Is maximum economic efficiency always desirable?

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Its a very hard question to answer in that format as the second you think of pros and cons your already trying to figure out 'what does this mean in the broader picture?'. That's why seeming or 'feeling' fair on first glance is the only thing I can really give it; it looks quaint, nice, inviting for a fleeting second. Its also what Marx talked about when he went on about a day where the family could spend time together and enjoy life rather than work all day; it speaks to our desires primarily, something a person could easily muse or sigh over for a second, after which their forced to pull their eyes off of the trees or lake outside the window and go back to their daily routine.

1) An economics question is a human question. The two are inseperable to me. The definition of economics I use (and I am not alone) is human action. Me typing this response to you is "economics". The formation of language, the ability to form associations, and move is economics. Economics has little to do with money. Money is just a convienent mode of exchange to avoid a more cumbersome barter system. It forms naturally. For example in prison cigarettes are used as money.

2) I won't debate you about why I think socialism is inherently violent because like you I despise thread decay (If you want to please PM me I would love to talk about it, as well as my struggles with what is meant by egalitarianism when the word is used). I apologize for missing any points, or bringing up arguments where they should not have been brought up. That was not my intent.

I think then, if I understand your original point more, there is a need for much more discussion. I am a person who despises to place "universal values" on things. If that doesn't make sense to you, that is because people with different ideological backgrounds and education talk past eachother all the time. In the end both parties leave the discussion with nothing gained. Some groundwork and common ground has to be established before people who think on two different planets can have any productive dialogue. We may have some fundamental differences in the way we even define and use terms.

I surmise from this and the rest of your post that you are perhaps a fan of the Austrian School? What I was referring to was more narrowly material well-being.


Meh, the thread's already gone and you aren't the one who killed it. I can see how you would view socialism as inherently violent if you are thinking in terms of the government using force to impose a certain order.


Well, I am not a socialist, and I actually used to follow Austrian thought quite closely. I understand why you would avoid claims of universal value. I disapprove of socialism partly on the basis that it gets worse results than capitalism, but I also sympathize with socialism's concern for the poor. Could it be that less is more? (Disregarding the fact that I think a socialist society would likely collapse entirely, I'm assuming, in my hypothetical situation, that some workaround is found to maintain a stable state)

honestly. you guys have just argued in a vacuum.

I get the disticnt impression that you don't know what your talking about when it comes to socialism. You attribute ideas to it which has nothing to do with it. You don't even engage with the main points of the socialist argument.

@Orwell - THe fact that you follow Kautsky and the Austrian school says it all. Socialist by name only.

I could probably make a fair stab at guessing your socio-economic backgrounds while I'm at it - white, male, lower middle class, college education (or at least intending).

I wonder why you would want to discredit socialism without ever having to actually engage with socialist ideas? Perhaps because you have the benefits of being born in one of the better off castes and want to retain that?

So far as the original topic goes socialism is a more efficient mode of production than capitalism, without this the whole thing will slide back into capitalism as was seen in the soviet union

Last edited by TitusLucretiusCarus on 22 May 2009, 12:52 am, edited 1 time in total.

Well I guess we see eye to eye now. Yes, I agree with many Austrian type thoughts (the phrase human action is the dead give away) though I tend to have major disagreements with your typical austrian libertarian on certain concepts (I am pretty much a moral nihilist).

1) I honestly do have a hard time doing universal values.
2) As far as just looking at this from a practicle sense (and assuming socialism wouldn't collapse) and looking at it with no moral sense ("moral" meaning what I consider right and wrong, which I think is somewhat consistant with most peoples thoughts): I just see price inflation going through the roof. How could devolopment/improvments anywhere not be seriously hampered?

I think instead of "pure" socialism, you would have to be looking into a more "third way" model that would have to know the meaning of production and wealth to achieve this end. Sweden is a decent example of this. In a way they have more economic freedom that the US (in an oddball way to look at it), plus they usually seem to know what real wealth means. The government doesn't run social programs that it can't afford (at least not to the extant of say, France or nowadays maybe even the UK and USA). That being said, for something in government to work like that, it would still have to be much more market oriented and fiscally conservative. If a democratic government can pull that off it is a small miracle, but as far as I know Sweden has done a somewhat OK job in doing it. Even then; you are still praying that a centralized, beurecratic, democraticly elected, political group of people are running things effeciently, with expertise, and with the best interests of everyone in mind for now and always. That to me seems like a very tall order.

As far as concern for the poor. I have it too, I honestly do (I admit it is not a major driving force for me, however). For that you are right many socialists must be looked at with respect (George Orwell was a great man) for caring about others like that many call attention to it, along with some other issues (notably foreign policy) makes them a valued intellectual force (though I have deep INTENSE disagreement with them). I am of the opinion though that most socialists have confused the free market with colonialism, mercantilism, protectionism, the state banking system, imperialism, nationalism, war mongering, and conservatism. Most people can not be blamed for this as governments and politics do have a very wonderful gift for distorting info.

Because I'm not really interested in debating socialism per se in this thread, just one particular judgment that could be made either way based on certain assumptions. I know my assumptions can be contested, but that wasn't really the point.


Socialist by name only? What do you mean? I'm not a socialist by name. I used to follow the Austrian school, not so much anymore, though I still admire some of their ideas. I'd actually not heard of Kautsky until you brought him up.


White, male, middle-class or so, yeah, college-level education with grad school as a possibility. None of your guesses there were terribly impressive though.


I wasn't trying to discredit socialism in this thread, and I think I've actually defended it in at least a couple posts. If you want me to engage with socialist ideas in order to discredit socialism, I'd be glad to do so- it's really not that hard. I mean, all I have to do is say that a socialist has no mechanism for allocating resources and I can pretty much be done with that. I haven't engaged socialist theory in depth because I consider it pretty well refuted already and don't see much need to continue trotting out the same arguments. That socialism gets poorer results than capitalism is a settled question, I was wondering if people thought a moral argument could be made in favor of socialism even with its (overall) inferior results because of a different distribution of wealth.


Socialism more efficient than capitalism? How so? And if that were the case, why did Lenin turn to capitalism in his NEP when he needed to rebuild the Soviet economy after WWI? Why did all the Soviets turn to the black market when Brezhnev was in charge?

my apologies for misinterpreting the point of your thread, further apologies for taking the thread of the original toipic, but to answer your points:

sorry, I meant the austrian school was socialist in name only, considering it did its utmost to defend the status quo in austria at the time (as did the german SDP, assisting the liquidation of the spartacist revolution of 1918-1919 and the bavarian soviet republic - ultimatley leading down the path to Hitler and his glorious little cabal)



thought it was easy



you've identified one of the main problems currently dividing the left - ideas advanced include centralised state distribution, democratic inter-industry and worker-consumer councils going over costs of production, renumeration for labour, in order to determine prices/means of renumeration/barter valuation. one idea i personally am drawn to but don't know a great deal about is thermoeconomics.

I'm not the least bit convinced this is a settled question, but we're not going to find common ground on that i feel.



well, after a devestating (and lost) war against germany, followed by years of civil war in which the bolsheviks, attacked by 21 (again 21) foreign nations, holding at one time only a corridor linking st petersburg with moscow (and possibly volgograd), in a war in which starvation levels reached the point were some russians were driven to hunt rats for food, in which the White forces had packed up and shipped out most of the technical machinery required for running any basic european economy of the day, Lenin's government was again faced by the very real possibility of a starving population. Lenin was vehemently opposed to the NEP but saw it as a necessary evil to get an economy that was on its knees started again and to prevent the people he said he was trying to protect from starving to death. Right or wrong it happened. His argument being that a level of state-capitalism was a necessary step on the path to a socialist economy and ultimately a communist one.

Even before all this Russia was very much a dying feudal outpost on the edge of a sea of capitalist development, its agricultural economy was already largely inadequate before these conflicts and compared to Germany, the UK and especially the US had a laughable level of industrial and infrastructural development. In spite of this through the twenties into the thirties the bolsheviks turned it around, the problem was the NEP had allowed the bourgeois elements to flex their muscles and were feeling a new purpose. Some parts of the economy, particularly heavy industry (the backbone of most socialist movements in developed and urbanised regions) did extremely well relativley speaking, seeing huge advances in output which made the capitalist west look positively lazy. Light industry, consumer goods and development of both culture and technique lagged far, far behind. Combine this low economic output with the renewed strength felt by the bourgeoisie = the bourgeoisie step in to meet the demand for certain goods leading to black markets etc. Add to this the bureacracy's (ies'?) power, being the distributor of all legal (and often illegal/balck market) goods (those few goods made given to those favoured by the technocrats, leaving the majority without necessaries) meant the reawaking of class conflict between the technocrats and everyone else. Some call it state-capitalism (rejected largely by Trotsky I think), some call it a degenerate workers state (can it really be so? Trotsky advanced this view but with the end of the democratic rights of the soviets and numerous other vile breaches of workers rights to continue a dictatorship set up out of necessity i do not and cannot accpet this) or a new form of exploitation specific to the economic, social and historic conditions of the time (something which comes through in Trotsky's analysis but which he doesn't articulate)? Perhaps the last can be called Stalinism, after the bloody handed despot and criminal who did the most to discredit the ideas he supposedly fought for. Given Lenin, before his death, was preparing a massive case for the expulsion of Stalin and his supporters in the party and bureacracy we can assume this was not the path he hoped for (he is quoted somewhere as saying"Do not let him in").

You will very likely roll your eyes and exclaim "oh my god!" but socialism has yet to exist, it can only be judged on the limited data available.

Umm... the Austrian school isn't socialist. At all. They are the most avid opposition to socialist ideas. Austrian school usually refers to the followers of Ludwig von Mises, Friedrich Hayek, and a number of other avidly libertarian(in the American sense) intellectuals. So, right, I think you confused one Austrian school with another Austrian school, with the one Orwell was referencing being better known in most circles.


Well, he basically just cited the argument against socialism used in the socialist calculation debate, which argued that a socialist system could not efficiently determine where resources should be allocated as only a market based system could handle this kind of process on a large scale.



Well, I doubt that Orwell is entirely ignorant. The reason that the USSR is cited is because it is one of the few bits of empirical data that can be cited. One could also cite China and all of the other states that attempted a more socialist path during the 20th century. It further could be argued that none of these legitimately attained socialism, however, to get more to the point, nobody really knows what the ideal socialist nation would look like, and if a goal is impossible to attain(or reasonably attain) then failures to attain this system would be expected.

In any case, it is correct that socialism should ultimately be engaged somewhat at a theoretical level, however, it is equally correct that individuals seeking knowledge should apply their energies most to the areas where they have the highest expected gain in knowledge acquisition, which can preclude ideas that seem problematic and that are generally rejected as well as things that are less relevant, and this can mean ignoring socialist theory, and it can also mean ignoring the history of the Mario franchise, or any number of things that may or may not end up being useful.

The Austrian school is quite possibly the most overtly anti-socialist intellectual movement in history. They are hard-core capitalists, and many of them are anarchists as well.


Well, all that information has been posted here before. Male is in my profile, and white, middle-class, and relatively educated isn't a tough guess in any case.


Most of those plans are just castles in the air. I find it telling that a socialist admits being "drawn to" an idea about which they "don't know a great deal." It really sums up most of the modern socialist movement.


Well... the Austrian arguments during the socialist calculation debate were considered to be pretty devastating. I suppose you could argue that with the advent of computers and large-scale information technology socialist calculation might have a bit of a chance, but I still can easily point to the inflexibility of any centralized system as being unable to deal with unexpected circumstances.


Lenin wasn't opposed to the NEP. He's the one who came up with it, for crying out loud. Anyways, by Marxist theory the Bolshevik Revolution should never have occurred, it was premature, and Lenin knew that full well but he was just an impatient bastard.


Heavy industry was pretty much failing until Stalin killed and plundered all through the countryside in order to invest in some factories. Might want to read up on the "scissors crisis"- agricultural production was far outstripping industry, and the organization of the Soviet economy pretty badly screwed over the farmers.


Black markets weren't a major thing in the USSR until the 70s. Some cheap boots weren't worth your life, and that's what dealing on a black market would have cost you during the Stalinist regime.


Lenin's Testament was sharply critical of all the Communist leaders of the day (Kamenev, Zinoviev, Stalin, Trotsky, Bukharin) and he was wary of Trotsky, who he saw as arrogant and possibly power-hungry. One of Lenin's main objections to Stalin was his rudeness, and this complaint came up after Stalin insulted Lenin's wife, so it seems like it was more of a personal issue. He did want Stalin removed from the post of General Secretary though.


Well, I agree that the USSR was not a good example of a socialist state, perhaps not an example at all. But socialism fails for theoretical reasons.

Orwell, the average anarchist considers themselves a socialist and the most common form of anarchist to run into seems to be a social anarchist, while the Austrians tend to call themselves "anarcho-capitalists" and argue that their version of anarchism is individualist anarchism updated with better economic ideas.

Right, I should have said anarcho-capitalists. Anyways, they have extremely anti-statist views, and this goes against most notions of socialism.

This item from the SlashDot site may have some relevance.

"According to the BBC, 'Russia is making plans to detach and fly away its parts of the International Space Station when the time comes to de-orbit the rest of the outpost. ... To facilitate the plan, RKK Energia, the country's main ISS contractor, has already started developing a special node module for the Russian segment, which will double as the cornerstone of the future station. ... Unlike many Nasa and European space officials, Russian engineers are confident that even after two decades in orbit, their modules would be in good enough shape to form the basis of a new space station. "We flew on Mir for 15 years and accumulated colossal experience in extending the service life (of such a vehicle)," said a senior Russian official at RKK Energia...' Is Russia the last country where engineers are not (yet) forced by corporations to intentionally produce designs that fail two days after warranty expires? There used to be a lot of equipment manufactured by various countries (Germany is the first one that comes to mind) that lasted virtually forever — old cars or weapons systems, but one rarely sees anything of the sort these days."

my apologies, when you said austrian school I was working under the assumption that you were formally an adherent of austrian and german socialist thought of 1900-1920ish, hence my reference to Kautsky. I knew the Austrian school you refer to as the Vienna school.

I said I am "drawn to it" and don't know a great deal about it because my formal education has not been centred on economics, what understanding I have is a self-education and can only work from that point forward.



I wasn't accusing Orwell of being ignorant, that said the point I should have continued to make is that it is unwise to draw an absolute conclusion based on very limited empirical data. Just how much can you garner from war communism (which was introduced so that the Bolsheviks would not starve before having any chance of taking on the whites and foreign armies, who would eventually crush the risings in Germany and Hungary but not that in Russia). The NEP wasn't a reform. War communism was an extreme but necessary measure to bring the Russian economy up to an absolute minimum level of functioning, from which Lenin who, for crying out loud, being a communist was opposed to the NEP, rightly argued that reintroduction of a limited market was necessary to develop the economy beyond this absolute bare bones of subsistence while a planned economy in heavy industry saw advances which massively increased output from the very basic level of development seen under the Tsar and from that seen under the devastation wrought by WW1 and the civil war (when I said relative I meant the speed compared to the development seen in the west, which was accomplished in conditions which did not annihilate swathes of production and over a period of decades as opposed to 10-15 years from comparatively post apocalyptic conditions)
What does the ideal free market nation look like? You demand a complete theory of everything from socialism but do you offer one for capitalism, or does it exist in the US? where god knows how many are on the poverty line, where the economy actively creates a certain minimum level of unemployment as a precondition of its functioning, many starve and go homeless while a minority add nothing to the economy whatsoever beyond their possessing the vast majority of capital, are entirely parasitic on the rest of the population and are so obscenely wealthy that they can fly by private jets fitted with bedrooms and jacuzzis on a whim and own a panoply of motor vehicles.

Not knowing how to get somewhere is not the same as it being impossible to get there, and we (Marxists) have a relatively explicit idea of where we're going and how to get there.



I'll have to overlook the straw man staring me in the face for now to make the point that this smacks of the arrogance (not trying to make a personal attack I should say) typical of exponents of capitalism who will wilfully ignore anything that disrupts their nice theoretical economic models which, to borrow from Orwell (the real one *wink wink*), are a masturbatory fantasy of endless growth and production of wealth which has almost no relation to real life. You may wish to level the same accusation against socialists, but we want to engage capitalist thought because you tend to forget the number of times marxists and socialist have accurately anticipated the consequences of the economic policy of capitalist systems, one example extremely pertinent today being in Alex Callinicos' An anti-capitalist manifesto (polity, 2003) in which the path to today's recession is clearly described. Perhaps if you weren't so quick to dismiss socialist thought as no more than a curiosity you may have read it and recognised that he is correct and been able to avert or mitigate the recession we see today, though that would probably have required state intervention in your lovely free markets and you would have (inaccurately) squealed 'socialism!'. Not crying about it now are you?

The only thing that happens in intellectual homogeneity is incest and the degeneracy of ideas.

That said I'll refer back to my initial post about the opening post, that the OP conflates socialism with a complete equalisation of all income and that a socialist economic system is less efficient than a capitalist one. The first part displays a school boy error; as I noted previously this is categorically not a feature of socialism, I'd like to know who has proposed that a bin man earn the exact same wage as a quantum physicist, a miner at the coal face or a veterinarian so that I may be allowed to chuckle gently at their ideas. A socialist society, according to Trotsky (from revolution betrayed) would be based on state ownership of the economy, the state controlled through direct democracy councils/soviets (same word, I know), all citizens being exactly equal shareholders in the state enterprise and "the theoretical income of each citizen is thus composed of two parts, a+b--that is, dividend+wages", with every citizen being liable/compelled to labour; and don't go throwing that in my face as totalitarian because that is how capitalist economics work, only that withholds bread and home as opposed to saying 'get your arse in that factory', which, I know, was done at gunpoint under Stalin, but I've already indicated my opposition to that one.

So far as one form of efficiency is concerned i'll point you to Sand's post above and give you two words: planned obsolescence



Considered by who? If I can get the link to work, and if you can be bothered, you may find it interesting - http://www.marxist.com/pdf/marx-desai-c ... 240805.pdf

Lenin proposed the NEP. He's the one who thought it up. I dunno how you think someone is opposed to their own plans. Next you'll be telling me Bush is against the war in Iraq.


Do I have to? Our system mostly works.


America's poor are still quite well off by historical and global standards.


Not necessarily true, and some frictional unemployment and such will always exist without being a real problem so I don't see how that's an issue.


Rather an over-simplification, and also a bit of populist class-warfare rhetoric.




As I stated in the OP, it's an oversimplification, just for purposes of discussion. The example wealth distribution for capitalism is also a caricature. I know that socialism does not necessarily entail absolute equality, but socialism does value egalitarianism more.


Well, that's just true.


Until recently in Cuba physicians and janitors earned the same wage. So that's be Fidel you're chuckling at, I guess.


Then how do you propose it be done?

again. Lenin. was. opposed. to. market. economics. and. the. NEP. I note you have been very selective in your quotation so i'll finsih the sentence for you. As he saw it it was an absolute necessity to reintroduce market forces through the NEP in order to prevent the collapse of the soviet government which would have taken place given the abysmal level of development of the consumer goods industries, not much point saying you're for the people and asking them to support you if they can't put shoes on their feet and food in their mouths is there? Simplified - against the idea - only way forward - therefore acts on it.

I don't think capitalists should be so cavalier about the Iraq war, nor was it an economic necessity, nor should anyone else be as flippant given the horrific acts of violence in a war of aggression that in 2006 had taken 655,000 civilian lives (http://www.johnpilger.com/page.asp?partid=445) and annihilated the history and culture of millions of people so that the west can take oil at knockdown prices and sell shoddy DVD players. laugh at that.



Yes, if you ask socialists to do so. Mostly? oh, so it also doesn't have to work perfectly. whereas socialism does. Within that 'mostly' there is a great deal of deprivation, violence and despair. For. The. Majority. Your use of language tells me somehting I knew already, if you'll excuse my use of understatement, capitalist economies aren't the unqualified success some hail them to be.



Nothing like ignoring the facts to suit your ideas. a) compared to what period of history? Middle ages? 1742? The Punic Wars? what about 2009, in just about any US city, or dying midwest town? what do you think the family who has their home repossessed and must sleep in their car thinks of the owners of GM flying in their private jet to a meeting to ask the government for taxpayers money to protect their investments think? 'yay for capitalism!'? or 'More free markets!' perhaps? b) compared to what global standards? your standards of education are among the lowest of all the developed economies. Cuba has universal literacy. Cuba for gods sake, they make sugar. What about compared to a textiles worker in Bangladesh getting 5 pence (GBP) an hour (http://news.bbc.co.uk/1/hi/business/6219274.stm). Can you guess where the products they make go? Free market west! Can you guess who demands the lowest possible production costs? Free market west! apparently thats about the third of the living wage in bangladesh.



not an issue? frictional unemployment and such? so long as you're happy begging for scraps on the street or for benefits when you can and will work. which one is it? not necessarily true or will always exist? You're contradicting yourself. You also abstracting to cover up the reality of the thing. 'and such' what is 'and such'?

what happens with full employment? Or when there are more jobs to be done than workers to do them? Take a look at the Peasants revolt. In a nutshell the black death killed enough people for there to be more lords with land to be worked on than there were peasants to work them, resulting in demands for higher wages and fewer hours. The statute of labourers was enacted to hold wages and conditions at levels before the black death. Didn't go down that well. The peasants made the foolish error of not securing a position from which they could safely negotiate terms before entering negotiations. Their leader Wat Tyler was killed in parlay by the kings men.

What effect do you think this would have on a free market? like i said, a minimum level of unemployment is a necesary precondition for a capitalist economy, so that costs incurred in wages are minimised to maintain profits. Also helps in preventing the working class feeling too...ambitious, shall we say.



the part about the jets or the part about the cars? you don't appear to dispute the part where i say that the capital possessing class are parasitic.



I see you're resorting to simple assertions now (an oversimplified one at that). What do you consider to be efficient? A pareto efficiency? The process whereby a minority accumulates the majority of goods and wealth?



He's also done a lot himself to discredit the socialist movement, add this to it. I have few qualms about chuckling at Castro.



Not by the sword, as in death in the gulag or execution (Stalinism) and not by starvation amid a sea of gluttony (capitalism). And so far as the measures used under war communism, Communism and Terrorism (Trotsky) is a pretty good read. Also how do you get workers in a capitalist economy to work? the use of culture (protestant work ethic and the like) also I quote "those deprived of property are not inclined to create and defend it" (Trotsky RB) .

I would also like to know whether you still consider the socialsit calculation debate to be 'devastating'.

Titus says:

Cuba has universal literacy. Cuba for gods sake, they make sugar.

I ask:

Can a Cuban pick up a leave the country to go, say, to Florida?

Yes they have universal literacy in Cuba. In Cuba the government also takes fifteen percent of money sent to Cubans by their relatives living elsewhere. So they can be both one hundred percent literate and looted at the same time.

In the United States if you make less than a certain amount of money you pay no taxes on income.

And do not think I am writing a brief in favor of the deficiencies and inequities in the U.S. system. I most certainly am not. We can do much better here in the U.S. without falling into the stew of Socialism. If the voters spent less time in front of their T.V. sets and read more and thought more critically about social and economic issues we could have improvement within the current system and without a revolution and violence.

ruveyn