I guess I will do this criticism section by section. Bear in mind that my knowledge of Austrian Economics is nowhere near complete and doubtless hardly above that of a novice, but I think this will be both a good exercise in critical thinking and one in which I can doubtless learn from the ‘pros’.
Alright, so the first paragraph seems to already show that the author is lacking in knowledge. Basically, to use the Socialist term, describing the “anarchy of the market”. A few things I take especial offense to is his connection of “ancient custom” and “necessity of barter”. He seems set on trying to discredit any sort of voluntary trade between his implied link of “ancient” (obviously trying to get the idea of ‘outdated’ to the reader) and “barter”. It is clear that he no longer views exchange or bartering as necessary, because we no longer live in a “scarce” society. Looking at the state of the world it is very clear we are living in a scarce society; everyone does not have everything. Even if his point about barter, exchange, and prices not being able to emerge in an abundant society were true (which it is not, people would still value things and would still value some things more than other) it is demonstrably false that we live in such a society.
His “common denominator” theory is silly as well. Certainly a common denominator is that it goods/services require energy, but is it not also a common denominator that they have mass? What about the fact that they are valued? This is no less of a simplification than the one made by Marx in his Labor Theory of Value
It is possible that the scientist’s method could work in a completely static economy, but a completely static economy is just as impossible as one with perfect competition. This in and of itself refutes that entire paragraph, but lets examine this closer shall we? Looking at it, the action advocated for is “regulation” and “redistribution” based on energy cost. But this would, in my view, completely ignore an individual’s preference or the fact that some resources that go into the production of goods and services are more valuable than others and that it seems highly impossible, or at least inefficient, to measure the energy that when into making an ore (say uranium) and then using this as a basis for its value, while completely ignoring scarcity of the ore and consumer preference.
It seems to me that technocracy’s fundamental postulate is flawed. Besides having variable definition for both ‘material’ and ‘environment’, it seems to me the basic flaw is that utility cannot be measured, and obviously the happiness/satisfaction of others in our environment not only affects our own behavior but it also affects their own. And yet it is immeasurable. While a refutation of its basic postulate could be more than sufficient to discredit this theory I will pursue it further.
It seems to me that their system of tracking human behavior and preferences is inefficient. After all, what is the market but a system that does this without central planning and the inevitable bureaucracy that comes along with it? Not only this, but the system offers only the choice of “consumable goods and available services”… it seems to me that it is completely ignoring any progress (or perhaps purposefully stopping progress?) that could be made and only offers present goods, not future ones.
The whole scheme reeks of an almost Big Brother-like system of observance and reporting. This by itself is enough to scare me away from ever coming close to considering the system, but I will trudge on. The seven steps just seem silly to me, but if a kind volunteer would take the time to refute them from an “economic calculation” point of view I would be much appreciative.
Here comes the flaw that only associates value with scarcity, completely ignoring both individual preference and the use-value of goods. He is correct in saying money is not a ‘measure’ of anything (Mises himself said that “Money does not measure value” in Socialism), but their qualifications for a medium distribution seem to be totalitarian in nature. You’re not allowed to trade your ‘tokens’ and you cannot save them. Without savings future investment and progress are both impossible. This would ultimately lead to what Mises’ called destructionism where capital is destroyed in order to finance consumption. Even if it were not destroyed, it would eventually wear down, and since it is implied (because there are no savings) that all that is being produced is being consumed there would be nothing left to keep the capital equipment working or even improve it.
If we accept that all his assumptions for what would qualify as a good ‘medium of redistribution’ than energy tokens (that were non tradeable) would be a good way to do this. While avoiding the topic of why redistribution has negative effects, it seems to me you could just as easily have mass or labor tokens and still have the same value distortions as would exist with this.
I don’t understand what he means by ‘money is a species of debt’. Money is nothing more but a medium of exchange. His conclusions about it show a level of economic ignorance, however. There is no reason why money supply would have to constantly be increased. If our goal, however, is equality through distribution, than of course we cannot have money as this would lead to freedom which would disrupt the planning of the scientists. However, I’m sure most here will reject the goal of income equality for various reasons I choose not to rehash here.
Besides still failing to define ‘abundance’ it is falling into countless socialist calculation fallacies. There is no speculation going on, so there is no way to predict consumer needs and desires which would inevitability lead to dissatisfaction. Since the only true measure of how well an economy is doing is the satisfaction it imparts on the members of the economy, this system would always be at least a year behind consumers. Production must come before distribution, but demand exists before production. So it would almost have to be after the fact that something is produced that consumer’s desire; there would be a waiting period of months in order to get what one wants (especially if your preferences changed) because the economy would have to be restructured to meet consumer demand. However, it would not be a step ahead, like capitalism, but always a step behind, trying to meet consumer demands, but always these demands are of the past and not of the future.
It seems to me this ending was originally describing the market (voting with one’s dollar and all of that), however, for whatever reason, it assumes that the system will create an abundance even though all it will create is dissatisfaction. I don’t know how switching to an objective standard of value will cure all these social ails he mentions, and if he really wants to know why I ‘stick with it’ it is because money is the only rational way of making purely economic calculations.
But hasn’t a mistake been in the past, for Austrians, that they didn’t really do all that much to refute popular theories (I think of Hayek and Keynes)?
Thanks for the post Chro. I’ve seen the ‘technocrat’ term but never really looked into what they might be about, figured it had something to do with technology providing utopia.
Technocracy sounds like it would work perfectly in a world of self replicating robots or selectively bred dehumanized drones (yo Benjamin) but is otherwise obviously severely flawed, especially the impossibility of managing steps 3, 6, & 7.
Sounds like they are trapped in a statist mentality not realizing the true cause of war, poverty, etc.
I wonder how the Technocrats view natural rights, diversity, and beauty? An artist in their world could only paint the canvas solid grey it seems?
How will a technocracy eliminate diseases and folks on the inside loop from grabbing a few extra ‘energy certs’ for their bredren?
I don’t know. They eliminate the market because we have “abundance” (relative to what?), so we must also give out energy credits for people to buy art? I really don’t know, the whole thing is fishy and might work if men were angels and didn’t actually have wants.
Is Technocracy even popular? Was it ever? It’s one among a million “we won’t even need money because there will be so much abundance!!” acid trip policies. The originator of this nonsense was profoundly confused. For example, the proposed “energy units” are not even a medium of exchange, they are rationing coupons. By simply positing that these rationing coupons will solve all the world’s ills, “technocracy” fails to address the necessity of exchange. Even assuming an initial distribution of energy was optimal (and automatically solved all of society’s needs), there would still be a need for subsequent exchange, after people realize they need this instead of that. How will such exchanges be facilitated? If by “energy units”, then we are really talking about a commodity paper money, not the abolition of money. If by nothing, then we are reduced to the primitive economy: barter. If by something else, then we are back at square A… money.
Its not meant to be a medium of exchange. Its supposed to be a “medium of distribution”; so yes, rationing coupons. Anyway, I just wanted to post and refute and see if I could get some criticisms/a discussion (maybe?) going.