Date: Fri, 10 Jan 1997 11:53:26 -0500 (EST) From: Justin Schwartz <jschwart-AT-freenet.columbus.oh.us> Subject: Re: M-I: Cooperatives? I observe that after my last outburst Louis seems to have calmed down and started to present some arguments. Well, good, that's more productive. I still think he owes me an apology, but I won't hold my brief. And, by the way Louis, Solidarity explicitly does not conceive itself tobe a permanent group but as a sort of transitionbal organization whose task it is to build our movement and ultimately merge into something bigger when we have it. Carroll Cox once again raises the argument that there's no point in building abstract models unless theres are tied into to trajectories of struggle, since the specific shape of these will affect what models are actually realized and in what ways. While I agree that it would be very useful to think about how socialism could practically be achieved, I draw the exactly opposite conclusion about models from the variability of the circumstances in which they might be realized or deviated from. At present we have no idea what shape a practical struggle for socialism would take--I mean one involving actually bringing it about, as opposed to winning workers and others to socialist ideas and defending and perhaps extending reforms--and therefore no basis for speculating about how the circumstances of struggle would affect the attempt to realize our models, planned or market or mixed. What we need right nowm as far as a vision of the future goes, is a set of reasionably convincing answers to the worry that socialism won't work under the best circumstances. This is a major political and intellectual obstacle to winning subordinate groups to socialist ideas. Getting those answers means building idael models--as heuristics, not as blueprints, not as something to be imposed by an elite leadership no matter what, and with the understanding that any model one comes up will not be implemented as conceived. The point of this is to identify problems to nbe solved and to explore ghow they might be solved under precisely specified assumptions. If we don't like the models we come up with, the precise specification and explicit articulation will allow us to see where we have to change our thinking to come up with new and better models. This sdebate is not only politically useful, it will be practically useful in providing a socialist government with a choice of various tools to test in practice. Now as to plans and markets. Louis basically says with regard to Cuba that the problem with their economy is the US trade embargo, not the collapse of the USSR and the end of fraternal subsidies. I think it's probably both. Louis is doubtless right that Cuba would do a lot better if it could tradew ith the US, its natural partner. But I don't think you'sd find anyone in Cuba or any serious economist or politician elsewhere who thinks that Soviet subsidies were not a big boost to the Cuban economy and that their removal didn't hurt badly. I agree with Louis and Barkely that the Cubans havedone wonderful things with education, health, and welfare--the raw figures on literacy and life expectancy show that in comparison with other Caribbean and Central and Soth American countries. But their agricultural planning seems to me, from what I gather from supercial reading, to be seriously deficient. Soviet style collectives don't work work in Cuba or elsewhere, and I gather taht there is a move away from them towards a slightly more cooperative model that allows for farmers to sell some percent of their produce on thre open market. As to industry, well, Cuba hardly has any. Of course taht doesn't mark it out particularly in the region, but it diminishes the utility of the Cuban model for an industrial economy. Louis claims that what went wrong with the Soviet economy was not totalized planning but badly politicized planning by technical incompetents. I agree that there was a lot of the latter, particularly in agriculture. Lysenkoism was a disaster and the kolkhozes never worked well. In industry, though, the planning was fairly interlligent and carried out at a reasonably high level of technical competence, and indeed through the 1960s it was fairly successful. As late as the early 60s, Harry Braverman could say that the USSR had shown, by its high growth rates and rapid industrialization, that the Soviets yhad shown that industrial planning could be as good if not better than capitalist models. This was widely believed by capitalist economists too. But in the late 1960s and early 1970s the Sovuiets started to run into the problem that qhile planning was pretty good at dealing with quantitative economic growth, it had serious difficulties in handling innovation and qualitative development. The problem wasn't technical incompetence and politicization, although there was some of that, but the nature of the economic problems the USSR faced once it had restored its industrial base after the war, which was done pretty much by 1960 or so (an impressivwe achievement). At that point, the sort of problems Hayek had postulated and on which I'm insisting started to kick in. They'd been there earlier but had mattered less since the planning targets coukd be computed simply in large numnbers of easily measured thingfs, kilowatt hours, tons of steel, etc. Once economic growth became a matter of product diversification and innovation, the Hayek calculation problems quickly became a terrible obstacle to economic growth and development. The literature of the planners and the discussions of planning problems by industrial managers, most of whom had probably never heard of Hayek, started to sound like quotations from him. Bottlenecks and shortages mushroomed as enterprises hoarded materials and understated their capabilities so that they could meet plan targets that had decreasing relevance to anything anyone could use. Consumers had no ability to find alternative sources, so the pressure on the enterprises was entirely to meet those irrational targets. Innovative technologies failed to be incorporated into the plan because they were too disruptive, outside the moderately dynamic military sector. Enterprises became decreasingly productive and were desperately overstaffed because there was little ability to shift labor about. By the late 1970s the USSR aws essentially living on raw materials exports, like a third world nation. The crisis was real. The crash was perhaps not inevitable. If Gorby hadn't taken apart the planning system under the false assumption that markets would just spring up, the USSR might be tottering along today. But the late USSR vindicated the Hayek critique. More intelligent planning might have made matters better. But I do not think it woukdd have done anything but deferred the problems. Gotta go read Employment discriminaytion. More later. --Justin --- from list marxism-international-AT-lists.village.virginia.edu ---
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