More on Dialectics

Sam Pawlett rsp at
Sat Sep 4 17:15:59 MDT 1999

Chris Matthew Sciabarra wrote:
> I have to say that I largely agree (!) with Sam Pawlett's discussions.  I
> found his post really fine reading, and agree with the points he has made.
> The issue here, though, is not so much that things are unknowable, but that
> not everything is quantifiable as inputs and outputs.  There is simply a
> dimension to knowing that is qualititative and tacit; we are not inside
> peoples' heads -- we don't know everything about their preferences, the
> intensity of their preferences, or even the future state of their
> preferences.  My argument is that the price system has a kind of dynamism
> that allows individuals to relate the various bits of information about
> relative scarcities to THEIR OWN CONTEXT OF KNOWLEDGE.  When that process
> is usurped, when all the individual contexts are somehow merged as if they
> were a SINGLE context with no differentiation among the parts, the result
> must be distortion.  The whole is not simply the sum of its quantifiable
> parts.  It is an integration, more than the sum; it is not simply summing
> up input 1 and input 2 and input 3, etc.  Marxists, who understand this
> principle so well in most areas of analysis, suddenly become static,
> bourgeois thinkers when it comes to "planning" an economy.  Suddenly, the
> whole is looked at like one giant computer, rather than as a complex
> mechanism of quantities and qualities, shifting perspectives and unintended
> consequences.

  OK, but the proof of this particular pudding will be in how well
planning works in practice. That means how well it does what its
champions say its going to do i.e. ensure maximal efficiency and
dynamism in the economy while also operating with a maximal amount of
democracy, equality and negative freedom in all spheres (no small
  Janos Kornai (whose methodological ideas are similar to Chris's I
gather) argued in his *The Socialist System* that the USSR and like
societies were organic systems that were able to reproduce themselves
over time. However, these systems didn't work very well (shortages,
waste, inefficiency, environmental damage, lack of political&cultural
freedoms) mostly because of the soft budget constraint.
  State capitalist planning has been enormously successful in S.Korea,
Taiwan and Japan (see A.Amsden, R.Wade, C.Johnson, J.Smith,
M.Hart-Landsberg, W.Tabb) because in Amsden's phrase they "got the
prices wrong" which suggests that a free market price system is less
important to overall economic dynamism than the Austrians say it is.
Simply, these authors show that planning works. Yes these economies were
not totally planned but substantial and important parts were planned. Up
until the early 90's the S.Korean state owned all the banks.
   And what about Coase's argument that planning can internalize
   There are unintended consequences--something Marx was all too
cognizant of-- but I don't think serious enough to undermine the
functioning of a socialist economy.

Sam Pawlett

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