Saturday, September 26, 2009

The Socialist Marketplace

While reading Khrushchev Remembers (translated by Strobe Talbott, Little, Brown, 1970) I came across a very illustrative anecdote. Khrushchev was in Yugoslavia, meeting with Tito to smooth over Soviet-Yugo relations, probably in 1963. He had a brief conversation with the Yugoslav dictator expressing Soviet envy of the comparatively lucrative Yugoslav tourist industry.
One issue that Khrushchev found pertinent was avoiding the national embarrassment that occurs when foreign tourists are swarmed by local youth wanting to buy the tourists’ clothes. Tito told Khrushchev that whenever the party-state apparatus noticed an emerging fashion trend they set up a factory to make the desired items themselves. Khrushchev thought the concept very interesting. Tito qualified his remark by noting that fashion trends can change capriciously… and that some thought is required to try to stay current with the likes and dislikes of the consumers.
How anal can you get? Somehow the government has to be in charge of satisfying the public’s sumptuary desires. Dictators, planners… well, they’re all dictators.
In California we had a fairly recent experience with a governor who had serious socialist tendencies. Remember Gray Davis? Aptly named, he presided over the electrical crisis of 2000. Because of abjectly moronic public policy we had a shortage of electricity at the retail level. Rather than let market pricing sort out the consumers’ priorities, or stimulate increased supply… he imposed price controls and then ran an ad blitz imploring the public to conserve, conserve, conserve.
The state subsidized the price controls and went broke. Davis was recalled… and the state is still broke. Why are these people so freakin’ scared of markets? Head shrinkers call it agoraphobia: fear of public places… but agora is Latin for marketplace.
My theory is that these pinko dictator-planner types can’t abide the fluid chaos that continuously settles discrepancies between buyers and sellers. Where’s the opportunity for a self-important autocrat to take control?
About fifteen years ago a friend dragged me off to Berkeley to see Cornell West and Michael Lerner (the Bay Area’s best known phony rabbi) explain to the true believers how Jews and Blacks can find common ground in the new utopia. The answer was simple: they are both caught in the struggle against oppressive capitalism.
Lerner went on to say that stores (you know, where you go to buy stuff) should not have cash registers or posted prices. Such practices were oppressive. Customers should just pay the proprietor what they felt fair and take their stuff and leave. Years later, somewhere back East, some trust fund baby squandered her inheritance trying to find the virtue in such a dumb-ass idea.

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