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    (Original post by aaran-j)
    What is the opinion of TSR Socialists over the US investigation into the release of the Lockerbie bomber?
    hmm, that's a tough one, on the one hand I have my reservations about BP and its relations with the British Goverment, on the other I find it odd that the Scottish government would be complicit in a deal between westmister and libya, especially as the SNP are in power at the moment, they dont strike me as a party that would cowtow to the demands of BP via the intermediary of the UK government.
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    (Original post by paddy__power)
    No I understand, it's an opinion which is not dissimilar to my own.

    Thanks for the reply.
    no worries.
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    If you believe in a totally State-planned economy, how is it remotely feasible for a State to have the amount of knowledge to calculate/predict the supply and demand of goods (and thus their price), as opposed to individuals who have knowledge of local markets and who are just responding to price indicators so that they can become productively efficient, rather than trying to look at the bigger picture?

    (Hayek showing why not even the greatest computer in the world could ever solve the economic calculation problem).
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    (Original post by Melancholy)
    If you believe in a totally State-planned economy, how is it remotely feasible for a State to have the amount of knowledge to calculate/predict the supply and demand of goods (and thus their price), as opposed to individuals who have knowledge of local markets and who are just responding to price indicators so that they can become productively efficient, rather than trying to look at the bigger picture?

    (Hayek showing why not even the greatest computer in the world could ever solve the economic calculation problem).
    thanks to a little something we call Democracy, those people will be having a say in how the supply and demands of goods is anyway, by either electing people who they agree with, or in some cases voting in refferendums, taking part in council meetings and other forms of local government.
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    (Original post by SciFiBoy)
    thanks to a little something we call Democracy, those people will be having a say in how the supply and demands of goods is anyway, by either electing people who they agree with, or in some cases voting in refferendums, taking part in council meetings and other forms of local government.
    But thats the whole point - when voting you vote for a package, not on individual issues. As well as this government enforces conformity, there is no room left for individual choice.

    If you read the whole article that is linked it makes it clear, and this is indisputable, that nobody can have complete knowledge even of simple economic arrangements to make the necessary changes which will allocate resources most efficiently, and ensure people get what they need and want. The example of tin production used in the article is perfect.

    Even if you could make a calculation using several "experts" over several months, using complex formulas and attempting to take account of several innumerable consequences of even the slightest changes - this "planning" would have to be set out many months, if not years in advance. It would stand no chance of keeping up to date with the daily fluctuations of supply and demand of raw materials and products. Indeed, I'm sure you'll accept that economic planning can only work effectively in an economically stagnant country with zero innovation.
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    (Original post by Musty_Elbow)
    Even if you could make a calculation using several "experts" over several months, using complex formulas and attempting to take account of several innumerable consequences of even the slightest changes - this "planning" would have to be set out many months, if not years in advance. It would stand no chance of keeping up to date with the daily fluctuations of supply and demand of raw materials and products. Indeed, I'm sure you'll accept that economic planning can only work effectively in an economically stagnant country with zero innovation.
    Not to mention that from a starting base of less knowledge you will always come out with a flawed outcome. The market system combined all the knowledge of everybody, how they value products, whether this one is better quality than that one, and the price signal means that producers produce what people want to buy.

    Central planning doesn't work, it simply can't reflect the amount of information and you get inferior outcomes, even if it theoretically could stay in time, through a series of planning supercomputers...
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    (Original post by SciFiBoy)
    thanks to a little something we call Democracy, those people will be having a say in how the supply and demands of goods is anyway, by either electing people who they agree with, or in some cases voting in refferendums, taking part in council meetings and other forms of local government.
    How would 51% of the country know the precise amount of steel to produce for 100% of the country in order to satisfy the idiosyncratic tastes of different groups of people living in different areas with different professions with different houses and hobbies and recurring household/industrial problems, with different and ever changing local supplies of resources... etc?
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    (Original post by SciFiBoy)
    thanks to a little something we call Democracy, those people will be having a say in how the supply and demands of goods is anyway, by either electing people who they agree with, or in some cases voting in refferendums, taking part in council meetings and other forms of local government.
    Most people don't have the faintest clue on what sort of goods are produced that are required for many parts of our technological and manufacturing industries. Why should they have any say whatsoever on the amount of, say, manometers or pnp transistors, produced each year?
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    (Original post by Melancholy)
    If you believe in a totally State-planned economy, how is it remotely feasible for a State to have the amount of knowledge to calculate/predict the supply and demand of goods (and thus their price), as opposed to individuals who have knowledge of local markets and who are just responding to price indicators so that they can become productively efficient, rather than trying to look at the bigger picture?

    (Hayek showing why not even the greatest computer in the world could ever solve the economic calculation problem).
    I haven't finished reading the article yet, but is that really what Hayek is saying in it? I've got to the third paragraph which starts with:

    The peculiar character of the problem of a rational economic order is determined precisely by the fact that the knowledge of the circumstances of which we must make use never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess.
    Does this not suggest that the problem would disappear if the knowledge of the circumstances was concentrated? As in, if a computer were somehow able to know, it would be able to calculate and solve the problem?

    I'd always been under the impression that Hayek actually misunderstood the calculation problem and always presented it strictly as a knowledge problem; hence my question. I'll try to finish reading it now, though it's irritating to actually read.
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    (Original post by Hy~)
    I haven't finished reading the article yet, but is that really what Hayek is saying in it? I've got to the third paragraph which starts with:

    Does this not suggest that the problem would disappear if the knowledge of the circumstances was concentrated? As in, if a computer were somehow able to know, it would be able to calculate and solve the problem?

    I'd always been under the impression that Hayek actually misunderstood the calculation problem and always presented it strictly as a knowledge problem; hence my question. I'll try to finish reading it now, though it's irritating to actually read.
    I think the economic calculation problem can be seen from many angles, but the two main angles are:

    (a) it is computationally hard to find out the optimal and most efficient level of resource distribution (without a price mechanism)
    (b) the impossibility of perfect central knowledge in first place, regardless of the technology involved.

    Hayek attacks it using (b). In other words, not how a computer would be able to process the continually changing and vast amount of knowledge in order to establish prices, but rather how do you give the computer the knowledge in the first place?

    To support (b), I'd give three reasons:

    (i) knowledge is massively dispersed among market participants;
    (ii) a large proportion of economically relevant knowledge is tacit, unarticulated and unspoken;
    (iii) people will often have no incentive to provide the information, and even more often an incentive to provide inaccurate information.

    I don't think that Hayek is misunderstanding the economic calculation problem, he's just choosing a different angle.

    edit: To cover my back, this problem doesn't tackle sophisticated forms of leftism (e.g. Rawls' principle that one should take care of the worst-off). Rawls accepts that the difference principle's policy implications, at the level of political philosophy, are indeterminate between capitalism and socialism. If socialists are in favour of whatever in fact maximises the position of the least advantage, then if it's true that we need a non-centrally planned market to maximise the position of the least advantaged, then socialists ought to want a free market.
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    (Original post by Melancholy)
    I think the economic calculation problem can be seen from many angles, but the two main angles are:

    (a) it is computationally hard to find out the optimal and most efficient level of resource distribution (without a price mechanism)
    (b) the impossibility of perfect central knowledge in first place, regardless of the technology involved.

    Hayek attacks it using (b). In other words, not how a computer would be able to process the continually changing and vast amount of knowledge in order to establish prices, but rather how do you give the computer the knowledge in the first place?

    To support (b), I'd give three reasons:

    (i) knowledge is massively dispersed among market participants;
    (ii) a large proportion of economically relevant knowledge is tacit, unarticulated and unspoken;
    (iii) people will often have no incentive to provide the information, and even more often an incentive to provide inaccurate information.

    I don't think that Hayek is misunderstanding the economic calculation problem, he's just choosing a different angle.

    edit: To cover my back, this problem doesn't tackle sophisticated forms of leftism (e.g. Rawls' principle that one should take care of the worst-off). Rawls accepts that the difference principle's policy implications, at the level of political philosophy, are indeterminate between capitalism and socialism. If socialists are in favour of whatever in fact maximises the position of the least advantage, then if it's true that we need a non-centrally planned market to maximise the position of the least advantaged, then socialists ought to want a free market.
    Hayek thought that the calculation problem was epistemological rather than ontological in nature; in this way, he misunderstood it.

    In Hayek's view, in the hypothetical situation where perfect knowledge and a powerful enough computer were in the hands of the central planners (and, contrary to your (b) above, I can't actually think of any reason why this is impossible a priori, though I'll grant I haven't considered it too much), it would be possible to perform economic calculation because that's what the problem was to him - a knowledge problem.

    Mises argument, however, was not this. Mises believed that even in the hypothetical situation presented above economic calculation would still be impossible. The entire calculation problem stems directly from the subjectivity and incommensurability of value - a cardinal comparison of value between individuals is impossible (non-arbitrarily, of course). Knowledge (which, in the hypothetical situation, the central planners would have) of individuals' ordinal value scales still would not solve this problem due to their incommensurability. It'd be like saying "5 kg is larger than 6 metres"; nonsense, because there is no non-arbitrary "valu" metric for interpersonal comparison. Your "(a)" written above is an understatement - it is computationally impossible to allocate resources non-arbitrarily without: private property, a monetary standard and the price mechanism which follows this.

    Mises was, of course, correct; though this is pleonastic - Mises was never wrong.

    I believe this has important implications as technology advances, incidentally, as some socialists might slip into the trap of believing computers will eventually be able to solve the calculation problem, or solve it to a sufficient degree that is satisfactory for them. As Mises correctly argued, though, this is impossible.

    Oh yea and I don't really care about Rawls or any "leftism" (in this thread, anyway), btw, I only care about the economics aspect of it. I have no interest in what peoples' entitlement theories are - I only care that private property is necessary for civilisation. If socialists don't want to exterminate 99% of the human race, then they ought learn about this problem instead of going all ostrich about and sticking their head in the sand in hope that, just because they can't hear the problem, it will magically cease to exist or solve itself.
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    I don't think that just because Hayek raises a new objection in his paper, focussing on a knowledge-based critique, then that means he misunderstands Mises' objection - his paper isn't meant to merely reiterate Mises' objection; what would be the purpose of that..? That seems to make most of what you said rather redundant. Apart from that, I don't see what there is to disagree with. I could have quoted Mises paper (the [a] argument which you've roughly outlined) - instead of Hayek's argument (the [b] argument, as I called it in my previous post). The reason I said computationally hard rather than impossible is because, of course, it isn't impossible for a computer to allocate resources in the most optimal way, it's just negligibly unlikely that it will, given the sheer amount of luckily correct guesses (about people's values and so forth) that need to be made to make its arbitrary allocation identical to that of a market-allocation result. But that's semantics - impossible or just very hard, it's not really relevant. Unlike with the knowledge example, where it is impossible for any agent to know, through a priori reasoning, what the preferences of another agent might be with any certainty (beyond, loosely, basic needs and preferences that some might not be able to back with their wallet, I guess). Only the agent knows himself whether he's lying and truly knows what's in his own self-interest (and use the knowledge of local market conditions in order to satisfy his unique preferences under unique circumstances at a particular point in time). Points (i), (ii) and (iii) in my previous post outlined why the epistemological considerations were mammoth objections to overcome.

    I mentioned Rawls to the socialists, it wasn't intended as part of my stuff on Hayek directed at you.

    Quite why the economic calculation problem should only be viewed as an ontological problem rather than, on reflection, an epistemological problem as well, is uncertain. What's more, saying that Hayek misunderstands the economic calculation problem, when he's merely offering another objection, seems unwarranted.
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    (Original post by Melancholy)
    I don't think that just because Hayek raises a new objection in his paper, focussing on a knowledge-based critique, then that means he misunderstands Mises' objection - his paper isn't meant to merely reiterate Mises' objection; what would be the purpose of that..? That seems to make most of what you said rather redundant. Apart from that, I don't see what there is to disagree with. I could have quoted Mises paper (the [a] argument which you've roughly outlined) - instead of Hayek's argument (the [b] argument, as I called it in my previous post). The reason I said computationally hard rather than impossible is because, of course, it isn't impossible for a computer to allocate resources in the most optimal way, it's just negligibly unlikely that it will, given the sheer amount of luckily correct guesses (about people's values and so forth) that need to be made to make its arbitrary allocation identical to that of a market-allocation result. But that's semantics - impossible or just very hard, it's not really relevant. Unlike with the knowledge example, where it is impossible for any agent to know, through a priori reasoning, what the preferences of another agent might be with any certainty (beyond, loosely, basic needs and preferences that some might not be able to back with their wallet, I guess). Only the agent knows himself whether he's lying and truly knows what's in his own self-interest (and use the knowledge of local market conditions in order to satisfy his unique preferences under unique circumstances at a particular point in time). Points (i), (ii) and (iii) in my previous post outlined why the epistemological considerations were mammoth objections to overcome.

    I mentioned Rawls to the socialists, it wasn't intended as part of my stuff on Hayek directed at you.

    Quite why the economic calculation problem should only be viewed as an ontological problem rather than, on reflection, an epistemological problem as well, is uncertain. What's more, saying that Hayek misunderstands the economic calculation problem, when he's merely offering another objection, seems unwarranted.
    Woops, didn't see this until now.

    Alright well I seem to have come off as aggressive(?), or else I'm interpreting unnecessary defensiveness in your post. Nuances are difficult to read on the internet. That was not my intention, I was actually thinking about this recently and wanted to write out exactly how I understood it. Anyway..

    In any of my reading of Hayek (though I haven't read a huge amount of his stuff), I've never seen him explain exactly why perfect knowledge and a powerful enough computer are a priori impossible. Only if it is a priori impossible will his argument be immune to technological advancement or hypothetical situations. I believe Hayek's argument is flawed in this way, because it rests upon this ipse-dixitism (unless he gives an explanation somewhere that I haven't seen). He hijacks Mises argument and turns it into something different, and then this leaves his argument with a serious vulnerability which Mises' argument simply didn't have - he may have initially understood the problem but in his later years, as he was more and more influenced by British empiricism, his view on it changed to be a knowledge problem, rather than calculation problem.

    Your points (i), (ii), (iii) above are, I agree, mammoth objections but they are still technical problems and not logical problems; this leaves the possibility of them being solved by technological advances open. The reason I posted this was, as I wrote before, to preempt any socialist's retort about possible solutions to the calculation problem through use of technology. I'm nearly sure I've seen people before talk about how computers were used in Chile when it was socialist in the early 70s, so I was just pointing out how computation is still impossible because the calculation problem is exactly that - a problem of calculation, and not knowledge.

    I don't see (m)any socialists jumping into this discussion so I'll restate Melancholy's question:

    How do you socialists get around the calculation problem? If you can't get around it, do you accept that socialism is impossible?
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    We pay tribute to this man, if you please
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    Hi, I think Stricof should have forwarded on a fairly long post regarding a bill on localism & tax reform. Any opinions from any the Socialists, objections or thoughts on turning it into a bill? I'd be interested to hear how it goes down, in theory it should appeal, no?
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    (Original post by simontinsley)
    Hi, I think Stricof should have forwarded on a fairly long post regarding a bill on localism & tax reform. Any opinions from any the Socialists, objections or thoughts on turning it into a bill? I'd be interested to hear how it goes down, in theory it should appeal, no?
    I posted it up in the subforum. Either I or someone else from the party (probably Stricof) get back to you about it some point in the near future regarding our views as a party.
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    (Original post by simontinsley)
    Hi, I think Stricof should have forwarded on a fairly long post regarding a bill on localism & tax reform. Any opinions from any the Socialists, objections or thoughts on turning it into a bill? I'd be interested to hear how it goes down, in theory it should appeal, no?
    Hi yes I was going to do that but Dayne did it for me instead

    We've been having some reforms...well I have anyway....in the Party so i've been busy. We'll be on to you shortly. Thanks
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    Heh, it doesn't really matter who posted it up, but thanks for doing so. If you don't manage to reach any sort of consensus as a party then don't worry, just give me everything. The more individual opinions the better, really.
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    What does TSR Socialist Party think about the idea, that one's council tax can be reduced for the appearance of their house? For example, someone would receive a reduction on their council tax if their front garden was well kept and the front of their house looked pleasing. These sort of incentives help the community look pleasing to the eye and orderly. This scheme runs in Austria and has proved successful.
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    (Original post by abucha3)
    What does TSR Socialist Party think about the idea, that one's council tax can be reduced for the appearance of their house? For example, someone would receive a reduction on their council tax if their front garden was well kept and the front of their house looked pleasing. These sort of incentives help the community look pleasing to the eye and orderly. This scheme runs in Austria and has proved successful.
    I can't speak for the party as a whole (after all, the party is the sum of its parts, so perhaps its best to gain a lot of separate members opinions), but I don't see the point. Looks are very unimportant to me tbh, so I don't care how well kept their garden is.
 
 
 
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