The Case for the SUPERIORITY Of the SOCIALIST BLUEPRINT

As a matter of blueprint logic, the socialist blueprint is drawn at a higher level of rationality.

This, I believe, is the correct way of putting the matter. It is not a case of rationality versus irrationality. The farmer whose reaction to hog and fodder prices produces the hog cycle is, individually and from the standpoint of the moment, acting perfectly rationally. So is the management of a concern that maneuvers in an oligopolistic situation. So is the firm that expands in the boom and restricts in recession. It is the kind and scope of rationality that makes the difference.

This is certainly not all that can be adduced on behalf of the socialist plan. But so far as the pure logic of a socialist economy is concerned, most arguments that are not provably wrong are in fact implied in the one submitted.

An example of the first importance is afforded by unemployment. We have seen in Part II that, as regards the interest of the unemployed themselves, capitalist society in any stage sufficiently advanced to offer a chance for successful socialization need and presumably will not leave very much to be desired. But concerning the loss to society the preceding argument implies that in a socialist society unemployment will be less, mainly in consequence of the elimination of depressions, and that where it does occur, mainly in consequence of technological improvement, the ministry of production will be in a position—whatever it may actually do— to redirect the men to other employments which, if the planning lives up to its possibilities at all, might in each case be waiting for them. A minor advantage that is also implied in the superior rationality of the socialist plan results from the fact that in the capitalist order improvements occur as a rule in individual concerns and take time and meet resistance in spreading. If the pace of progress is rapid, there is often a large number of firms that cling to old methods or are otherwise of substandard efficiency. In the socialist order every improvement could theoretically be spread by decree and substandard practice could be promptly eliminated.

I call this a minor advantage because capitalism as a rule also deals pretty efficiently with the inefficient. Of course, the likelihood of this particular advantage, whether great or small, being realized by a bureaucracy is another matter; a decent bureaucracy may always be relied on to bring all its members up to its standard, but this says nothing about what this standard itself will be. That possible superiorities might in practice turn into actual inferiorities must be kept in mind throughout.

Again, managers or owner-managers of small or medium-sized concerns are as a rule primarily either engineers or salesmen or organizers and, even if good men, rarely do all things equally well. We often find that even successful businesses are indifferently managed in some respect or other— witness the reports of efficiency experts—and their leaders are therefore partially misplaced. The socialist economy could, as modern largest-scale business does, use them to fuller advantage by using them exclusively in what they really know how to do. But obvious considerations that need not detain us will not allow us to entertain high hopes on that score. There is however an advantage of prime importance that is not visible in our blueprint as drawn. The outstanding feature of commercial society is the division between the private and the public sphere—or, if you prefer, the fact that in commercial society there is a private sphere which contains so much more than either feudal or socialist society allocates to it. This private sphere is distinct from the public sphere not only conceptually but also actually. The two are to a great extent manned by different people—the history of local self-government offering the most conspicuous exception—and organized as well as run on different and often conflicting principles, productive of different and often incompatible standards. Friction can only temporarily be absent from such an arrangement the paradoxical nature of which would be a source of wonder to us if we were not so accustomed to it. As a matter of fact, friction was present long before it developed into antagonism in consequence of the wars of conquest waged upon the bourgeois domain with ever-increasing success by the men of the public sphere. This antagonism entails struggle. Most activities of the state in the economic field then appear in the light that is well characterized by the old bourgeois economist’s phrase, government interference. These activities do in fact interfere in every sense of the word, especially in the sense that they hamper and paralyze the private engine of production. It cannot be urged that they are frequently successful, even in increasing productive efficiency. But as far as they are, the central board’s activity would stand a still greater chance of being so, whereas the costs and losses incident to the struggle as such would be entirely avoided in the socialist case. And these losses are considerable, especially if we count in all the worry caused by incessant Can Socialism Survive?198 inquiries and prosecutions and the consequent discouraging effects on the energies that propel business. One element of these costs should be mentioned specifically. It consists in the absorption of ability in merely protective activities. A considerable part of the total work done by lawyers goes into the struggle of business with the state and its organs. It is immaterial whether we call this vicious obstruction of the common good or defense of the common good against vicious obstruction. In any case the fact remains that in socialist society there would be neither need nor room for this part of legal activity. The resulting saving is not satisfactorily measured by the fees of the lawyers who are thus engaged. That is inconsiderable. But not inconsiderable is the social loss from such unproductive employment of many of the best brains. Considering how terribly rare good brains are, their shifting to other employments might be of more than infinitesimal importance.

The friction or antagonism between the private and the public sphere was intensified from the first by the fact that, ever since the princes’ feudal incomes ceased to be of major importance, the state has been living on a revenue which was being produced in the private sphere for private purposes and had to be deflected from these purposes by political force. 11 On the one hand, taxation is an essential attribute of commercial society—or, if we accept the conception of the state alluded to in the first chapter, of the state— and, on the other hand, it is almost inevitably 12 in the nature of an injury to the productive process.

Until 1914 roughly—if we agree to consider modern times only—that injury was confined within narrow bounds. But since then taxes have grown, by degrees, into the dominant item of business and family budgets and into a major factor in the explanation of unsatisfactory economic performance. Moreover, in order to wrench ever-increasing amounts from an unwilling organism, a huge administrative apparatus has come into existence that does nothing but struggle with the bourgeoisie for every dollar of its revenue. That organism has in response developed organs of defense and does an immense amount of work in self-protection.

Nothing else brings out so well the wastes that result from the conflict of structural principles in a social body. Modern capitalism relies on the profit principle for its daily bread yet refuses to allow it to prevail. No such conflict, consequently no such wastes, would exist in socialist society.

Since it would control all sources of revenue, taxes could vanish with the state or, if my conception of the state does not command approval, with the bourgeois state. For, as a matter of common sense, it would be clearly absurd for the central board to pay out incomes first and, after having done so, to run after the recipients in order to recover part of them. If radicals were not so fond of chivying the bourgeois that they cannot see anything wrong in taxes except that they are too low, it would have been recognized before this that here we have got hold of one of the most significant titles to superiority that can be advanced in favor of the socialist plan.