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Project Cybersyn: real-time computer control of a planned economy (1970-1973) (wikipedia.org)
56 points by henning on March 14, 2010 | hide | past | favorite | 33 comments

It's quite telling that this attempt by a Marxist government to computerise control of the economy had it's biggest success in organising scabs during a strike.


It took about a year to become operational but it was never completely finished.


The software (...) was written by Chilean engineers in consultation with a team of 12 British programmers.

12 developers for a year.. controlling the entire economy?This smells a lot like vaporware, and it was in fact never operational, even though the article makes it sound like the main culprit was the 1973 coup.

It was just 500 factories. Probably any company today that has at least 500 factories has similar (modern) hierarchical system of control in place.

AI is effectively replacing free market from inside out not top down like in government attempts to instantiate centrally planned economy.

Exactly. Free market does not contradict planning. Both in-house and national-level planning works quite nicely in market economies. Leontief got a Nobel for theory and practice of the process.

"Probably any company today that has at least 500 factories has similar (modern) hierarchical system of control in place."

Yeah, it's called Walmart.

The hard part of such as system is defining the objectives and the economical model to use, but that work is left to politicians, not programmers. Once the model is known, it is much simpler to write a program which applies it to get from the current situation to the objective. 1 year sounds perfectly reasonable.

Yes, the technical aspects of network communication are relatively trivial. The actual economic planning absurdly difficult -- impossible, in fact. Friedrich Hayek showed (and won a Nobel Prize for his work) that the coordination of production in the economy is achieved by using money as the channel of communication, which neatly encapsulates all of the information about preferences, substitutability, etc. Planned economies are necessarily subject to shortages and the like because it's impossible for any centralized entity to have all the knowledge about what the goals and needs of all actors are.

The article argues against the establishment of a Central Pricing Board (advocated by Lange) by highlighting the assiduously dynamic and organic nature of market price-fluctuations, and the benefits of this phenomenon. He asserts that a centrally planned market could never match the efficiency of the open market because any individual knows only a small fraction of all which is known collectively. A decentralized economy thus complements the dispersed nature of information spread throughout society. http://en.wikipedia.org/wiki/The_Use_of_Knowledge_in_Society

a little historical context: that strike was funded by the cia...


This is an interesting problem.

I'm not an expert, but I feel like a lot of socialism depends on accurate demand forecasting and in the past forecasting models may have failed because of lack of real-time data collection and processing capabilities. As both collection (sensor networks) and processing (CPU) capabilities increase exponentially, perhaps the model can be made more accurate.

Of course, I'm sure socialism as an economic system has other, deeper flaws :-)

This short essay from the 1920's lays out the fundamental flaws of trying to do economic calculations in the socialist state:

Economic Calculation In The Socialist Commonwealth: http://mises.org/econcalc.asp

I'm also a big fan of Hayek's "The Use of Knowledge in Society" which explains how a capitalist system, rather than being "unplanned" as its critics often claim, actually uses decentralized planning that makes more efficient use of knowledge at all levels of society.


For any economic system in a country to function also depends on having your chief export (copper, something like 70 or 80 percent of Chilean exports at the time IIRC) not having its price dropped through the floor by a huge and powerful country dumping its strategic reserves on the market all at once, on keeping alive your top military brass instead of having them killed by car bombs and replaced with guys eager to overthrow your president, on maintaining order despite agitation stirred up by foreign spooks and their covertly funded proxy organizations, &c. &c.

Chilean socialism may have been flawed, but it was never really given a fair shot.

It is indeed interesting to speculate whether a command economy could function effectively given modern computer hardware and software.

"Chilean socialism may have been flawed, but it was never really given a fair shot."

That's what all failed socialist countries claim (including my own, former East Germany).

The basic principle of socialism, in all its flavours and colours, is based on the idea that some country, idea, person or group needs to be "given" (by whom?) a "fair" shot (well how much do the demanders of the chance "feel" is "fair" and do the givers have a say in it?).

What's interesting is that you never need to ask for chances, favours or a fair shot if you have something very appealing to offer and can point out its benefits (sometimes this is called marketing) in a convincing manner. This site alone is an example of many.

Okay. My point is only that the people you need to convince, in the specific case of cold-war-era governments, are not your own citizens, but rather the hard-ass anticommunists in the U.S. government, war criminals like Kissinger et al.

Amusingly enough, if you were a military junta like Alvarado’s in Peru in ~1970, even a leftist military junta, you could pretty much get away with attempted agrarian reform, expropriation of foreign assets, nationalization of major industries, etc., as long as you agreed to fight against isolated communist guerillas in the jungle, and the US would leave you alone. If you were a democratically elected moderate like Belaundé, they’d cut off aid and impose sanctions. If you were a center-left european-style socialist like Allende in Chilé, they’d go all out to destroy your government.

Former East Germany didn't work out for substantially different reasons than Chile. Neither excuse making nor specific domestic policy was really the cause in either case though.

Basically, the "givers", other states, should, according to commonly accepted international laws and norms, only intervene in the operation of other sovereign states in certain limited circumstances, such as for self defense, etc. Deciding you don't like the leaders they elect, even before those leaders have done anything, doesn't cut it as a rationale for toppling a foreign government.

Allende sought to to nationalise banking and redistribute land. That's not what people think of as centre-left.

European socialists (outside of Italy where everyone is mad) are generally solid on constitutional matters, including separation of powers. Whereas Allende created the crisis by trying to steamroll the supreme court on separation of powers.

Western Europe is dramatically less economically centralized than any part of Latin America, and so there’s much more balance between the influence of the richest part of the society and the rest. (Which is to say, egalitarian policies are much less politically explosive.)

Allende’s politics were much closer to western European socialists than to say, Mao or Lenin. Maybe “center left” is a bad label for being ambiguous; the point is that his goal was not some kind of communist utopia with a completely centrally planned government, &c. &c.

In places where a tiny minority have a chokehold on a country's economy, land reform is a pretty essential prerequisite to general political and social equality. General MacArthur carried out massive land reform in Japan in the late 40s, and few people would call him a leftist, &c.

* * *

But all of that is getting away from the central point, which is that thinking that it was better for U.S. long-term interests to overthrow the government, without any legitimate justification, and replace it with a brutal fascist police state, is the height of hubris, and frankly despicable.

He didn't use force against his own people, and this was in strong contrast to the sort of leaders you have pointed out. Mao and Lenin and Chavez wouldn't hesitate to use force to reach their objectives.

    his goal was not some kind of communist utopia with a
    completely centrally planned government
Central planning is a foundation of socialist thought, and he was pursuing this. (1) He was implementing a computer system designed to run a centrally planned state and used it in anger; (2) he had a stated aim to seize and redistribute property based on priorities to be determined by a central authority; (3) he was forming strategic relations with the soviet union; (4) he was undermining the separation of powers in the standing constitution; (5) close working relationship with the communist party, sometimes against the perspective of his own party and supporters.

    In places where a tiny minority have a chokehold
    on a country's economy land reform is a pretty
    essential prerequisite to general political and
    social equality
Social equality is an unachievable ideal though.

Chile never underwent that reform, and has for the last twenty years been the most stable elected parliament in the region, with economic growth at all levels of society. The UK has never land reform of this sort either.

    ... thinking that it was better for U.S. long-term
    interests to overthrow the government...
I don't buy into your original point that what Kissinger thought was to have been more important than what the local powerbases was doing.

I don't find it surprising that the US took a dim view of Allende. He was supported by his local communist party and was setting up an intelligence relationship with the Soviet Union, and the cold war was on.

But I agree with you that the US would do better by leading by example rather than meddling in the affairs of other states, and that that sort of conduct is the 'right' thing to do.

You are wildly out of context here.

In 1970-73 Chile had a democratically elected president with a socialist program, not unlike France's Francois Miterrand. He wasn't "given a fair shot" because he was overthrown before the end of his term.

(Edited: no solid evidence that he was murdered.)


I don't think the parent of your post was out of context.

Wikipedia is poor resource for recent political history, because people defend their history there. Heavily contested events like this, or The Dismissal in Australia end up with summaries that are sympathetic to the left-wing view of history. That doesn't make it right, it just means that people of that inclination are more interested in contesting the history than their opponents.

You do Miterrand a disservice by comparing his to Allende. Miterrand is an example of a socialist leader who worked within the bounds of his constitution.

It’s not clear that he was murdered: officially it was a suicide, and as far as I know the evidence is pretty sketchy. But many others were certainly murdered, before and after the coup.

You think his girlfriend left him?

  Of course, I'm sure socialism as an economic system has other, deeper flaws :-)
Wow, such political correctness, it brings tears to my eyes.


Articles talks about "planned economy". It should even precise "planned central economy". The deep flaw in it is generally that citizens are not included in the loop of doing the plan !

Disclaimer: capitalism is also a planned economy (no there's no army of monkey deciding what to do), and at the top level (US government/financial circles/big companies/media networks) it is even mostly centrally planned... So: same problem...

If an economy is centrally planned at the top level... it's not capitalist.

"Actual capitalism" is as far from "capitalism" as "actual communism" is from "communism"...

One of the shortest most insightful comments of the day.

I really, really like that photograph of the "control room." It's like a beautiful fusion of every fab 1960s sci-fi set I've ever seen.

That's exactly what it is (Sci-fi). It was never operational, just a mockup for propaganda reasons.

There is a very interesting video about the entire project here: http://vimeo.com/8000921

Thanks for that link -- the video is even more fascinating.

I wonder how open it was, and how democratically controllable it was.

I'm not surprised by such a system, I mean, every big controlling entity (Banks, Wall-Mart) has a something like this but much more modern. The difficult "political" part here, is to make such a information system democratic by opening information to citizens and putting them at the basis of decisions.

Robin Hahnel and Micheal Albert wrote things about that, an economy with decentralized decision taking-process, "Looking Forward: Participatory Economics in the Twenty First Century" is a good intro to that. They include computers to ease decision making.

It would be interesting to see where Soviet central planning might have gone if it were possible to solve massive sets of thousands or even millions of simultaneous equations digitally during the heyday of the whole affair.

Anyone see a connection with the real world Cybersyn and the fictitious Cyberdyne Systems from the Terminator movie?

This sounds like the way that WalMart operates its stores.

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