A MORE CRITICAL LOOK AT MARKET SOCIALISM

1. The role of the market in a planned socialist economy The capacity of any society to produce is finite. So too, is the demand for any one particular good. Some goods, e.g. water in a rainy country, can be produced to satisfy our needs with a minimal expenditure of labor. But by definition these goods account for only a small part of the value of a nation's output. The more valuable part is hard won by labor, our ultimate scarce resource. Technology may reduce the labor required for some things, or even abolish whole branches of the division of labor. But as fast as it does this it creates new trades and specialisms, and, by opening up new vistas of the possible, engenders new and more sophisticated tastes. By the standards of the nineteenth-century founders of the socialist movement, the workers of Eastern Europe in 1989 lived a life of plenty: Owen and Lassalle had never heard of CDs and personal computers. It is a fact, not of economics but of geology, that 1,300,000,000 Chi