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ECONLOG PERMANENT LINK | FEBRUARY 14, 2011 Printable format for http://econlog.econlib.org/archives/2011/02 /commie_cargo_cu.html

Commie Cargo Cult

Bryan Caplan

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Frank Diktter's Mao's Great Famine firmly supports a simple but shocking theory of Communism: It was the largest cargo cult the world has ever seen. Communist revolutionaries were great at seizing power, but if power were their sole aim, the horror would have ended once they were firmly in charge. Alas, the Communists saw absolute power as a mere stepping stone to their true goal: Mimicking a few random characteristics of advanced economies, no matter how many lives it cost. Take steel. Since modern countries have lots of steel and backwards countries have none, the Communists strove to make a big pile of steel - or at least something that vaguely looked like steel. As Diktter explains: Steel was the sacred ingredient in the alchemy of socialism... Steel output magically distilled all the complex dimensions of human activity into a single, precise figure that indicated where a country stood on the scale of evolution. Mao may not have been an expert on industry, but he seemed able to rattle off the steel output of virtually every country at the drop of a hat. During the Great Leap Forward, the result was a system where hundreds of millions of peasants were forced to throw their perfectly serviceable iron utensils and tools into backyard furnaces to make worthless pseudo-steel sludge. Who needs knives? Modern countries have steel! Under Mao, bolts of cloth became another Communist fetish: [C]lothes became the battlefield where communist supremacy had to be asserted, as products from grey sheeting to cotton prints flooded the market... By the end of the year, as poor farmers in the countryside were facing a winter without cotton-padded clothes, some 14 million bolts had been sold abroad below cost. All that was done in order for China to be able to claim the title of the world's third largest exporter of cloth - instead of being fifth. I've been reading up on the history of Communism for over two decades. But even now, I find it hard to wrap my mind around its absurdity. If the first-generation Communists had grown up in a culture where people had worshiped steel and cotton cloth for centuries, I could chalk their crusades up to intellectual laziness. What staggers the imagination is that these pseudo-intellectuals actually originated their own nonsense.

COMMENTS (12 to date) Latest Comment

Stephen Smith writes:

This is not at all exclusive to communist countries. What is high-speed rail, after all, if not cargo cult urbanism? You're looking at countries that have been highly successful with market-based transportation and land use policies (i.e., Japan), and then taking the absolute apex of their achievement (Shinkansen) while ignoring all the quotidian things that make it really hum (15-story buildings and regular elevated intracity train lines).
Posted February 13, 2011 11:37 PM MikeP writes:

Doesn't some of the blame here go to simplistic notions of economic success promulgated by macroeconomic

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metrics and parroted by inept journalists? In particular, two errors explain it all. First, believing there's more competition between national economies than cooperation. And second, making the measure of goodness for an economy gross domestic product rather than gross domestic consumption. The formula for international economic success then becomes how to output the most of something that you can credibly claim a comparative advantage in -- whether or not that product is actually traded for value. Thus you have the economic "successes" of World War II US and pre-World War II Germany, where lots of war machinery was produced while cupboards were rationed bare. Or the economic "success" of the Soviet Union and its dam and monument building. Or the economic "success" of China and steel or textile production. When production is judged more important than consumption, then the economy is as easy to run as a few factories that don't have to care whether or not there is a market for their product. And that is pretty easy -actual well being of the people be damned.
Posted February 14, 2011 3:41 AM Doc Merlin writes:

What you say applies to most government projects not just communism. Our own experiment with the space race, and the left's obsession with high speed rail (as Stephen Smith suggests) are examples of this as well. Government is inherently such.
Posted February 14, 2011 4:12 AM MernaMoose writes:

Communist revolutionaries were great at seizing power, but if power were their sole aim, the horror would have ended once they were firmly in charge. Alas, the Communists saw absolute power as a mere stepping stone to their true goal: Mimicking a few random characteristics of advanced economies I haven't read this work but I too have been reading the history of communism for most of two decades. Somehow the above just doesn't ring true, if you're looking to get at fundamental causes. Seizing power was indeed a means to an end for communists, and I would argue that Mao was the quintessential communist extraordinaire. He actually believed in communism. As a true Marxist, Mao genuinely sought to create a class-less society. This is what he was after more than anything else. Whereas Stalin's purges were largely (or entirely) to insure his own grip on power, Mao was after more than that. Mao's perpetual frustration was the fact that in order to impose a class-free society, he needed an organization to impose it. Because you realize, there has never been a "class-free" society in nature, and there never will be. What Mao proved beyond all doubt, is that a class-free society cannot be created even in a lab beaker. Because the organizations he created to impose his beloved class-free condition, inevitably led to a hierarchical structure and ohmyGOD no, we've got class distinctions all over again. Yes communists pushed steel production -- over and above things like agricultural output -- because you don't need localized knowledge to produce steel. It's a recipe, like making cupcakes. But agricultural output cannot be reduced to one hard-and-fast recipe, because success and optimum output require knowledge of localized conditions. The fact that the communists were missing the most critical piece of info in their steel production, i.e. market conditions, was beside the point.

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The one-upsmanship of steel and cloth quotas, like high speed rail, is a mere symptom of a particular type of universal human stupidity. It's missing the whole boat to think that Mao was after power so he could engage in this particular stupidity. Mao was a romantic. He actually believed the Marxist vision, and the pursuit of that was his reason for seizing power.

I have always thought it an odd paradox, that the most dedicated Marxist leader the world has ever produced was Asian. Make no mistake, Mao was an SOB but he was also a brilliant political thinker. He pulled off a communist revolution in a country that had no factories, and no industrial workers to revolt against their capitalist pig over lords. Adapting Marxist theory to the Chinese context was no small achievement. OTOH, you can readily argue that there were strong socialist inklings in classical Confucian China. But that's a whole other story.
Posted February 14, 2011 4:45 AM Jaap writes:

how does this compare with the housing frenzy many Western economies have (had)? or modern-day China? acre after acre of unused housing built and now deteriorating (even if Scott Sumner disagrees with me, I still think a lot of housing was built for the elements to have their way with).
Posted February 14, 2011 7:59 AM Floccina writes:

When I lived in Honduras, the Hondurans used to say we need more industry. By that they meant manufacturing and to this end they had instituted huge tariffs to spur domestic industry. I though you do not necessarily need "industry" people just need to figure out ways to make money and I got no idea what those ways might be. Sounds similar they saw USA industry and thought the USA is rich we need industry so we can be rich.
Posted February 14, 2011 10:06 AM Vladimir writes:

Bryan, All that you write in this article is absolutely true, but shouldn't the next step be to ask yourself what instances of this same thinking exist in the contemporary Western societies? Or do you believe that the elites running our countries, and the economic profession in particular, are altogether innocent of cargo-cult striving after various meaningless numbers? (Not that they're anywhere as bad as the communists, but it's in my opinion a matter of degree, not essence.)

Posted February 14, 2011 10:37 AM Silas Barta writes:

Did anyone start thinking of monetary economists and NGDP after reading the passage about steel? Just curious...
Posted February 14, 2011 11:47 AM Mr. Econotarian writes:

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William Easterly also discusses this in "The Elusive Quest for Growth", in that investing aid in machinery, setting up mass education, controlling population growth, building dams, and many other projects have ended up not doing much for the growth of developing countries, especially in comparison with simpler things such as enhancing economic freedom in general. Is an educated populace important to growth? Only if they can start businesses and trade and make money. Otherwise, it is only a fetish of development, not actual development, and the educated kids will go back to their villages and do the same subsistence farming they did before as there are no real jobs to go to, and they will split up the land their parents owned (without formal title) to even smaller patches of inefficient farming. I like the simple idea that consumption must drive production, and you are best off reducing barriers to both.
Posted February 14, 2011 7:15 PM Irresponsible Hater writes:

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Posted February 14, 2011 8:31 PM Jeff writes:

I think the most logical explanation is that this was simply another form of propaganda. Communism had critics and skeptics all over the world mounting some pretty convincing arguments as to why central planning and the abolition of private property was a terrible idea, and the Soviets and Maoists naturally wanted to convince people otherwise. They probably also wanted to do something to bridge the disconnect the average person couldn't help but notice between the utopian society they'd been promised and the reality of life under communism, which included bread lines and other resource shortages. So they (Mao and Stalin) probably latched onto "hey, if Communism's such a bad idea, how are we able to export all this steel and cloth?"
Posted February 14, 2011 10:34 PM Jeremy, Alabama writes:

This is Rawlsianism. In the absence of market, you write down a list of things that are important, and do those things. The list becomes more important than the people you are claiming to help.
Posted February 15, 2011 10:28 AM

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