To Bryan K on Socialist Calculation

Bryan,

This is not such a petty debate as you imply. To attack the calculation argument is, to most Austrians, at least Rothbardian-Misesian’s, effectively an attack on human freedom and the very means of life itself.

This is my specific area of work, and responding to what you’ve said above would require substantial effort. But, in short, the way that you are approaching the problem is so significantly different from both Mises and Hayek that it is not, fundamentally, the same discussion.

Mises says that when you take away man’s need to perform individual economic calculation, you destroy the very process by which men’s minds develop the ability to calculate increasingly detailed, timely, and precise uses of resources.

Hayek sees this same process happening on an inter-temporal scale in large populations – effectively manufacturing ignorance in populations, rather than, as both of these men would advocate, letting the network of human cooperation train each individual inside it to become a master of his portion of it, all in an effort to better manage resources, increase research and development, and, in turn, increase production making all goods cheaper for all men.

Stress is a reaction to learning, and learning and experimentation are necessary to increase production.

This concept is no more complicated than if you say that we were to ban money and accounting, and, in doing so, how would we approach the process of performing economic calculation at any position in a population? People would no longer know how to do so.

I think that Georg Simmel describes this best, as the very destruction of the human mind. Without this inter-temporal calculation, we are simply animals.

So, the debate is fundamentally one of freedom, economic production, and the continual improvement of man. They, and I, see the opposite view, in socialism, as the very destruction of man’s mind, and his concurrent enslavement and long-term destruction of his ability to do otherwise. Unless you are one to say that we are gifted by nature, fate, or some divine entity with infinite common sense and the ability to generate such ideas, even if we lose the traditions of them in our populations. Something that is quite counter to the evidence.

As for your argument to proof with empirical data, there are at least two problems. The first, which is logical and an error in categorization, I think I will leave for Hoppe. The second, which is methodological, is simply an error in what data CAN show, given a sufficiently complex network of cooperation. I am quite sure that any data to prove such a thing as you ask would require such a wealth of data as to represent nearly the entire activity of the economy in question, all measurements being an approximation or categorical convenience given a particular number of variables in a given period of time. But the outcome would be the same. The socialist economies fail. They fail in all dimensions. Whether you speak of the Russian mobilization of women and resulting population declines, or of the negative result of their iron production, or the decay in entrepreneurial innovation, or the destruction of social interactions in small communities.

Your approach is more the typical econometric endeavor for more short-term ends. This is common in the field. It is especially common for those without a tradition of economic coordination in large populations. But the time horizon and ambition of Austrians is a bit broader, and, frankly, a bit more substantive both in ambition and in outlook than mere skeptical analysis of temporary trends.

If you only mean to say that there is humor in the fact that the Rothbardian wing is so emotive as to keep you in good company, then that’s well enough on its own. But there is a long history back nearly to Zoroaster of poking fun at such ideas to discredit them. While it is an effective way to rally the peasantry which lacks the means of evaluating the idea by more critical thought, it is not necessarily indicative of the truth or falsity of such things, and is reliant on the physical restraint and character of the opposition whose dedication is to reason alone – if the subtlety of my meaning comes across.

Hopefully, this is another example of the attention that you would wish to garner.

-Curt