In recent discussion on This Week @CPUSA, John Case and Dale Mathews discuss what a planned economy might look like. Tyler responds:

First I want to address the question that came up about planned and market economies. I take “planned economy” simply to mean that the means of production (factories, natural resources, labor, technology, etc.) are coordinated by the government in some way to produce or attempt to produce a planned result. Whereas a market economy is characterized by a more autonomous management of production that acts according to supply/demand and profit incentives.

This gets into a debate on whether you can have “market socialism,” or what I understand as a system where the means of production are owned and managed by the workers cooperatively, but still produce based on market demand and for profit.

From my understanding you cannot have socialism when production is based on the profit incentive. In a socialist economy, goods are produced according to demand based on use value and utility. If we take the auto industry as an example, under socialism there wouldn’t be incentive to have 50 different types of fancy million-dollar sports cars; rather you would produce different models of cars designed around utility that meet the demands of working-class people at an affordable price.

However, if we assume there are no longer capitalists in this “market socialist” system, then not enough people would have the money to purchase luxury cars in the first place; thus there would be no demand to produce them. So in some sense you may be able to get to a kind of socialism this way even with the profit incentive still in effect. But again this is an area of debate and I don’t claim to know all the answers. I would defer to someone who’s an expert on this issue of worker ownership and market socialism like Richard Wolff.

I think we should all concede that we live in an imperfect reality, and so socialist solutions will not be perfect or “pure.” In my opinion the socialist platform should be a combination of planning and state ownership of certain sectors of the means of production, and market socialism to fill in the gaps while also allowing for some degree of private ownership of small businesses. Two sectors of the economy which should be planned and state run are the military and pharmaceutical industries, because just based on principle I find it unethical to profit off warfare and health care.

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