# Small business in a Marxist economy **URL:** \ **Category:** Great Debates\ **Created:** [March 15, 2014, 1:29am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737 "2014-03-15T01:29:49Z")\ **Posts on this page:** 17\ **Page:** 5
**Author:** ![Bryan\_Ekers](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bryan_ekers/32/183_2.png) [@Bryan\_Ekers](https://boards.straightdope.com/u/Bryan_Ekers)\ **Post date:** [March 17, 2014, 4:50pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/81 "2014-03-17T16:50:46Z")
Well, now you’ve got me wondering how much informational infrastructure is needed to make communism work, even partly. I was picturing massive computer resources dedicated to real-time analysis for just-in-time production, but if you had that, why would you need communism? ---
**Author:** ![Lumpy](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lumpy/32/446_2.png) [@Lumpy](https://boards.straightdope.com/u/Lumpy)\ **Post date:** [March 17, 2014, 4:52pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/82 "2014-03-17T16:52:09Z")
> [@Sam\_Stone](#): > > So somehow you need some authority to decide who gets a hammer and who doesn’t. But that decision requires knowing who really needs one and who doesn’t, and that knowledge isn’t available to him either. Even if every citizen is being a good little Marxist and only asks for a hammer if he thinks he really needs one, you still can’t allocate them efficiently because the citizens have no way of knowing if their need is greater than their neighbor’s need. What happened in practice was that the planning bureau gave first pick of the hammers to people who were building things that the planning bureau considered really important- such as the missile silo, or the undersecretary’s dacha. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [March 17, 2014, 5:15pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/83 "2014-03-17T17:15:24Z")
> [@Bryan\_Ekers](#): > > Well, now you’ve got me wondering how much informational infrastructure is needed to make communism work, even partly. I was picturing massive computer resources dedicated to real-time analysis for just-in-time production, but if you had that, why would you need communism? It’s impossible, because the required information _doesn’t exist_ until it is created as part of the market process. How do you know if your ‘need’ for a hammer is greater than your neighbor’s? Your hammer might be chipped, but his may be broken. Or maybe your hammers are in the same state of repair, but he is more productive with a hammer than you are, so the better one should go to him. But how do you determine that? And how do you make that determination when there are millions of people who ‘need’ hammers? How can you possibly sort that mess out? You don’t even know what your real need for a hammer is until you are forced to make the hard decision of determining how much you want to pay for it relative to all the other things you could buy with your money. It’s that decision-making process and the subsequent transaction that creates the information needed to allocate resources, and that information gets absorbed into the price system so that it’s available to everyone else. The beauty of the price system is that it forces you to choose between scarce resources - and your choices subtly affect supply and demand, which changes the math for everyone else. One of the beautiful things about money is that it is a pure abstraction that filters out all the unnecessary information and distills all the information about the relative supply and demand of a hammer down to one number that can be compared against the prices for all the other scarce goods you may need and want. Think about how cool that is - you don’t need to know why a hammer is $12. That price may be the result of a million negotiations between people interested in hammers and all the stuff that goes into making them. It takes into account the fire in a hammer factory, or the discovery of a new source of steel, or the collapse of a company that consumed a lot of hammers. It takes into account the relative rise and fall in demand for hammers as the economy moves to different modes of production, as industries that use hammers rise and fall according to changes in supply and demand. All of that is abstracted away into the price of the hammer, so that you get the essential knowledge of the market relevant to hammers when it comes time for you to decide if you need a hammer more than, say a screwdriver or a steak dinner. The system isn’t perfect. For example, it doesn’t take into account moral factors. A person with a need for a hammer for bashing in the skulls of his victims isn’t distinguished from the person who needs a hammer to make church pews. A rich person may have 20 hammers and never uses more than one, while a poor genius carpenter is plying his trade with an old chipped hammer. But as the old saying goes, it’s the worst system there is - except for all the other ones. For all its flaws, we’ve never come up with anything better, and for good reason. ---
**Author:** ![Bryan\_Ekers](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bryan_ekers/32/183_2.png) [@Bryan\_Ekers](https://boards.straightdope.com/u/Bryan_Ekers)\ **Post date:** [March 17, 2014, 5:27pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/84 "2014-03-17T17:27:03Z")
> [@Sam\_Stone](#): > > A person with a need for a hammer for bashing in the skulls of his victims isn’t distinguished from the person who needs a hammer to make church pews. Is it wrong that I reflexively said “what’s the difference?” to myself? ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [March 17, 2014, 5:34pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/85 "2014-03-17T17:34:55Z")
Well, most Communist states would be pretty tough on anyone building church pews. ---
**Author:** ![Frank\_Merton](https://avatars.discourse-cdn.com/v4/letter/f/b9e5f3/32.png) [@Frank\_Merton](https://boards.straightdope.com/u/Frank_Merton)\ **Post date:** [March 18, 2014, 7:03am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/86 "2014-03-18T07:03:08Z")
> [@Really\_Not\_All\_That\_Bright](#): > > Well, most Communist states would be pretty tough on anyone building church pews. Not so. You should actually visit one (other than N Korea – I don’t know about it). What Communist states don’t like is foreign missionaries, and if you saw the effects they can have you would know why. ---
**Author:** ![Sam\_Stone](https://avatars.discourse-cdn.com/v4/letter/s/ecccb3/32.png) [@Sam\_Stone](https://boards.straightdope.com/u/Sam_Stone)\ **Post date:** [March 18, 2014, 7:27am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/87 "2014-03-18T07:27:22Z")
> [@Bryan\_Ekers](#): > > Is it wrong that I reflexively said “what’s the difference?” to myself? (-: I knew I should have picked different examples! ---
**Author:** ![Human\_Action](https://avatars.discourse-cdn.com/v4/letter/h/ac91a4/32.png) [@Human\_Action](https://boards.straightdope.com/u/Human_Action)\ **Post date:** [March 18, 2014, 12:34pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/88 "2014-03-18T12:34:16Z")
> [@Frank\_Merton](#): > > Not so. You should actually visit one (other than N Korea – I don’t know about it). What Communist states don’t like is foreign missionaries, and if you saw the effects they can have you would know why. Very much so, at least in some cases. The Soviets harshly repressed the [Russian Orthodox Church](http://www.loc.gov/exhibits/archives/anti.html). The Khmer Rouge harshly repressed [Buddhist monks.](http://www.culturalsurvival.org/publications/cultural-survival-quarterly/cambodia/buddhism-and-revolution-cambodia) Albania outright banned [all religions.](http://www.georgefox.edu/academics/undergrad/departments/soc-swk/ree/Hiorth_Albania_articles_previous.pdf) These weren’t cases of excluding foreign missionaries, but rather the elimination of long-standing, and local, religious practices. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [March 18, 2014, 3:59pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/89 "2014-03-18T15:59:13Z")
> [@Frank\_Merton](#): > > The ASEAN countries (Vietnam, Laos, Cambodia, Thailand, Burma, Malaysia, Indonesia, Philippines, Singapore, Brunei and little East Timor) East Timor does not belong to Asean. It has formally applied to be the eleventh member but is not yet a member. Singapore and Laos were blocking membership on the grounds that the country was not developed enough, but last year the Asean secretary-general said all the members finally favored East Timor entering. However, it is not yet fully qualified. For example, it does not have an embassy in all the other member states, which is a requirement. They hope to join in 2015, but I think that’s overly optimistic. ---
**Author:** ![Horatio\_Hellpop](https://avatars.discourse-cdn.com/v4/letter/h/e5b9ba/32.png) [@Horatio\_Hellpop](https://boards.straightdope.com/u/Horatio_Hellpop)\ **Post date:** [March 19, 2014, 5:00am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/90 "2014-03-19T05:00:00Z")
> [@Really\_Not\_All\_That\_Bright](#): > > It’s possible that the Chinese you know don’t complain about being unable to go on religious or political rants because they’re… unable to go on religious or political rants. Just a thought. A ranter’s captive audience doesn’t meet everybody’s definition of “free.” See: Westboro Baptist Church. Different societies value different things. Many Americans at dinner parties are admonished to keep their religious and political views in check for the duration, albeit not by the state. ---
**Author:** ![Frank\_Merton](https://avatars.discourse-cdn.com/v4/letter/f/b9e5f3/32.png) [@Frank\_Merton](https://boards.straightdope.com/u/Frank_Merton)\ **Post date:** [March 19, 2014, 5:03am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/91 "2014-03-19T05:03:49Z")
> [@Siam\_Sam](#): > > East Timor does not belong to Asean. It has formally applied to be the eleventh member but is not yet a member. Singapore and Laos were blocking membership on the grounds that the country was not developed enough, but last year the Asean secretary-general said all the members finally favored East Timor entering. However, it is not yet fully qualified. For example, it does not have an embassy in all the other member states, which is a requirement. They hope to join in 2015, but I think that’s overly optimistic. That’s interesting; as far as travel there goes they might as well be. ---
**Author:** ![Frank\_Merton](https://avatars.discourse-cdn.com/v4/letter/f/b9e5f3/32.png) [@Frank\_Merton](https://boards.straightdope.com/u/Frank_Merton)\ **Post date:** [March 19, 2014, 5:10am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/92 "2014-03-19T05:10:13Z")
The Vietnamese police have broadly worded laws they can bring to bear in accordance with their judgment – things like “agitation,” or “acts tending to harm public morals.” The reality is that as long as one is not blatant, things get ignored. Gambling is an example; it is not allowed at all, but goes on intensively at all levels. Just don’t do it in the open. I think pretty much the only political act likely to bring the police is a public demonstration of some sort (the lesson of places like Egypt has been learned, but I really don’t see the sort of dissatisfaction that would lead to an Egypt like affair). Even demonstrations in favor of government policy are not allowed. ---
**Author:** ![Frank\_Merton](https://avatars.discourse-cdn.com/v4/letter/f/b9e5f3/32.png) [@Frank\_Merton](https://boards.straightdope.com/u/Frank_Merton)\ **Post date:** [March 19, 2014, 5:18am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/93 "2014-03-19T05:18:48Z")
> [@Human\_Action](#): > > Very much so, at least in some cases. The Soviets harshly repressed the [Russian Orthodox Church](http://www.loc.gov/exhibits/archives/anti.html). The Khmer Rouge harshly repressed [Buddhist monks.](http://www.culturalsurvival.org/publications/cultural-survival-quarterly/cambodia/buddhism-and-revolution-cambodia) Albania outright banned [all religions.](http://www.georgefox.edu/academics/undergrad/departments/soc-swk/ree/Hiorth_Albania_articles_previous.pdf) > > These weren’t cases of excluding foreign missionaries, but rather the elimination of long-standing, and local, religious practices. The situation regarding religion in Vietnam is I would say one of watchful tolerance. What is done inside a church or other religious establishment is pretty much free, but what is done elsewhere is not. Nowadays religious leaders are often also party members (I think the party is trying to de-ideologize itself and turn itself into a true meritocracy, but that is a personal guess). I will be curious what happens when the present RC archbishop passes (he is very old). Most Communists nowadays practice most of the old rituals, especially those about dead ancestors, without being criticized. ---
**Author:** ![ISiddiqui](https://avatars.discourse-cdn.com/v4/letter/i/97f17d/32.png) [@ISiddiqui](https://boards.straightdope.com/u/ISiddiqui)\ **Post date:** [March 19, 2014, 5:47am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/94 "2014-03-19T05:47:28Z")
The thing I find somewhat strange is all the descriptions here (aside from those of Vietnam or China) seem to imply that all Communism must be “command socialism” rather than “market socialism”. Even the USSR had market socialism at one point: > **[New Economic Policy](https://en.wikipedia.org/wiki/New_Economic_Policy)** > > The New Economic Policy (NEP) (Russian: новая экономическая политика (НЭП), romanized: novaya ekonomicheskaya politika) was an economic policy of the Soviet Union proposed by Vladimir Lenin in 1921 as a temporary expedient. Lenin characterized the NEP in 1922 as an economic system that would include "a free market and capitalism, both subject to state control", while socialized state enterprises would operate on "a profit basis". > The NEP represented a more market-oriented economic policy (deeme... > [@](#): > > The complete nationalization of industry, established during the period of War Communism, was partially revoked and a system of mixed economy was introduced, which allowed private individuals to own small enterprises,[1] while the state continued to control banks, foreign trade, and large industries.[2] In addition, the NEP abolished prodrazvyorstka (forced grain requisition)[1] and introduced prodnalog: a tax on farmers, payable in the form of raw agricultural product.[3] The Bolshevik régime adopted the NEP in the course of the 10th Congress of the All-Russian Communist Party (March 1921) and promulgated it by a decree on 21 March 1921 “On the Replacement of Prodrazvyorstka by Prodnalog”. Further decrees refined the policy. > > Other policies included the monetary reform (1922–1924) and the attraction of foreign capital. The NEP was revoked by Stalin after Lenin’s death (after Stalin gained control by joining with the pro-state capitalism [and pro-NEP] Communists against the complete control Communists, who were backing Trotsky). Of course, Stalin’s collectivization leading to brutal industrialization may have saved the county when the Germans came around again. However, the NEP is another model for a Communist economy. ---
**Author:** ![Frank\_Merton](https://avatars.discourse-cdn.com/v4/letter/f/b9e5f3/32.png) [@Frank\_Merton](https://boards.straightdope.com/u/Frank_Merton)\ **Post date:** [March 19, 2014, 6:18am UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/95 "2014-03-19T06:18:52Z")
I think the Chinese and Vietnamese economies are referred to as “command” economies because for the most part the appropriate economic ministries and officials have a great deal of leeway and what they decide tends to be final. Appeal to the courts is virtually unheard of. There is little for lawyers to do in That said, with such power comes a lot of unseen scrutiny by higher-ups and everyone has fixed terms of office. I would offhand guess that Vietnam is mostly market driven, except for certain businesses considered critical, and that list seems to steadily get shorter. ---
**Author:** ![Human\_Action](https://avatars.discourse-cdn.com/v4/letter/h/ac91a4/32.png) [@Human\_Action](https://boards.straightdope.com/u/Human_Action)\ **Post date:** [March 19, 2014, 12:16pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/96 "2014-03-19T12:16:00Z")
> [@Frank\_Merton](#): > > The situation regarding religion in Vietnam is I would say one of watchful tolerance. What is done inside a church or other religious establishment is pretty much free, but what is done elsewhere is not. > > Nowadays religious leaders are often also party members (I think the party is trying to de-ideologize itself and turn itself into a true meritocracy, but that is a personal guess). I will be curious what happens when the present RC archbishop passes (he is very old). > > Most Communists nowadays practice most of the old rituals, especially those about dead ancestors, without being criticized. That’s the situation in Vietnam (taking your word for it). It was not the situation in several Communist states. ---
**Author:** ![Siam\_Sam](https://avatars.discourse-cdn.com/v4/letter/s/d78d45/32.png) [@Siam\_Sam](https://boards.straightdope.com/u/Siam_Sam)\ **Post date:** [March 19, 2014, 4:17pm UTC](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737/97 "2014-03-19T16:17:14Z")
> [@Frank\_Merton](#): > > I think the Chinese and Vietnamese economies are referred to as “command” economies because for the most part the appropriate economic ministries and officials have a great deal of leeway and what they decide tends to be final. Appeal to the courts is virtually unheard of. There is little for lawyers to do in > > That said, with such power comes a lot of unseen scrutiny by higher-ups and everyone has fixed terms of office. > > I would offhand guess that Vietnam is mostly market driven, except for certain businesses considered critical, and that list seems to steadily get shorter. > [@Human\_Action](#): > > That’s the situation in Vietnam (taking your word for it). It was not the situation in several Communist states. I can tell you that Vietnam has the second-highest concentration of Catholics – 8-10% of the population – in Asia after the Philippines. The government started taking a more liberal line on religion in 1990, and the Catholic population is growing. There’s even a homegrown religion: [Cao Daism](http://en.wikipedia.org/wiki/Cao_dai). Their website is [here](http://www.caodai.org/web/content.aspx?pageID=1). [Previous page](https://boards.straightdope.com/t/small-business-in-a-marxist-economy/683737.md?page=4)