[sudosysgen]

There are dozens of reasons. Free markets have deduplication of labour, concepts like patents and IP that are inefficient are necessary, there are economic crises that wreck compound growth in the long term, there are issues of inequality, humans may be lazy and not attempt to allocate their capital in the most appropriate way (see index funds), socially useful endeavors may not be profitable, etc...

But central planning is insanely hard, so it's not easy.

That said, the USSR which literally used pen and paper for planning was the #2 economy in the world, so it clearly has some potential.

Now there can be other reasons to not want planning.

[slibhb]

> There are dozens of reasons. Free markets have deduplication of labour, concepts like patents and IP that are inefficient are necessary, there are economic crises that wreck compound growth in the long term, there are issues of inequality, humans may be lazy and not attempt to allocate their capital in the most appropriate way (see index funds), socially useful endeavors may not be profitable, etc...

There's no reason to think that economic crises and inequality would be absent in a planned economy.

[lucian1900]

The USSR was unaffected by the Great Depression, unlike all capitalist countries. It’s because it used planning for use instead of markets for profit.

[lumost]

The USSR didn't have the great depression, but they did have the HoloDomor or terror famine of Ukraine between 1932 and 1933 and the wider Soviet Famine of that period.

The history of the famine later went on to inspire the book Animal Farm and were a pure artifact of the central planning economy forcing the export of the very food required to feed millions of people.

https://en.wikipedia.org/wiki/Holodomor https://en.wikipedia.org/wiki/Soviet_famine_of_1932%E2%80%93...

[sudosysgen]

Yes, the Soviet famines were due to erroneous data due to dysfunctional bureacracies.

Which is exactly why "pen and paper" are an issue.

[lumost]

Calling the famine an issue of erroneous data does a disservice to the victims. Millions of people don't starve while having their food confiscated at gun point due to an accounting error.

[sudosysgen]

It's the proximate cause. As we all know it had horrible effects. Had the USSR been able to accurately measure food production it wouldn't have happened, so it is indeed the proximal cause.

[nradov]

The Soviet famines were intentional genocide. Communist Party leaders always had plenty to eat.

https://victimsofcommunism.org/

[sudosysgen]

This used to be believed by academic historians, until the opening of the Soviet Archives in 1992, and now the consensus is that it wasn't, it was just really bad data.

The link you're citing had multiple authors resign due to academic dishonesty and is funded by the US government, therefore making it state propaganda.

[lucian1900]

It’s worth looking at primary sources for “Holodomor”, a depressing amount are from Ukrainian fascists.

The consensus among historians is that there was indeed a famine, one of the periodic environmental ones in the region. Planning was indeed slow to react to the famine and the sabotage by landlords, so food aid arrived late.

It was also the last famine in the region. The landlords that destroyed food were expropriated, land was collectivised and agriculture was industrialised. Talk to any older Ukrainians and they’ll tell you there was plenty of food throughout their lifetimes until the 90s after the USSR was defeated.

[flohofwoe]

Wasn't the Great Famine in 1932 and 1933 a direct result of central (mis-)planning? PS: also I wonder if you actually experienced living in a centrally planned economy, the East German economy for instance stumbled from one crisis into the next, not as bad as the Soviet Union under Stalin obviously (as in: people didn't starve to death), but a healthy economy is pretty much the opposite of the "real socialist" economies of the Eastern Bloc.

[lucian1900]

There had been periodic environmental famines in Eastern Europe for centuries. The one in the 30s in Ukraine was exacerbated by landlords (kulaks) refusing to sell food to the state for lower prices and even destroying grain and cattle in an effort to raise prices. Incomplete information meant central planning was slow to react to both of these problems and many did starve, but of course capitalist countries also exaggerated the numbers.

My parents and extended family lived in România before 89, they describe quickly improving conditions, in some ways better than today. Guaranteed homes, education and jobs went a long way, for example.

All of the Eastern European economies also started off semi-feudal with little industry when compared to Western Europe. They were also under constant attack and blockade from the capitalist countries, that’s what the Cold War was about.

Regardless of all that, it’s a fact that the Soviet economy was unaffected by the Great Depression, which was the whole point on planned economies.

[cherryturnover]

Doesn't it have more to do with the fact that they didn't even recover yet from the 1st World War? Also don't forget Holodomor. It literally happened after the Great Depression yet unlike Western Nations, 3.5 million people died from disease or starvation. Unlike in said Western countries that just had an economic collapse.

[sudosysgen]

Of course there are. If you have good knowledge of the economy and of production mechanisms you can simply not do anything that could cause a crash. The issue is getting the knowledge to behind with, obviously.

Inequality is necessary to some level but empirically it's possible to make it much smaller.

Empirically the USSR had a single economic crisis without exogenous cause which was caused by incorrect accounting of agricultural production at its heart.

[slibhb]

> If you have good knowledge of the economy and of production mechanisms you can simply not do anything that could cause a crash

But we don't have that knowledge. Economists disagree on many foundational questions. At some point, economics shades into psychology and we certainly don't have theories that predict human behavior.

I don't discount the possibility that knowledge can help economies run more smoothly but you're understating the difficulty here.

> Empirically the USSR had a single economic crisis without exogenous cause which was caused by incorrect accounting of agricultural production at its heart.

The idea that the USSR had one economic crisis is a bizarre joke. The only way you can justify this comment is to ignore all the shortages and poverty and make some tortured semantic argument about what constitutes a "crisis".

Empirically speaking, free markets trounced centrally planned economies in the 20th century. If you can't recognize that, I'm not sure why anyone would take you seriously.

[sudosysgen]

I mean knowledge of the real economy. What materials there are and what is done with it. That's all you need in a planned economy to avoid crises.

I said that the USSR had one economic crisis that wasn't due to exogenous circumstances. Which is true.

I agree that free markets outperformed them. I'm saying there is clearly potential for improvement since the USSR was so dysfunctional and was planned with pen and paper.

[nradov]

There is no way to gain accurate, detailed knowledge of the real economy. It has always been impossible. That's one of several reasons why economic central planning is stupid.

[sudosysgen]

This is stupid. We can definitely do that, even today, with basic computer technology.

[kolinko]

#2 economy per capita, or in absolute numbers? I'm quite sure western nations had better economies when you adjust for each country's size.

[sudosysgen]

In absolute numbers. But planning economies becomes so much more difficult at scale, though if we looked at the communist country with the highest per capita economy we would still see numbers that are middle of the pack.

[aaronchall]

At its highest, relative to the USA, USSR per capita gdp was only one third that of the USA. Not that impressive, even if you trust their numbers.

[sudosysgen]

The USSR never published a GDP figure. It couldn't, because GDP makes no sense without a market.

But yes, the USSR as a whole had a third of the US's average GDP. I agree, it was less than the US. The thing that is surprising is that they got there by planning an economy with pen and paper, which is insane to me.

[aaronchall]

I don't know how it's possible, but nearly every sentence you wrote is completely wrong.

[sudosysgen]

I made a typo which I corrected (s/world/US/), other than that I don't see anything wrong.

[lumost]

A central planning economy requires calculating desired outputs and required inputs through multiple layers of a supply chain. The resultant outputs through each layer of the economy, exports, and imports have a direct value that was in fact measured in the soviet currency of Ruble's - these Ruble's could be exchanged for dollars and provide a useful GDP figure in any desired currency. The basket of goods a given amount of these Ruble's could buy internally vs. their dollar equivalent elsewhere also provides a reasonable measure of Purchasing Power Parity.

One can also bypass the production component and measure GDP in terms of the incomes in Ruble's paid to Soviet workers in combination with the export/import figures to arrive at a reasonable estimate.

[sudosysgen]

This is not in fact true.

The basket of goods didn't have any fixed ruble price, as much of it was free.

Much of production was never given a full price in rubles, as a large part of it was by direct resource allocation.

You can indeed estimate it using a basket of goods and their equivalent values, but not with income and import/export + exchange rates because you're then removing all natural wealth.

It's a very difficult problem. You can make an estimation, but it's still an estimation, that is, for hard GDP. For PPP I agree the numbers are accurate, but that's not what was being discussed.

[nahuel0x]

Do you accounted the zarist backwardness from which the USSR started and the incredible WWII destruction in the USSR territory in lives and buildings?