Everyone has a plan ’till they get punched in the mouth.
– Mike Tyson
The following notes are the result of an informal reflection on scale, labor cooperation, and its general implications for socialist planning. A version of these notes was presented at the Left Forum 2011 at Pace University in New York City. It is a work in progress.
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For socialists, the general problem of planning is how to allocate society’s productive force of labor so that the freedom of individuals is maximized.
Socialists in the Marxist tradition view the expansion of the realm of freedom as concomitant with the collective appropriation of the premises, processes, and results of production. Said differently, the expansion of our freedom and powers as individuals requires that we collectively own and deliberately remake the conditions in which we produce and live.
And we do this under the circumstances that exist, with the resources at hand, always under hostile fire by the well-entrenched forces of the status quo. What makes these forces well entrenched is that they are not something always separate from us, something that we can mechanically suppress. Often times, they are rooted in the conditions that we inherit, reproduced in our day-to-day practices, and even latent in our unconscious thoughts. Our task is more like the proverbial Sisyphean torture as these hostile forces spring back to life for as long as the social conditions that foster them persist.
Alec Nove (1983/1991), a sharp observer of the Soviet proto-socialist experiment, after decades of study, reached the conclusion that one of the main “curses” that doomed Soviet planning to failure was the massive scale of the tasks the planners had to undertake. In the Soviet Union, scale — Nove noted — overwhelmed the resources of the associated producers.
It is difficult to sort out exactly what was forced upon the Soviets as they strived for mere survival and what was in fact a more relaxed choice. But even taking into consideration the extremely adverse historical conditions under which the Soviets existed, it is likely that at times such choices were skewed in the direction of overreaching. (As I will argue below, Lenin was less prone to this than many of his comrades.) Perhaps, as Nove also noted, this resulted from a certain underestimation of the complexities and difficulties inherent to any large-scale organization (in contrast to large scale social organisms, like capitalism, that just evolve and function spontaneously, even if they are not socially efficient, i.e. conducive to the development of human freedom and powers).
That scale in production, management, control, and ownership became a “curse” of socialist building is a bit ironic, because — in the Marxist tradition — the argument for socialism was based precisely on the notion that scale, i.e. the size of the productive apparatus and the complexity that goes along with it, doomed capitalism to failure. To be more specific, capitalism began historically by gathering direct producers that until then had been producing separately and independently, bringing them together and thus making it possible for them to produce in increasing combination and cooperation. With that simple step, capitalism moved the producers towards tighter interdependence in space, time, and circumstance. And that was only the beginning. Capital — seized by its inherent drive towards self expansion — pushed itself to continuously and thoroughly revolutionize the conditions of production.
The impulse of these revolutions came from large-scale combined or cooperative labor, making larger and larger masses of workers work in unison, fragmenting the processes of production into minute tasks, fomenting the specialization and refinement of productive inputs (labor power and means of production), and then — one way or another — reassembling all these fragmented pieces into a whole. This all led to an extraordinary expansion in the amount of wealth produced.
These extraordinary productive powers, again, ultimately the result of socialized labor at an increasingly larger scale, clashed constantly with the capitalist social structure: private ownership and the conditions of social inequality that force the working majority to wage slavery. Within a given productive unit or under the purview of an individual capital, the integration of the fragmented pieces of a given process of production, the allocation of the productive force of labor was planned ex ante. But, at the level of society as a whole, the pieces of the fragmented labor were unified only through trial and error, via the blind coordination mechanism of the markets.
Economic turbulence, frequent industrial dislocations, periodic highly disruptive widespread crises, should have made it clear to everyone that the social structures of capitalism were a very wasteful way of managing our social life — they were dangerously destructive of the ultimate sources of all wealth, i.e. human beings and the natural environment. Capitalism had to be overthrown. Capitalism unleashed the forces of large-scale cooperative labor, but its foundations (markets and gaping social inequality) were not fit to manage these powers any longer. These productive powers were too much content for such a conflict-ridden, turbulent, limited social form.
The producers had to become aware of these facts and act accordingly, build their collective self confidence and organization through their struggles, of resistance at first and then proceeding to reclaim their productive wealth, to then reshape it, manage it, and operate it for their own democratically-determined collective ends. And, given the drive inherent to labor to conform the environment, natural and social, to human design, then it was clear that the tendency would be towards a society in which the free development of each one would be the premise for the free development of all.
That was — in brief — the classical argument for socialism. So, again, how did we go from scale being the “curse” of capitalism to scale being the “curse” of socialist planning?
What is the look and feel of these revolutions in the conditions of production? How, in general, can people produce more goods, i.e. more wealth? The general pattern of a revolution in the conditions of production is not exclusive to capitalism; it applies mutatis mutandis to a socialist society as it tries to remake the conditions of production, to make them more conducive to the overall development of human freedom and powers. The first thought that comes to mind is that, to produce more wealth, people need more productive forces. Aside from raw natural resources, people need the productive power of dead labor (what Marxists also call produced means of production) and of living labor (what Marxists call labor power proper). These are the basic inputs of production.
But, is it sufficient to juxtapose these productive inputs for production to happen? Not really. Also indispensable — as Marx (1867/1976, chapter 7) noted — is the existence of an idea, a purpose or design, an anticipated image of the final product, a blueprint that includes a list of the specific inputs required and an adequate description of how these inputs are to be combined to obtain the product. This idea (or whole set of ideas) is what economists today call technology.
In fact, as Marx emphasized, technology is inherent to human labor. Labor is the process that guides and regulates the process of transformation of the natural environment into wealth. Labor is subjective activity, the activity of the subject, a subject that — insofar as truly human — always starts with an idea or anticipation of the product and then problematizes the world accordingly; the producer’s problem being how to make the idea happen, how to produce the product, under the given or existing conditions. As the producer engages in transforming the world, the producer herself winds up transformed. So, again, the idea of the product — including the list of inputs and the description of the procedure to make the product (i.e. technology) — is inherent to human labor.
Now, back to the question: how do we produce more wealth? Clearly, we need to use either more inputs and the same technology or the same inputs and a better technology (or some combination thereof). But unless we have a lot of idle inputs lying around, using more inputs is not a sustainable option: the additional inputs required would have to be produced first. Instead, if we are serious about producing more wealth — in the case of socialism, if we want to produce more freedom, more development of our human capacities — and do so in a sustainable fashion, then we have to improve technology, come up with better ideas. In other words, to increase the output/input ratio, we need to increase the numerator, because the denominator has to be taken as given for the time being.
Let us consider how technology is improved using a very simple setting, without mathematical paraphernalia.
Consider four inputs to be used during an hour: two workers, an adequate physical space, and a heavy object placed at point A in that physical space. Consider also the good to be produced, existing first as an idea in the mind of one of the workers: the displacement of the heavy object from point A to point B in the same physical area. That idea includes the notion of pushing or lifting the heavy object across the physical space using human mechanical force. The “obvious” technological breakthrough here is to have the two workers, who are not far from each other, work together, in cooperation, coordinating their actions, going on each side of the object, lifting it, carrying it, and then placing it at B. Note that if the object is heavy enough, and each worker tries to move it individually, the intended good may not even be produced in the given hour. In that case output is zero. By cooperating, the scale of production can be increased from zero to one. If they do it in less than an hour, they will have the rest of the time to rest, think, etc. The heavy object can be displaced as intended, but — again — that requires that the workers cooperate. (Note also that the technological improvement, the notion of having the two workers lift the object in sync has to be produced, which requires that some of the productive force of the labor deployed be used to think that out. Perhaps one worker has the idea and then communicates it to the other worker, who has to actively receive it, learn it, make it hers to use it. Or perhaps the idea is jointly developed by the two workers in interaction and dialogue, by trial and error. That, of course, is leaving alone the fact that their mutual communication presupposes a lot of prior socialization, language, etc.)
Let’s examine this more carefully. What do we mean by these two workers “cooperating”? We mean first and foremost that the workers share the technology: they share the idea that the object is supposed to go from A to B, the idea of the inputs required, the idea of how to lift it, displace it, etc. They need to coordinate their actions, which requires that the worker with the idea communicate it to the other worker, and that they act in harmony, space-wise, time-wise, and detailed-specs-wise. Cooperating also means here that the workers share the physical space so that they can use the mechanical force of their bodies to move the object and the sound of their voices to communicate with each other at a short distance. So, aside from technology, there is at least one input of this production process that they share or use in common: the physical space. That is not all. The heavy object is also shared, used or manipulated in common by the workers. The workers have to position themselves at different ends of the object, etc., which means that they must share that object as well. In brief, the idea or technology has to be socialized, the physical space (the means of labor) has to be socialized, and the heavy object (the object of labor) has to be socialized as well. The entire process of producing the good (the displacement of the object) becomes a socialized process. The product is social.
Let us add to the scene another heavy object that also needs to be moved. If the distances are similar, then the workers can move both objects in about twice the time it takes them to move one of them. Say all that is doable within the hour allotted. They do one object first, and then the other one. That expands the scale of output. More good (object displacement) is produced per unit of physical space or per worker used. No new technology is required. Let us keep adding heavy objects to the scene. At a point, the workers’ ability to transport the objects will be overwhelmed. This is something that economists noted at least since Malthus and Ricardo. They call this phenomenon decreasing returns to an input; in this case, decreasing returns to the heavy objects added to the scene. After a point, each time an extra heavy object is added, the inputs that are not expanding (physical space and workers) will get crowded out and overwhelmed, so that the output will not keep pace with the inputs.
Let us keep the heavy objects fixed at four, and add two more workers. The output will expand compared to having two heavy objects and two workers. But then, if we keep adding workers, while we keep the physical space and the heavy objects fixed, the output will not expand. Heavy objects and physical space will be crowded out and overwhelmed. At this point, the output/input ratio will start to decrease.
Let’s add more workers and also more heavy objects. At a point, the physical area will be crowded out or overwhelmed. Our ability to expand labor cooperation requires that we expand the other inputs in accordance with certain proportions, or else, we’ll run into decreasing returns to the inputs we add.
Note that there may be flexibility to add certain inputs while keeping others fixed, but such flexibility is not absolute. Some proportionality, loose or strict, among the different inputs is required. If the output/input ratio is to be increased, then we have to be mindful of these proportions, even if they are somewhat flexible.
Suppose now that we have many heavy objects to move and extend the time allotted for heavy object moving, or expand its frequency. We repeat the heavy object displacement so much that then it starts to make sense for the workers, for some of them at least, to take some time off and think of better ways to displace more objects in lesser time. In other words, the workers must now allocate some of their labor, not to move heavy objects, but to produce ideas on how to better move heavy objects: to produce knowledge or technological improvement. The technological improvement may consist, for example, of introducing another input (a wheeled cart, a bucket brigade, or what have you), which would have to be produced or assembled first with the existing resources.
Note that for this technological improvement to become possible, the time allotted or the frequency have to be increased. Adam Smith noted that the extent of the division of labor was limited by the extent of the “market.” He said the “market” because he couldn’t conceive of a society beyond markets. But, we can translate that as meaning that the size of the social need (which in a market society is market demand, social need backed up by purchasing power) puts a limit to the ability of the producers to split their processes into minute tasks and then enable improvements on how to carry them out, gear some inputs to those specific tasks, etc. Clearly, the extent to which it makes sense for the workers to divert time to think on how to better displace the heavy objects depends on the amount of heavy objects that altogether need to be moved.
Let me emphasize another key fact here. The ability to produce more output with a given set of inputs hinges on being able to share (or use in common) at least one productive input. At the very least, technology is shared, even if no other input is. But let us consider first the sharing of at least another input. For example, if you have ample physical space and you can have several workers and heavy objects there, then you can move more heavy objects from one point to another in an hour. However, after a while of adding more of the other inputs, the shared input will be crowded out or overwhelmed. Depending on context, economists call this phenomenon saturation or depletion. So, if you want to keep the output/input ratio increasing, then you need to add more of that particular input — more of the input that is shared up to the point when it gets saturated or depleted.
Let me note here that physical inputs in general, such as physical space (distances, areas, or volumes) or objects that occupy physical space (e.g. heavy objects), are saturable a fortiori. Economists have a name for goods (in this case productive inputs) that can be shared, used or consumed in common simultaneously by many consumers (in this case, by many workers). They call these goods (or inputs) nonrivalrous. So, clearly physical inputs (e.g. space and heavy objects) are nonrivalrous to the extent many workers can share them, manipulate them, or use them productively. But the problem, of course, is that — no matter how large they may be — they are always finite and therefore saturable or depletable. In other words, at a point, they become rivalrous.
Are there productive inputs that are absolutely nonrivalrous, i.e. nonsaturable or nondepletable? No physical output has these characteristics. This “curse” afflicts all physical inputs, both physical and nonhuman productive inputs (e.g. land, machines, roads, tools) and physical and human productive inputs (e.g. human brains and bodies). There is only one productive input, if we can call it so, that is absolutely nonrivalrous, i.e. nonsaturable or nondepletable; that is technology. Ideas are truly nonrivalrous. A million workers can use the Pythagoras theorem at once and it will not be saturated, or suffer or tear. We may be able to generalize it or embed it in a broader cognitive framework, but that discrete piece of knowledge will remain nonrivarlous. In fact, anything that we can, nowadays, digitalize (however imperfectly its digitalization might be for particular ends is another matter) is absolutely nonrivalrous, i.e. nonsaturable or nondepletable.
That is good news. However, there are two serious limitations involved here. One, technology, ideas have to be produced. And to produce them we always need inputs that are physical and, therefore, rivalrous. Or, if these inputs are nonrivalrous, they are only partially nonrivalrous, because being physical, they are necessarily saturable or depletable. That is one issue. The second issue is that ideas can only exist in a physical medium of support. Ideas cannot just float in a Platonic world, uncontaminated by the physical world. Always, ideas exist embedded in physical media: human brains or nervous systems, air waves, electromagnetic spectrum, magnetic drives, ink and paper. In fact, if we think about it, the entire infrastructure of physical productive wealth, nonhuman and human, is a bunch of human ideas objectified. (The technology or the idea of a building exists also in the physical building once the building has been built, and — with some effort — smart humans can reverse-engineer the building and infer its technology by examining the prototype. The idea of a Renaissance human being exists in actual humans like Leonardo Da Vinci and — with some effort — we can try and reverse-engineer the combination of natural and social factors that made them possible. Of course, our ability to replicate a good like that is limited, so we may require a large amount of work to do so, but my point here is simply that we cannot rule that out as a possibility.)
The key point here is that ideas are always tied to a material or physical medium of support. The physical medium with the idea embedded is a product. Therefore, all human products (from food to housing to art to religion) are material, physical, objective in form while immaterial or ideal or subjective in content. There is no physical product, no matter how elementary and prosaic, that does not embody an idea. And there’s no idea, no matter how subtle or elevated that does not take a physical form.
This is a big issue, because the production of ideas, the storage of ideas, and then the retrieval and sharing of ideas (which is crucial to expand our output/input ratio), i.e. the communication of ideas, are all processes that a fortiori are subject to the laws of the physical world. The physical forms of these inputs are saturable or depletable, hence rivalrous at some point. Human bodies and brains are saturable productive inputs. With existing technologies and other goods and resources, there is so much one can do in 24 hours!
Let me insist here in the fact that the ideas themselves are not saturable. The idea content of our wealth is nonrivalrous. However, if we store ideas by keeping them in the nervous systems of human beings, then — at a point, if we want to expand the amount of ideas — we will need more human beings. If we store ideas by carving symbols in rocks, then we will need rocks, adequate physical space, chisels and hammers, and the people who do the carving — people who have finite, mortal physical bodies. If we use books, then aside from producing the ideas, we need physical space, facilities, printing presses, ink, trees, and people to make the books. On top of that, we need people with time and ability to read those books, etc. These inputs are all saturable or depletable. At a point, they become rivalrous. There is a bit of good news here though: we can produce better ideas on how to store, manipulate, share, and communicate ideas. With some effort, we can come up with better technology in the production, storage, manipulation, and communication of technology. The cost of all that will go down, but it will never vanish completely, because there will always be physical inputs involved, which are saturable and depletable, and hence rivalrous at some point.
This all may seem trivial to some, but it is not. This is of the essence to understand the problem of scale in building socialism.
Marx distinguished between the legal fiction of ownership and ownership as an effective economic phenomenon. Legally owning an object means that society has codified a law that says that the object is yours, that you are entitled to use it, consume it, give it away, or exchange it for another good — as constrained by the laws of nature, economic conditions (e.g. prices), political conditions (i.e. the balance of forces between contending classes and groups), the rest of the legal framework, ethical and aesthetical norms, etc. But then the law has to be enforced. In my review of David Laibman’s book, Deep History, I noted that political power is the alienated productive force of labor when deployed to set up, reinforce, or dismantle particular social structures. To enforce ownership laws, societies have to devote certain amounts of their productive forces to that end, productive forces that are thus diverted from producing wealth. Note that, in itself, the political use of labor power cannot produce any wealth; it can only redistribute (and use, consume, or waste) the wealth that has already been produced.
Economists have noted that, if a good is rivalrous, then it is not very costly to enforce its private ownership. They say that goods that are rivalrous are not too costly to exclude. On the other hand, if a good (or productive input) is nonrivalrous, then it can be, depending on technological and social conditions, extremely costly to exclude. We are all familiar with the difficulty that media companies (from Hollywood to music to publishing to art) are having excluding access to digitalized products on the Internet. The same problem afflicts “research and development” and any type of scientific production.
Now, the excludability of goods is not a physical property inherent to the good. Rivalry is a physical property of the good. If a good (or productive input) is physical, then it is (at some point) rivalrous. But excludability is a social relation — it corresponds to what Marxists would call economic or effective ownership (in contrast to legal ownership). And social relations such as excludability (effective private ownership, viewed in a continuum) can be overthrown or transcended by means of concerted and concentrated (e.g. political) action.
The problem then (for the economists, not for socialists) is when goods (including productive inputs) are nonexcludable, i.e. when the private owners cannot effectively exclude other people from using or consuming those goods without their consent, or when excluding them becomes too costly for them compared to the benefits they expect to receive from the good. A society cannot sustain private ownership if it becomes too costly for it to do so, if it has to divert too much productive force to protect or enforce private ownership. A society facing this conundrum has to find other forms of managing the provision and production of goods that are too costly to exclude.
Again, this is very close to the notion that Marx and Engels had of effective or economic ownership, as distinct from the “legal fiction” of ownership. As I have shown, expanding the productive force of labor is intimately related to the expansion of the scale of labor cooperation. In turn, the expansion of labor cooperation (and of output/input) requires the sharing (or common use or consumption) of productive inputs (and goods in general) by many producers (or consumers). Productive inputs (and goods in general) that can be shared are nonrivalrous. Ideas are absolutely shareable, as such, as ideas; hence, they are nonrivalrous. Thus, as a society develops its productive force, the role of ideas (technology) is its reproduction expands. Insofar as technology play an ever expanding role in the production and reproduction of our material lives, private ownership becomes increasingly costly to society. Greater and greater amounts of the productive power of our collective labor have to be diverted towards the nonproductive use of propping up the social institutions of private ownership.
This, of course, does not mean that socialism solves the issue of scale by default. The socialist planners (in the last analysis, the associated producers, the entire demos) are not above the physical laws of production involved here. Implementing the cooperation of labor at a larger and larger scale — and appropriating the premises, processes, and results of production entails doing so — requires that we keep certain proportions in place, proportions that may be dictated by the available productive forces. So, even if ideas play an increasing role in social production, given the fact that ideas have to be produced by physical inputs that at some point wind up being rivalrous and can only exist in a physical form, the ability of socialists to appropriate their productive wealth is also subject to these restrictions. In summary, socialist planners need to be mindful, on a case by case basis, of these limitations to the expansion of the scale of labor cooperation.
Said differently, in building each of the cellular social structures that constitute a socialist society, we have to be mindful of the advantages and disadvantages inherent to each particular process involved. Even if, by historical chance, political power were to fall on the laps of the associated producers, allowing them to decree themselves as the legal owners of all or most productive wealth, that could only be the beginning.
The associated producers would then have to go through the process of effectively appropriating the premises, processes, and results of production. They would have to remake such premises, processes, and outcomes so that they are geared to promote our freedom and overall human development. That remaking would require, necessarily, expanding the scale of labor cooperation. However, this expansion will be necessarily subject to the strictures discussed here.
I will end with a historical illustration. It is now common for some socialists to repudiate state capitalism as a vehicle to build socialism. Lenin was an adamant advocate of state capitalism as a necessary intermediate step in the long process of building socialism, at least in the conditions of Russia after the October 1917 ascension to power. He was also known for his insistence on quality even if at the expense of quantity: “better fewer but better,” was one of Lenin’s favorite mottos. In the light of the reflection I have shared with you here, it seems to me that he had the right instinct. The temptation of socialists to swallow more than they can chew should be resisted. To the extent the political conditions of the struggle permit it, socialists should try to first consolidate their advance in the areas that top their priority list. Then they can expand their reach, mindful that each step is subject to the limitations inherent to the growth of production in general.
Huato, Julio (2009), “Deep History and Capitalism,” Science & Society, 73:1.
Marx, Karl (1867/1976), Capital: A Critique of Political Economy, vol. I, with an Introduction by E. Mandel, London: Penguin Books.
Nove, Alec (1983/1991), The Economics of Feasible Socialism: Revisited, 2nd edition, London: Harper Collins Academic.