A new economic system

[themediumdog]

I have written an economic system, basically along communist lines: http://angeleconomics.blogspot.com/.

I'd warmly appreciate comments, critiques, suggestions, improvements etc.

For quick ref:

- The starting point is "from each according..." etc. I fill in the details of a structure that is able to actually work around that.
- Key point of novelty is probably the use of natural units.
- There are other things around along these lines (I'm not claiming total novelty) but I think the comprehensiveness is worth a nod.
- The name is just a whim of mine. Forget it if you like.
- Its not a utopia, its a practical system (this is the intention, I should say).

Anyway, see what you think.

[Dimentio]

Interesting. I am wondering whether or not you plan to arrange production in the way that people should be voting at what should be produced?

[Hyacinth]

The use of natural units, i.e. calculation in-Natura or in kind, is hardly novel. It was proposed as a basis for socialist calculation as early as Neurath, and there were some attempts by the USSR to do the same via direct material accounting, none of which went very far. Not because of any inherant problem with calculation in kind, as some would claim, but simply because up until very recently we lacked sufficient data processing and gathering capability to handle the complex system of equations necessary for calculation in kind. As it stands today, I see no reason why a socialist economy would opt out for an alterantive system of accounting, either labour-credits or energy accounting, insofar as we have the technical means to do calculation in kind.

[Dimentio]

The use of natural units, i.e. calculation in-Natura or in kind, is hardly novel. It was proposed as a basis for socialist calculation as early as Neurath, and there were some attempts by the USSR to do the same via direct material accounting, none of which went very far. Not because of any inherant problem with calculation in kind, as some would claim, but simply because up until very recently we lacked sufficient data processing and gathering capability to handle the complex system of equations necessary for calculation in kind. As it stands today, I see no reason why a socialist economy would opt out for an alterantive system of accounting, either labour-credits or energy accounting, insofar as we have the technical means to do calculation in kind.

I am critical of the Venus Project partially because resource accounting seems to require quite much data. I think energy accounting is a much more easy and overseeable model for the public.

[Lynx]

There's a good amount of Pareconist theory (http://en.wikipedia.org/wiki/Parecon) as well :)

[Hyacinth]

I am critical of the Venus Project partially because resource accounting seems to require quite much data. I think energy accounting is a much more easy and overseeable model for the public.
See Cockshott, "Calculation in-Natura, from Neurath to Kantorovich (http://www.dcs.gla.ac.uk/%7Ewpc/reports/standalonearticle.pdf)":


When we do accounting in money, or in a surrogate like labour [or energy credits], then we add up the total cost of each column of the I/O matrix, giving us a vector of final output in money terms. A price system thus represents an enormous destruction of information. A matrix of technical coefficients is folded down to a vector, and in the process the real in-natura constraints on the economy are lost sight of. This destruction of information means that an economy that works only on the basis of the price vector must blunder aroundwith only themost approximate grasp of reality.
And:


[There are] mathemtaical proofs that there exist solutions to a system of calculation in kind, and then with practical algoritms to arrive at such solusions.

Yes, calculation in kind does require more data and is more complex than folding a matrix of technical coefficients into a vector, nevertheless, modern computing technology makes it a non-issue. We no longer really require surrogates to stand in for the value of resources in the planning process. Now, of course, this isn't to say that something like labour-credits wouldn't be useful on the distribution end, but it is an obsolete method when it comes to the planning of production.

[themediumdog]

Interesting. I am wondering whether or not you plan to arrange production in the way that people should be voting at what should be produced?

Yes, people vote. This is part of the process.

At different levels (in individual workplaces, locally, regionally, etc) what gets produced is decided democratically, by all those affected. The particular procedure (consensus, voting, etc) will be different in each case - whatever one is most suitable (e.g. consensus in small groups, voting in large ones).

There is also the system of information agencies which supply the data for consideration. So, the people voting know what they're doing.

[themediumdog]

The use of natural units, i.e. calculation in-Natura or in kind, is hardly novel. It was proposed as a basis for socialist calculation as early as Neurath, and there were some attempts by the USSR to do the same via direct material accounting, none of which went very far. Not because of any inherant problem with calculation in kind, as some would claim, but simply because up until very recently we lacked sufficient data processing and gathering capability to handle the complex system of equations necessary for calculation in kind. As it stands today, I see no reason why a socialist economy would opt out for an alterantive system of accounting, either labour-credits or energy accounting, insofar as we have the technical means to do calculation in kind.

Yes, Neurath was a key reference-point for me. (Some decent work by Cockshott and Cotterell (I believe you've just linked to one paper of theirs); an interesting article (http://home.flash.net/%7Ecomvoice/25cLaborHour.html) by Joseph Green of Communist Voice; and some comments of Engels etc were other references).

However there are a couple of points. First, Neurath's position is still rather stuck, I feel, in the top-down, planning-by-a-group-of-experts mode of thinking, common at the beginning of the last century. It was by no means obvious that in-natura accounting would translate into a distributed system (which is what I'm proposing, at least in part).

Second, Neurath's work is a little ad hoc. He is not proposing a self-consistent system, based around natural-unit accounting and the philosophical justification for this. But rather, as it were, taking an already-existing system and bolting on this method. As I'm sure you know, he was inspired by observing the methods used during the war.

[themediumdog]

There's a good amount of Pareconist theory (http://en.wikipedia.org/wiki/Parecon) as well :)

Yes, I found a great deal of inspiration in Parecon.

The main differences between Angel Economics and Parecon, are the use of natural units instead of prices, and the lack of any link between remuneration and work.

I feel the use of prices is wrong for a great number of reasons, philosophical, economic, information-theoretic, 'moral', etc. I also feel that Parecon's rewarding for 'effort and sacrifice' creates more problems than it solves.

There are a few other big differences, but these would be the central ones. I intend to write a detailed critique of Parecon (from a friendly point of view, since I think it is admirable) in the coming months.

[Hyacinth]

Yes, Neurath was a key reference-point for me. (Some decent work by Cockshott and Cotterell (I believe you've just linked to one paper of theirs); an interesting article (http://home.flash.net/%7Ecomvoice/25cLaborHour.html) by Joseph Green of Communist Voice; and some comments of Engels etc were other references).

However there are a couple of points. First, Neurath's position is still rather stuck, I feel, in the top-down, planning-by-a-group-of-experts mode of thinking, common at the beginning of the last century. It was by no means obvious that in-natura accounting would translate into a distributed system (which is what I'm proposing, at least in part).

Second, Neurath's work is a little ad hoc. He is not proposing a self-consistent system, based around natural-unit accounting and the philosophical justification for this. But rather, as it were, taking an already-existing system and bolting on this method. As I'm sure you know, he was inspired by observing the methods used during the war.
Indeed, do not get me wrong, I was not criticising, only pointing out that calculation in kind has long roots (ones which righly deserve to be recovered) in the socialist tradition. Which, due to (until recently) technical limitations were eschewed by socialists in favor of some sort of market socialism or planning via labour-credits. Prima facie, I'm rather fond (sans the name) of your proposal, I look forward to looking over it in greater detail. Though, the novely in what you've sketched out isn't so much in coming up with any specifically new ideas, but rather taking the already existing good ideas and combining them; which is far from a fault, quite the contrary actually, as the old joke about the feedback given by a professor on a student's paper goes: "Your paper was both good and original, unfortunately the part that was good wasn't original, and the part that was original wasn't good," so originality is not always a virtue.

[themediumdog]

Hyacinth wrote:


A price system thus represents an enormous destruction of information. A matrix of technical coefficients is folded down to a vector, and in the process the real in-natura constraints on the economy are lost sight of. This destruction of information means that an economy that works only on the basis of the price vector must blunder aroundwith only themost approximate grasp of reality.

Yes, this is one central motivation for the use of natural accounting instead of prices (there are others). Prices are 'one-dimensional', in contrast with an array of natural-unit data (I'm not using the word "dimension" in a technical sense here, though one could). It is rather like trying to get a grip on an object using only a measure of its weight, as compared to the whole panoply of sensual and conceptual information that we humans have evolved.

As a side-note, I would point out that an economy can't just be reduced to information-theoretic terms, however useful this is from one perspective. There are other considerations. I feel that Cockshott and Cottrell, in their enthusiasm, are apt to miss this a little. Thus for example, they are still, as far as I can tell, advocating planning by a small group of economists. Even if this were for the best in information-theoretic terms (which it is not), that wouldn't automatically recommend it.

There are moral considerations (having to do with control); and the thought that people will flourish from having an eye to economic organization.

But even speaking purely information-theoretically, C&C do not argue convincingly that you can reduce the info specific to a person's time and place, to data that can then be processed (i.e. 'know-how' into arithmetic data).

[Hyacinth]

As a side-note, I would point out that an economy can't just be reduced to information-theoretic terms, however useful this is from one perspective. There are other considerations. I feel that Cockshott and Cottrell, in their enthusiasm, are apt to miss this a little. Thus for example, they are still, as far as I can tell, advocating planning by a small group of economists. Even if this were for the best in information-theoretic terms (which it is not), that wouldn't automatically recommend it.
Personally I'm much more enthusiastic about open-planning in combination with the use of cybernetic mechanisms for the self-regulation of the economy along the lines of Project Cybersyn (http://en.wikipedia.org/wiki/Project_Cybersyn). These two mechanisms combined, alongside democratic oversight, would make unnecessary, or at least significantly reduce, the dependence on technical experts for economic planning. We could, in effect, make the entire planning process almost automated, in the sense that production, distribution, and consumption data would be gathered, and, with sufficiently advanced algorithms, the system would be able to coordinate the entirely of economy activity without recourse to a class of coordinators or administrative hierarchy. It would be the replacement of "the government [over] persons [...] by the administration of things."

[Dimentio]

Yes, people vote. This is part of the process.

At different levels (in individual workplaces, locally, regionally, etc) what gets produced is decided democratically, by all those affected. The particular procedure (consensus, voting, etc) will be different in each case - whatever one is most suitable (e.g. consensus in small groups, voting in large ones).

There is also the system of information agencies which supply the data for consideration. So, the people voting know what they're doing.

If the community decides to only produce vegetables which I dislike, does it mean that no other option should be available? Is'nt it easier to simply leave the decision to each individual?

I will also make a short argument for defending energy accounting. It is not so that energy accounting is made to shroud the cost of products and services. It is rather made to make the cost readily available. Not all people will have the time or interest to look through what everything consists of in terms of resources. But the option would exist to dig deeper and look what the fractions of the cost are representing.

Resource accounting will force everyone to have knowledge not only about the resources, but the amount of them, their interrelations and the entire production chain. In a system with billions of products and services, that would be extremely time-consuming for the consumer, even with computer search engines. Energy accounting could be defined as reformed resource accounting.

[ckaihatsu]

We could, in effect, make the entire planning process almost automated, in the sense that production, distribution, and consumption data would be gathered, and, with sufficiently advanced algorithms, the system would be able to coordinate the entirely of economy activity without recourse to a class of coordinators or administrative hierarchy. It would be the replacement of "the government [over] persons [...] by the administration of things."


My own proposed blueprint for this can be read at my blog entry, in the header of this post.


Chris





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[themediumdog]

Personally I'm much more enthusiastic about open-planning in combination with the use of cybernetic mechanisms for the self-regulation of the economy along the lines of Project Cybersyn (http://en.wikipedia.org/wiki/Project_Cybersyn). These two mechanisms combined, alongside democratic oversight, would make unnecessary, or at least significantly reduce, the dependence on technical experts for economic planning. We could, in effect, make the entire planning process almost automated, in the sense that production, distribution, and consumption data would be gathered, and, with sufficiently advanced algorithms, the system would be able to coordinate the entirely of economy activity without recourse to a class of coordinators or administrative hierarchy. It would be the replacement of "the government [over] persons [...] by the administration of things."

Interesting. I had not heard of Project Cybersyn.

The combination you speak of - algorithmic control mechanisms + open planning + democratic oversight - is basically what Angel Economics is.

The couple of points I would make are:

1) Clearly, software has moved on since 1973. Obviously there is no such thing as a 'revolutionary' or a 'capitalist' algorithm so one would just employ the analytical, predictive and statistical techniques in use in large companies today, for any planning and modeling.

2) Wanting to make "the entire planning process almost automated" is not the right sentiment in my view.
Maybe it is just a matter of being clear what one is talking about. If it is a question of generating a prediction for the number of umbrellas to make in the coming year then fine - this is best left to a computer crunching on statistics. But its important to see that economic choices are real, 'moral' choices about what kind of world you want. Do you want to plough your resources (at the margin) into space-exploration or art? Do you want to devote this land to wild woods or mine it for its silver? Its a category mistake to think an algorithm can answer such questions. I don't think economic coordination is something that you can 'have done with'. Sometimes the impression is given that, you know, you get 'the economy' on autopilot so that you are then freed up to pursue higher things, the things you want to do. Again, I think this maybe comes about through telegraphing the meaning of "economic" so that its all pig-iron quotas and corn yields. No, its selecting a trajectory through the space of possibilities of our engagement with reality. And thats something you either choose consciously, or duck. A calculation won't generate an answer, at least, not with any system of formal reasoning currently available.

[Nothing Human Is Alien]

“We develop new principles for the world out of the world’s own principles. We do not say to the world: Cease your struggles, they are foolish; we will give you the true slogan of struggle. We merely show the world what it is really fighting for, and consciousness is something that it has to acquire, even if it does not want to.”

[ckaihatsu]

But its important to see that economic choices are real, 'moral' choices about what kind of world you want. Do you want to plough your resources (at the margin) into space-exploration or art? Do you want to devote this land to wild woods or mine it for its silver? Its a category mistake to think an algorithm can answer such questions. I don't think economic coordination is something that you can 'have done with'. Sometimes the impression is given that, you know, you get 'the economy' on autopilot so that you are then freed up to pursue higher things, the things you want to do. Again, I think this maybe comes about through telegraphing the meaning of "economic" so that its all pig-iron quotas and corn yields.





No, its selecting a trajectory through the space of possibilities of our engagement with reality. And thats something you either choose consciously, or duck. A calculation won't generate an answer, at least, not with any system of formal reasoning currently available.


This is a crucial (political) theme for *everyone* to understand, no matter *what* their political orientation. To me, this sentiment is at the crux of what it means to be a revolutionary -- ! Because while our modern age (post-Enlightenment) has provided more people with more access to the records of humanity, far too many wind up spending far too much time in the catacombs, to the detriment of the here-and-now and to the detriment of potential conscious planning for humanity's *future*.

What's the point, anyway, of being studious *at all* -- ? If it's for edutainment / entertainment, that's fine, but how much of that can any one person stand, really...? Isn't the *point* of being educated and intelligent is so that one is better equipped at dealing with the real world, *as it happens*, even helping to *carve a path* into a future domain so that it's *not* *left to chance*...? -- !

Anyone who's *less* than revolutionary is historically *backward*, by default -- you know the type -- they'd rather be well-read about something historical than knowledgeable about the current situation facing the world. Worse yet -- in a bitter irony -- they'll freely admit that both the system itself, and they in it, are powerless to change the world's trajectory for the better, and yet they still adhere to a politics of participation *within* the system (that's going nowhere).

I like to think that my revolutionary conviction *comes* from *default* -- that there's no possible way to be serious about politics *unless* one deals with the fact that the capitalist system is hazardous and wayward. Anything less is merely contributing to a farce, *at best*, and more commonly is lying to oneself and everyone around.

We *shouldn't* leave the business of the future to business, or to bourgeois governments -- it's entirely within our responsibility to *be* revolutionary-minded and to push and fight for programs to be enacted that make sense for human well-being....

[themediumdog]

If the community decides to only produce vegetables which I dislike, does it mean that no other option should be available? Is'nt it easier to simply leave the decision to each individual?

This isn't an issue. Things that people want, get produced; simple as that really. If (per-chance) you're the only kumquat-eater in a community of millions, then probably you get overlooked, just as today. But the means are available (unlike today) for you to make your own.


I will also make a short argument for defending energy accounting. It is not so that energy accounting is made to shroud the cost of products and services. It is rather made to make the cost readily available. Not all people will have the time or interest to look through what everything consists of in terms of resources. But the option would exist to dig deeper and look what the fractions of the cost are representing.

Resource accounting will force everyone to have knowledge not only about the resources, but the amount of them, their interrelations and the entire production chain. In a system with billions of products and services, that would be extremely time-consuming for the consumer, even with computer search engines. Energy accounting could be defined as reformed resource accounting.

Angel Economics doesn't require the kind of omniscience of the production chain by everyone that you imagine.

Have a look. You'll see that knowledge is distributed in a not-dissimilar fashion to today.

There is a part of the planning process which involves everyone having an 'overview' perspective on the entire economy - and this at different levels (local, regional, sectoral, world-wide). That doesn't mean everyone knowing what screws to put into the playground furniture in a small village in Burkena Faso. At higher levels, one works with more composite data-objects - again, just as today.

[Hyacinth]

I will also make a short argument for defending energy accounting. It is not so that energy accounting is made to shroud the cost of products and services. It is rather made to make the cost readily available. Not all people will have the time or interest to look through what everything consists of in terms of resources. But the option would exist to dig deeper and look what the fractions of the cost are representing.

Resource accounting will force everyone to have knowledge not only about the resources, but the amount of them, their interrelations and the entire production chain. In a system with billions of products and services, that would be extremely time-consuming for the consumer, even with computer search engines. Energy accounting could be defined as reformed resource accounting.
But the point is that contemporary, and future, computers make it unnecessary for people to be familiar with the details of the cost of production, at least once you have the models of the economy set up. And the number of products in a contemporary economy is in the order of tens of millions, not billions, though even with billions the complexity of the linear equations, if not something which we can practically compute today, we will be able to in the not-too-distant future given the advances in computing technology. But let us grant that using a currency as a proxy for value is simpler, in this case the best argument that can be given for the use of labour-credits or energy credits in the planning process is that it simplifies it during the transition stage to full planning in kind.

Resource accounting in no way increases the burden on consumers, since, as stated previously, it isn't proposed as a system for distribution. One can still employ labour-credits or energy credits as a means by which to distribute scarce products (insofar as labour and energy are both resources which will need to be taken into account, hence the information on them will be available, and they are generally not bad indicators). Furthermore, even this sort of currency or credit system could be dispensed for abundant goods. There is no need to limit consumption of those, one can merely monitor it to ensure that sufficient, but not excessive, quantities of it are produced (e.g., food would be an example of a product that we are technically capable of effective abundance of).

[Hyacinth]

2) Wanting to make "the entire planning process almost automated" is not the right sentiment in my view.
Maybe it is just a matter of being clear what one is talking about. If it is a question of generating a prediction for the number of umbrellas to make in the coming year then fine - this is best left to a computer crunching on statistics. But its important to see that economic choices are real, 'moral' choices about what kind of world you want. Do you want to plough your resources (at the margin) into space-exploration or art? Do you want to devote this land to wild woods or mine it for its silver? Its a category mistake to think an algorithm can answer such questions. I don't think economic coordination is something that you can 'have done with'. Sometimes the impression is given that, you know, you get 'the economy' on autopilot so that you are then freed up to pursue higher things, the things you want to do. Again, I think this maybe comes about through telegraphing the meaning of "economic" so that its all pig-iron quotas and corn yields. No, its selecting a trajectory through the space of possibilities of our engagement with reality. And thats something you either choose consciously, or duck. A calculation won't generate an answer, at least, not with any system of formal reasoning currently available.
I think our disagreement is merely verbal, and not substantive, insofar as I agree with what you say here. I was using the term 'economic' in a more restricted sense. What we want, and what we decide, to produce is indeed something that cannot be determined by any algorithm, however advanced (well, at least sans the invention of a sufficiently advanced AI that could actually predict what our preferences are and would be, but we'll ignore these science fiction scenarios for the time being). What the planning algorithms can do for us is, given a set of preferences, and given available resources, it can determine the most effective way that said preferences can be achieved, and if they can be achieved. What to product is still our decision, and it is often, as you correctly point out, a moral and political question, rather than a purely economic one. Do we want a space program? Do we want an extensive network of cultural centers? Etc. There are where consumer preferences and democratic decisions come into play in the planning process, to determine the outputs of planning.

[New Tet]

I have written an economic system, basically along communist lines: http://angeleconomics.blogspot.com/.

I'd warmly appreciate comments, critiques, suggestions, improvements etc. [...]

In our economic system today, most things are privately owned. Even central national institutions like railways, power stations, water treatment plants and hospitals, which everybody uses and therefore has a stake in, are owned by a small group of individuals, with nobody else having any say in what is done with them.

The question you attempt to answer with your essay is also asked here:
http://www.slp.org/what_is.htm

"Communism deprives no man of the power to appropriate the products of
society; all that it does is to deprive him of the power to subjugate
the labor of others by means of such appropriations."

--K.Marx & F.Engels

[themediumdog]

...What we want, and what we decide, to produce is indeed something that cannot be determined by any algorithm, however advanced... What the planning algorithms can do for us is, given a set of preferences, and given available resources, it can determine the most effective way that said preferences can be achieved, and if they can be achieved.

Yes, that sounds about right to me.

[ckaihatsu]

...What we want, and what we decide, to produce is indeed something that cannot be determined by any algorithm, however advanced... What the planning algorithms can do for us is, given a set of preferences, and given available resources, it can determine the most effective way that said preferences can be achieved, and if they can be achieved.


Agreed.

[Dimentio]

But the point is that contemporary, and future, computers make it unnecessary for people to be familiar with the details of the cost of production, at least once you have the models of the economy set up. And the number of products in a contemporary economy is in the order of tens of millions, not billions, though even with billions the complexity of the linear equations, if not something which we can practically compute today, we will be able to in the not-too-distant future given the advances in computing technology. But let us grant that using a currency as a proxy for value is simpler, in this case the best argument that can be given for the use of labour-credits or energy credits in the planning process is that it simplifies it during the transition stage to full planning in kind.

Resource accounting in no way increases the burden on consumers, since, as stated previously, it isn't proposed as a system for distribution. One can still employ labour-credits or energy credits as a means by which to distribute scarce products (insofar as labour and energy are both resources which will need to be taken into account, hence the information on them will be available, and they are generally not bad indicators). Furthermore, even this sort of currency or credit system could be dispensed for abundant goods. There is no need to limit consumption of those, one can merely monitor it to ensure that sufficient, but not excessive, quantities of it are produced (e.g., food would be an example of a product that we are technically capable of effective abundance of).

The problem there is hoarding. We should try to avoid bottlenecks, and EA gives each individual an equal access to the means of production. But I think that in the far future, EA itself might be replaced by RA.

[Hyacinth]

The problem there is hoarding. We should try to avoid bottlenecks, and EA gives each individual an equal access to the means of production. But I think that in the far future, EA itself might be replaced by RA.
I'm not following, you'll have to elaborate.

But, if you're referring to the issue of hording of some sort of credits, then, as I said, this has nothing to do with planning in kind, insofar as, as stated previously, it is not intended as a mechanism for determining distribution, only production. Distribution could still take place using some non-transferable, and possibly expirable, credit system (be it labour or energy or whatever), hence, given the non-transferable nature of said credits, there will not be any issue of the accumulation of credits.

What you haven't made the case for is that energy accounting would be a better system than planning in kind for the purposes of planning an economy.

[Hyacinth]

As well, given the viability of planning in kind in the not-too-distant future (a decade or two, given the advances in computing technology), if not today, you can't get away with saying that planning in kind might replace energy accounting "in the far future". If it is superior to energy accounting, or labour accounting, or markets, and if it is viable at present or shortly what reason have we to adopt the inferior methods?

[Dimentio]

I'm not following, you'll have to elaborate.

But, if you're referring to the issue of hording of some sort of credits, then, as I said, this has nothing to do with planning in kind, insofar as, as stated previously, it is not intended as a mechanism for determining distribution, only production. Distribution could still take place using some non-transferable, and possibly expirable, credit system (be it labour or energy or whatever), hence, given the non-transferable nature of said credits, there will not be any issue of the accumulation of credits.

What you haven't made the case for is that energy accounting would be a better system than planning in kind for the purposes of planning an economy.

No, rather hoarding of resources.

If we take a gift economy or an economy built on that everyone could walk into a depot and simply take what they want, we could get individuals or groups who are stockpiling products in order to create bottlenecks in which a black market could be created.

[Hyacinth]

If we take a gift economy or an economy built on that everyone could walk into a depot and simply take what they want, we could get individuals or groups who are stockpiling products in order to create bottlenecks in which a black market could be created.
Setting aside the question of whether people would actually behave like this under a gift economy, and all the potential mechanisms that could be put in place to prevent this, who's talking about a gift economy? I'm certainly not, I mentioned it briefly that perhaps a gift economy should be instituted for a certain portion of products that are producible in abundance, but certainly not for the economy as a whole. For the remainder, if not for all products, we can institute something along the lines of labour-credits or energy credits to limit and keep track of consumption. Lastly, and again, none of this has anything to do with planning in kind vs. energy accounting as a system for the planning of production.

[Dimentio]

Setting aside the question of whether people would actually behave like this under a gift economy, and all the potential mechanisms that could be put in place to prevent this, who's talking about a gift economy? I'm certainly not, I mentioned it briefly that perhaps a gift economy should be instituted for a certain portion of products that are producible in abundance, but certainly not for the economy as a whole. For the remainder, if not for all products, we can institute something along the lines of labour-credits or energy credits to limit and keep track of consumption. Lastly, and again, none of this has anything to do with planning in kind vs. energy accounting as a system for the planning of production.

Energy accounting is actually more remniscent of non-capitalist market economics, as its not really a planned economy but a demand-driven economy.

[Hyacinth]

Energy accounting is actually more remniscent of non-capitalist market economics, as its not really a planned economy but a demand-driven economy.
Inasmuch as the point of any economic system is the satisfaction of wants, all economies are demand-driven. The question of what method of planning to adopt is the question of how best to satisfy our wants. Nowhere was it suggested that anything other than consumer preference and democratic decisions would determine the final outputs of the economy.

[Hyacinth]

As well, you fail to address the central question: why should we prefer a market socialist scheme, of whatever sort, when contemporary data processing and gathering technology makes it, on the production end, possible to solve the system of equations necessary for the planning of a modern economy, and, on the consumption end, makes it possible to keep track of, and anticipate, consumer preferences without recourse to market mechanisms?

[Dimentio]

As well, you fail to address the central question: why should we prefer a market socialist scheme, of whatever sort, when contemporary data processing and gathering technology makes it, on the production end, possible to solve the system of equations necessary for the planning of a modern economy, and, on the consumption end, makes it possible to keep track of, and anticipate, consumer preferences without recourse to market mechanisms?

I would claim that Energy Accounting solves the bridge between such kinds of systems. And what is Energy Accounting except the result of a system where all information is available on data undistorted?

[Hyacinth]

I would claim that Energy Accounting solves the bridge between such kinds of systems. And what is Energy Accounting except the result of a system where all information is available on data undistorted?
First you object to planning in kind because it "requires too much data", now you claim that energy accounting leaves "data undistorted", you can't have it both ways. If energy accounting is simpler, which it is, then, as stated previously, it [folding a matrix of technical coefficients (i.e. the input-output information for products) into a vector (e.g., energy or labour)] involves "enormous destruction of information". Hardly undistorted.

Furthermore, if by the claim that energy accounting "solves the bridge between such kinds of systems" you mean that some credit system can be employed as a means by which to gather data on consumer preferences, and to regulate consumption, sure. I never claimed otherwise, and, in multiple instances, made reference to the employment of credits precisely for this purpose. But there is nothing that makes energy credits especially advantageous over, say, labour credits for such purposes. As well, there is a world of difference between the use of credits for the aforementioned purpose, and the proposal to employ energy accounting in the planning of production, the latter which I understand proponents of technocracy to be committed to.

[Dimentio]

First you object to planning in kind because it "requires too much data", now you claim that energy accounting leaves "data undistorted", you can't have it both ways. If energy accounting is simpler, which it is, then, as stated previously, it [folding a matrix of technical coefficients (i.e. the input-output information for products) into a vector (e.g., energy or labour)] involves "enormous destruction of information". Hardly undistorted.

Furthermore, if by the claim that energy accounting "solves the bridge between such kinds of systems" you mean that some credit system can be employed as a means by which to gather data on consumer preferences, and to regulate consumption, sure. I never claimed otherwise, and, in multiple instances, made reference to the employment of credits precisely for this purpose. But there is nothing that makes energy credits especially advantageous over, say, labour credits for such purposes. As well, there is a world of difference between the use of credits for the aforementioned purpose, and the proposal to employ energy accounting in the planning of production, the latter which I understand proponents of technocracy to be committed to.

Energy credits are not credits per see. They are allocation units. They cannot be saved, accumulated, exchanged or be subject of inflation. Because they do not represent arbitrary values but the overall production costs of products and services.

[Hyacinth]

Energy credits are not credits per see. They are allocation units. They cannot be saved, accumulated, exchanged or be subject of inflation. Because they do not represent arbitrary values but the overall production costs of products and services.
Well, they are credits of some sort, insofar as they are intended to be representations of value that can be redeemed for a good or service. But, regardless, this is merely a semantic point.

That such credits "cannot be saved, accumulated, exchanged or be subject of inflation" has nothing to do with them being objective measures of production cost, insofar as one can employ an objective measure of value such as labour currency while permitting said currency to be accumulated, exchanged, etc., rather in establishing an economic system we would make the decision to make said credits non-transferable and expirable.

Lastly, while energy, insofar as, trivially, all production processes employ it, is an objective measure, it does not give us the overall cost of production of goods and services, except its overall energy cost. And while this information is certainly relevant, it isn't the only relevant information. There is no need to handicap ourselves by limiting our focus to only one aspect of production cost, and, at that, not even the most relevant one. Consider, for instance, that the directive to planners to minimize energy expenditures, which, under a system of energy accounting would make sense, might result in the adoption of labour-intensive production methods, insofar as the operation of a fully-automated production line consumes more energy than does the use of human labour power. But, plainly, this is an outcome no one wants. What we want to minimize is the use of labour, not energy. Especially so if we are capable of producing energy in relative abundance. In fact, under conditions of relative abundance, the use of energy accounting in the planning of production becomes pointless, insofar as we no longer need to economize on energy. In contrast, labour is something that we would always want to economize.

[ckaihatsu]

No, rather hoarding of resources.

If we take a gift economy or an economy built on that everyone could walk into a depot and simply take what they want, we could get individuals or groups who are stockpiling products in order to create bottlenecks in which a black market could be created.


This is a *horrible*, counter-revolutionary statement to make, from *anyone*'s mouth. You're basically asserting a reactionary value judgment on human nature as a whole, saying that people would naturally hoard in the presence of abundance.

The determining factor as to whether people have a hoarding impulse or not has to do with the relative stability of the society in question. A societal infrastructure that is not well-grounded, that people cannot be sure of the future of, is one in which private hoarding will be seen as preferable to working together on projects for the common good, for the distant future. An objective situation of scarcity will also tend to drive people towards hoarding since they can't be certain of future common availability.

The converse is when people feel satiated in the midst of plenty -- how much water can one possibly drink if one has easy access to it by merely turning on a faucet? And how much of a roof over one's head does a person need if one is present that does the job, in relation to the dwelling?

The same goes for anything else -- all hoarding in the present day is due to the dictate (and ideology) of the profit system, and not for any intrinsic human-animal behavior.





Energy credits are not credits per see. They are allocation units. They cannot be saved, accumulated, exchanged or be subject of inflation. Because they do not represent arbitrary values but the overall production costs of products and services.


I *would* ask for a provisional definition of an 'energy credit', except that I'm quite sure that you wouldn't be able to provide a definition anyway -- to define a standard unit of material input would require establishing a baseline of some sort which would necessarily have to factor in human labor of varying types, commonly consumed products of varying types, and variable amounts of energy and resource inputs, in a single attempt to find a common denominator among all of them, so as to provide a single, unwavering standard definition of a common material unit.

Considering the wide variation of material inputs that go into the production of some fancier, more complex finished goods -- especially varying by location of production -- I don't think we should look to trying to define a standard unit of *all-material* input.

Instead, it would be better to reduce the equation to the single variable of human labor time since that is what an economy -- and a revolutionary politics -- is based on, anyway. Animals *don't* produce a surplus -- only people do, and it is that human effort that is the ultimate basis of everything that has been built up in the world -- civilization, in short.

It would be better to attempt to quantify the range of human effort, on some sort of sliding scale of difficulty, divided by units of time, as a standard for *everything else material*, especially considering that all of the resources provided to us by nature, all over the world, really can't justifiably be "claimed" by anyone in particular since all of us just happened to find ourselves existing on this planet. So, in the course of socially planned production we can *attach* natural resources to the production process, and make note of it, but the fundamental input will always be human attention and labor.


Chris




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[Lynx]

Re. hoarding: Precautions should be taken against potentially malicious behavior. Where's the harm in that?

Btw, excellent thread :)

[cyu]

The determining factor as to whether people have a hoarding impulse or not has to do with the relative stability of the society in question. A societal infrastructure that is not well-grounded, that people cannot be sure of the future of, is one in which private hoarding will be seen as preferable to working together on projects for the common good, for the distant future. An objective situation of scarcity will also tend to drive people towards hoarding since they can't be certain of future common availability.

The converse is when people feel satiated in the midst of plenty -- how much water can one possibly drink if one has easy access to it by merely turning on a faucet? And how much of a roof over one's head does a person need if one is present that does the job, in relation to the dwelling?

A lot of excellent points.

I'd also add that another determining factor for the hoarding impulse is the amount of consumerist advertising that people are exposed to in that society.

In some societies, their entire mass media is funded by consumerist advertising - yes, you know the ones I'm talking about :D

[Technocrat]

Just thought I'd throw in my two cents.

Energy Accounting is a method of distribution only. It is almost completely unnecessary to do EA on the consumer side of things, it is more for the production/allocation side of things. The literature is confusing about this, but energy accounting is just a method to track how much of certain services are consumed so that production can be matched accordingly. For example, if x units of energy are consumed in food, then x units of energy would be allocated to food for the next production cycle. Since energy use is a direct measurement of activity, it becomes possible to precisely match consumption with production using EA.

On the production side of things, you would need to have some kind of resource accounting system that tracked everything (all resources), but this would be easy to do with modern technology. EA only takes the place of money in the role of distribution.

Just thought I'd clarify this - the literature on EA makes it seem like you would need to "stay within your limit" and worry about budgeting. In reality, with more energy units than you can consume, you wouldn't even have to worry about how many energy units you had. You would simply walk into the distribution center and take what you wanted, when you wanted. There would probably be some kind of system in place to notify you and/or someone in the Social Relations Unit if you were engaging in activity that brought you close to your energy limit, such as building a mountain out of shoes or something. The literature on EA also makes it seem like this would be the entire basis for operating production, which as I've pointed out, it would not be.

As far as differentiations in incomes between individuals - that becomes pretty pointless when everyone already has a share of production which is more than they can consume. Differentiations in incomes only make sense under scarcity conditions.

[Hyacinth]

Just thought I'd throw in my two cents.

Energy Accounting is a method of distribution only. It is almost completely unnecessary to do EA on the consumer side of things, it is more for the production/allocation side of things. The literature is confusing about this, but energy accounting is just a method to track how much of certain services are consumed so that production can be matched accordingly. For example, if x units of energy are consumed in food, then x units of energy would be allocated to food for the next production cycle. Since energy use is a direct measurement of activity, it becomes possible to precisely match consumption with production using EA.

On the production side of things, you would need to have some kind of resource accounting system that tracked everything (all resources), but this would be easy to do with modern technology. EA only takes the place of money in the role of distribution.

Just thought I'd clarify this - the literature on EA makes it seem like you would need to "stay within your limit" and worry about budgeting. In reality, with more energy units than you can consume, you wouldn't even have to worry about how many energy units you had. You would simply walk into the distribution center and take what you wanted, when you wanted. There would probably be some kind of system in place to notify you and/or someone in the Social Relations Unit if you were engaging in activity that brought you close to your energy limit, such as building a mountain out of shoes or something. The literature on EA also makes it seem like this would be the entire basis for operating production, which as I've pointed out, it would not be.

As far as differentiations in incomes between individuals - that becomes pretty pointless when everyone already has a share of production which is more than they can consume. Differentiations in incomes only make sense under scarcity conditions.
Well put, this is a much more coherent and convincing defence of energy accounting than offered by those who try to argue for it as a system for planning of production.