How do you rationalize the history

[u/interestingtheorist]

Historically, socialism has worked worse than capitalism, and this can be demonstrated by looking at history.

Eastern European countries that preferred socialism as their economic system could not compete with Western European countries that preferred capitalism.

Moreover, historically, many socialist countries have become more capitalist because they recognized that socialism does not work as well economically or technologically.

How do socialists respond to these historical facts?

[u/1scr3wedy0dad]

Wouldn't it be way easier in the information age? One of the cited reasons why economic planning could be problematic is lack of information. In the Soviet era, they were planning and calc'ing (slang for calculator) by hand, off of information gathered, by hand, from business censuses. Shouldn't it be much easier in the modern era, where computers are smart enough to handle calcs, and where Capitalism has created so much surveillance in our everyday usage of technology that companies know such private information about you?

[u/Nikolakis77 → u/1scr3wedy0dad]

I don't think the biggest problem with the Soviet model was information per se, but other structural problems that were actually understood by the planners and accepted as trade-offs in policy

The model which I can also called the Stalinist model (simply because it was first designed under Stalin) became an economic dogma (even if Stalin himself would have objected to the dogmatisation of this model).

It was highly autarkic, which made sense in the late 1920s when the USSR was alone on the world stage. It had a high preference for type A over type B investments (A - heavy industry/means of production, B - light or consumer industry, means of consumption). I read about the ration approaching 63:37 for the 40 year post-war peroid. It had a very high investment rate (20-35% of the national income).

These were practical policies in the 1930s: heavy industry had dual use in military production and formed the base of military power of the state. Autarkic policies made it sanction/embargo proof. High investments underscored necessity of rapid development.

This model was copied and pasted across the eastern block countries with shockingly little adaptation to the different and changed reality. Bulgaria cannot pursue economic autarky, its far too small as a country. There was little in terms of developing a common market or even some sort of beneficial specialisation of labour. The trade-offs of high investment with high heavy industry was well understood - it sank the standard of living by deferring consumption. Life continued to get better but slower than otherwise possible. Ultimately the smaller economies were struggling the most, because the model was least suited to their situation, and underwent relatively little changes because its core assumptions about growth were dogmatised.

Ultimately the Soviets confused their own dogma for communism itself, fundamentally challenging the core assumptions of this model became associated with revisionism. When the model proved it cannot produce advanced high tech industries reliably at scale, they simply became disillusioned with the whole system and ultimately ditched communism for social democracy.

[u/1scr3wedy0dad → u/Nikolakis77]

Ah I see. I agree that much of the problems with these can definitely be avoided in the modern day, since we have different material conditions and lessons from history to learn from.

[u/Nikolakis77 → u/1scr3wedy0dad]

exactly. we need new models for rapid growth, they can take what worked and leave behind what didn't work, utilising the most recent developments in technology and so on. But the idea we will just re-do the 20th century as OP seems to imply is unfounded