Friday, April 17th, 2009
Corcoran has a point. Can we at least be honest about this – the transition that the Western world is going through, not only in terms of the bailouts, but also the next slate of plans to manipulate the economic system, are socialist, or collectivist if you prefer. Whether or not you agree with them does not change the fact. So let’s get our terms straight.
Flashback: Climate panel presses for federal cap-and-trade system | U.N. ‘Climate Change’ Plan Would Likely Shift Trillions to Form New World Economy | U.N. Environment Head Wants Global Warming Tax | Scientists warn global warming accelerating | Top Japanese Scientists: Warming Is Not Caused By Human Activity | EU calls for global carbon trading system to fight climate change | IPCC caught with false figures, doubt cast on accuracy of global temperature record | B.C. carbon tax kicks in on Canada Day | Every adult in Britain should be forced to carry ‘carbon ration cards’, say MPs | CEOs call for ‘aggressive’ action on climate change
Terence Corcoran, Financial Post
April 17, 2009
The great economic Sovietologist and state planning expert Michael Ellman, of the University of Amsterdam, once described various types of socialist planning. There’s the “traditional Soviet-type model,” in which the state owns the means of production and the economy operates under dictatorship. That socialist planning system didn’t work, so other presumably more benign versions emerged, including one called the “indirectly bureaucratically controlled model.”
The indirect control model is worth a review these days, since it is where we seem to be heading in Canada. “In this model,” writes Prof. Ellman, “the role of indirect methods (e.g. prices and taxes) of plan implementation is stressed.” He describes it thus:
Bureaucratic regulation remains of central importance in the economic system, but instead of attempting to implement their goals by means of instructions, the authorities attempt to implement their goals by adjusting certain economic regulators (e.g. prices, taxes, the rules governing enterprise behaviour, the rate of exchange, etc). The classic example of the indirectly bureaucratically controlled model is the New Economic Mechanism introduced in Hungary in 1968. The model which the official reformers in the USSR appeared to have in mind in the late 1980s as the goal of reforms initiated under Gorbachev was also of this type.