[lbo-talk] Hayek, was Re: Stalinism (was Eric Hobsbawm)

[Jim Farmelant]

BTW speaking of Ludwig von Mises, Bukharin, who had written a famous critique of the Austrian School ("Economic Theory of the Leisure Class") was not unappreciative of Mises' points concerning rational pricing as indicated in the following passage from this 1925 defense of NEP,  ” Concerning the New Economic Policy and Our Tasks”: ------------------------------------------------------------------------------ Although bourgeois critics of the policy of the proletarian dictatorship in Russia have offered mainly nonsense and foolishness, some of their comments were not so stupid and contained a relative truth. One of the most learned critics of communism, the Austrian Professor Mises,presented the following propositions in a book on socialism written in 1921-22. In agreement with Marxist socialists he declared that one must brush aside all sentimental nonsense and accept the fact that the best economic system is the one that develops productive forces most successfully. But the so-called “destructive” socialism of the communists leads to the collapse of productive forces rather than their development. This collapse occurs mainly because the communists forget the enormous role of private, individualistic incentives and private initiative. True, capitalism suffers from certain defects. But capitalist competition leads to growth of productive forces and drives capitalist development forward. As a result of the growth in society’s productive forces, the lot of the proletariat improves as well. So long as the communists attempted to arrange production by commands, with a stick, their policy would lead, and already was leading, to an inevitable collapse. There is no doubt that the system of War Communism, viewed in terms of its economic essence, somewhat resembled this caricature of socialism whose destruction was predicted by all the learned economists of the bourgeoisie. Thus, when we began to reject this system and shift to a rational economic policy, the bourgeois ideologists began to cry: Now they are retreating from communist ideas, they are surrendering their positions, they have lost the game, and are returning to time -honored capitalism. That is how they summarized the question. But in fact they were the ones who lost, not we. We have been placed in a certain position, and we acted me Only way we could. But then we had to consider how to go forward, and now we can say that our opponents were the ones who lost in this debate. In the course of the struggle, we upheld what was most important and had to be upheld, namely, the dictatorship of the proletariat. When we crossed over to the NEP we began to overcome in practice the above-outlined bourgeois case against socialism. Why? Because the meaning of the NEP lies in the fact that by using the economic initiative of the peasants, of the small producers, and even of the bourgeoisie, and by allowing private accumulation, we also placed these people objectively in the service of socialist state industry and of the economy as a whole. Freeing the commodity turnover, we made it possible to awaken the interest of small, private producers; we stimulated an expansion in production; we placed the individualistic stimuli of backward strata of the proletariat (who were motivated by noncommunist ideas and private interests) in the service of socialism; and by formalizing the previous wage system, by introducing piecework, and so on, we encouraged these strata to work in such a way that their private interests would promote an upsurge of social production. Our former view consisted of thinking it would be possible to introduce a planned economy almost immediately. Now we see things differently. We control the main commanding heights, we organize what is essential; then our state economy, by different means, sometimes even by competing with the remnants of private capital through market relationships, gradually increases its economic might and, in diverse ways, draws the backward economic units into its own organization, doing so, as a rule, through the market' ------------------------------------------------------------------------------
Jim Farmelanthttp://independent.academia.edu/JimFarmelanthttp://www.foxymath.com Learn or Review Basic Math

---------- Original Message ----------
From: andie_nachgeborenen <andie_nachgeborenen at yahoo.com>
To: "lbo-talk at lbo-talk.org" <lbo-talk at lbo-talk.org>
Subject: Re: [lbo-talk] Hayek, was Re: Stalinism (was Eric Hobsbawm)
Date: Fri, 12 Oct 2012 13:09:52 -0400

Exactly. Life is hard, commodity fetishism is the cost of rational pricing and reasonable prosperity. Live with it. As Mises put it in his first paper in 1920 laying out the idea, you could choose to dispense with rational pricing (sensible use of resources), embrace waste of resources and record, and live in poverty. That's not an attractive option.

Sent from my iPad

On Oct 12, 2012, at 11:14 AM, "Carrol Cox" <cbcox at ilstu.edu> wrote:


> My objection to Hayek is that he wants to use markets to provide
> information, therefore reinstituting commodity fetishism. It's no use
> getting rid of capitalism if the labor of one person continues to be equated
> (implicitly or explicitly) to the labor of others. Pre-capitalist markets
> exerted no tyranny: the labor of one nation was not cheapened by the labor
> of another. Hayek's markets are specifically defined to exercise that
> tyranny.
> 
> In other words the core objection to Hayek is precisely what Andie cites as
> the core advantage -- the use of markets to convey information.
> 
> 
> Carrol
> 
>> -----Original Message-----
>> From: lbo-talk-bounces at lbo-talk.org [mailto:lbo-talk-bounces at lbo-talk.org]
> On
>> Behalf Of andie_nachgeborenen
>> Sent: Friday, October 12, 2012 8:01 AM
>> To: lbo-talk at lbo-talk.org
>> Subject: Re: [lbo-talk] Hayek, was Re: Stalinism (was Eric Hobsbawm)
>> 
>> Nothing in Hayek requires private ownership, a point I have made to
> generations
>> of spluttering libertarians. Hayek's problem is with planning, not
> ownership. His
>> attempted save by appeal to the need for entrepreneurship, with which I
> agree
>> heartily, fails because nothing in Hayek's argument requires the
> entrepreneurs be
>> individual private owners rather than employees of a cooperative,
> regardless of
>> where title lies.
>> 
>> Multiple equilibria are irrelevant. The problem is a model that makes
> equilibrium a
>> goal based on false premises. Hayek, like Marx, is great in part because
> he tried to
>> capture the laws of motion of real economic systems, not axiomatic models
> with
>> demonstrably false premises.
>> 
>> Lange's reply that they never tried what I advocated is ridiculously weak
> given
>> what they did try produced every problem Hayek observed/predicted in
> spades.
>> You can believe that pigs will fly if you like. I will continue to insist
> with Heyek that
>> they have no wings.
>> 
>> Sent from my iPad
>> 
>> On Oct 12, 2012, at 7:39 AM, c b <cb31450 at gmail.com> wrote:
>> 
>>> Wojtek S wsoko52 at gmail.com
>>> Thu Oct 11 07:51:12 PDT 2012
>>> 
>>> [WS:] The existence of the mythical equilibrium is a red herring here,
>>> since as Ormerod demonstrated in his book "Death of Economics"
>>> multiple equilibria can be calculated in sufficiently complex system.
>>> The crux of Lange's argument was that planners do not need to know
>>> more than private capitalists, as both in real life proceed through
>>> the process of trials and errors to adjust their prices. So that
>>> undercuts the supposed omniscience required in planning but not
>>> private capitalism - in fact neither requires it to improve
>>> efficienc
>>> Lange argued that both planning and capitalism are on equal footing in
>>> this respect. What makes planning superior is the planning ability to
>>> overcome constraints imposed by private ownership of property, which
>>> leads to either periodical crises or equilibria skewed away from
>>> optimum toward consumption of the rich. I do not think that this
>>> argument can be dismissed that easily.
>>> 
>>> As far as the price mechanisms under planning postulated by Lange -
>>> they were either not implemented or if they were, they were later
>>> circumvented by political and social mechanisms (informal economy,
>>> etc.) So as Lange aptly observed, the reasons of the central planning
>>> "failure" lie not in planning but in sociology and politics.
>>> 
>>> Alas, there is one thing that is not considered in these arguments -
>>> the capacity to externalize costs. That capacity is much greater in
>>> capitalism - under which private firms can not only dump costs on they
>>> public sector in their own countries, but also on other countries
>>> thanks to imperialism. In planning systems, the capacity for cost
>>> externalization was pretty much non-existent. First, the public
>>> ownership of the means of production meant that public sector would
>>> have to externalize to itself, which defeats the purpose. Second, the
>>> planned economies lacked the capacity to externalize on other
>>> countries because they were not imperialist (EE) or because their
>>> imperialism had strategic rather than economic nature - i.e. its goal
>>> was to maintain political influence against the west, rather than
>>> economic exploitation. In other words, while western imperialists
>>> externalized their costs on their satellites, Russian imperialists
>>> absorbed the costs of satellites to maintain their allegiance.
>>> 
>>> -- Wojtek
>>> 
>>> "An anarchist is a neoliberal without money."
>>> 
>>> ^^^^^^^
>>> CB: I would to identify with Comrade Wojtek's remarks . Soviet Union
>>> far from an evil empire was an anti-imperialist system
>>> ___________________________________
>>> http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
>> 
>> ___________________________________
>> http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
> 
> ___________________________________
> http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk

___________________________________
http://mailman.lbo-talk.org/mailman/listinfo/lbo-talk
____________________________________________________________
Mom Lazy Way to Look Young
Doctor Reveals Way to Look Significantly Younger in 17 Seconds
http://thirdpartyoffers.juno.com/TGL3141/5078637fe1123637f1cd7st03vuc