I would recommend looking to nature for patterns. Large networks of loosely interdependent organisms work best. Once one species (e.g. humans) become too dominant the whole system begins to fall apart.

There is no central planning in nature. It could be argued that central planning is an unnatural state. A far more robust solution would be to focus on having an economy made up of many small/medium size organizations and individual makers. Currently our economy with our "too big to fail" institutions is very fragile, as single points of failure can have catastrophic global effects. It would be much more healthy to eliminate the possibility of devastating single points of failure.

I'm not sure about appeal to nature here; biology seems rather centralized in a lot of aspects. An organism may be made of many cells, but each of those cells have a specific function. Kidney cells do not compute, and brain cells do not contract to pump blood. When a cell starts doing whatever is best for it locally, we call that "cancer". Centralized management arises naturally whenever there's a need for efficiency. So while there's a lot of distribution going on, I wouldn't say centralization is unnatural. It seems common enough on many different scales.

The body as you have described it is one node (an organization in my example) in the wider network. For that node to function it needs to have all of its components working in unison but if the node fails other nodes can adapt and the system keeps on chugging.

This layering of central and distributed seems common on all levels. If you go up from your example, you have an ecosystem that needs to work in unison. But if it fails, there are always other planets...

Yes this occurred to me too. Very interesting. At what layer is the economy at naturally?

I could have sworn the old idea was that factories would shift from working for the executive suite to working for the workers. That is, make the workers the shareholders and board.

That idea (at least in the form you mention) becomes redundant when the factories are full of robots.

I don't think it ever was a question of tools, but rather who is allowed to use those tools.

What will they actually optimize for is an excellent question. We have plenty of central planning, its just most people don't like it very much. Look at the intentional destruction and elimination of the american middle class or the general population of Greece or how the criminal justice system treats black people in the USA. Statistically, they're unlikely to optimize for you, for most values of you.

Also don't forget the somewhat more intractable philosophical problem of whats actually good for you vs what you superficially want vs what you actually want, and our recent history of spending trillions on PR to intentionally confuse people about those three. I think we can safely assume that it'll be very cheap and easy to keep almost everyone unhappy about "the" central plan, which will be weaponized by factions.

Looking at how the disease of Puritanism has infected most of our culture pretty deeply, you can expect a similar meme infection in a centrally planned economy. So even assuming there is a "True" ideal state, we'll have infections and need an immune system. Merely computing faster or more complicated models is like assuming yeast are diseased and whales are disease free merely because of size and complication differential. What we do know from biology is the more mono-cultural and rigid something is, the more likely it is to get wiped out, and the analogy to central planning would be it'll inevitably get wiped out by meme diseases, so the best long term central plan might ironically be to not centrally plan.

I think it actually was. Central planning is a Bad Thing because Soviets did it and it went bad, so nowadays its inferiority is treated as an axiom. But back then optimization theory was just starting to develop and was never actually applied in practice, and we didn't have enough computing power, nor instant communication infrastructure. I think we should revisit the concept of central planning with algorithms doing global optimizations based on real-time signals.

The issue with central planning is that it isn't robust - if the planners mess up, everyone is screwed. If we could inject a method by which a failed plan would take down only the planners (and not consumers), it would help a lot. For example, we could allow large centrally planned organizations to exist, but if they fail to meet consumer needs they get dissolved and consumers can go to a different planning board.

Wait, we already have such central planning boards - Uber, Fedex, Walmart, etc. My mistake.

On the other hand, such distributed planning is incredibly inefficient - how much resources are wasted by Uber competing with Lyft competing with Taxis, by FedEx competing with UPS competing with post office, etc.? The point is, it's a tradeoff - efficiency with single points of failure vs. resilience at a cost of huge waste.

What resources are wasted? Perhaps some innovative ideas are being duplicated at worst?

Goods are produced that no one needs. The market gets randomly stuck at local minimas that lead, for instance, to throwing away tons of food because it's more profitable to do that than to donate to those in need. You get tons and tons of duplication by companies competing with each other over a limited set of customers, which also feeds the advertising industry that wastes resources on zero sum games. In current model, the economy is regulated implicitly, by feedback loops fighting against each other creating a dynamic equilibrium. It's inherently less efficient than regulating explicitly. My point is that while humans are not capable of regulating on such scale and thus have to rely on implicit methods, optimization algorithms run on real-time data feeds may in fact be able to regulate explicitly.

Getting stuck in local minima happens in centrally planned systems too.

You are correct that things like advertising are (sometimes) zero sum - specifically, advertising based on irrational criteria. (Advertising which transmits useful information, e.g. "taxis suck and Uber exists", is not zero sum.)

But you also gloss over one of the big benefits of a non-centralized system - correctly finding the utility function. In a centrally planned system, your utility function needs to properly identify what tradeoffs people would make if they had the choice. This is not easy, and modern computing doesn't help very much here.

In contrast, consumer choice via price systems handles this nicely.

as a person who lived in yet another centrally planned country, let me tell you this, plain simply - it doesn't work. soviets failed, but so every other nation that went that way. let's call it slow but steady financial rotting that will bring any country down, given enough time. there are plenty of reasons for that, they are always the same, but for me one is most important - they all work with ideal person who wants to help the system, instead of disconnected greedy selfish individuals, that real society consist of.

this is of course valid for humans, who have all kinds of flaws, some more than others. so you propose to give power to software, who by principle always has... flaws. imagine how juicy this thing would be for hackers, who would have billions-big incentives from shady business people to nudge decisions in their favors... silly naive people :)

What I would suggest - let some state of the art simulation run along the humans, and evaluate its decisions after some time passes, to clearly see who made the right one, in long term. after there is some long term perception that computer is clear winner (definitely not below 10-20 year mark of steady performance), we can move that way. and always, always have some sort of semi-neutral commitee to oversee and accept/reject all important stuff (with necessary reasoning, not on whims of current most powerful one). make it as transparent as possible. -- do you think this is real? no way, when looking at how shady today's politics are done, be it US, europe or any other place...

I've never understood why anybody would think that central planning would ever work. The very idea is total hubris - before you even get to the decision making process, you need accurate data to work from. It should be painfully obvious that data about (and especially provided by) humans is at best an approximate representation of reality. Often, it is completely wrong. Real-time noise is still noise.

If you want proof of this, consider why work-to-rule[1] works. While it is obviously intended to be used as a type of strike or similar direct action, the idea is that you are technically doing you job too accurately. The work continues to function thanks to the fact that almost nobody does everything they are technically supposed to do. We speed on the way to work, we overlook minor mistakes, we fix instructions and reinterpret orders. Reports are regularly sent up the chain of command that "yes, project $FOO was finished on time" even though everybody involved knows it wasn't.

The idea that you can take known-bad data, apply it to a fantastically complex model, iterate that model to add unknown amounts of chaotic noise, and get usable results is completely insane. Given the realities of how bureaucracies work, that noise will simply be re-interpreted until it says whatever the people involved want it to say. In the end, it is still a situation where the people making decisions are distanced from the consequences of their decisions.

If you want to fix some of the problems we have, I suggest that we need a lot more of the opposite of central planning: local decision making authority. A control system tends to work better when it can get accurate and immediate feedback, and in human terms that means experiencing - or at least directly seeing - the consequences of any decision. We, as a species, are notoriously terrible at evaluating any decision where the consequences are not felt immediately and personally.

[1] http://libcom.org/organise/work-to-rule

Say you're the engineer responsible for maintaining the Central Planning And Optimization Algorithm. What motivates you not to calibrate the algorithm in such a way that your family and your buddies benefit the most?

Nothing. Of course I'll be tempted to set things up so that those that matter to me have their problems solved. That's unfortunately human nature, that's what happens now (people can game distributed systems too), and I have no idea how to design a system that would be gaming-proof and perfectly egalitarian.

But even assuming that some people will abuse the system (as they do today and we still live with it), it seems plausible to me that the economy would still run better if everything was driven by global optimization algorithm fed with real-time data.

There has been a partial attempt [1] to do central planning with computers.

[1] https://en.wikipedia.org/wiki/Project_Cybersyn

I'm as leftist as they come and I'm against central planning. Bitcoin, removing gatekeepers, technologies that reduce/remove barriers to entry like 3d-printers, secure free-flowing information networks look much more promising for a future with empowered humans, free from debt and corporate/government overlords. Artificial scarcity, planned obsolescence and utter waste of resources both human and planetary could be solved if you combined tech like self-building machines, advanced recycling and permaculture principals.

I don't consider myself leftist (or rightist or any -ist) at all, I try to evaluate all the concepts on their merits. At the time of writing my original comment it seemed to me that computer-based central planning could be a good solution for some problems. Responses here brought up some arguments that made me reconsider the extent to which such central planning could be successfully applied. Maybe inefficiency is a price worth paying for increased resiliency and ability to adapt to environment without explicit specification.

I'm definitely not buying into the principle that everything needs to be distributed, libre and democratic. There are too many obvious failure modes there. Empowering everyone is good, but empowering everyone to the point when a random nutjob can kill millions with a home-made bioweapon doesn't. Nor the coordination prolems like tragedy of commons, oh so present around us everywhere, and one of the primary reasons things are being regulated.

Large corporations typically implement a form of central planning - that's what applications such as Oracle Hyperion and IBM Cognos are for - managing complex multidimensional models that integrate actual historical values with multiple forecast scenarios.

Another valid analogy with large corporations is if central planning was the optimum strategy, then extreme micromanagement from the top would be the optimum business strategy. Surely it would take top level supercomputers and programmers to run an entire country, but any random MBA with an Excel spreadsheet could run a business more successfully than a business without TPS reports and content-free numbers. So observationally, micromanagement and management by metric number should be a sign of a highly profitable and successful company, yet its usually associated with dying companies or companies only kept alive by what boils down to corruption (monopolies, licensing, regulation, revolving door between .com and .gov, etc).

If there was a solid argument WRT scaling explaining why the result would be different at extreme scale vs business scale then the picture might be brighter for central planning.

There are also growth rate issues where your two examples are unfortunately companies experiencing an implosion of mindshare, people run from those companies as fast as they can, not run toward them. That is probably just an unfortunate coincidence but does look bad for central planning PR. There must be some "cool companies" that centrally plan and are successful? Or maybe there aren't?

I think that any large business is already too large for the top to micromanage things. No human has enough time and free computing power in their head to do that. That's why I believe central planning run by humans is unworkable - we're too slow to handle the complexity.

But then again, successful micromanagement happens - it's usually called "strong leadership", "CEO with vision", etc. Apple with Jobs and Amazon with Bezos come to mind as past examples (not sure how Amazon is doing now, but there was a lot of praise written for Jeff's micromanagement), and the most visible current one would be Tesla and SpaceX under Elon Musk.

Worth noting that Google seems to use Oracle Hyperion - you pretty much have to use tools like Hyperion for consolidated financial reporting once a company gets past a certain complexity level.