth of Socialist PlanningIt is often thought that the idea of socialism derives from the work of
Karl Marx. In fact, Marx wrote only a few pages about socialism, as either a moral or a practical blueprint for society.
The true architect of a socialist order was Lenin, who first faced the practical difficulties of organizing an economic system without the driving incentives of profit seeking or the self-generating constraints of competition. Lenin began from the long-standing delusion that economic organization would become less complex once the profit drive and the market mechanism had been dispensed with—“as self-evident,” he wrote, as “the extraordinarily simple operations of watching, recording, and issuing receipts, within the reach of anybody who can read and write and knows the first four rules of arithmetic.”
In fact, economic life pursued under these first four rules rapidly became so disorganized that within four years of the 1917 revolution, Soviet production had fallen to 14 percent of its prerevolutionary level. By 1921 Lenin was forced to institute the New Economic Policy (NEP), a partial return to the market incentives of capitalism. This brief mixture of socialism and capitalism came to an end in 1927 after Stalin instituted the process of forced collectivization that was to mobilize Russian resources for its leap into industrial power.
The system that evolved under Stalin and his successors took the form of a pyramid of command. At its apex was Gosplan, the highest state planning agency, which established such general directives for the economy as the target rate of growth and the allocation of effort between military and civilian outputs, between heavy and light industry, and among various regions. Gosplan transmitted the general directives to successive ministries of industrial and regional planning, whose technical advisers broke down the overall national plan into directives assigned to particular factories, industrial power centers, collective farms, and so on. These thousands of individual subplans were finally scrutinized by the factory managers and engineers who would eventually have to implement them. Thereafter, the blueprint for production reascended the pyramid, together with the suggestions, emendations, and pleas of those who had seen it. Ultimately, a completed plan would be reached by negotiation, voted on by the Supreme Soviet, and passed into law.
Thus, the final plan resembled an immense order book, specifying the nuts and bolts, steel girders, grain outputs, tractors, cotton, cardboard, and coal that, in their entirety, constituted the national output. In theory such an order book should enable planners to reconstitute a working economy each year—provided, of course, that the nuts fitted the bolts; the girders were of the right dimensions; the grain output was properly stored; the tractors were operable; and the cotton, cardboard, and coal were of the kinds needed for their manifold uses. But there was a vast and widening gap between theory and practice.
Problems EmergeThe gap did not appear immediately. In retrospect, we can see that the task facing Lenin and Stalin in the early years was not so much economic as quasi military—mobilizing a peasantry into a workforce to build roads and rail lines, dams and electric grids, steel complexes and tractor factories. This was a formidable assignment, but far less formidable than what would confront socialism fifty years later, when the task was not so much to create enormous undertakings as to create relatively self-contained ones, and to fit all the outputs into a dovetailing whole.
Through the 1960s the Soviet economy continued to report strong overall growth—roughly twice that of the United States—but observers began to spot signs of impending trouble. One was the difficulty of specifying outputs in terms that would maximize the well-being of everyone in the economy, not merely the bonuses earned by individual factory managers for “overfulfilling” their assigned objectives. The problem was that the plan specified outputs in physical terms. One consequence was that managers maximized yardages or tonnages of output, not its quality. A famous cartoon in the satirical magazine Krokodil showed a factory manager proudly displaying his record output, a single gigantic nail suspended from a crane. ( More below)
Continue reading →
Comment by Jim Campbell, Citizen Journalist and Patriot.
