Soviet economic growth reached 20% under Stalin's reign. As we know, this is a figure never seen in the western world. If socialism is so crummy, why were the growth rates so high? Why was the increase in the standard of living so great during this period? I think life expectancy jumped 20 years under Stalin.
Was this because the government was able to direct growth into areas of the economy that mattered; it could divert funding into investment in say manufacturing for example?
I'm not denying that living in the USSR was shit. Yes, millions died of starvation but why did the economy grow so fast if the system was so poor?
The Bomb19:Why was the increase in the standard of living so great during this period? I think life expectancy jumped 20 years under Stalin.
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To paraphrase Marc Faber: We're all doomed, but that doesn't mean that we can't make money in the process. Rabbi Lapin: "Let's make bricks!" Stephan Kinsella: "Say you and I both want to make a German chocolate cake."
For life expectancy, look at the correlation between survival rate and age in prisons (be they US or foreign). A Siberian Gulag is not somewhere an elderly man is likely to live through. WIth less elderly people, the population's lifespan thus increases.
The Bomb19: Why was the increase in the standard of living so great during this period?
Why was the increase in the standard of living so great during this period?
The Bomb19: Was this because the government was able to direct growth into areas of the economy that mattered; it could divert funding into investment in say manufacturing for example?
You might want to watch this lecture:
What measure of growth are you reffering too?
Who calculated it in Russia?
On the whole did the standard of living increase in the USSR?
Those who died of starvation or in gulags never saw an increase in their standard of living.
With a totalitarian regime it is not hard to manufacture whatever "growth" number the state wishes.
Haven't seen the above video yet so sorry if this post is answered in it
but are you claiming that said GDP growth figures were simply manufactured? That's a pretty poor rebuttal. Do you have any evidence of major tweaking? If central planning is such a poor system, then why did the average standard of living increase so much in such a short space of time?
under a free market system, would the USSR have experienced more growth and development? Remember, in the early 20th century the USSR was an agrarian society, perhaps 100 years behind the rest of europe.
My question is whether the USSR was able to benefit from the government targeting key areas to drive growth, and if this is the case, surely this is a better economic model for development than your pure free market system.
The Bomb19: Haven't seen the above video yet so sorry if this post is answered in it
The Bomb19: My question is whether the USSR was able to benefit from the government targeting key areas to drive growth, and if this is the case, surely this is a better economic model for development than your pure free market system.
You might be interested in reading this. (Warning: it's long.)
The tl;dr of it is that the Stalinist Five-Year Plans relied upon "increasing the productivity of labor" to build up the (primarily heavy) industrial base. What did that mean in practice? It meant forced savings on the workers, to the point of destitution and virtual enslavement.
On another note, GDP figures don't actually measure economic grow, as they fail to distinguish between broken and unbroken windows.
The keyboard is mightier than the gun.
Non parit potestas ipsius auctoritatem.
Voluntaryism Forum
but are you claiming that said GDP growth figures were simply manufactured?
GDP is simply an analysis of the volume of expenditures in an economy, not what is actually being produced. So if government spending increases ("G") then naturally GDP ("Y") will increase. In fact, GDP can only continually rise if inflation is occurring, as the normal market process is for factor prices and consumer good's prices to gradually decrease as production is expanded. Hence why we had something like 30% price deflation during the Gilded Age.
But if we took John Maynard Keynes's infamous advice and dumped government spending into paying workers to dig up bottles of money only to have them buried again then certainly GDP would rise exponentially, but we'd have very little to show for it.
That's a pretty poor rebuttal.
Communist government's are notoriously unreliable when it comes to economic statistics. If we were to listen to the government of the Republic of Cuba we'd have to conclude that they have the highest standard of living in South America, but this is obviously untrue. Correspondingly, if we were to take Kim Jong-il at his word then we'd have to concede that North Korea is the most prospeous nation on earth.
If central planning is such a poor system, then why did the average standard of living increase so much in such a short space of time?
We've previously established that GDP is a bunk statistic, so to say that the standard of living for the average Soviet increased under Stalin is patently untrue.
under a free market system, would the USSR have experienced more growth and development?
Most definitely.
Remember, in the early 20th century the USSR was an agrarian society, perhaps 100 years behind the rest of europe.
That is irrelevant. Hong Kong has sparce natural resources and at one time possessed almost no capital, and through generally laissez-faire economic policy has become the financial center of Asia with a standard of living comparable, if not exceeding, that of the United States.
It didn't benefit due to the socialist economic calculation problem. This debate was settled over 70 years ago by the person this institution was named after.
The Bomb19:That's a pretty poor rebuttal. Do you have any evidence of major tweaking?
That's interesting; a request for evidence of claims from a person who provides none of her own.
Also I assume you're not familiar with the term "Potemkin village".
How are you measuring average standard of living? From what time period? Specifics please.
Hmm. Interesting. I wonder why that is.
It doesn't sound like that's your question, it sounds like that's your assertion...and a conclusion you've come to based on more or less nothing other than just what you'd like to believe. Again, you've presented this "virtues of central planning" notion elsewhere, and nowhere have you provided any support for it whatsoever. Based on your MO of starting a thread and then abandoning it to go start another one, it's not surprising that you haven't addressed any of the questions asked of you and haven't provided any support for any of your claims in any of the threads you've started...but it would be nice to be surprised.
Soviet economic growth reached 20% under Stalin's reign. As we know, this is a figure never seen in the western world.
Bosnia had something like an 84% growth rate after the war, and it maintained at least 28% annual growth until 1998..
If socialism is so crummy, why were the growth rates so high? Why was the increase in the standard of living so great during this period? I think life expectancy jumped 20 years under Stalin.
The Soviet Union managed to produce a lot of producer goods, but it did so only at the expense of consumer goods. In other words, the Soviets, through ad hoc economic planning, were able to produce a lot of steel while, at the same time, millions waited on breadlines, which stretched around entire city blocks, because there wasn't enough resources to produce both steel and final consumer goods simultaneously.
The point is that GDP merely measures production; it does not distinguish between warranted production and waste, between investment and malinvestment.
I'm not denying that living in the USSR was shit. Yes, millions died of starvation
Indeed.
"If we wish to preserve a free society, it is essential that we recognize that the desirability of a particular object is not sufficient justification for the use of coercion."
I'd like to know how Soviet Union GDP figures were actually calculated. It must be different from GDP figures in a market economy, because goods produced in the soviet union were not bought and sold on an open market, and don't have market prices. Who is to say if a sack of wheat produced in the soviet union is the same quality as a sack of wheat produced in the united states. It might be worth just as much to a consumer, or it might worth much less. There is no way to tell. I have heard stories of nails being produced which are too large or to small, depending on whether production was demanded in weight or in volume.
I am sure that many of the figures would have also been total lies as well, owning to the self-delusional nature of totalitarian leaders and the incentives they produce by shooting the messengers.
I find the soviet figures dubious at best.
Dear The Bomb,
Paul Samuelson, an economist that loved math and figures, wrote on the 1989 edition of his introductory books about economics, that given the figures announced, the soviet system was not only sustainable but that it would surpass the USA in wealth.
That was in 1989, I'm sure you know what happened that year.
Yeah, but that's purely anecdotal. It doesn't prove anything.
"Economic growth" is a meaningless term without capital goods being directly designed for the production of specific consumer's goods which are actually designed for people. If I need a machine for making pins, and I make a shovel, then in my one man economy growth has occurred, but it doesn't really matter, I haven't done what I should, I didn't produce what I needed, and I have wasted time that could have been allocated to. No one could argue that, so long as the population is subdued and the economy is really under the control of the central government, the construction of capital goods could not be increased under a socialist dictatorship. If I have control over the entire United States economy I could transit almost all production to the construction of capital goods but they would be discoordinated from the structure of production, I would likely be producing a lot of pins but very few shovels, and there would be significant suffering in the short run as all consumption would have to go on hold.
The soviet experiment was helped out because of the fact that Russia was a truly vast country with a huge amount of natural resources to utilize, it had previously been held back by old time peasentry (I believe that Russia was the final nation to end serfdom), technological knowledge borrowed from the capitalistic nations of the west, it could copy prices and production structures of the west, and a huge population much of which could be easily moved into the projects which the Soviet managers wished to. We have never seen what a country going full out free market overnight looks like, but we know what one going totally socialistic looks like, and those are Russia and China. Russia industrialized fairly quickly with the five year plans, but the standard of living still sucked. Soon there was a huge surplus of captial goods but there was a general shortage of consumers goods which continued throughout the history of the nation. Also Soviet growth slowed down as time moved on and it came closer and closer to the captialist nations and industrialized itself, it could no longer simply copy western manufacturing techniques and it had a harder and harder time replicating prices as there were more goods to demand and particular tastes developed amongst the population.
So basically Russia had a lot of things going for it, a simple economy to deal with, and more importantly the "growth" gives us relatively little important information, they didn’t produce capital goods that were really useful to a better standard of living which was later showed by the general shortage of consumer’s goods and rationing. They made a lot of shovels when they needed pin machines, they knew just how to make them because they could look at their capitalist neighbors, and they had plenty of people and materials to make them.