In keeping with the definition of command economy a force outside of the market, government, must dictate the final outcome of all production. Most recently the examples of the former Soviet Union and its satellite nations and China serve as prime examples of a command economy. Some of the characteristics of a command economy are:
• Stability- Command economies are less affected by economic fluctuations since the products and the resources used in their production are in steady demand as opposed to the constant state of flux that prevails in a market system.
• Steady unemployment- The rate of unemployment is static as a result of lack fluctuation in the system.
• Little Surplus production.
• Investment in long-term projects.
• Emphasis on collective benefits.
The felling of the Berlin Wall revealed the destructive results of a centrally controlled economy. West Germany is just now recovering from cleaning up the years of human and economic destruction left in the wake of the command economy that once mired East Germany in a quagmire of economic decay and human demoralization. Until recently the United States has experienced a free market economy that resulted in a prolonged period of economic growth. Even though the American public has prospered economically as a result of free market policy and can readily see the advantages of a free-market system compared to the failures of a controlled economy it has been duped by the current administration and its coterie of muckrakers and thugs into accepting a command economy.
The central tenet determining the success or failure of a command economy is control of all means of production including those peripheral sources which provide cradle to grave support of the production process. The Obama administration has succeeded in bringing all means of production under the purview of the federal government through the vehicle known as The Economic Stimulus Package. However, the peripheral resources supporting such means of production have not been placed under direct government control. It is therefore necessary to identify the peripheral forces to which I refer and show how those forces are incrementally being brought under direct government control thus completing the circle that closes the noose around all means of production and the peripheral forces supporting it thus transitioning America’s economy away from its current laise faire philosophy to the shackles of a command economy.
Three separate forces are represented within the cradle to grave concept supporting the process of production within a control or command economy. They are: Planners (Government), Laborers, and Consumers.
In his 1660 treatise Leviathan, Thomas Hobbes describes the need for a strong state to prevent civil discord. In a command or control economy the government dictates the plan of production of goods. In order for an effective planner to exist, it is incumbent that government be of large scale and power. Furthermore, such entity must maintain the latitude to expand its scope and power in order to prevent any deviation from the plan which provides stabilization for the economy and its supporting cast.
If a product is to be made it must have someone produce it. If labor is not provided in the numbers and with the education required to produce the good in question the grand plan fails. With that in mind one should be cognizant of 16th century British Philosopher Francis Bacon’s observations on education. Bacon states that a government will provide only the type of education necessary to maintain itself. While education represents a major factor upon which the success of an economy hinges it can be argued that society must satisfy the fundamental needs represented on Maslow’s Hierarchy of Needs. The bottom level of the pyramid this theory creates is physiological needs, food, drink and the like. Second comes the level of safety which includes security of: body, health, employment, property… Any failure to provide the basic necessities will lead to failure to effectively execute the planner’s dictates. A good example of the desire to provide the needs represented on the lower two levels of Maslow’s hierarchy is the utopian socialist philosophy espoused by the likes of Charles Fourier and his theory of creating social communities he called Phalanxes. Taking an example from Fourier, many American entrepreneurs during America’s industrial revolution built utopian communities based around their businesses hoping to provide their employees with the basic necessities of life thus improving their productivity. An example of this phenomenon is the community established in 1880 by American industrialist George Pullman. The company town of Pullman was located just south of Chicago and was centered on the production of railroad cars. It was Pullman’s hope that this community would be a shining example of how industry and labor could cooperate in order that the company would operate more efficiently. The community of Pullman, like most such communities, failed. A more recent example of the desire to provide the basic necessities of which Maslow refers is the welfare state created by Franklin Roosevelt’s New Deal.
The final force in the three part equation is Consumers. In a planned economy it is assumed that government, laborers, and consumers all have common interest. Conversely, in a market driven society consumers are considered as looking out for their best interest. In a free-market economy, the business community spends exorbitant amounts of money yearly in an effort to determine what consumers want in order that they may realize a profit by providing consumers with the services they demand. In contrast, in a command economy the planner tells the consumer that he will accept the product he is offered or go without as there is no other offering and no means of obtaining the service he seeks unless he goes outside of the system to obtain that which he desires. A prime example of this principle is represented by the colossal proportion of Canadian citizens who annually traverse the U.S. border in quest of health care services not readily available in Canada’s rationed health care system. In such a central command economy only a limited supply of one design of a product is offered thereby rendering the concept of what is in the best interest of the consumer moot.
Ultimately the American people must decide if they want to continue to enjoy the benefits of a market driven laise faire economy or opt for the false security and government control offered by a command economy and the despotic tyrant proposing the creation of a draconian corollary to the New Deal.
http://www.investorglossary.com/command-economy.htm
http://en.wikipedia.org/wiki/Maslow%27s_hierarchy_of_needs
http://en.wikipedia.org/wiki/Charles_Fourier
http://www.google.com/search?q=george+pullman&hl;=en&client;=firefox-a&rls;=org.mozilla:en-US:official&hs;=OPu&sa;=X&tb; http
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http://www.geocities.com/lazaridous/consumer.htm
http://en.wikipedia.org/wiki/Thomas_Hobbes
http://www.economywatch.com/economy-articles/command-economy.html
