Read Time Will Run Back Online

Authors: Henry Hazlitt

Time Will Run Back (31 page)

BOOK: Time Will Run Back
7.05Mb size Format: txt, pdf, ePub
ads

“Such as what?”

“Suppose a manager of a particular factory turned out an output with a greater value than his input. Why not allow him to keep the difference?”

“All of it?”

“Well, half of it... or, say, some fixed percentage of it.”

“Suppose the situation were the other way round, Adams, and the manager’s input—his cost of production—were greater than the value of his output? Would he have to suffer the loss?”

“Exactly.”

“Suppose he didn’t have that much for us to take away from him?”

“Then, chief, you would be back to my penalties. Fire him. Or, if the loss was big enough, let him starve. Or shoot him.”

“I’m afraid, Adams, that your proposal wouldn’t quite work out. Suppose a manager really had a surplus of output over input. How would we know that that wasn’t merely the result of his having taken a reckless but lucky gamble? Or how would we know that it wasn’t really the workers in that factory, and not the managers, who were responsible for the gain shown? Or—most important of all—wouldn’t it probably be true, for the most part, that the gains and losses shown by the different factories had little or nothing to do with their individual management but were caused primarily by the arbitrary prices that the Central Planning Board put on the raw materials or labor that a factory bought, or on the finished products that it sold? In short, wouldn’t the gains or losses shown by individual factories depend primarily on prices? And aren’t we, then, right back to the price problem?”

“But if you have a price system for consumption goods, chief, why can’t you have a price system for the tools of production?”

“For the simple reason, Adams, that consumption goods are owned by individuals who exchange them only at ratios that they consider to their personal advantage, while all the tools of production are owned by the State. The State can’t sell to and buy from itself.”

“But why not, chief? Why can’t one industry sell to another, or buy from a third, even if all of them are State-owned?”

“Because the prices set would be arbitrary, fictional and meaningless. The Central Planning Board, Adams, just can’t
play
‘market’; it can’t
play
‘price system,’ like children playing house. Markets and prices, in order to perform the function they do perform—that of showing us the relative values that users and consumers put on things—must be
real.
Our present system of arbitrary allocations of raw materials and labor, arbitrary decisions concerning how big each industry should be and exactly how much of each product should be turned out—this is at least a controllable plan. It may not give people what they want, but at least it is far better than fixing prices at random and then watching the bizarre and unpredictable things that would happen under them.”

But Peter was troubled by Adams’ criticism that he condemned proposals without trying them. A few weeks later he came up with an idea that had been maturing in his mind for some time.

“One of our great troubles, Adams, is that we are trying to plan more than any human mind can hold. We are trying to plan
every
industry—and all their interrelations—and all the rest. Why not let the workers of
each
industry control and police their own industry? That would decentralize control and break up the planning problem into manageable units.”

“The idea has possibilities, chief... but it might lead to results we couldn’t foresee.”

“Precisely,” said Peter; “and that is why we ought to try it out.”

“But the results might be bad. They might give Bolshekov just the excuse—”

“Why not try it out, then, only on a small scale? Why not apply the idea, Adams, in only one province—far away from Moscow? Why not throw a censorship around that district, so that no news could get in or out until we were certain that the experiment was a success?”

“Have you decided, chief, who our guinea pigs would be?” “How about the Soviet Republic of Peru? That’s certainly remote enough!”

So Peter arranged to go to Peru personally to supervise his experiment. He kept his trip a public secret, redoubled the guard around his father, had Bolshekov more closely watched, and left Adams again in charge of Wonworld at Moscow.

At the very start he found himself confronted in Peru by a problem of unexpected difficulty. He wanted each industry to be self-governing and independent. But what
was
an industry? Where did each industry begin and end? Did the copper industry consist purely of the copper mines? Or did it include the smelters? Did it include the makers of copper wire? Or were the wire makers—whether they made wire of copper, aluminum or steel—a separate industry? Should the sugar growers be grouped with the sugar refineries or with the farmers? Were the shoe manufacturers part of the leather industry, or part of the apparel industry, or an industry of their own? Was carpentry part of the building industry, or part of the furniture industry—or a separate industry?

These problems of classification were endless. No general principle seemed to apply. Practically every decision finally made, Peter at length realized, was at least partly arbitrary, and most of the decisions were completely arbitrary.

At the end, when the Peruvian commissars he had appointed had finished their work, they had named fifty-seven different industries. Peter had asked that these be reclassified into an even fifty, but he now recognized that they could be classified into only a dozen “industries” or into several hundred.

A temporary head was named for each industry. Someone jokingly nicknamed these heads the industry “czars.” Each industry was told to organize itself in any way it thought fit, provided each worker was allowed an equal vote. The industry could fix its own production, its own prices or terms of exchange, its own hours and conditions of work, its own entrance requirements.

Some Peruvians called the new system “syndicalism”; others called it “guild socialism”; and still others liked the name “corporativism.”

Peter returned to Moscow, promising to be back in Peru in six months to see how the new system was working. He left a secret cable code with the three top commissars to keep him informed.

Before two months had passed he received urgent cables begging for his return.

He came back to find a chaotic situation bordering on civil war.

The first thing the workers in each industry had done had been to exclude anybody else from entering the industry. Each industry had quickly discovered that it could exact the best terms of exchange for its particular product by rendering it relatively scarce. There had then developed a competitive race for scarcity instead of for production. The workers in each industry voted themselves shorter and shorter hours. Each industry was either withholding goods or threatening to suspend production altogether until it got the prices it demanded for the particular kind of goods it had to supply.

Peter was indignant. He called in the various syndicates of workers representing each industry and denounced them in blistering terms for the selfish and shortsighted way in which they had “abused” the privileges he had conferred upon them.

But as he studied the matter further he cooled off, and took a more objective view. He was forced to acknowledge to himself that the fault was his own. It was inherent in the system he had set up. He had allowed each industry to become an unrestrained monopoly. The more essential or irreplaceable the product that it made, therefore, the more it could and would squeeze everybody else. Inherent in his system had been the assumption that production existed primarily for the benefit of the producers—whereas, he now saw, its only real justification was what it provided for consumers.

He dismantled the new system entirely, and ordered the restoration of the old centralized socialism under the Central Planning Board at Moscow.

Bolshekov, he later learned, had got wind of the experiment and its failure, but fortunately had had no way of making his knowledge public. Peter thanked his lucky stars—and Adams’ foresighted advice—that he still had control over the radio and the newspapers.

But as an economic reformer he felt more frustrated than ever before.

Then suddenly, one night at the piano, when he was playing a Bach fugue, an idea hit him like a bolt of lightning. He stopped midway in an intricate passage. His mind had been returning to a question that Adams had asked: “Why can’t you have a price system for the tools of production?” And he thought of his own answer: “Because consumption goods are owned by individuals... while the tools of production are owned by the State.” Of course, that was the right answer... but wasn’t there an answer to the answer?...

Yes, there was!
Why hadn’t Adams made it then? Why hadn’t he himself thought of it then? He knew the answer! The tools of production didn’t
have
to be owned by the State!

It was late at night. But he rushed, hatless and coatless, out of his own apartment, took the automatic elevator to the street level, waved aside the sentries at the main entrance, and ran alone along four blocks of solitary streets to Adams’ rooms, using a pass key that Adams had given to him. He routed him out of bed, shook him awake, threw his arms around his shoulders, slapped him on the back, hugged him.

“I’ve found the answer, Adams!” he shouted. “I’ve found the answer to all our problems! I’ve found the key that unlocks everything:
Private ownership of the means of production!”

Chapter 30

EVEN Adams became cautiously enthusiastic when Peter explained all the consequences he expected from his proposed reform.

“I’ll put it into effect immediately,” said Peter.

“No, chief; it’s too revolutionary. You must consult the Politburo first.”

“But Bolshekov is certain to oppose it, Adams! And he would probably swing the whole Politburo with him, with the exception of ourselves. He has every advantage. He would probably argue that my plan was new, untried, untested, revolutionary.... He might even say that it was anti-Marxist!”

“Don’t you think it
is
a trifle anti-Marxist, chief?”

“I’m not concerned with that, Adams. I’m only concerned with whether it would work. If I were to put it up to the Politburo, they wouldn’t let me do it, and so I would never find out. I didn’t consult the Politburo when I proposed a free exchange system for consumption goods; but once we put that into effect it was a great victory.”

“I must admit it’s only because of that, chief, that Bolshekov’s been afraid to move in on you. But—”

“Then let’s act immediately,” said Peter. “This is our trump card. It’s so important, so revolutionary, that we should put it into effect with great fanfare. I’ll make a thumping radio speech over a worldwide hook-up. I’ll draft the speech right away. We’ll order the text published in the
New Truth
and every other newspaper in Wonworld for release the instant I start talking. We’ll print millions of folders with the full text. We’ll develop slogans....”

They started to work. Peter began drafting his speech. It explained the scheme, and what its great consequences would be. The details would have to be worked out. The people must be patient in the meantime. But instead of everybody’s owning a theoretical one-billionth of every tool of production in Wonworld, each person would now wholly own either a specific tool or at least a definite percentage of a specific machine or factory....

The draft went on to explain what “ownership” would mean. It would be a system of legal rights, established and protected by the government. Each individual would have the right to use as he saw fit the particular implement or machine to which he held legal title. He would not have to wait for directions from the Central Planning Board for every move he made. He would be able to share his tools or machines voluntarily with others, to “lease” them or exchange them on any terms mutually agreeable

There was a lot to be packed into a half-hour’s talk. As soon as the text had been drafted to his satisfaction, Peter fixed an evening three days off as the time for its radio delivery. It was put on the wires and cables for simultaneous publication throughout Wonworld.

On one consequence, however, he had failed to calculate. One of the mimeographed copies of the proposed speech that went to the office of the
New Truth
was sent immediately to its editor, Orlov. Orlov had been persuaded to go along with the new setup on the argument that Peter was Stalenin’s publicly appointed deputy. But he read the prepared speech with mounting horror, and then took it directly to Bolshekov. Bolshekov read it in a cold fury.

“That does it!” he announced. “This young idiot must be stopped!”

Peter and Adams were at their regular afternoon conference in Stalenin’s office.

“Our next step,” said Peter, “is to call in our two Italian economists, Patelli and Baronio, and have them work out the details of the new sys—”

Adams jumped up. “Those were shots!”

“I think I did hear shots,” said Peter, rising slowly.

They stared at each other with a wild surmise. Neither dared to put it into words. Sergei burst into the room, his face livid. “His Supremacy has been shot! He’s dying!”

They rushed into Stalenin’s bedroom. He was in bed, breathing heavily. Blood was seeping through the sheet above him. Peter stumbled over a body.

“Who’s that?” he asked, looking down.

“The assassin,” said Sergei. “This guard shot him.”

The guard stepped forward. “We found these papers on him, Your Highness.... One of Bolshekov’s gang.” “I’ve already called the doctors,” said Sergei. “They’ll be here in a few minutes, but—” He shrugged his shoulders hopelessly.

Peter bent over the dying man. “Father!”

His father grabbed his hand and looked at him appealingly. He seemed to be making a desperate effort to say something. “Rec—rec—record!” The record! Peter squeezed his father’s hand tenderly and bent down to kiss his brow. He turned to Adams.

“Quick! We haven’t a moment to lose!”

They rushed back to Stalenin’s office. Peter turned the safe combination, took his key from an inside pocket, and unlocked the little steel door to the compartment containing the two recordings that Stalenin had so foresightedly made. He was surprised to find his hand shaking.

BOOK: Time Will Run Back
7.05Mb size Format: txt, pdf, ePub
ads

Other books

Let's Ride by Sonny Barger
Two Mates for a Magistrate by Hyacinth, Scarlet
Daughter of the Sword by Jeanne Williams
Bitter Sweet Love by Jennifer L. Armentrout
Three Way by Grant, Daniel
Street of the Five Moons by Elizabeth Peters
Splintered Lives by Carol Holden
The Far Side by Wylie, Gina Marie