Marx vs. Hayek, conscious action vs. utopianism

tgs at tgs at
Sun Nov 13 18:05:42 MST 1994

Justin said:


It looks to me as if we have run out of things to say about democracy and
corruption. I could repeat stuff which obviously hasn't persuaded you and
which you haven't answered to my satisfaction and vice versa, but I
suspect that would go on in fruitless and uninteresting way for a long

I reply::

In a sense yes, in a sense no, because I think that it will come up we
discuss the more quantitative aspects, which you seem to want to discuss
later in this very same post

Justin writes,

As to Mandel's model. The key to Mandel's solution to the
calculation problem is a drastic simplification of the input descriptions.
Instead of saying that we produce so many t-shirts and button down
shirts, etc., and specifying t-shirts in detail--a recent Pentagon request
for plain white t's had thirty small print pages of specs--we say "shirts."
Now this will work to reduce the information about consumer preferences to
manageable loads, but at a great cost, probably, in terms of consumer

Tom replies,

Perhaps so--about Mandel's model.  But he, like you, might be wedded to an
overly centralized model. It kind of reminds me of the non-debates in American
political science (which I study professionally) about the "seemingly impossible
problem of Congress making ALL the many decisions it has to make as a body--
thus the necessity of throwing out 90% of all bills by leaving them rot
in committees, etc." the problem with that, as with yours and Mandel's model
(By the way, just saw the man in the "debate" with the Sparts--what a circus!),
is that we're not considering means of decentralizing decision-making so that
all the inputs don't pile up into the databank of one computer/one national
assembly or committee of commission of that assembly.  Your models also seem
to assume that everything is going to be made by high and centralized technology,
so that it is all a matter of computer inputs, whether these be in the market
or in planning

I can easily imagine, under a democratic planning system, small production
 plants for the basic necessities, like food, clothing, and shelter, producing
and making decisions.  To support the production of basic materials for these
plants, which might be termed rather "finishing plants," national production
processes will be required.  These small finishing plants can be run by
cooperatives. So I can imagine going down to my local clothing cooperative,
which would be accountable to the neighborhood assembly,
and saying, I'd like a button-down T-shirt
. Either it's immediately on-hand, on the
shelves, or it could be produced in a few days.  A far more sensitive system
than what now obtains in corporations--yet without  the private system
of incentives, interests, falling rates of profit, etc. which obtain in

Justin writes,

Two further problems and one observation. Mandel's solution has the same
problem Paul's does with regard to production. There's nothing it which
enables or allows or encourages calculation of least-cost methods of
production, choice among different ways of satisfying demand. So
production is liable to be wasteful, and also, not innovative, insofar as
innovation disrupts the plan and requires adjustment all over. (Mandel
admits this, saying, what's so great about innovation? This is a big
concession for a Marxist!)

Tom replies,

the more decentralized public scrutiny there is, at the microscopic level, the
more Mandel's problem disappears.  In addition, "least-cost," in a socialist
system, means less workhours for the same wages.  Why do we need the whip
of the market to enforce what we as workers already want?  If it ain't broke,
why fix it?

Justin writes,

The other problem, on the consumer side, is that Mandel suggests that much
demand is inelastic, so we can just project from the past on how many
shirts, how much milk, electricity, etc. we use. This runs into problems
with change in demand, which are amplified by the simplification solution
to the information problem.

The observation is that Mandel himself says that we can use his method
only where demand is inelastic, which he calculates at 65-70% of the
economy--he doesn't say how he gets that figure. So for the rest, what he
calls "luxury goods" and services, the economy is marketized. He
accordingly says his model is less than what he would consider to be fully
socialized. He expresses a wish or hope that luxury production be
socialized eventually but leaves it at that. Any any rate Mandel is not
offering a model of a fully planned economy.

Tom replies,

no I guess not, but then Mandel, the centrist-Trotskyist, was always more
apologetic for Stalinist centralization than I, the hippie, am. So Mandel
takes over many of the problems with centralization without much consideration.
You can see this even in that ATC #32, where he and I join together against
both council tyrannist Fisk and social democrat Brighouse.  Mandel, if I
remember correctly, albeit "democratic"-minded, wants to do everything with
computers, whereas I bring up the institutional checks and the decentralism
of the Paris Commune.

A good book on decentralized
planning and production and
 all this is Communitas, by Paul and Percival Goodman


On Sun, 13 Nov 1994 tgs at wrote:

> Justin,
> Re: in reply to your last message on market socialism vs. democratic
> planning
> Too many brackets to use the line item veto.
> A) Yes, I'm close to Mandel


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