re: #540 lostlakehiker

Because the government doesn’t have enough information about what needs to be done.

The baker can judge, by sales of this or that type of cookie, which cookies need to be produced in greater number, and which, in lesser. The government has a satellite’s eye view of the economy. There aren’t enough bureaucrats to take care of every cookie decision, every leaky faucet, and so forth.

Socialist economies have tended to resolve this problem by setting quotas. But if a nail factory gets credited for nails by count, they’ll produce many small nails and no big ones. If it’s credited for kg’s of nails, it’ll produce big nails. This was exactly what happened in the Soviet Union.

Actually, that’s a flaw of authoritarian governments, of which there are capitalistic as well as socialist economic examples.

What a government calls itself (socialist or democratic) is propaganda and may have nothing to do with its actual operation.