wages under socialism

[trivas7]

How are wages determined under socialism without a free market? Isn't it for this reason von Mises pronounces socialism as unworkable? I realize that under communism there is no need for wages. Thanks.

[Die Neue Zeit]

Actually, under socialism already there is no such thing as "wage-slavery." Per the Critique of the Gotha Programme, compensation is through the issuance of labour-time vouchers, not $$$ as we know it today.

[gla22]

some of us (mutualists) believe wages should be determined by a % of profits of whatever company or collective they are apart of. The shareholder is replaced by the worker and the profits are divied up among workers, either on top of a minimum wage or as a wage.

[trivas7]

Actually, under socialism already there is no such thing as "wage-slavery." Per the Critique of the Gotha Programme, compensation is through the issuance of labour-time vouchers, not $$$ as we know it today.

Do you know if labour-time vouchers are currently computationally feasible without a free market?

I would assume, e.g., that computation is used in planning the Cuban economy. But in this case von Mises would argue that Cuban planners must make use of world markets to plan just like the Soviet economists did, no?

[Kwisatz Haderach]

Do you know if labour-time vouchers are currently computationally feasible without a free market?
They were feasible for a system the size of the British economy with the computer technology available as of the early 1990s. See here (http://www.ecn.wfu.edu/~cottrell/socialism_book/).

It's reasonable to expect that they should be feasible for the entire world economy with the processing power we have today - and getting more feasible all the time.

To my knowledge, however, neither the Soviet nor the Cuban economies ever used information technology to any large extent in their planning decisions. Neither did they particularly use world prices - nearly all Soviet and Cuban trade pre-1990 was done within the CMEA, which was a trade bloc largely disconnected from the rest of the world and therefore operating at different prices.

[mikelepore]

As for labor time vouchers, I'm convinced that exactly what Marx said in Critique of the Gotha Programme is directly translatable into a set of "n equations in n unknowns" that a computer could easily solve. You select a consistent accouting period, such as the week, month or year. You add up all the labor time expended in every department of production. You carry the labor time of intermediate products over into larger assemblies that include them. You add all of society's production into one large inventory. From the total inventory you subtract out the labor time embodied in anything that's not going to be charged to individuals. You divide the remainder of the production inventory by the number of hours that the whole population worked, and that's an individual's hourly income. You divide the total number of hours that the whole population worked by the hours embodied in each product, and that's the price of the product, in units of work hours. This is very simple arithmetic. I'm skipping some details here, but in my past writings I have discussed how such calculations can be easily modified to provide for a policy, which I believe people will likely vote to adopt, that gives higher rates of incomes for the more strenuous or uncomfortable types of work.

[mikelepore]

How are wages determined under socialism without a free market? Isn't it for this reason von Mises pronounces socialism as unworkable?

No, as I interpret his writings, Mises' main claim is that product prices determined in a competitive environment are the only form of "information" that ever allows consumers to know what efficiency means at all. For example, how do the people who want to make a gravel road know that buying shale to pave it with is a better choice than buying diamonds to pave it with? They know that by comparing the prices. So prices inform the user of the most efficient choice. Then Mises just assumed that any and every form of socialism would either have no prices at all, or it would have prices selected arbitrarily by bureaucratic leaders in ivory towers, thereby destroying the "information" content. He concluded that this makes socialism unstable -- it cannot last if no one has any idea what's efficient and what isn't. If Mises were right in his assumption that socialism has to mean politicians making up product prices out of the clear blue sky, then his conclusion would be right, but his assumption is wrong, and therefore his conclusion, the instability of socialism, is also wrong. There are several forms of economic information available without using prices derived in a competitive market. For one, each industry could set the prices of goods according to the total labor time materialized in those goods. Secondly, there there is specification-based efficiency, knowing what is efficient based on what uses the minimum number of joules of energy, kilograms of tin, etc. Third, there is the inventory roll, where the makers of each product realize: the more of this item the consumers buy, the more of them we will have to make. Mises' claim that all of the significant information is communicated by a single one-dimensional measure, a price that fluctuates in a competitive marketplace, is simply false.

[Die Neue Zeit]

^^^ Comrade, maybe the Socialist Labor Party (DeLeonist) website should be modified to mention this labor-time voucher accounting you've mentioned. Comrade Hyacinth and I talked yesterday about how to account for capital asset depreciation using LT.

[mikelepore]

I was a member of the SLP (http://www.slp.org) during the years 1973-1980, and now I don't get any input into how they do anything. Their national office staff barely talks to me. I created deleonism.org (http://www.deleonism.org/), which contains some information about it (http://www.deleonism.org/v.htm). I view the labor voucher subject more strictly than the SLP does does. To them it's often expressed as a conjecture, a brainstorming exercise, "... not a blueprint". IMO, it should be precisely a blueprint, a necessary part of answering the old chestnut about "socialism is against human nature." I believe it's the way to solve the "incentive problem" and the "free-rider problem". It's the necessary way to be scientific by not offering any propositions about future human behavior that we can't prove. I find the most commonly expressed objection that the working class has to socialism is "I can't visualize how it could possibly work", and that calls for details of its operation, even if we are then to moderate those details by saying "here are some of the visions that some of us have, although some others don't share them."

By the way, "De Leonism" and "SLP" aren't synonyms because there are numerous De Leonist organizations produced by the SLP diaspora, such as Campaign for a Working Democracy (http://newunionparty.org/) and People for a New Society (http://peopleforanewsociety.org/) and Real Union of Social Science (http://socialismmarxdeleonforarealunion.org/) and The De Leonist Society of Canada (no web site).

[Die Neue Zeit]

Social Proletocracy, Marx, and Lenin's theoretical mistakes (http://www.revleft.com/vb/social-proletocracy-marx-t80882/index.html)