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

c b cb31450 at gmail.com
Mon Oct 15 06:28:19 PDT 2012


CB: There is a division of labor in capitalism as in all previous modes production.

In Marxist theory http://en.wikipedia.org/wiki/Socialization_%28economics%29

Socialization is a process that begins to take place in capitalism as large-scale manufacturing based on a vertical division of labor displaces "cottage industry"; small-scale and family-owned production shops. This process transforms production into an increasingly social and collective process, but appropriation of the social product in the form of private profit continues to be an individual or private affair by investors and private owners of the enterprise. Furthermore, exchange of the commodities produced is the private act of a small group of capitalists or an individual owner. As the process of socialization expands, a contradiction between the socialized nature of production and the individual nature of appropriation of the surplus product arises, coinciding with the obsolescence of the functions performed by the capitalists (the private owners).

This socialization of production and centralization of capital that takes place under capitalism lays the foundations for a socialist economy. Socialism entails ownership of the socialized means of production by the workers engaged in the production (see: Worker cooperative) and social, or worker control in the appropriation of the socially produced surplus product (profit), either in the form of economic planning and planned investment, or by autonomous worker cooperatives. The establishment of social ownership over the means of production resolves the contradiction between social production and individual exchange/appropriation under capitalism.[7]

Socialization of the workplace is contrasted to rigid hierarchy and bureaucracy; as workers gain more autonomy, they gain more collective decision-making power and control over the output they produce in a socialized work environment. Socialization of industry is different from nationalization, which can, but usually does not imply the socialization of the workplace; socialization of industry can take place in private or cooperative-owned enterprises. In a capitalist economy, socialization entails "commodification" and is therefore limited.[8] Socialization therefore takes a different form in the capitalist mode of production than in the socialist mode of production.

^^^^

If, otoh, you are arguing that perfect planning is not possible because there will be always unforeseen consequences, and that a decentralized entrepreneur system is better equipped in dealing with these contingencies than centralized planning because it can "localize" or contain the unforeseen costs instead of spreading them through the system - you got one sympathetic ear.

-- Wojtek

^^^^ CB: Why is it that Marxists advocate "centralized", that is holistic, planning or planning at the level of the whole economy ? This is , of course , derived from its critique of the anarchy of production of capitalism. Capitalism is made up of entrepreneurs and enterprises of all of which supply a certain amount of goods or services without regard to how much the other enterprises will produce. So, often there is a mismatch between supply and demand at the level of the whole, because the parts are not coordinated and are left up to their own estimates and devices . The price mechanism and its signals cannot get around this, because the problem is not based on the subjectivities of consumers, subjective "demand".

Also, an economy is complex of inter-related part enterprises, complementary parts. Marx and Engels were focused in this regard on the socialization of production and its increase. There is the sociologist Emile Durkheim's organic solidarity among capitalist enterprises as in all historic economies. Today we have a world wide web of labor. There is an optimizing necessity for coordination of these parts as a whole. Communism will be a world system. Globalization or imperialism is a precursor of Communism.

As to unforseen costs being resolved more optimally locally, in general, the insurance function is carried out better at the level of the whole because the locales that are not adversely impacted by the unforeseen costs can share their good fortune with the unfortunate locales _through the "center"_. The connection between locales is the "center" . ("Center" is a symbol of the whole through the metaphor of the circle in which the center is equidistant from every point on the circle ,and thereby is a point that represents the whole circle like no other point).



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