The economic calculation problem rears it’s head again. They have the audacity to claim that “voluntary exchange” aka the free market does not work, that it must be regulated by wise overlords, yet time and time again they repeat the same mistakes. They have no way to answer this devastating critique of socialism and its impossibility as a viable political and economic system.
But Mises does not stop with the demonstration that socialism must eradicate economizing activity within the social nexus; he also traces out its implications for the development of the human mind. With the dissolution of social production that inevitably ensures upon the imposition of a world-embracing socialist state, humanity is reduced in short order to dependence upon economic activities carried on in relative isolation. The primitive production processes suitable to autarkic economies do not require economic calculation using cardinal numbers nor do such simple processes offer much scope for purely technical calculation. No longer dependent upon arithmetic operations to sustain itself, the human mind begins to lose its characteristic ability to calculate.
Mises’s analysis of the effects of socialism also has another momentous implication. With the impossibility of building up and maintaining a capital structure in the absence of monetary calculation, human economy under socialism comes to consist of super-short and repetitive household processes utilizing minimal capital and with little scope for adjustment to new wants. The result is that time itself–in the praxeological sense of a distinction between present and future–ceases to play a role in human affairs. Men and women, in their capitalless, hand-to-mouth existence, begin to passively experience time as the brute beasts do–not actively as a tool of planning and action but passively as mere duration. Humanity as a teleological force in the universe is therefore necessarily a creation of the inextricably related phenomena of calculation and capital.** In a meaningful sense, then, socialism not only exterminates economy and society but the human intellect and spirit as well.**