Is planning the past, as the mainstream argues? Is planning the present, as critics of capitalism argue? Or is planning the future, as different visionaries and revolutionaries argue? Trivially, to answer such questions in rough outline, we have to improvise a little philosophy of planning. Although the necessity of planning is almost undeniable now, an anti-planning attitude still dominates the political imagination. „Planning“ is a dirty word, not to mention the idea of a planned economy. We start with a widely unknown tradition of systemist philosophy and end with idealized designs of planned economies, after briefly having visited central planning in actually existing socialism, neoliberal planning, and capitalist planning. What is our answer? Planning is the past, the present and the future, an anthropological constant, a necessity of authentic democracy, and a requirement for the cure of all the catastrophic socio-ecological ills in the world system. That planning has received a bad name will soon be ranked among the greatest follies in the history of thought. By Daniel Plenge
What follows are robust 21700 words for self-clarification, roughly 5 1/2 ‚long reads‘, and a run through some literature. Perhaps someone has a use for it. It should be possible to freely pick and choose from the menu, although it is one thing.
- The Problem of Planning in the Age of (Anti-)Planning
- Two Ideal Types of Socio-Political Imagination: Planning and the Market
- ‘Capitalism’s Dirty Secret’ and Neoliberal Planning
- Some Types of Planning
- Comprehensive Economic Planning (aka ‚Planned Economies‘)
In the 28th month of life someone asked “What is this, life?”. Although that someone lives in a tribe of atheists, the next day the little human wanted to know “Who is God?”. In this spirit of puzzlement, curiosity, honest concern and experimentation the What-the-Fcuk series asks classic and current questions at the intersection of the real world and public as well as academic thought.
“Any progressive, thorough, effective, and lasting transformation of a social order calls for systemic, participative, multilevel, and flexible planning.” (Mario Bunge)
Within the systemic world crisis, the one we have spoken about the last time, it is worth noting that this crisis is made by humans themselves, though not by the generic and misleading communitarian ‘Us’ that is often used. (Remember What The Fcuk Is A Problem? and What The Fcuk Is Inequality?) To the contrary, the grand crises in pre-modern or early-modern times had been due to natural processes, e.g. crop failures, earth quakes and plagues. Meanwhile, in the ‘Anthropocene’ or ‘Capitalocene’ even the natural catastrophes are humanely induced to various degrees, whether these are pandemics, famines, or weirding weathers.
Although the evidence is in many concrete cases contested and ambiguous, for most of humanity this would have been regarded as a totally absurd thought – unimaginable. The crises then were experienced as fateful, due to supernatural forces which even transcended nature, not to mention humanity. Now humans influence the whole geo-history of the planet. Without fossil fuel burning it is estimated that the next ice age would have happened in 50,000 years. Now it is re-scheduled to happen in 120,000 years.
If this crises-ridden system were planned by engineers it would be ready for being dismantled. The many smaller and larger crises would be taken as many signs of the system being out of control and in need of redesign and refurbishing. Leigh Phillips and Michael Rozworski write about “the horror and marvel of the Anthropocene”:
“Humanity so fully commands the resources that surround us that we have transformed the planet in mere decades, on a scale that leviathan biogeophysical processes took millions of years to accomplish. But such awesome capability is being wielded blindly, without intent …”
Imagine: By accident I have recently been made aware again that my grandfathers were born in 1917 and 1922. The so-called ‘great acceleration’ of economic ‘growth’, rapid technological change or ‘progress’, and ecological destruction took off just before or shortly after 1945, and took some three generations. If the command over resources is as great as may be superficially read into these lines and the system would be redesigned, some comparable change might not be unimaginable. Some suggest it is now time to start to even plan the earth’s geo-history of the next centuries and millennia.
In a cynical or just realist mode we could counter this focus by saying that world-society can feel lucky, there is no need for change. And indeed, in part it does. That the system is out of control and beyond intent is celebrated everywhere, for decades.
Its representatives and intellectual ‘elites’ are proud of the supposed fact that this system and its processes have no ‘subject’ whatsoever that makes it or plans it, but is nonetheless producing the best or ‘optimal’ results. It is similar to nature because no one – at least according to atheists – has designed it. Although it is alright to ‘intervene’ as much as it pleases into what is called ‘nature’ and to re-design it on large scales, it is taken to be highly doubtful, downright false, or even a sin, to ‘intervene’ in what formerly had been called ‘culture’ or ‘society’ and has become the self-organising and all-encompassing ‘the Market’. Only ‘the Government’ somehow is external to it. If this strategy is not universally valid, it holds at least by political default in the absence of grand crises.
For most of humanity also this would have been regarded as an absurd and absolutely delusional thought structure.
If it is true that there are multiple crises, then, from this perspective, these crises either have to be interpreted as the ‘optimal’ result at the time or they have to be taken as an indicator of the non-existence of ‘the Market’ in its pure form. It simply cannot be the case that they are its product. Both interpretations are frequently to be found in one form or other among market fundamentalists. Not surprisingly, the liberal-conservative New Optimism tells us that everything is only getting better. The political strategy that follows is business-as-usual. (Remember What The Fcuk Is Normality?)
Here is our topic: Wherever you may live, it is likely that in public political discourses planning is a dirty word and that you have witnessed some polemics about it since 2020.
In a podcast the philosopher Scott Heftler said in passing that „in America there’s this hatred, it’s like an in-principle, superstitious religious hatred for state planning”, which not only fits common perception about American political culture but the much-quoted maxim, ascribed to Thomas Jefferson (1743-1826), that “the government that governs least, governs best.” Where there is planning, there is government, we have learned. And where there’s government, there’s socialism.
It doesn’t need much philosophical wit to notice that by extension the best form of democracy is a regime in which the people think the least about public matters and decide even less.
If you subscribe to this perspective, you may want to strengthen your view with the 20th century idea that all intended social change has uninteded consequences, and maybe therefore needs to be feared. Adam Ferguson (1723-1816) already claimed in 1767 that the social is “the result of human action, but not the execution of any human design”, which is a favourite slogan of ‘liberals’.
Moral: Don’t plan! It may make it even worse!
Thus, if you touch the planning word too openly, you may still get burned, although nothing is more common than grand speeches about visions, strategies, management, missions, or the declaration of an Agenda.
Don’t tell them, but these are just different words that substitute for “plan” and “planning”, perhaps with the exception of the vaguer “vision”.
How discredited something called “planning” is in many circles can be seen when even people who are situated in the ‘progressive’ corner think the tale has already been told, at least in relation to every “imagination of a planned economy”, and that hardly any (or no?) ‘left’ party openly advocates planning. Also ambitious lefties who argue that millions of people should find a job in a secondary public economy called “Job Guarantee” claim you are a fool if you want to touch capitalism with the aim of implementing a “Planwirtschaft” (planned economy). Economics? „At best, economists will briefly mention planning, and then only to ridicule it.” Lefties of all kinds:
“Interest in any kind of government planning has shrunk considerably over the past half century as faith in the wisdom of the titans of industry and the magic of the market remains high even as anti-establishment sentiment grows.”
At least in common sense psychology resentment starts to grow when things are – or are believed to be – out of control.
PART 1: The Problem of Planning in the Age of (Anti-)Planning
Is Planning a Problem at all?
From the perspective of the ideological consensus our question is (again) highly misguided or dull, an old hat that has become antiquated with the end of history. Young people even might not remember or only occasionally stumble over it in old James Bond EPs. But there once was a conflict or war of “the systems”, between the ‘liberal’ market economies aka capitalism on the one side and planned (or command) economies aka communism on the other.
Strangely, however, the most successful economy in the last decades, at least according to conventional criteria, refers to itself as socialism (with “Chinese characteristics”), is from the outside normally called “communist” and has, as it is usually said, a strong state planning component nobody really wants to talk about. Some have quipped that it has become the last hope of liberalism, since it is the example most often mentioned when the success of capitalism needs to be defended: Look at China!
Western commentors seem to prefer to highlight whatever fits their perspective. Michael Ellman calls the hybrid „developmental-state capitalism with state-socialist features“, others may call it „developmental-state socialism with authoritarian-capitalist features“. He notes that China already changed an article of its constition about its economic system from “planned economy” to “socialist market economy” in 1993, which may emphasize change instead of continuity and similarity with ‘the West’ over differences. Two years earlier, the Russian State General Planning Commision (Gosplan), one of the planning bureaucracies that had launched its first 5-year plan between 1928-1932, was transformed into an ordinary Ministry of Economics.
As it seems, there can hardly be any doubt: Planning is history, past history, not future history.
Here, again, there are three reasons to be sceptical about any of this:
According to some, the planned economy didn’t disappear at all with the Iron Curtain, not even in ‘the West’.
Early on in the pandemic, Grace Blakeley wrote “we already lived in a planned economy, but the planning that does take place is neither democratic nor rational”. Similarly, Leigh Phillips and Michael Rozworski had written in 2019: “Today’s economy is already to a large degree planned rather than spontaneous”, and the economist Michael Hudson, who is among the ten people who predicted the Great Recession after 2007/8, said in a lecture for the University of Hong Kong in 2021, taking up a thesis from his book Killing the Host:
On the face of it, this is confusing from the standpoint of mainstream wisdom.
Even more strange, on China one academic source claims that its Tenth Five-Year Plan (2001-2005) would have been its very last and was “followed by the Eleventh Five-Year Guidelines or Programme”, which “reflected the discrediting of ‘planning’ and the wish to disassociate policy from it.” However, another academic source tells us that from “the Eleventh Five-Year-Plan period (2006-2010), the Chinese Government also changed the term of the ‘Five-Year-Plan’ into ‘Five-Year-Planning’”, which is said to be a change beyond mere names.
Huh? What the fcuk is the difference between a plan and planning, or a ‘programme’ and ‘guidelines’ on the one hand and plan/planning on the other?
The economist Robin Hahnel summarizes recent economic history the following way (emphases added):
“For the moment the countries where economic performance has diminished and right-wing populist discontent is highest are the advanced economies in Europe and the United States where the anti-planning, neoliberal trend has been most pronounced. While the economic ‘success stories’ over the past five decades are in countries that have embraced more planning, the most important being China, which replaced Communist authoritarian planning with authoritarian capitalist planning 30 years ago, and in the process has risen to become an economic superpower.”
The deception may be about the amount of planning and its specifics, fed not only by ideological interests and economic education but unclarities about what planning exactly amounts to, where it starts and ends, and which types of planning there perhaps are.
For instance, in a contribution by a renowned scholar to the marginal academic field called Planning Theory the first sentence reads: “Everyone plans” (“Jeder plant”), i.e. every individual, social system or social organization. In Michael Hudson’s Killing the Host we also read: “Every economy is planned.”
What is the issue at all if it is true – and according to the consensus it cannot be true – that everybody and any social thing is planning or planned anyway? And is it true? Furthermore, we seem to already be living in the Age of Planning, either in reality, aspiration, or by necessity, even apart from explicit intellectual disputes such as those indicated above.
The Age of Planning in the Age of Anti-Planning
On the national level the pandemic has shown in many countries that state administrations and health systems were not prepared for it. In other words, they did not plan for the case at all or the plans were insufficient: no masks, not enough hospital beds, not enough medical personnel, insufficient bureaucratic structures, personnel and equipment, no or inadequate emergency-, well, emergency-plans of how to respond in the case of a sudden pandemic.
When vaccines were available with the help of massive government subsidies, the governments of the rich states in the Global North planned in such a way that their populations get fully vaccinated or at least had the chance to get vaccinated (and a booster shot). For the rest of the planet, it was decided that „a global action plan to scale up production“ was not drafted and profits of the big players of Northern pharmaceutical industries ensured.
Vaccine apartheid was and is planned, it doesn’t just happen. Beauty Dhlamini summarizes an article suggestively in our context: „The failures of the vaccine rollout in Africa is not an accident—it’s the system working as it was designed.“ Also noteworthy: Patents often monopolize plans.
On the international level all the United Nations member states famously adopted “the 2030 Agenda for Sustainable Development” in 2015, which includes “17 Sustainable Development Goals and 169 targets”. The first sentence of the preamble says: “This Agenda is a plan of action for people, planet and prosperity.” The third sentence reads: “All countries and all stakeholders, acting in collaborative partnership, will implement this plan.”
Whether it is a plan or not, a good one or a bad one, it states to be a plan, and one of global aspiration and reach.
Another overlapping case in point is, of course, the climate emergency and its connection to the biodiversity emergency. William Rees, an environmental economist, commented on COP26 that its participants had wilfully ignored the main “meta-problem”, which is, according to him, overshoot. He added that “on our present course, chaotic collapse is inevitable”, i.e. the collapse of civilization.
“Overshoot occurs when people use energy and biological resources faster than ecosystems can regenerate and pollute beyond nature’s assimilative capacity. It’s a meta-problem, the cause of most so-called ‘environmental problems’ including climate change. Overshoot means that we modern humans are consuming, polluting and destroying the biophysical basis of our own existence.” (On the problematic use of “problem” here remember What The Fcuk Is A Problem?)
This is one big reason why many intellectuals and activists start again to openly think about the prospects of planning.
Noteworthy: Many natural scientists or earth systems scientists are among them. One explanation may be that they are less influenced by ideological debates in politics and social studies.
If the global trend in carbon emissions shall be broken, some target temperature achieved and biodiversity somewhat restored (and ‘civilization’ rescued), the argument goes, it is inconceivable how this could be possible without a dramatic increase in the amount of planning and acting on its outcomes, aka ‘interventions’.
In one of the arguments merely one part of the duopoly of modern political economy shall be strengthened at the cost of the other. ‚The State‘ shall be strengthened at the cost of ‚the Market‘, which, according to Bobby Kurz, has happened in one form or other in every period of capitalist ‘modernisation’.
To take just one example, George Monbiot, well-known among environmentalists and readers of The Guardian, wrote:
„During its three years of war, the US manufactured 87,000 naval vessels, including 27 aircraft carriers, 300,000 planes, 100,000 tanks and armoured cars and 44bn rounds of ammunition. Roosevelt described it as a ‘miracle of production’. But it wasn’t a miracle. It was the realisation of a well-laid plan.„
The by now more frequent call for something like a “wartime effort” in relation to the ecological crises is at the same time a call for (state) planning. In other words, perhaps the visible hands and voices of planning are to be trusted and not the ‘invisible hand’ of ‘the Market’: “Climate change – so the simple insight – can only be countered by means of collective planning.”
There is even – beyond the boundaries of the conservative duopoly, in the direction of a new socio-political configuration and imagination – hope among some that the idea of democratic planning can inspire movements which translate into global cooperation and coordination, two more words that usually smack like planning.
However, in this case reality is perhaps much faster.
With increasing frequency in the wake of COP26 in Glasgow we could read daily about either pledges, NDCs (nationally determined contributions) or plans to reach ‘net zero’ emissions at some point in the future (also by corporations), whereupon others evaluated those ‘plans’. The result were many judgements that the COP was either a total failure or substantial progress.
That planning is prima facie required is also implicit in the idea of one overall global and various national carbon budgets that are associated with the respective global average temperatures that are striven for, at least if you trust the words. Not to plan what to do with those theoretical budgets amounts either to denying their reality, to irresponsibility, or to irrationality. The same holds for capacities of ecosystems or ‘planetary boundaries’ (The case of government budgets is different. Remember What The Fcuk Is Money?)
From the perspective of a (thus far hardly existing) philosophy of planning, and at least for non-experts, it often remains unclear what exactly ‘the plan’ is because they are hardly ever described in any detail and they often include assumptions about unplannable technological developments and equally unplannable developments in ‚the Market‘, i.e. something that is impossible to implement in any sense, but can only be hoped for. For critics, this is as rational as praying to ‘the God’ for rainfall within a drought, as happened in the USA recently.
Be that as it may, the population of the world is told by the media that there are plans, which must have the effect in the casual news consumers we are that there is nothing to worry about. Stuff is taken care of. But reviewing 30 years of failed climate policies, more than 20 scientists referred to the old ideological clash:
“Some antipathy to climate action stems from a realization that addressing climate change often can involve significant levels of government intervention and as such may conflict with particular worldviews and political values.“
If you take the story until here for granted, isn’t it remarkable or even strange, nay, absurd and a sign of deeply ideological times, that there is no recognizable, explicit, public debate about planning, and also hardly an academic discourse about it?
Let’s have quick look at what planning is about. This is never asked because it is taken for granted, also in contrast to its supposed anti-thesis, ‘the Market’.
Most basically, planning is the process that is required the very moment a state of affairs is judged to be deficient, a change in that state is imagined, which is also judged to be better in some respect, and individual or social actions are believed to be necessary to bring the latter state about. But planning doesn’t need to be reactive, it can, of course, also be preventive.
A problem is, in a nutshell, the gap between an individual’s assumptions about what is or will be the case, and what (s)he believes ought to be the case. Problems are in brains that think about the world, not ‘out there’. If two or more people agree on such a gap – and this is a big IF -, then they may collectively engage in thinking about closing that gap by planning social processes that do so. Sociologist know that this is also a very big MAY.
If you wish, planning first connects a problem with its solution in thought and then guides the latter’s realization in action. No surprises, in spite of the above mysteries: “Planning is mental work involved in making plans.”
A plan is the outcome of a sequence of planning activities.
To act on plans, then, is in the optimal case to realize desired futures and to prevent undesired futures, i.e. future states of systems.
The opposite of planned individual or social actions are impulsive, coercive and routine individual actions and rather spontaneous social coordination due to shared conventions and the like (e.g. the supermarket queue). If people collectively follow explicit (formal) rules and laws, then these rules and laws have been the subject of planning as much as the processes that control that the rules are followed. We come back to this. (Some call this “institutional design”.)
Routine action may be undertaken in accordance with an established overall plan, which may be written down and communicated or not, kept as mental scripts, without consciously following a plan. In all organisations many or even most actions happen in accordance with some plans (made long ago) without the necessity of ad hoc re-planning by individuals, for instance simply because people follow the roles that had once been planned for them, but are now followed routinely.
This is one of the reasons that make it hard to distinguish what happens because of a plan or according to a plan in a complex reality in which much seems not to be the result of intentions and plans – and often in fact isn’t.
Here, as in society, explicit, conscious (re-)planning often only happens when something went wrong, furthermore not only once. A problematic state may also be constituted by something that is experienced as new and unknown, which may not only be a crisis but also an opportunity, or just a challenge. Put in different terms: An occasion for planning often happens when normality is on holiday. Eutopian visions of some future can also be a source of problems in the present. (Remember for the imagination of, or in, problems What The Fcuk Is A Problem?)
The pattern is rather general, from sciences to the humanities, technological research or investment planning etc. When a researcher seeks a grant, (s)he has to sketch a problem that is connected with general aims that also the granting institutions share, and plausible steps of finding a solution have to be included, although the solution may only be known in very rough outline so that also the steps can only be sketched with broad strokes. Something similar is true of the pitch in front of some investor that is supposed to be the beginning of a successful business. In the latter case the ‘money bag’ shall join the boat of the problem by spotting a plausible opportunity for profit, which is the start of the emergence of a plan, and perhaps a shared plan.
For short, plans can be enormously varied in detail, knowledge contents, implementation instructions, and also consciousness, everything somewhere between an architect’s plan for a bridge, a cooking recipe, a daily production plan, a research plan, a plan for a weekend trip, or a mere visionary story. Accordingly, not only in common sense “plan” as such is a rather vague notion.
This can already teach us that, as happened in relation to actually existing socialism, it is absurd to demand that the results of planning and plan-implementation have to one-on-one match what had been anticipated in a plan because this is close to never the case. It is also absurd to demand that planning is rigid, excessively detailed, and that plans cannot be modified on the fly, as happens in the same context (as seen above) when there is believed to be a clear divide between plans and planning. On the Soviet ‚planned‘ economy we read:
This is as absurd as stating that failing businesses are not managed at all.
If you demand that planning is totally successful, then planning happens only in routine cases such as brewing a cup of coffee, just by definition. But of course, the problem of relating outcomes to plans and planning remains, that is, how close or wide the gap shall be to call the plan good or bad (ex post), and the real-world result a result of the plan.
As some philosophers would say, “planning” is not an achievement-verb, such as scoring a goal or to understand. You cannot score a goal and have missed it. Planning can fail and it can be successful to different degrees. Mario Bunge wrote: “Acting intelligently according to plan is like driving in an overcrowded Indian city: it involves making frequent snap decisions.”
Because we know that all projects that are not miniscule have unintended consequences and unexpected external influences, planning has to be flexible, plans need to be redrafted, and next to all plans that are made and used in social contexts are interpreted by those who implement them, often quite many people.
It is also worth noting that in most societies there is no equality in planning and its precursor, problem-construction or problematization, a central part of the human imagination.
Planning is either a privilege of some or delegated in some form by someone or other, may it be the management of a corporation, the consultant hired by that management, the representative of the fictitious democratic sovereign (‘the people’) or the former’s consultants, namely formerly civil servants, now more and more private consultants – and what have you?
For this simple reason, planning as such is also not necessarily liberating. It depends on the kind of planning procedure.
Everywhere planning has in the end to do with the allocation of space, time, resources (material and monetary), roles and power. Such asymmetries in planning-roles themselves may yield, obviously, another power-problem or many such problems. The most central inequality remains a taboo in democratic capitalism, namely that (a minority of) capitalists or ‘entrepreneurs’, managers and bankers for the most part plan what their employees merely execute – and what they receive in return. If anyone publicly challenges this asymmetry, he or she is rebuked as a communist.
Nothing here is surprising, but this doesn’t make it unimportant. Probably among the most ardent critics of planning are all the counselling and advising industries, outside of the social care sector (e.g. Social Work), that, on the face of it, either sell plans or inputs into planning processes.
The overall image of humans in this type of socio-political imagination is that they can envision futures and use their minds to realize them, or strive to realize them, as individuals or collectively. This already is a little anthropology and philosophy of history: “man is the planning animal par excellence.”
What associates planning with controversy is, of course, that the socialist or communist imagination connects social (or ‘collective’) planning with democracy and liberation whereas the neoliberal/libertarian imagination connects it with totalitarianism and unfreedom.
In a sense, a problem – that mental thing which gets planning on the road – already is a creative image where the anticipated but unknown and uncertain future is meshed up with an image of present reality, ideas of how the world works, what is of value in it and what not. The economist and historian Walter Ötsch writes in his assessment of market fundamentalism: „In relation to decision-making and action we need a (mental, simulated) image of the situation as well as an (mental, simulated) image of ourselves.“ („Für Entscheiden und Handeln benötigen wir sowohl ein (innerlich simuliertes) Situationsbild wie auch ein (innerlich simuliertes) Selbstbild.“) As the sociologists say, the “definitions of a situation” may be shared or not.
Creating such images is also one important aspect of engaging in any collective project in any social system of whatever scale, since such a project is, however vaguely, the imagination of a future that differs from the present and shall be realized by some plan.
Within Planning Theory it has been said that the overall worldview of those agents who make the plans constitutes a “planning world” (“Planungswelt”). Within non-authoritarian planning one step of the overall process is accordingly to achieve that those persons who are hoped to make use of the plan (or are merely affected by it) share enough of this planning world to be willing to try to implement the plan, i.e. willing to make it their own (or merely willing to tolerate or support it).
As everyone knows: We all love our routines and are as ready to accept new plans as academics are willing to adopt new ideas, i.e. hardly at all. In organizations, there is an established way of doing things, a lived (quasi-)plan that is as hard to change as the core ideas of a scientific theory. New ideas and ways of doing tend to emerge in the periphery of the organization.
In strictly authoritarian planning, to be found in the military, most corporations, bureaucracies, and many families, this step of communicating and negotiation of planning worlds is missing or marginal. Obviously, one promising strategy in order to share such planning worlds is to let as many people participate in the planning process itself as is possible and practically desirable. As we will see below, part of the neoliberal planning world is the shared view that planning is either unnecessary or has to happen behind a veil.
Another reason for participative planning is that planners high up in the hierarchy often lack knowledge that only people on the ground have. Von Hayek believed this is a massive problem for centrally planned economies, but it is an issue in every larger corporation or bureaucracy, where many anecdotes are told about managers who have no clue about what the business they ‘manage’ (plan) actually involves.
The usual strategy within organizations is to combine a more rosy and vague vision – the emotionalized content that creates “purpose”, a word used by Mariana Mazzucato – with different concrete aims, spread over different departments of a bigger system. The result shall be cooperation, which is just inconceivable without a modicum of planning of the processes, at least to the point of sharing a problem/aim. Contrary to the myth of fervent anti-planners, social organizations don’t emerge spontaneously.
Politics is similar but usually different because political communication targets the electorate, which is a heap of people (an aggregate), collectivized only by the shared fiction of ‘the Nation’ or ‘Heimat’ (‘homeland’) and being the subject of the same laws, but they don’t constitute an organization.
The people usually don’t expect to take part in anything, especially not organizing for the public good. Accordingly, organizational communication happens elsewhere in the executive or party bureaucracies, in the same way in which a Premier League team concocts a strategy in the locker room while the fans are incited in a press conference with some slogan. In both cases it is assumed they would not understand the secrets of the game, but that the outcome is in their interest anyway. This is, of course, something that those want to change who connect planning with a vision of authentic democracy. (We come back to this.)
However, a simple though important point is that it is something different whether a plan is written for a social system and its transformation or for an aggregate (heap) of isolated individuals that shall be ‘nudged’ to behave in a certain way.
Almost trivially, to state a problem or to formulate an aim, a target, or pledges, is part of planning but is not identical with a full-fledged plan, although this is so in common language, routine planning, and deceptive reporting on environmental policy.
In the everyday world of common sense, most of a plan and planning can be taken for granted when “the plan” is to go to the movies tomorrow (which is an aim), or a map that is called a “plan” is supposed to be used by tourists to find some sight. In this case the plan is no such thing but only a source of information for the person who then makes a plan for herself.
A real plan also contains ideally two sorts of predictions, and even more. If you consider that what is often called a “solution” is in the future this is hardly surprising. (Dan Seni’s monumental, unpublished sketch of a philosophy of plans, perhaps the only on the market, has 1000 pages.)
First of all, a passive prediction, which is the anticipation of the future without any ‘intervention’. Second, an active or technological prediction, which states that, given this or that concrete type of (inter-)action or ‘intervention’, the aim-state of the system will be reached or at least approached, with some probability.
Many will say that this technological prediction is, in fact, the plan itself, the recipe that is waiting to be staged by someone, the steps that need to be undertaken. These predictions then need to be combined with value-laden rules which contain aims, somewhat like this: If you wish to realize aim A, then do H, and expect side-effects E. Note that hundreds of scientists in the pandemic faced the reproach of forcing value-laden aims on politicians and populations, although for the most part they suggested passive predictions or technological forecasts, given aims or assuming aims are clear.
As always, this sounds more complicated than it is.
For instance, the passive prediction states that, other things being equal, in 4 weeks there will be X cases of Covid-19 infections, Y cases of hospitalization, and Z deaths. The active prediction states that if measures A, B, C are implemented, there will be X cases, Y hospitalizations, Z deaths (with some probability), where the values of the variables should differ significantly.
The old-fashioned tourist, short on a smartphone or an internet connection, may be said to implicitly predict that he will get lost if he does not use the city plan in making his own plan, which states that he will reach the sight if he uses the streets A, B, C, in some order.
At the same time such predictions are the precondition for the mere possibility of making historia magistra vitae, to learn from history through the evaluation of the results, to have a look whether the plans were successful or not or to which degree they were. This may explain why politicians tried to obfuscate the exact advice they received in the pandemic by which expert, which parts of the advice they adopted to justify measures, and why they didn’t choose others, along with the explicit aims or problems, so that whatever happened, no one could have foreseen it and no one really was responsible.
We see here that planning does not only, to different degrees, involve the imagination and valuation. It also contains the search for reliable knowledge if common sense promises or threatens not to be enough.
In politics the opposite to careful planning is, for example, the irresponsible, impulsive, uninformed and intuitive whim of the likes of Trump, Johnson, Bolsonaro and other ideologues, although their behaviour is often just a mask of plans which favour their comrades and class. The opposite is also realized by IMF structural adjustment programs that prescribe the same cure regardless of the state of the patient, a detailed diagnosis, and theories checked by data. The ‘theories’ are in effect the above technological forecasts, which simply turn out to be false.
Those who believe that knowledge of the world is good and necessary (though not sufficient) in order to change it also believe that the more detailed knowledge of a type of system and specific circumstances there is, the better the plans and real-world results will be.
Almost trivially, an instrumentally good plan is one that helps to achieve the aim of those who draft it, or at least helps approach it significantly, because of the knowledge it contains. Still the aim itself may be bad, even if the plan is instrumentally good.
However, real-world politics is a different matter, where policies and programs are improvised at the intersection of the pseudo-wisdom of party grandee (who tend to be lawyers and accountants, i.e. dogmatists by profession), a party’s tradition, backdoor bargains late at night, coalition negotiations, the expertise within a ministry, external lobbying, and the pressures of the media. This is not necessarily bad, because we call it ‚representative democracy‘ and the pluralism it shall help to handle.
Though it is an old story that specifically scientific knowledge for specific social policies and the above technological forecasts are often not available when needed – and when it’s there, it clashes with the established ideology, so that it turns out to be unwanted –, the pandemic, the ecological disaster as well as the inequality crises have taught again that this philosophy (in the Enlightenment tradition) is basically correct, although we also have learned again that knowledge claims or “the science” are hardly as unambiguous as is still often presupposed. (And in ordinary social affairs common sense is often just what is needed, even better than social science, and the what may be more important than the how, so that what is at times feared under the term ’scientism‘ is unnecessary. ‚Reflected practioners‘ often know more than researchers.)
Because of all of this, many or most plans are incomplete, fallible, and temporary while planning goes on.
Plans are also specific. To talk of “the Planning” in the abstract is highly artificial. Planning happens in specific contexts or social systems and requires specific knowledge for specific implementations. There is no universal planner you can call if you have whatever problem to solve. If you find someone, (s)he definitely is a crook (or an economist). There are only people who may plan a wedding, others plan a holiday, factory or system of health insurance, and some have general skills to acquire specific knowledge relevant for specific plans. In plans for huge systems much specific knowledge may be integrated. In other cases of ‘planned economies’ you either find a central planning agency or a social system in which different planners coordinate their specific plans – in a way that was planned, to some degree.
Although this is disappointing, apparently there is no theory of “the Planning” and there is no theory of “the Market”. The latter is also historically a rather recent phenomenon. As a central category of thought “the Market” is inexistent before the end of the 19th century, when also the term “market economy” appeared for the first time. To the contrary, “planning has accompanied human societies as long as they have existed”.
That somebody needs to be at the steering wheel, at least in the fiction of socially shared ideas, was the normal assumption, although for most of human history there had never been the primary concern of modern thought, “the economic problem”, how to allocate ‘scarce’ resources ‘efficiently’. The economic question, if there was anything like it, had been how to allocate resources justly, within the context of the given worldview, and this presupposed that there was some individual or community that knew what was just.
This was so much the case that one challenge for Adam Smith had been to convince at least the elites of such a historical world that a story of an ‘invisible hand’ was somehow convincing and not just insane. I would risk the guess, although I admit I don’t know, that there never was a general intellectual problem with something called “planning” either.
According to the best-selling economics textbook, however “we” (i.e. economists) distinguish two types of economies. In one of them allegedly the state makes economic decisions and orders people down in the hierarchy to do something they may not want to do. Everything here happens top-down, whereas in the other type of economy decisions are made voluntarily “on markets”. That historians have long argued – or even take for granted – that most of human social arrangements did neither feature ‘the State’ nor ‘the Market’, and that pre-modern people were not just the dogs of omnipotent potentates, is beyond the concern of the economists.
However, our textbook economists are convinced that in a market economy no individual human, no organization, and no government is responsible “for the solution of economic problems” and that this economic system is “coordinated by the market alone”. It is claimed that relations between persons are “horizontal, essentially voluntary and non-hierarchical”. Planned economies are identified with command economies.
According to the authors, ‘the Market’ appears to be miraculous to the uninitiated. But students are assured – interestingly in some Hegelian-Marxist tone – that it is a system with “an internal logic”: “And it works.” (For most philosophers, logic is not to be found in the real world.)
It is the market which “solves the problems of production and distribution”, a market economy is “a complex mechanism” that coordinates people, actions and business relations. Apparently, the market does not only have problems, it also solves them by doing something.
Socialist critics summarize the practically relevant stuff in the following way:
“Under capitalism, our current mode of production (in essence, the way our society organizes the economy), the primary method used to allocate things is the free market. Ours is a world where prices for goods and services are, in principle, determined in response to supply and demand. Free market advocates claim this leads to a situation where the amount of stuff demanded by buyers matches the amount of stuff produced by suppliers: a condition they describe as ‘economic equilibrium’.”
Whereas we above talked about planning in a general sense, here the issue is the allocation of commodities and human actions (‘services’).
When you start with the worldview of economic textbooks, the ‘natural’ appearance, also legitimated by human history, is that there is a choice to be made. Either you are for ‘the Market’ or you are for ‘the Planning’.
In this story, it is ‘the Market’ that allocates useful stuff and useful services. It, so to speak, ‘decides’ who gets what in the societal distribution game, and also how the goods and services that are allocated are produced. Supposedly, the prices determine which goods are supplied in which quantities and how many of them are demanded. Everything else may be relevant, but it is buried in a wide ceteris paribus clause (or “other things being equal”, some philosophers quip “other things being right”, namely as it suits the theorist).
At the assumed equilibrium price, the amount demanded (desired) is supposed to match the demand supplied (desired to be supplied), whatever the Market may be, whether it is human labour, toys or bombs. In a sense, no desire remains unfulfilled. The market participants receive the price information from ‘the Market’, and at least neither by one player dominating ‘the Market’ nor by social phenomena involving power and social asymmetries of whatever kind. As we learned before, on ‘the Market’ relations are “horizontal, essentially voluntary and non-hierarchical”.
Of course, this would change if there is a planner, who is not needed in ‘the Market’ because, contrary to The Rolling Stones, everyone can get, and gets, satisfaction, as the Mankiw assures:
“At the equilibrium price, the quantity of the good that buyers are willing and able to buy exactly balances the quantity that sellers are willing and able to sell. The equilibrium price is sometimes called the market-clearing price because, at this price, everyone in the market has been satisfied: Buyers have bought all they want to buy, and sellers have sold all they want to sell.”
This world and socio-political imagination is rather harmonious, because it ignores that people without money are not among “everyone in the market” in the first place. However, if there is too much supply at a given price, the assumption is that sellers will lower the prices, which is supposed to lead to consumers demanding more, such that at some point which no one knows they match. If the mechanisms runs smoothly, it also assures that everybody is rewarded with exactly what (s)he deserves, because everyone’s income is determined by everyone’s ‘productivity’ in ‘the Market’. The mechanism assures this because supply and demand are the “forces” that somehow automatically or “naturally” lead to, or ‘tend to’, an equilibrium, if only you let the mechanism take its course.
Philosophy, often claimed to be useless – and rightly so – is at times helpful in sharpening the senses, which can prevent us from being fooled unnecessarily easily.
The eternal textbooks often talk of ‘the Market’ as a mechanism. There has been roughly 70 years of literature on what mechanisms are because philosophers wanted to understand what a scientific explanation is. Now, there are two main concepts of a mechanism that are easy to grasp.
Either “mechanism” is another word for “system” – a complex thing, composed of different parts that have a structure (a set of relations) and behave as one thing in some respect. Or “mechanism” is a word that refers to a process within such a system that brings about the ‘behaviour’ (or ‘macro’-processes) of that system as a whole.
In general, the social sciences are well-known for being able to describe the former systems in detail, but they are still short on theories about mechanisms in the latter sense. As a consequence, they are said to be normally of doubtful use in planning, because they don’t provide us with plausible or even detailed technological (or theoretical) if…then-forecasts about the workings of systems and the outcomes that are to be expected. They are strong in description, ex post (historical) explanation and criticism, but weak in prediction. This criticism may be false, or one-sided, but no one really knows.
Now, if you wish, a market is a system (“mechanism”) in which some components try to sell some type of thing while others try to buy it, where some of the social relations are stable while others are one-off online purchases and the like. Prices are published, usually they are just accepted, at least on consumer markets, at times they are negotiated a bit. But in the process sense of “mechanism” a market is not (just) such a system but a process in such a system that brings about something due to ‘forces’, for instance in brings about the equilibrium of supply and demand or the overall (unequal but just) distribution of stuff and services.
Although it is so common to think in these terms in the modern worldview, the confusing thing is that there are multiple convincing arguments that equilibrium, supply, demand (and all the rest) are more similar to the holy trinity of the Christian churches than some features of the real world, some mechanism that moves ‘the economy’ or even society. In this view, ‘the Market’ is just a modern myth. Nobody has seen it, nobody has measured it, nobody has explained its workings, nobody can be sure that it exists, but the initiated talk as if all of this is obvious. The economists Bichler and Nitzan claim that “nobody, including economists, has any idea what demand, supply and equilibrium look like!”
In fascinatingly detailed and analytic book at the intersection of social science, history and philosophy, Walter Ötsch has dissected the main traditions of thinking about ‘the Market’ in the 20th century. According to him (and others), the study of economics and its textbooks is a ritual in converting millions of young people worldwide into a belief system which is without any foundation and not the result of anything close to scientific thinking, although it is presented as such. He writes in our present context (translated from German): “What the concepts of (market-)supply and (market-)demand mean, we don’t know.” About the economic mechanism in mainstream economics he writes in summary (translated from German):
“Most notably, the neoclassical school of economics cannot provide its core claim about the economic system with a foundation: that a price mechanism exists, which is capable of producing efficient results, which works automatically, and which can form a stable economic system.”
Mainstream neoclassical economics is also said not to be about the real world at all, its systems and processes, but about words, words in their conventional definition within a group of academic economists, exactly as in the case of theological scholasticism. It is about nothing at all, i.e. nothing real, a fantasy model world.
The economists Shimshon Bichler and Jonathan Nitzan formulate in a video:
“Unlike in the hard sciences, the tools of neoclassical political economy, namely supply, demand and equilibrium, are entirely imaginary.” (A detailed paper on the “1-2-3 Toolbox of Mainstream Economics” you find here.)
There is a common sense view of markets as systems we are all socialized into, but ‘the Market’ of economics and political ideologues is a different tale. This is ‚the Market‘ of the political imagination.
Although the so-called ‘law of supply and demand’ has become culturally so entrenched that in debates about social laws, in analogy to laws of nature, philosophers have come up with it over almost a century as the only and sole example, the economist Howard Nicholas, for instance, said on the show Renegade Inc.:
And whether it somehow somewhen adjusts to some Newtonian ‘forces’ is another doubtful matter.
The consequence of this philosophy in the real world can be disastrous, because those who believe that the (counterfactual, fictive, competitive, ‘free’) market tends towards equilibrium – ceteris paribus, other things being right – will not ask for a specific processe or mechanism that achieve this in some historical context, but will demand that reality is likened to the (counterfactual, fictive) image of ‘competitiveness’ and ‘freedom’ and the like. The trouble also is that no one has ever scientifically or otherwise investigated ‘the free Market’ –, so nobody knows how it would work if it is not only possible but would be in fact realised.
Whatever else there is to say, in the context of our topic it is somewhat likely that any such specific mechanism and the system that would host it would be planned to some degree.
Of course, the detailed and at times fierce and esoteric controversies we leave to the experts. But it is noteworthy that the other side does not believe that a tendency towards equilibrium is a feature of real-world economies, a central mark of capitalism, but that it is instability or the tendency towards crises. Accordingly, they look for (planned or unplanned) processes and mechanisms of instability or crisis, for instance within the monetary system, which mainstream economists claim to be irrelevant. Their analyses don’t lead to a global crusade for the freedom of ‘the Market’ but to specific proposals of a redesign of the system.
For us it is enough to know that ‘the Market’ as it is envisioned is dubious or worse because as a socio-political imagination it is the counterpoint to ‘the planned economy’ – or even planning as such. It is also not the case that the critics of the myth of ‘the Market’ are socialists, retro-communists or advocates of a ‘planned economy’. This is not the point. They only insist that real-world markets are not like ‘the Market’. Some of them for sure even love markets.
Any analysis of real-world, historical markets leads to the question of networks, power, interests, collusion, politics and the State, the real sovereigns in the neoliberal era: bankers, violence and deception, education, crime, exploitation, ethics and morals, or what the social sciences outside of economics call institutions, structures and (real) mechanisms.
Then there may still be much to be said in favor of real-world markets, as so-called ‘market socialists’ do for decades, who are among the fierce opponents to ‘planned economies’. But the point is that then markets appear as something that can be – and in fact are– sculptured or, if you wish, planned in complex ways, and have a highly ambiguous track record, even a disastrous one if we focus on the present and upcoming ecological catastrophe or simply look on what is euphemistically called “inequality” within the world system. (Remember What The Fcuk Is Inequality?)
However, the myth of the Market is only one aspect of the overall deception when it comes to planning.
Part 3: “Capitalism’s Dirty Secret” and Neoliberal Planning
“Capitalism’s Dirty Secret”
In contrast to the hegemonic market myths, in one of the really enlightening and thought-provoking books, Leigh Phillips and Michael Rozworski have questioned that market relations are that hegemonic in our societies at all, although everybody talks and thinks as if they were all the time.
It is also worth to let them remind us that societal division of labour as well as money were not spontaneous products of ‘the Market’ or bartering independent individuals, but outcomes of planning activities in large-scale ‘households’ in Ancient Mesopotamia, which include basic accounting techniques. Money basically is a socially obscured accounting technique. (Remember What The Fcuk Is Money?)
Their main and ingenious twist is to maintain that our highly integrated global market economy does not only show that large scale economic planning already exists, namely in the form of mega corporations, but also that such planning is ‘efficient’, contrary to what market fundamentalists claim about ‘central’ planning.
The market myth tells us that ‘economies’ which have as their dominant characteristic something called “planning” are inefficient. That efficiency is achieved best when there is no intentional organization based on plans but only mutually independent systems that engage in market exchange via their representatives, typically by selling some stuff or activity for money.
As David Graeber noted, in ordinary life or what he called “everyday communism” people who know each other a little bit don’t charge each other some cash for handing over the butter at the table, to play a deep pass in football, or to do whatever in what they collectively engage in (and hardly ever have done so across evidenced history even outside of the household). For short: Here markets don’t spontaneously emerge.
Philipps and Rozworski stress that nothing else is characteristic of the typical capitalist corporation, just usually in a rigid hierarchical command way, more Soviet style than communist style. There simply is no market within the boundaries of a typical firm. One department doesn’t sell its things or services to another department that is a sub-system of the overall organization, and the departments also don’t compete with each other for customers. Competition is supposed to be another ‘mechanism’ of, or in, the market.
Put in other words, “internally, as in any other firm, everything is planned”, it doesn’t happen ‘spontaneously’ by some (imaginary) ‘forces’. Let’s listen to their words about “capitalism’s dirty secret” a bit:
“The market economy is not only rife with planning, but with authoritarian planning that concentrates economic decision making in the hands of wealth owners and keeps workers in line. Companies plan everything from how money is distributed between departments to the exact amount of time it should take to assemble a hamburger – and in every case, they plan which individual worker does which task, when, where and how. When you’re on the clock, what the boss says goes.”
Using Walmart and Amazon as examples they describe this in some detail. But the short story is known since Adam Smith, namely that the advantage of a division of labour is productivity – an emergent property of the whole system, not of an individual worker or a single machine-, and especially in today’s sociotechnical systems this is all the result of detailed planning or ‘design’. (As Steve Keen always says, for good reasons factories are designed by engineers, not economists.)
Even external relations of the company with other companies – the ‘supply chains’ – are, of course, (mutally) planned, but these usually take the form of market exchanges (almost by definition of “external relation”). The suppliers in ‘the chain’ usually are not formally or organizationally included in one big corporation, so that the chain would become one mere link. But this happens in the case of mega corporations (and other mergers).
The philosopher Mario Bunge wrote in 1998, also in this respect swimming against the currents of the times:
“As [Adam] Smith  noted, businessmen ‘during their whole lives … are engaged in plans and projects.’ Nearly all management experts admit the need for planning: they only differ with regard to the best kind of plan, as well as to who should do it – a special department or all those in the know?”
Planned obsolescence is also a famous form of capitalist planning. It means that capitalist corporations, which are primarily interested in profits and not products, design the breaking points of products into them, so that consumers have to buy more of them in a given period of time.
Phillips and Rozworski specify that about half of all exchange relations we conventionally classify as ‘economic’ are internal to firms and in fact no market relations at all. Another figure I found gives an estimate of 60%, which would mean that most economic relations in the market economy are no market relations at all.
Even more, what we do in private, not within the so-called ‘private sector’, but according to the rules of ‘everyday communism’ is conventionally and arbitrarily not classified as economic activity at all. What ‘the State’ provides is conventionally counted as economic activity by including it in GDP, for instance the wages of teachers in public schools, but this is also arbitrary because here we don’t find market relations either. (Remember What The Fcuk Is GDP (And Wealth)?) If we would include all this into the numbers, the market or ‘the economy’ would look rather small.
What is even more irritating for market enthusiasts and another unwelcome secret of capitalism is that these corporations are meanwhile often close to the scale of whole nations, comparable with the former Soviet Union:
“Walmart is not merely a planned economy, but a planned economy on the scale of the USSR smack in the middle of the Cold War. (In 1970, Soviet GDP clocked in at about $800 billion in today’s money, then the second-largest economy in the world; Walmart’s 2017 revenue was $485 billion.”
According Phillips, Rozworski and data from 2015, Walmart is as big an economy as Sweden or Switzerland. As a country it would rank as the 38th largest economy on the planet. Elsewhere we can read that Amazon would meanwhile reach three times the GDP of the former Soviet Union, while Walmart employs more people than Slovenia has inhabitants.
If the ‘communist’ Soviet Union was one large factory and failed, then capitalism has shown that large scale ‘planned economies’ can, in principle, work, because in such firms (parts of) the supply chain are incorporated into the firm, into just one big link of non-market relations.
This is intellectually somewhat embarrassing because in the so-called Socialist Calculation Debate, which started in 1919 and went on into the 60s, the ‘liberal’ opponents to planned socialism claimed that economic (central) planning on a large scale would be impossible for different reasons, that either the number of input-output-calculations would be impossible to handle (with or without money) or the central planner would not have the necessary information to calculate anything, which is dispersed as local knowledge across the components of the economy.
Granted that actually existing socialism found its deserved historical grave (we get back to this), if this would be the case, such mega-corporations should all collapse or never come into being. And if ‘the Market’ is such a powerful coordination mechanism, why don’t such corporations introduce one internally, Phillips and Rozworski ask (knowing very well that the mainstream answer is ‘transaction costs’)?
The subsequent question is: On which scale exactly becomes something called ‘planning’ impossible? The quick answer is that every answer seems to be arbitrary today. If the arch-capitalists, the most calculating and rational people in human history choose planning within their mega-corporations, why should it be impossible (and not socially desirable) beyond the borders of a single firm?
The other question is the one Phillips and Rozworski ask repeatedly to open up the socio-political imagination: Given that these corporations are still ‘Satanic capitalist mills’ which are, as social artifacts, designed and run for profit (and exploitation), so that they cannot just be taken over in a revolution to realize something called “socialism”, is it possible to transform them and the wider economy to harness the powers of planning democratically?
What the fcuk is planned and what not?
To come back to our puzzle from the beginning, this view of the current world also vindicates the thesis that there is much planning in capitalism, or perhaps even that the economy ‘is planned’. We could add here the rationing of credit (and money creation) by private banks alongside central banks. These little sovereigns, bankers, have, in the words of Phillips and Rozworski, the power of “choosing between different possible economic plans” that others make, with the aim of fulfilling their own profit-targets and overall plans.
Within and after the financial crisis, governments in service of plutocracy planned and decided to bail out banks and their business plans, not people. The banks should, but largely didn’t, have lent more money to the ‘real economy’. Michael Hudson reminds us what the basic business plan of banks and effectively the whole “post-feudal rentier classes – landlords and bankers” – is:
These plans have as a result that 80% of bank loans and money creation go into speculation, not the financing of productive activity, while central bank Quantitative Easing has inflated assets of all kinds and enriched the already rich. Central banks are owned by ‘the State’, and they centrally organize the banking system, they are planners.
Whether it is justified to say that today’s rentier capitalism is centrally planned by banks and central banks etc. is another matter, but that planning is ubiquitous is clear, even a bit trivial as such, given our philosophical exposition above.
The great Mario Bunge already expressed his opinion “that in civilized societies all social facts are partly spontaneous and partly the product of design.” Of course, one (somewhat) spontaneous result happens when incompatible plans confront each other within social conflicts, e.g. of creditors and debtors. But this is only in part spontaneous because those who had the power to plan the rules and those who have the power to implement them often, or just normally, anticipate such ‘unplanned’ outcomes. For short: Bankruptcy may not be planned by those who go bankrupt, but the possibility of bankruptcy is planned into the system, there are established procedures for the case, which are quickly changed in a planful way if the fate of the free market hits the wrong players.
The trouble is, if you think this is unilluminating and you want to know more, then your view is correct!
But nothing more can be said in general about the amount of planning in society because in order to find out what is concretely the result of a (successful or failed) plan and what not, you have to compare all the plans in a society with their respective track record. Sociologists would call the result “The Evaluation Society” – it may ironically be a neoliberal nightmare.
If this mega-evaluation is unachievable, we would have to track powerful groups or networks who occupy roles associated with social power to plan in order to estimate who does the planning that is socially significant, and how far ‘the economy’ is planned. Michael Hudson observes about the mechanisms behind financial planning:
“National policy in today’s world is planned mainly by financial loyalists to serve financial interests. Central bank and U.S. Treasury officials are on loan from Wall Street, above all from Goldman and Citigroup. Goldman Sachs’s roster of CEOs in public service is hallmarked by Treasury Secretaries Robert Rubin (1995-99, at Goldman 1966-92) and Hank Paulson (2006-09, at Goldman from 1974 to 2006). At Treasury, Paulson was aided by Chief of Staff Mark Patterson (Goldman lobbyist 2003-08), Neel Kashkari (Goldman Vice President 2002-06), Under-Secretary Robert K. Seel (Vice Chairman at Goldman, where he worked from 1976 to 2004), and advisors Kendrick Wilson (at Goldman from 1998-2008) and Edward C. Forst (former Global Head of Goldman’s Investment Management Division). Goldman Sachs kept Paulson’s successor Tim Geithner, a protégé of Robert Rubin, close by with the usual reward tactic of paying lucrative speaking fees.
Feder Reserve Bank of New York Chairman Stephen Friedman (2008-09) was former Co-Chairman at Goldman Sachs, where he had worked since 1966. Its president after 2009 was William Dudley (at Goldman from 1986 until 2007). Former New York Fed President Gerald Corrigan (1985-93) ‘descended from heaven’ to work at Goldman Sachs, as did former Treasury Secretary Henry Fowler. Other Goldman Sachs alumni in high positions include White House chief of staff Joshua B. Bolten and World Bank president Robert B. Zoellick.
In Europe, Goldman Sachs Vice Chairman Mario Draghi (2002-05) left to become Bank of Italy Governor (2006-11) and later President of the European Central Bank. Italian Prime Minister Romano Prodi served Goldman Sachs from 1990-93 and acted as a consultant when not in office. Former Italian prime minister and finance minister Mario Monti is an international adviser to Goldman Sachs. Bank of Canada Governor Mark Carney (2008-13 moving to Bank of England in 2013) joined Goldman Sachs in 1995 and worked there for thirteen years. Antonio Borges, head of the IMF’s European division in 2010 and main administrator for Portugal’s privatization program, was Goldman Sachs’s International Vice Chairman 2000-08, and Carlos Moedas, Portugal’s Secretary of State to the Prime Minister, worked at Goldman Sachs on mergers and acquisitions. The list could go on and on.”
As in Ancient Rome and oligarchies anywhere else: It’s networks, stupid! Follow the money to find the plans!
But what about neoliberalism/market fundamentalism and its professed anti-planning attitude? How does this fit into our story thus far?
As we have seen before (remember What The Fcuk Is Neoliberalism?), although the ideological deception has it that neoliberals are for deregulation and laissez-faire, against the state and ‘planning’, the truth is that the only thing the heterogenous group of neoliberal market fundamentalists agreed on was that laissez-faire led to the decline of ‘liberalism’ and that the new liberalism needed to be activist. Activist politics that pursues aims by choosing strategies is built on an idea of planning. Planning in neoliberalism is only slightly different than elsewhere.
Neoliberal market fundamentalists plan for ‘the market’ and against all other political visions that don’t fit their view, most basically what they globally call ‘socialism’. In other words, neoliberal planning has the more abstract but official aim of establishing the ‘market order’ itself, whatever its outcome, and the unofficial aim of distributing income upwards by changing the rules.
Claus Thomasberger writes pointedly about the official side of creating a market order and defending it tooth and nail against the realization of all other possible imaginations (translated from German):
Walter Ötsch observes that the supposed de-regulation always is a re-regulation, which also fits the observation that bureaucracies grow exponentially in neoliberal regimes. Whatever is done, whether this is ‘merely’ the creation of an ‘order’ in which markets emerge (okay) or whether this is an intervention into a market (not okay) can neither be asked nor answered within a neoliberal mindset, and therefore it is also eluded if the ‘intervention’ favours some market participants.
Given that ‘the Market’ is a nothing, neoliberal politics of ‘facilitating the market’ or its ‘growth’ can, in the end, also be anything whatsoever in different contexts and circumstances. Walter Ötsch again: „Economic policy for ‘the Market‘ is always to a large extent arbitrary.” (“Eine Wirtschaftspolitik für ‘den Markt’ ist immer in hohem Maße willkürlich.“)
As the religious fundamentalists, the market fundamentalists can never be quite sure what their God is demanding – at least demanding from those who are the objects of their plans (such as austerity). Accordingly, at times ‘planning’ is the object of neoliberal criticism and at others its disguised tool. Within the pandemic, for example, the choice can be laissez-mourir in the beginning and mandatory vaccination later, bailing out first and letting go under later, depending on the whim of the propertied classes and their experts.
Here is a textbook summary:
“An irony of neoliberalism is that it has reinvented planning, giving it a new set of purposes, scales and spaces for the twenty-first century. (…) Some have claimed that planning has become the handmaiden of neoliberalism, legitimizing a process and outcomes that favour certain groups and interests over others.”
Part 4: Some Types of Planning
To get closer to reality and further away from deception it may be useful to also distinguish different types or spheres of planning as the explicit literature on planning sketches them out. In your recent collection of textbooks you find something similar with additional material and different jargon in the sections entitled Economic Policy or Policy Design.
It‘s certainly a part of deception via verbiage that all this is usually not discussed as planning because it is not “planning, in the traditional sense of a virtually all-embracing bureaucratic system of resource allocation”. However, everything less does not suddendly turn into some innocent form of ‘regulation’ or ‘influence’ and some anti-thesis to planning.
Macroeconomic Planning (aka ‘Macroeconomic Management’):
Macroeconomic planning is undertaken by fiscal means by the treasuries (ministries of finance) and so-called monetary means by central banks as the servants of the governments who own them, usually with the aims of boosting aggregate ‘demand’, controlling (or trying to control) inflation, stabilizing specific prices, and formerly, in the ‘Keynesian’ form, to reach full employment, in the end to save capitalism from eating itself up. A new toolbox in this bag comes from Modern Monetary Theory and its idea of a Job Guarantee, but also from Basic Income enthusiasts. (Remember Basic Income Or A Job Guarantee?)
Though usually not mentioned in this tool-box (but below, under “regulation”), large inter-regional or inter-national trade agreements are an even more general tool of ‘macro’-economic (or, better, macro-societal) planning. Outside of the conventional vocabulary, national constitutions are also tools of economic planning. However, whereas the latter are fairly compatible with neoliberalism, all of the former is, of course, a sin if you believe that anything bad is caused by ‘interventions’ if they are to the benefit of broader shares of the population.
The economist Steve Keen has recently proposed a system of carbon rationing based on carbon credits, which is a form of econ-ecological planning. The idea is that carbon should not be priced in ordinary money, say dollars, because for starters no one has a clue what the ‘true’ price is. In addition, it would hit only the poor(er) parts of the population, not the richer parts, who are at the same time high polluters.
Therefore, he proposes that everything that is up for purchase in the usual currency receives a second price in a second carbon currency, namely the amount of carbon that was used up in its production. Every individual citizen would get a rationed carbon budget, equal for all citizens, at the beginning at the average level of carbon use in the country.
The trick is that, starting in the real world, the richer parts of the population of a country would soon run out of carbon credits, so that, if they wish to consume more, they need to buy carbon credits with the usual currency from those poorer parts of the population who run out of usual money before they run out of carbon credits. Obviously, this idea includes not only a theoretical national carbon budget, but even one that can be in fact used in an overall plan to really phase out carbon.
Sectorial Planning (aka Industrial Policy):
Sectorial planning is undertaking, of course, by governments, by way of all sorts of tax measures, subsidies, loan guarantees, creation of demand and regulation of products to promote the growth of some industries or to ‘nudge’ their transformation in some preferred direction.
“In situations in which socially desirable investment is inhibited by uncertainty, the state is assigned the task of ensuring that finance is available on sufficiently favourable terms to bring the private profit making interest of firms into line with the social interest. The principal instrument of industrial policy has been the provision, directly or indirectly, of long-term capital.”
In other words, the state creates enough money so that a type of industry gets going, then it creates enough money so that that industry doesn’t go under before the time comes, and, if necessary, it creates a demand (by regulations) so that private money finds the way where it should go, or the state just buys much of the stuff itself with the money it creates (if it has a sovereign currency).
Mariana Mazzucato call this “market-shaping” today. Her “mission economy” seems actually to be a mixture of all the spheres of planning listed here, with one exception, enrolled over society in a somehow coordinated way. That is also the reason why it is appealing to all traditional political parties.
What happens to the answer to the question whether current capitalist economies are planned (to some degree) if subsidies of all kinds are added to the picture?
Indicative Planning (aka The Round Table):
Is described differently. In one description, it is nothing more nor less than the process of changing the expectations of the parties involved by organizing the mutual sharing of expectations, aims, and measures. This leads to a form of homogenization of plans and perhaps shared ambitions in planning (“purpose”). The government is, so to speak, the agency that books the dinner table and gives the talks a direction, but the interests served are, in the end, those of the corporations.
Pat Devine described it the following way:
“The idea is that the government and the key sectors and enterprises in the economy should get together to discuss their plans for the future. By exchanging information about what they have in mind they make it possible for each of them to modify their intentions in the light of what the others are proposing to do. The process is then repeated until eventually a consensus emerges over target growth rates for the economy as a whole and for individual industries. In principle, all the separate plans of the independent decision-makers are then consistent with one another and between them add up to the agreed overall outcome, in terms of which they each individually make sense. Indicative planning is intended to remove or reduce the secondary uncertainty that arises from atomized decision-making. It is an iterative process designed to achieve ex ante coordination in the hope that this will improve both the quality and quantity of investment.”
However, whether this is planning at all and not just a form of communication is debatable, at least from the government perspective. There are no tools, no sticks and carrots, to ensure that those corporations that may have cooked up somewhat coordinated plans stick to them and realize them.
Although this is said to have been common after WWII in relation to ‘strategic industries’, it clearly reminds us of the way businesses wish to handle the ecological crisis – of course, with the addition of some checks and guarantees from ‘the Government’. However this may be, with sticks and carrots included it becomes ‘sectorial planning’, which is always a mixture of “bribery and threat” by good old Leviathan. What it exactly is depends on the overall state and mix of democracy, plutocracy, and oligarchy, the modern mixed constitution in the tradition of Polybius.
Just Any Formal Regulation (aka The Law):
That regulation is a sort of planning can be inferred from the fact that every advocacy group of businesses eternally laments over it, although they, of course, regulate internally as well, i.e. what their employees do under their regime. Regulation is especially the planning tool of the planer who has the power to set and enforce rules but does not want to be part of the systems that are being regulated, doesn’t want to give orders, for instance the State or, say, FIFA.
Part of the plan is, of course, an anticipation the planner has about the behaviour of those individuals or social units who are the objects of the regulation. External regulation may not be welcome or even hated because it either prohibits that some type of plan is put into practice or the regulation has to be incorporated in a planning process by setting boundaries for plans, say in regulating industrial pollution or the exploitation of big data or humans.
Phillips and Rozworski emphasize a huge success of this sort of planning, namely that “it was regulatory intervention – planning of a sort – that forced us to use other chemicals for our fridges and cans of hair spray” and thus to save the ozone layer. They call regulation the “toe-dipping exercise in economic planning”.
However, because regulation comes with the establishment of permanently organized social systems that control whether the rules are followed and enforce them (bureaucracies, police, prisons, military, headmasters in schools), in addition, the planning is also about the workings of those systems, i.e. organization planning.
This is trivial, but often forgotten: The reality of a regulation is the social system that controls and enforces its observation. The mere existence of those systems and their rulebook is, then, a part of the plan-book of the broader population, it is, say, the social technology in their brains, in the case that it is known at all, which is again a source of inequality.
For instance, within the idiotic German academic system, research projects frequently do not accidentally start the moment unemployment insurance dries up, whereas in the GDR the patterns of marrying and having children followed the opportunities that were provided/created by state rules in relation to paid leave, promised appartements and the like. Here planned regulation is used to channel the aggregate behaviour of individuals, who nevertheless make their own plans, as Marxians say, under conditions not of their own making.
Regulation is, of course, also used by capitalist in their power games, when one industry or company lobbies for some sort of regulation that is in its own interests.
To talk of regulation at the absence planning is an abuse of language, and any talk of “purpose” without some fruits to be picked up by people in their own authentic interest won’t change a thing.
Such regulation-cum-system forms of planning come in all kinds and sizes, can be long term or short term. As again Bunge said suggestively (and his fantastic style):
“In metaphoric terms, a public policy may prescribe surgery, specific medication, or aspirin. Land reform combined with the organization of farmer cooperatives, technical assistance, and credits is an instance of the first; massive inoculation against a threatening epidemic exemplifies the second; and the jailing of opponents, beggars, vagrants, or prostitutes typifies the third.”
No surprise, this box overlaps with the former categories and the next.
In the recent debate about inflation specific price controls for some goods, as had been practiced within and after the World Wars, have been suggested (and then, of course, critized harshly), which is another instance of specific medication, but no surgery. Another instance of planning prices and regulation famously is the minimum wage.
Organization Planning (aka Management):
As we have seen, all organizations plan their operations, whether public or private, and they are regulated – made possible and constrained at the same time – more or less by ‚the State‘. All societies or economies are planned in the sense that they consist of systems that are planned internally and also regulated externally. (A manager, by definition, is a part of the system (s)he plans/manages. A mere regulator, but also a planner, is outside of the system (s)he regulates.)
What would be of interest here are the myriads of forms of planning and organization that have been tried either in ‘the public sector’, ‘the private sector’, or at their intersection. For instance, Mariana Mazzucato praises NASA because in putting men on the moon it “was able to combine centralized planning and control with decentralized project execution”. It is obviously – from the standpoint of systemist philosophy – irrelevant for the evaluation of an organization whether it is somehow associated with “the Government” or is a private corporation, because this does not say anything about its internal structure. Mazzucato claims the obvious when she has to tell the reader:
It’s somewhat disappointing that we virtually find nothing about this when we look into the scattered literature that is explicitly about planning, although all the rest is about it. Your textbook of ‘economics’ will not feature the word planning (and contain only nonsense about production and firms), but every book on business administration, supply chain management, production, ‘systems design’, anything that has to do with running a social system, does not only explicitly contain that dirty word but different chapters on planning different aspects of the overall operation. A well-functioning corporation or administration is well-planned.
Accordingly, because there are more trees than forests, what we perhaps also don’t know is how within overall society different types of planning interact or might interact, how they could be coordinated.
What is usually not part of the category of ‚macro‘-economic planning or anything else is the case in which ‘the Government’ (or any conceivable non-market organization) provisions the population with some good or service by producing it itself, say public transport, healthcare, basic science, or what is at times referred to as Universal Basic Services, or the (dis-)service that is the military. This is, trivially, no ‚central planning‘, but planning an organization for some purpose.
Mariana Mazzucato has shown that no major technological innovation has ever been the result of “the Market” alone, because only a tiny fraction of basic research has potential for technological use and is therefore an opportunity only for a private investment that is almost guaranteed to fail. (Which is a well-known thesis in the philosophy of technology, by the way.) But it cannot be a failed financial investment for an entity that can create money endlessly, namely the State. Here it is meaningless to talk of financial risks. Any such ‚investment‘ can waste material resources and human time, but no money.
The proposal of a Job Guarantee of Modern Monetary Theory is also, although it doesn’t quite fit into this box, effectively the proposal of a de-centrally planned secondary economy, organized to satisfy ‘community needs’, not to make money, and imagined to employ tens of millions of people in a country such as the USA. Actually, it is a tertiary economy in addition to the market and regular, organizationally planned state services.
About China we read that “(t)raditional planning” has been abandoned, but “the state owns or controls the majority of the large firms; owns all the land; owns and controls the education system; and uses regulatory, monetary and fiscal policy to steer the economy.” So, it is just another hybrid as any other modern economy, politically more openly authoritarian.
Finally, we get to central planning, the broadest form of prescribed surgery and constant monitoring of the health of the overall socio-cultural-economic system.
Part 5: Comprehensive Economic Planning (aka Planned Economies)
The main idea behind comprehensive economic planning is, of course, that the anarchy of the market is substituted for by explicit planning of the allocation of (close to all) resources, including human lifetime:
Planning “substitutes the conscious, planned coordination of decisions ex ante for the blind, anarchic coordination of the market mechanism ex post, operating through the changing reactions of atomistic decision-makers to continuously changing market prices. In a sense this is the essence of economic planning and constitutes the fundamental difference between a planned and an unplanned economy.”
The structure between the economic entities, their relations, is changed from non-planned buying and selling, nay, (partially) uncoordinated buying and selling to planned provision – in some way, for someone, with some set of aims. As the textbook economists would say: The questions of what, for whom (why), and how of production, eventually also the boundaries or limits of production, are in theory and practice answered differently.
In the end ‘the economy’ is a huge input-output-machine in which materials and energy are turned by sociotechnical systems (and ‘work’, remember What The Fuck Is Work?) into potentially useful stuff with waste (such as greenhouse gases) as a byproduct. If the allocation of humans, energy, materials, and machines does not happen according to the independent plans of the owners, managers and financiers of capitalist corporations, the practical problem is how it could be done instead, if it is at all possible.
This is hardly a trivial task.
In theory it is not necessarily ‘the Government’ or ‘the State’ that does the coordination centrally, but this was the historical choice of actually existing socialism, also because within the duopoly of modern political economy it is always primarily the State that can cut back, transform or fertilise its own creature and other side, the Market, which resulted in the historical failure of one type of planned economy, namely centrally planned command economies.
But this is only one form of comprehensive economic planning, which also had the burden of being tried in countries that had to develop an industrial economy in the first place.
Before we start, note that when I raise some question below these may express my current (mis)understanding more than they indicate holes in the designs.
One of the biggest assets of the pro-capitalist imagination is the failure of actually existing ‘centrally planned’ economies. It is worth reconsidering quickly if only to compare it with new proposals. It worked (or didn’t) very, very roughly as follows:
The Party and its high ranks concocted broad targets and priorities for a plan period, for example how much societal effort was to go into expanding productive capacities or private consumption. This rough ‘vision’ was given to the planning board(s) in order to come up with ‘strategic’ 5-year-plans and explicit but provisional ‘operational plans’ and output targets for a year, given their knowledge about economic capacity. These targets were then handed over to the production units, so that these could estimate the inputs they needed to reach that target. Of course, the long-term plans were broader, more aggregated, than specific production targets.
The inputs of one production unit are the outputs of other production units, so that the overall planning activity is to find a ‘material balance’ in the plan, that everyone’s potential output finds its required input, first of all in the plan and at the next stage in reality, where the planning bureaucracy and the allocation bureaucracy are two different social systems:
“Output plans must be backed by the allocation of inputs and, since most factories’ output consists of products which are inputs for other factories and sectors, ‘the plan’ becomes an interlocking multiplicity of instructions on production and allocation.”
This is, so to speak, the substitute for the ‘market equilibrium’. Given any single production target, the planner either has to adjust the availability of inputs across the whole web of supplies or the target has to be scaled down if this is impossible in practice – for millions of goods.
It is a form of command economy because the main direction of planning is top-down (not participatory in design, as we discussed before). The “centre” tells the rest of the system through many levels of bureaucratic organization what to do and assigns the resources to be able to do it, because otherwise there would be no material balance:
“Transfers of goods and services between enterprises are determined vertically, by superior levels in the hierarchy, not horizontally, through direct contact and agreement between the enterprises themselves. Each enterprise receives from above instructions detailing the total quantity of output it is to produce and the enterprises or other destinations to which that output is to go.”
That the top-down relations take the form of ‘instructions’ implies their authoritarian command-character. They are orders (more in the military sense).
The material plan is then shadowed by a monetary plan which has a purely administrative function, but – as capitalists would say – they don’t reveal any ‘information’ about whatever (‘relative scarcity’, ‘value’, ‘cost’ as supposedly revealed by the ‘price mechanism’). Prices are set by the ‘centre’ and the production units account for their exchanges not only in material terms but also in monetary terms. But to get access to stuff an allocation certificate was more important than money.
This is now at times claimed to have been one of the central flaws of central planning. Because of the immense complexity of the task and the scarcity of computing power, detailed plans could not be made, especially not in terms of the required material means and for all the products, where stuff, in effect every necessary screw, must be allocated beforehand in the plan, not just some monetary means to purchase them somewhere else.
According to Paul Cockshott, Soviet planners were in the 1950s able to make detailed plans for some 3000 products and “had some control” over 30000. In the 60s there were “several million distinct products involved in the whole Soviet economy”. (He argues that it would be possible to make such detailed plans for everything today. See the videos below.)
The sound of the tune the orchestra plays depends critically on the availability of the inputs in the right time at the right place. This year the citizen’s of world-capitalism experienced imbalances in supply chains and resultant shortages for the first time in a while, although on a small scale, on the level of corporations, it happens all the time and is therefore the object of planning and the reason to pay for consultants (planners), though it isn’t recognizable at the macroeconomic level. The mills just stand still for a while, everyone has a cigarette or two.
Actually existing socialism was characterized by recurrent or permanent shortages. Janos Kornai, who died this year, stated that socialism was usually supply-constrained, while capitalism is demand-constrained. For short: In actually existing socialism people had money but there was nothing to buy, whereas in actually existing capitalism many or even most people don’t have money while stuff is there in abundance.
In practice, however, the ‘command’ and top-down-planning form was never such. Also here, the planning worlds of the commanders needed to be shared with those who should execute the plan, who were required to provide information up the hierarchy about what one thought to be able (and willing) to produce in the year, or willing to report to the bureaucracy. What happened was “plan bargaining” about output targets and assigned inputs.
“In the traditional model, the plans were worked out by a process of planning and counterplanning, i.e. of administrative iteration. The centre issued control figures, the periphery received the control figures, and, on their basis, submitted plan suggestions to the centre. In the light of these suggestions the centre issued revised control figures. Having received them, the periphery submitted revised suggestions, and so on.”
When the reward for a production unit is based primarily on plan fulfilment – because otherwise the whole machine stops running – and not over-fulfilment, then there are good reasons to underreport productive capacity from the bottom to the top. It was a game of playing cats and mouse. The production units had an interest to underreport their target and to demand more resources than were needed, while the central planning bureaucracy knew this.
All the planning decisions happened within the ranks of the bureaucracy and were thoroughly authoritarian and undemocratic. Philipps and Rozworski discuss the negative effects the overall authoritarian (or worse) character of the system had on the bottom-up and top-down information flows, which may explain the failure of the system, perhaps more than that it was centrally planned.
In the end, the workers in actually existing socialism, state ownership of the means of production notwithstanding, were as much powerless employees as in capitalism, exploited for the societal aims of the bureaucracy, interested in earning money or purchasing power, not the product that is produced or the common good, which are as irrelevant as in capitalism. The result is often described as political apathy, similar to our (perhaps) ending neoliberal era.
This resulted in the long run in an overall perverse social system, with profound dysfunctions that, as we all know, was internally and externally ridiculed, although it was in the beginning highly successful, if winning over Nazism, rapid industrialization, technological advancement, and undemocratic economic ‘growth’ are valid criteria. It is now forgotten that it was the initial success of central planning that made neoliberals shit their pants in the post-war years.
Some main errors, besides political authoritarianism or open terror, were:
- Because the State guaranteed that the planned demand produced by the units it owned itself would find a buyer, and accordingly competition between independent economic players was erased (while workers had no say in production or society either), the producers didn’t need to have much interest in quality, so that huge amounts of junk were produced, i.e. products that expired before the date of delivery. The planned market was a sellers’ market and reigned by suppliers, while the demand side couldn’t escape but had to repair the junk and wait years for its delivery. Call this the planned obsolescence of command socialism.
- Because the feedback of consumers was insufficient within the rather inflexible planning-bureaucracy, what was ‘wanted’, ‘desired’ or ‘needed’ did neither reach the planners nor the producers. Overall, actually existing socialism is said to have ridiculed the idea of an economy that has the satisfaction of needs as its goal, not profit or abstract national ‘wealth’: “In capitalism the firms which make toothbrushes do so because it is profitable. In the Soviet model they are made because a planning office so decides.”
- Because of perverse incentives, e.g. measuring success or plan fulfilment by the amount of materials used, by reaching a prefigured target, or past performance, while the top-down process demotivated bottom-up innovation, waste was ensured and ambition and productivity forestalled.
- A huge waste of human lifetime occurred, due to long-term lack of productivity combined with full-employment fetishism and ridiculous worker-heroism, all summarized in the joke: “They fake paying us. We fake to be working.” This also has similarities with our times., where people, not machines, are cleaning cars in hyper-neoliberal and supposedly rich countries.
- An overall economy of scarcity resulted in secondary competition even among the production units – a black market – over resources outside of the planning scheme. While capitalism is demand constrained while leading to abstract abundance for those with cash, as stated above, actually existing socialism was supply constrained, monetary savings increased because there was nothing to buy. In the GDR you had to wait 15 to 20 years for a car. And here we find one of the foundational myths that economics textbooks situate in deep history realized in modern times: barter.
Robert Kurz wrote in his brutal 1991-critique from a radically left perspective that actually existing socialism promised to be a post-bourgeois society but turned out to be a pre-bourgeois society, a dinosaur-like fossil of the heroic past of capital (in the German, 19th century second Reich), only as a real-world social experience within overall ‘modernisation’ a hundred years too late. State socialism he claimed to be united with its capitalist step-sister by commodity production (of ‘value’) and the accumulation of abstract wealth, while bureaucratic central state-planning was the substitute for anarchic competition, but not of a totally different kind. (Today some call actually existing socialism “state capitalism”, a title also given to China.)
What is still interesting about this critique is that it poses the questions – in different terms – that others pose still today, what a real ‘democratic’ alternative would and actually could be, which would not manifest the “deep irrationalism of the commodity producing system” or top-down authoritarianism, whether in the neoliberal form of capitalist planning or the state capitalist form.
After making clear again that in their view the future of planning does certainly not simply lie in “taking over the machine” (as many reviewers had it), that “it is not simply a world that must be taken over but one that must be transformed”, Phillips and Rozworski summarize the program briefly:
Of course, you don’t have to look far to find out that there is no agreement on much or anything here even among self-styled socialists, where “socialism” can mean anything and nothing, either anything among the above types of planning, or anything from a local allotment-garden socialism to democratic world communism.
However this may be, the question of the allocation mechanism has to be answered by those who wish to move beyond some form of capitalist planning (social democratic, market socialism, or neoliberal plutocracy). Jan Groos writes:
“if the concept of planned economies is not to merely mean a more extensive role of the state within a social market economy, but fundamentally different types of political economy, substantial open questions need to be addressed”
There are a few idealized designs of planned economies. How would a ‘planned economy’ work here, where the explicit assumption is that there are no markets at all?
There are the above three and more basic problems:
- the technical problem of designing logistic mechanisms and production mechanisms of the allocation of resources that work within and between all the production units within the system (regionally, nationally, internationally, or even worldwide);
- the political problem of designing political mechanism of decision-making about production and consumption on different social levels (the individual ‘firm’, the neighbourhood, the city, region, etc.);
- the epistemic problem of designing cultural mechanisms that ensure that societal aims (values), methods of achieving them (‚plans‘, ‚technology‘), and problems generally are critically checked and rationally developed;
- the socio-cultural problem of designing values and visions that could be (or even are) shared by some human population, which the whole system (on a given level) is built to realize;
- the historical and humanistic problem of designing a society in which individuals and groups are free to invent new designs of their histories and the future of society and to experiment individually and socially within the boundaries of the status quo.
The idea of central planning is not dead, for the simple reason that Soviet central planning is not the only conceivable type. Michael Cockshott, a computer scientist, developed since 1993 (and before) a model of a centrally planned economy with features of direct democracy. We won’t deal with it here, but below you find a bunch of videos.
Democratic Economic Planning (aka Parecon)
In the proposal for a “participatory economy” by Robin Hahnel and his co-thinkers, such as long-time comrade Michael Albert, which is an economy that should get along without „the inefficiency and unfreedom of markets“, society would consist of “worker councils” and “neighbourhood consumer councils” and larger “federations” they built. They
Another system is called the Iteration Facilitation Board, which is said to perform a “perfunctory role” in the procedure. Although this economy is meant to be planned, its advocates don’t associate it with the label „socialism“.
That those systems get by without market exchange is philosophically as well as practically possible because everything that is needed to produce something is treated as a collective inheritance which is, and always remains, in “social ownership”. This includes machines as well as thoughts (technology, capitalist patents) and the “natural commons”.
The egalitarian worker councils (or, if you prefer, cooperatives) are the substitute for the hierarchical corporations of commodity production. They make use of the productive commons on behalf of all, but as self-managed units, which makes it different from Soviet top-down command planning. Every participant in such a council has the same say in anything that concerns the production unit as such, that is the overall production plan about the what, how, and who of production.
Every single household of whatever composition and size is a member in a neighbourhood consumer council. In these councils, “consumption requests” are submitted by individuals and households, debated what public goods are desired in the neighbourhood, and delegates elected for higher level federations, where social consumption is dealt with according to scale (e.g. public transport or a sports stadium within the city and its council, a nuclear power plant in the region or state).
To citizens of capitalism it sounds strange to “request” consumption because this implies that such a request can be denied by someone, which sounds anti-liberal at least to those who believe within democratic capitalism the miracle machine of ‘the Market’ distributes consumption allowances (or „purchasing power“) and production duties in an impersonal and just way.
The authors assure us, however:
“Consumers are free to consume whatever kinds and amounts of goods and services they prefer as long as their effort rating and/or allowance is sufficient to cover the overall cost to society of producing the goods and services they request.”
This way of framing the issue is a result of the envisioned character of overall democracy, which differs widely from what has been historically tried. Those “effort ratings”, for example, are established within the democratic production units, where everybody has, in theory, the same voice, and what someone earns depends in part on such a rating.
The idea, furthermore, is not that consumers have to specify detailed consumption plans for the whole year in advance: “Proposals for private consumption are just best estimations of what they think they will want based on choosing from a list of ‘coarse’ categories, such as shoes, bicycles, computers, etc.” But given that production shall be planned, there is an overall deliberation about the use of resources that starts with social neighbourhood consumption.
For instance, individuals in a neighbourhood would perhaps not individually request 10 trampolines for their private gardens if the neighbourhood decides to install two big ones on a playground nearby. Similarly, the envisioned production plans are not rigid but guides that can be adapted over the year, as in every ordinary corporation.
Most basically, within the overall comprehensive planning procedure worker councils request the allowance to make use of the productive commons while the consumption councils announce consumption requests. The idea is that a planning procedure is reiterated
How is this envisioned?
The basics are three steps (after long-term plans of investments in productive capacity have already been made):
- The Iteration Facilitation Board estimates “indicative prices”, that is, prices that indicate the “opportunity costs and social costs” of making use of the whole of the productive commons, including environmental damage. (History doesn’t start anew, so that the first point of reference is the past year.)
- Consumer councils respond with consumption proposals, the ‘outputs’ they wish to use, and worker councils and their federations respond with production proposals, the ‘outputs’ they want to provide as well as, of course, the ‘inputs’ of all kinds they need to be able to do this.
- The Iteration Facilitation Board then“adds up all the demands for and supplies of each final good, intermediate good, capital good, natural resource, and each category of labor and adjusts its estimate of the opportunity or social cost of the good – its ‘indicative price’ – up or down in proportion to the degree of its excess demand or supply.” (They say this may even be done by some algorithm.)
Different councils then decide whether autonomous proposals made by others about the uses of resources and time are legitimate uses of the productive commons and should be granted. This is one role the estimates of “social costs” play, what the facilitation board facilitates.
In a sense this is the reverse of central planning because first the production units plan their activity, then the societal planning procedure shall coordinate the different micro-plans. Bungeans may at this point be reminded of a claim in Social Science Under Debate:
The idea is that the overall plan is the outcome of deliberative democracy, where on different levels different units make ‘free’ decisions, enabled and constrained by different feedbacks. But all the production and consumption units don’t sit together in excessively huge meetings to decide how a certain screwdriver should be produced or used. Only within the councils there is direct democracy. The rest is decided by representatives at different levels.
Given that one of the basic aims and criteria for this idealized design is “efficiency”, the production units are supposed to supply society with at least as much “social benefit” as the “social costs” they cause elsewhere through the inputs they demand. Given that consumption rights are supposed to be granted based on individual effort in ‚work‘ (and additionally needs), actual consumption or individual benefit should mirror somehow that effort, the individual costs.
The philosophical, theoretical, and practical problem is that what ‘social benefit’ is provided cannot be ‘decided’ by or ‘found out’ on a market ex post, but has to be estimated beforehand. In this model, say, values (costs) and disvalues (benefits) find expression in a single number, the unit of account of economic calculation, which is said to express “relative valuations”.
“Production proposals from worker councils are evaluated by comparing the estimated social benefits of outputs to the estimated social cost of inputs. In any round of the planning procedure the social benefits of a production proposal are calculated simply by multiplying quantities of proposed outputs by their ‘indicative’ prices and summing, and social costs of production proposals are calculated by multiplying quantities of inputs requested by their ‘indicative’ prices and summing. If the social benefit to cost ratio of a production proposal exceeds one, SB/SC > 1, everyone else in the economy is presumably made better off by allowing the worker council to do what they have proposed.”
Worker councils are said to adjust their plans in the iterated planning rounds to achieve at least a balance of costs and benefits. If their costs are higher than the benefits they planned to produce, they have to produce more or something else. But if they fail, it is assumed that their plans are rejected, so that such a council is not allowed to use the productive commons, which is the case of non-capitalist bankruptcy in this type of economy. Everything else would be inefficient within the assumptions of the design. (For instance, producing something just because it satisfies the needs of some persons, although the aggregate ‘costs’ are higher than the aggregate ‘benefits’ of the people whose needs are satisfied, would be by default ruled out, ceteris paribus.)
Worker councils can emerge if people make a plan that is approved within the overall democratic planning procedure. The idea is that there is also no labour market, but people become workers by becoming a member of such a council that is sovereign in relation to its members. Because these ‘corporations’ are managed by their members, it is said that there are no employees.
What the ‘central’ board provides the individual production units with is information that is required to make informed, socially responsible plans and decisions. That’s the idea. The legitimate questions are not only if this would overall work, that this form of coordination without an overarching centrally calculated production plan would allocate the resources that are required and desired, but if such a ‘board’ could provide that (objective or intersubjective) ‘information’ about ‘costs’ and ‘benefits’ in the form of “prices – which are a product of the planning process itself, and not competition, power, or central imposition”.
As far as I understand it so far, the allocation of resources after the planning phase is organized horizontally between the workers’ councils.
Another proposal that features planning in its design is due to Daniel E. Saros, who criticizes the Hahnel-Albert approach in Hegel-Marxian terms because it “does not offer laws of motion that differ sharply from, and compete directly with, capitalist laws of motion” and “encourages us to strive for the realization of empty abstractions like justice and equity”.
However, the mechanisms of planning he proposes, the ‘laws of motion’, are also decentralized:
“The socialist system defined here may be interpreted as a collectively thought-out plan where the thinking and planning never cease. It is not a central plan but a decentralized form of planning that does away with markets and organizes production and distribution to satisfy human needs.”
His idealized design starts from the idea that within a future socialist society “wealth consists of an immense collection of use-values”, not, as Marx stated about capitalism, of commodities.
Remember that for Marx a commodity is not just any odd thing, as we tend to think today, but a (historical) type of social thing (or ‘form’) that only exists when independent producers produce for an anonymous market to make a monetary profit, so that the ‘use-value’ of what is produced is secondary or totally insignificant. What counts is the value/exchange-value that the commodity is imagined to have by all the parties involved. (Remember What The Fcuk Is Value?)
In Saros’ socialism “the legal right of private property is replaced with a legal right of guardianship” by workers’ councils and their members. As a consequence, even when those “guardians” in a sense ‘sell’ products, they don’t own them and don’t receive revenues for doing so. However, personal property of consumption goods remains (as in other models), so that those who buy products transfer them into their property and are free to prohibit the use by others who perhaps need them.
Saros proposes the central idea of a General Catalog, an electronic profile in which “each individual registers his or her needs using a unique profile of needs (i.e., a needs profile)” that is accessed electronically. The Catalog features “all existing use-values”, namely all “products” and services. Every individual ranks them in his or her needs profile according to individual priorities:
“In the socialist society described here, all needs are given equal weight across people in their needs profiles. Individual workers can choose to rank as top priorities the use-values that they deem most important to their standard of living.”
This means that when your highest ranked need is a coffee maker and mine is a pair of boots, then both are given the same weight (in terms of “points”) in the collective quasi-decision of what is produced.
The General Catalog includes detailed specifications for all the use-values. Saros lists the following five points:
- an estimated price for the item for the individual’s budgeting purposes;
- specific information about the product or service;
- a date range indicating when the item must be purchased to qualify for a bonus;
- a number of locations indicating where the item must be purchased in the future to qualify for a bonus; and
- information relating to where and how the product was produced so that individuals can avoid products and services produced under conditions of which they disapprove“
Registering the “needs” thus is not a purchase. But some time period of purchase is connected to every registered need and “use-value” in the profile.
“A worker uses his or her work income, as well as bonus income, to purchase use-values at retail outlets. The worker may spend this income however he or she prefers, but the worker is likely to strive to purchase those use-values for which he or she registered a need.”
The idea is that individuals plan for the future and receive a bonus in the form of “credits” if they stick to the plan: “credits are the means of payment for use-values within the socialist mode of production”, and they are received only for education, “useful work”, and for realizing once’s consumption plan according to the needs profile.
A second quasi-currency are “points”, which are used to allocate the supplies among workers’ councils based on the aggregated needs profiles.
Saros imagines another profile for each “worker” which contains “the worker’s entire work and education history” and is used for applications. “Employment agencies” are another type of social system which help people find work. After school, a “base income” is received by those who either join some educational institutions or “perform useful work”.
For short, to each according to their ‘work’, at least as long as the incentives of socialism have to work to change “human nature”. To encourage workers to remain in one position in a workers’ council where they supposedly are of more productive use, the base income is increased over the years and is reduced to the base level if the worker wishes to leave that position.
What determines which activities are legitimate are “social needs”, which “should be the ultimate determinant as to whether a person is to be compensated for a particular type of work”. This choice is reflected also in the prioritization of the possibility to purchase “household labor and child rearing services” over the remuneration of just doing such within the family, which is deemed to be problematic. This is a strong indication that this socialism would still be a labour society in the 21st century, and it is still required of everyone to sell his or her labour-time, although this is perhaps given a different name. (In comparison, Hahnel writes that it would be left to the political process whether or not the participatory economy would declare a basic income to be a right of everyone. Saros reserves the possibility of decoupling income from work for the communist stage that would come after his model socialism.)
But what is a social need? As far as I can see, this remains unclear. (Critics may wonder whether it’s the need of ’socialism‘ itself, i.e. of those who draft the idea.)
The Catalog functions as a planning tool and an incentive tool at the same time:
Because the needs registered only concern goods and services that can at the time be provided, the Catalog – similar to, say, a universal Amazon, as also one reviewer noted – is connected to the production units, the workers’ councils, which post the types of products they want to produce. Actually, although the system is not designed as a market, the Catalog contains all the ‘offers’ of the workers’ councils at a given time.
Saros is not always unambiguous about this, so that it also appears as if people could register any need whatsoever in the Catalog or even, on a par with cigarettes, “a need for clean air in their particular region”, which is also called a “product”. It is also suggested that people would be able to “also assign a low or high ranking to routes that they would prefer to take on roads that do not currently exist”, so that “decisions pertaining to city layout and urban development may be made on the basis of individual needs rather than by city bureaucrats”. Here the thesis seems to be that the Catalog can also make urban planning redundant (or support it).
Dependent on the aggregate registered “needs” for their product and their ranking across all the profiles, the production units are said to receives “points” they need to get (allocated) the inputs to produce and deliver that product, i.e. the aggregated registered needs determine what is produced via this point system that allocates inputs.
How do production units ‘order’ (or register) those inputs? The production units “select these input quantities from the Producers’ Section of the General Catalog. This section contains all the physical means of production with complete descriptions of their characteristics”.
What happens here, as far as I see, is that workers’ councils plan their operation purely internally. They plan the production process within their boundaries and – as Robin Hahnel criticizes – are assumed to choose an efficient sociotechnical production mechanism, an “ideal input mix”. The result is a prediction about the time the production unit needs to normally – i. e. given the totality of plans internal to the operation, and given the availability of inputs – to deliver a thing or service and the resources it requires. This time is then fed into the General Catalog to coordinate needs registrations by consumers with the time needed for use-value delivery, which is a planned harmonization of demand with supply, but in this case this is no fictional ‘demand’ as in economics, but explicitly expressed demand of the I’ll-buy-it-in-the-indicated-time-frame type.
What is needed to be supplied, the final output as well as the inputs, is, at least to the extent individuals and councils use the General Catalog, plannable in the sense of predictable. As far as I see, when workers’ councils produce intermediate goods, they also indicate precisely their necessary production time. (This is no triviality, given that in capitalism hardly anything is more important than the production plus delivery time.)
“One advantage that workers’ councils have over capitalist entrepreneurs is that their target production levels are known in advance as a result of the construction of needs profiles. Their decisions regarding employment, investment, and choice of technique are, therefore, made on a more solid basis.”
“The registration of needs provides clear and relatively certain information regarding the quantities and qualities of particular products and services that are desired in a particular geographic region. Any new product or service must be listed among the products and services listed in the General Catalog before resources are allocated to it.”
In the “input acquisition period” of all the workers’ councils, producers of end-products register their requirements, the suppliers receive “points” to register their inputs and so on, until we reach the suppliers of raw materials.
This may be an overinterpretation, but one trouble may be that such workers’ councils presuppose knowledge about their total supply chain the moment the mandatory purchasing period for end-consumers is indicated in the Catalog, which necessarily has to be connected to the production time, which is connected to the longest delivery time of an input. In the model of the “five phases of every socialist circulation process” it seems as if the inputs are only registered in the producer section of the Catalog afterwards, where councils then would find information they already presupposed in the first phase.
Anyway, Hahnel criticizes at this point more generally that in this “ideal input mix” Saros presupposes what is at issue in economic planning and in his design. He asks: On which basis do these councils decide about that ‚ideal input mix‘ (without, for instance, ‚indicative prices‘, as is the case in his design)? And he guesses that it is another planning agency that allocates material resources based on the point system within this design, because Saros doesn’t seem to say much explicitly. Another question here is how exactly the aggregate measure of needs/desires is ‘translated’ into the allocation, via ‚points‘, of, say, energy, hammers and leather to make shoes of some specific design.
According to Saros, the Catalog provides a huge advantage over central planning because it provides a feedback mechanism from the consumer side of the overall planning process.
In contrast to Hahnel and Albert’s parecon, here the idea is that consumers don’t merely choose coarse categories of products at the beginning of the year, but detailed products: “In fact, the more detail the better”. A difference also is that in Hahnel’s and Albert’s design consumption is planned for a year, while in Saros’ approach there are many phases of needs registration, production and purchase that overlap.
A special workers’ council is a “Council of Scientists”, which puts constraints on what can be overall produced. The scientists “determine the quantities of raw material in each region that can be sustainably extracted”. According to Jan Groos, in Saros’ approach the advice by such councils would lead to a democratic choice of limits, which “would then be expressed in a sum total of production points”. (We didn’t deal with it, but there is also ecological planning in parecon.)
Now, ideally, every input needed to deliver the final consumption outputs should be available in the “production and transport period”, and within the boundaries of sustainability, if Saros’ allocation via a point system works. Note that not all registered needs are fulfilled.
This includes necessarily the allocation of human labour at the level of qualification required.
This socialism is competitive because “competition for jobs is the best way to ensure that each person contributes according to his or her ability”, and, we may add, nothing less. The individual councils also compete over being ranked high and first of all over being chosen at all in the needs profiles, so that they must have an interest in the quality of their product (in contrast to centrally planned socialism).
As far as I see, if the products a council offers in the General Catalog are less and less needed, then the council faces the problem of getting allocated less and less resources, including labor, until its existence ends. And then people are required (and forced?) to become workers either by joining an existing council or by founding one, because otherwise they don’t receive an income.
Thus, it is at least doubtful that such a society really has established “freedom from the employer”, when the councils are effectively a type of employer in relation to those outside of it. (Remember Job Guarantee or Basic Income?) It is noteworthy that the central anthropological category in this philosophy is not a human, but a worker. (Perhaps the “empty abstractions like justice and equity” have entered here through the backdoor.)
Because “use-values” are purchased in retail stores there are prices, and credits are used to pay for them. Those prices, which are set by workers’ councils, however, have nothing to do with either the resources needed to produce them nor with some social ‘demand’:
“The only purpose of socialist pricing is to ensure the complete sale of the use-values during the mandatory purchase period, whether the sales are made to individuals who registered the need or otherwise. (…) If necessary, prices can be reduced to zero near the end of the purchase period to remove the items from the retail outlets. (…) The primary purpose of pricing then is to distribute use-values.”
The credits are not money because they are destroyed within a purchase and cannot be invested. They are similar to theatre tickets that can be used for various goods, but only once. People are said to be allowed to make purchases also without registering their need, but then they don’t qualify for bonuses in the form of credits.
What now? What for?
Planning the Future
Overkill, overload, complexity, ambiguity, uncertainty, ignorance: So, how shall we finish this thing after this short ride through an immensely complex and in the end necessarily confusing problematic?
John Locke once held that the task of philosophy is to get rid of the rubbish that lies in the way to knowledge. We can take it up again and state that the aim of real-world philosophy these days has to be to get rid of the rubbish that lies in the way of social change or the imagination of change.
The wait-and-see ideology of market fundamentalism is the opposite of politics, poisonous to democracy, a kidnapper of the societal imagination (as Walter Ötsch and Nina Horaczek argue in their fine new book), and in total anti-humanist to boot. Planning is neither the road to serfdom nor the master plan but the precondition of possibilities. There are only socio-political possibilities at all if there is a willingness to plan. Otherwise there are only ontic possibilities that are provided by the mute laws of nature.
Mariana Mazzucato currently often writes that all our crises require to do “things differently and find a common purpose”, although in her “mission” statement, which is about nothing but planning, she clearly (and cleverly) avoids the words “plan” and “planning”.
Within our sketch we can see that doing things differently can come in many different varieties and configurations. Things can be done differently on all the levels of society, wherever someone or some group engages in plan-making, plan-implementing, and plan-evaluation.
As Mario Bunge told us, it is not necessary that only capitalist corporations or state bureaucracies engage in planning and imagining:
“ [I]t is simply not true that we must choose between the so-called free market and the state: Given a modicum of civil liberties, we can invent, construct, and manage associations capable of exploiting nature in a sustainable fashion as well as distributing the earnings in a fair manner.”
What works and what not can only be found out in real-world experiments, which are often or normally not allowed to happen in ‘the free world’.
Planning cannot yield a master plan because plans can only be clearly stated if there is a clear problem they are supposed to solve, based on concrete knowledge about the circumstances. They can only be implemented effectively if the planning is done in (or for) a social system and executed within the reach of its influence, while the participants executing it and the subjects of the plans share some ideas and values.
Planning as such is neither good nor bad, but instrumentally good or bad plans can be used to achieve either (morally, socially) good or bad aims (given some standard of good and bad). Planning as such also is not freedom because there is inequality in the capacity to plan and to execute plans. However, taking part in social planning is necessary for social freedom and authentic democracy. The partial contradiction summarizes the social condition.
Accordingly, in a complex society (and the current predicament) the question is how the coordination of plans is itself planned, if it is possible at all, and if a systemic politics for systemic change or even a system change is wanted, not piecemeal tinkering.
Systemist philosophy suggests for decades that realistic problems that involve interconnected systems cannot be solved piecemeal, one screw at a time, for example the complex of climate breakdown, biodiversity collapse, and catastrophic socio-econ-political inequality. This is now more and more, again and again, stressed (outside of the mainstream, but even in mainstream media). And this is also a meta-problem of planning that occurs in every modestly complex social system, not only in society, so there will be knowledge around somewhere about this.
Within a Hollywoodish tone that expresses the urgency of our time, with the ghost of market fundamentalism in the background, you may call it a “mission”:
“Mission making begins not by asking the question ‘where is the market failure that needs fixing?’ but rather the question ‘what is the problem we want to solve?’ and then attempts to marshal economic resources across multiple sectors and coordinate diverse stakeholders around tackling this shared challenge.”
Basically, this is just politics, problem- and solution-oriented, plan-making politics. But missions end, while planning does not.
As we agreed upon the last time (What The Fcuk Is A Problem?), idealized designs and visions are necessary to learn, state and debate what is wanted. They also make clear where there is no agreement. Although the proposed designs of planned economies don’t solve concrete problems and tell us nothing about current societies (and are for sure debatable at many junctures), they certainly show that there is nothing to be tabooed, suggest that ‘planned economies’ (in the technical sense) are possible, that there are alternatives to capitalism, and furthermore, they make clear that the topic is, in the end, what a real democracy would be. There are many great ideas around, although only a few dozens or so of people have thought about such issues professionally in the last decades.
Phillips and Rozworski nail it, not by peaking at eutopian designs, but with a view on recent history:
“There is no machine that can simply be taken over, run by new operators but otherwise left unchanged; but there is a foundation of planning that a more just society could surely take up and make its own.”
The idealized designs also show that the imagination is in many ways (necessarily) bound by the societies we live in, and that on the way to a social revolution of “cooperatively rational resolving of conflicts and problems of Iiving” there would need to be an agreement on what is to be achieved. What is of ‘social interest’, a ‘social need’, or an overall good state of affairs is never just evident, accordingly also what a good plan is. What is to be achieved, and what is to be agreed upon, such designs in part or for the most part presuppose, necessarily due to their coarseness. For instance, they don’t explicitly ask what a “’real’ need” is, if there is something like that, and what the consequences of different answers are, which type of education to pursue, in part whether energy and environment play a special role, how to envision the role of technology, or leisure, which level of ‘economic activity’ is wanted (‘growth’), or what justice is, etc.
Mario Bunge told us some 20 years ago, rightly so: “sound economic planning is only a component of comprehensive social planning”. And that is even harder (whatever ‚economic planning‘ may mean in isolation).
Again, thinking about planning vindicates the thesis of the underground philosopher Nick Maxwell that academia, the media and education systems have in the 20th century, before, and until today, catastrophically failed in creating systems of rational and imaginative thinking (and dispute) about societal problems and solutions, which says much about democracy. One major reason certainly is that in “the age of deception” (Michael Hudson) planning has earned a bad name, which is among the most insane intellectual scandals of all times. If you don’t want to talk about planning, you can also forget to talk about problems and solutions.
Now, note this: If the direst of predictions or prophesies about the future of human civilization come true, this will have one root in a bad philosophy. And, if this is still possible, a major philosophical shift in overall culture is required to prevent it.
I suggest you now write the book The Case for Societal, Economic and Ecological Planning.
(c) Daniel Plenge