Hacker News new | past | comments | ask | show | jobs | submit login

Hayek and Mises were in total alignment on this point: economic calculation under socialism is impossible. Without a working price system economic coordination is impossible to sustain. Those communist countries were not growing at all. If you look at actual output compared to capitalist nations at the same time there is no comparison. The case of East vs. West Germany is sufficient to demonstrate this case.

In fact the problem that subsidies create in society is a little window into the problem of socialism that exists on a larger scale.

Hayek would probably agree with the sentiment that you expressed though.




Hayek literally wrote the book on the "sentiment that I expressed", it's called The Road to Serfdom. Hayek's views on the "economic calculation problem" were more subtle than 'it doesn't work' and they needed to be because by the time he wrote the book, communism was a real economic power and it was getting more powerful. I'm not sure how you think Russia went from backwards feudalism to nuclear superpower by "not growing at all".


Hayek is an interesting character because "The Road to Serfdom" is not really his finest or clearest viewpoint on markets at all. I saw a video interview with him (you can find it on youtube if you want) where he just restates what I did that the economic calculation problem renders socialism unable to coordinate production effectively.

Russia as compared to the United States is still a backward country. Their wealth is nowhere near the United States and certainly didn't gain any ground during the Cold War period. It doesn't take much, if any, "growth" to force a nation as large as Russia to build a large military-particularly when you don't actually need to figure out the logistics of that army fighting an actual war (since Russia could never have done such a thing against the United States). Add to that forced labor and the basic confiscation of whatever you need to accomplish your goals and it all is pretty straightforward.




Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: