The Impossibility of Socialist Economic Calculation: A Problem for Grunts

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into the current war with Iraq, former army Col. David Hackworth
has brought up an interesting dilemma facing the ground troops in
the Iraqi theater of operations. It turns out that in the face of
a US assault on Iraq, the butcher of Baghdad may use chemical and
biological weapons as a deterrent. Hackworth has pointed out that
the Nuclear Biological & Chemical (NBC) protection (MOPP gear)
used by troops is woefully inadequate, particularly for an assaulting
force. He informs us that the protective suits were designed for
troops to don when attacked by an NBC agent, so they can survive
and withdraw from the contaminated area. They were not designed
for assaults in a battlefield dealing with obstacles like barbed
wire and extreme heat.

to a 60 minutes report, produced by Robert

in the field are so frustrated by the lack of preparedness that
they have twisted the acronym NBC, for nuclear, biological chemical
warfare. "Truth to tell, the troopers call it, u2018Nobody
Cares:' says retired Col. David Hackworth
, an advocate of
soldier's rights. "What they've been saying to me is that
they don't trust their gear. They don't think it will work in
a desert environment where it's burning hot. A soldier without
confidence is in trouble," Hackworth says.

of the protection available could get a soldier killed. If initial
waves of troops run out of new gear, they would have to resort
to older protective suits, up to 250,000 of which have potentially
fatal defects and are still unaccounted for. There have also
been errors made, such as gas masks issued with training filters
instead of the real thing and shortages of protective suits.

Hackworth and Soldiers for the
have made a valiant attempt to inform the public,
the families of servicemen, and the grunts in the field, about the
dangers they face with an NBC environment in the Persian Gulf. They
cite studies from the Government Accounting Office and as well as
insight from former and anonymous, concerned service members to
support their arguments. Despite all these concerns made public,
still very few seem to care. There have been efforts by Pentagon
officials in response to Hackworth's concerns, yet they still seem
inadequate. Why?

grunts of this war are facing the same dilemma they have faced in
previous wars. There always is a shortage of the proper goods and
materials needed to prosecute their campaigns, particularly from
those whose role it is to supply and support the frontline troops.
The answer may come, not from another soldier, but from an economist,
Ludwig Von Mises. In his classic treatise on economics, Human
, Mises describes what he calls "the impossibility
of economic calculation under socialism."

have assumed that the director has already made up his mind
with regard to the construction of a definite plant or building.
However, in order to make such a decision he already needs economic
calculation. If a hydroelectric power station is to be built,
one must know whether or not this is the most economical way
to produce the energy needed. How can he know this if he cannot
calculate costs and output?

paradox of "planning" is that it cannot plan, because
of the absence of economic calculation. What is called a planned
economy is no economy at all. It is just a system of groping about
in the dark. There is no question of a rational choice of means
for the best possible attainment of the ultimate ends sought.
What is called conscious planning is precisely the elimination
of conscious purposive action (Human
Action XXVI

Mises quote applies directly to military logistical planning, also
known as the three "B's," beans, bullets, and bandages.
And in the current case of NBC protection, we see a lot of "groping
about in the dark." Sure there are costs estimated by bureaucrats
for NBC protection, but there is no calculation as understood from
the economic perspective of supply, demand, and profit. The reality
is that military units are run as collective entities with socialist
type principles, which unfortunately leads to a deprivation that
can lead to death. Let us demonstrate the supply, demand relationship
that a grunt may face in this situation.

all economies, whether socialist or free market, there are consumers
who demand goods and services and the businesses that supply them.
In our example, the grunts (infantryman) are the consumers. Like
in all command socialist economies, a grunt's gear is "freely"
provided by a central supplier, or quartermaster. There is no exchange;
rather, gear is not purchased, but provided for. There are no bids
by the consumers to signal to the suppliers exactly what goods are
needed. A grunt is issued gear with the hope of receiving gear that
is serviceable and of a correct size. If it is incorrect, he may
requisition, via a bureaucratic process, to get correct gear. He
may have a small head and require a small helmet, but there may
only be large helmets remaining in the supply shed. What is he to
do? Like a good grunt, he'll overcome, adapt, and make do. Or he
may try a barter exchange with a soldier with a big head and a small
helmet. Another alternative is that he can go outside the military
network and purchase one at a surplus store. Unfortunately, these
options may not be available for all types of gear. He may want
to go to the outside market to replace his currently unreliable,
plastic framed MOLLY backpack, for the older, more reliable, metal
framed ALICE pack. But such a purchase may be considered inappropriate
by a command seeking uniformity of gear. Of course it should be
noted that such purchases become impossible in the combat theater
of operations. The grunt's economic situation is reduced by the
friction of barter trade and extreme shortage.

calculation problem becomes even more accentuated with NBC gear.
As anyone who has trained with a gas mask knows, size is of the
utmost importance. It's never fun spending time in a chamber filled
with CS gas wearing the wrong size gas mask. What is a grunt to
do when he has the wrong size, or defective, or broken after a long
day of urban assault? His only hope is that his chain of command
has requisitioned enough of his size from supply so that he can
have one as well. If not, he is SOL. There is some hope of barter
exchange. Maybe he can trade with another mismatch in his platoon.
Maybe there are no other matches in his platoon. Maybe he can see
if there are any other matches in other platoons or companies. The
problem he faces with looking in other units is the time it may
take going up and down chains of command finding a match. He runs
the risk of not finding one in time before the next gas attack.
This process will most certainly cause anxiety for the soldier dealing
with the shortage of his type of gas mask. Without the right size,
a proper seal cannot be maintained around his face to protect him
from chemical agents. He should be able to don and clear his mask
in nine seconds during an attack. As a last resort all he may be
able to do is steal a mask from one who is wearing the proper size,
and with that action he puts another one of his comrades into the
same conundrum. Of course in the current situation as laid out by
Col. Hackworth, after two or three chemical attacks, whole battalions
or regiments may face this shortage.

who has served in military service has been presented with the calculation
problem in one way or another. It is interesting to note that individuals
participating in the market economy hardly face such issues. With
free exchange of goods, services, and money, consumers are able
to find satisfaction of their needs and wants. People don't go to
the Gap to receive a supply of clothes, that potentially may not
fit the way they want. If there are no extra large jeans the consumer
can go elsewhere to a competitor and find it. Through the signals
of prices, suppliers are able to gauge what consumers need and want.
Through profit and loss mechanism, if a supplier does not meet the
demands of consumers, it may go out of business, giving way to other,
more competitive suppliers. For the grunt as a consumer there is
little else beyond the central supply and Army Navy surplus stores
at home. When on the battlefield his only resource is a central
supply that is unable to properly meet demand, because there is
no way to economically gauge how much is needed. There is no profit
or loss. No prices to signal to supply that the grunt needs it now.
The sad reality is that the grunt ends up like the poor proletariat
of the USSR waiting for the masters of the central supply to give
to them. The proletariat can either wait for his government and
potentially starve to death, or he can go to the black market, or
maybe just steal from others.

understanding of economics, particularly from the Austrian economists
like Mises, Rothbard, and Hayek, can help the grunt understand the
dilemma he is facing and why he is facing it. It would help him
understand why there is not enough effective NBC gear. Why no one
from the top listened to complaints about the M16A1, during Vietnam?
Why was there a Lance Corporal guarding the Marine Barracks in Beirut
with no rounds for his weapon? Why was there no tank support for
the Rangers in Somalia? Why mortarmen fire 81mm projectiles from
1972 in the year 2001? Why MRE's (meals ready to eat) tastes like
crap? Why nobody cares?

may respond by saying that these problems were later resolved, by
supplying future operations with what they need. The problem is
that in Vietnam the grunts needed a better rifle at that time. That
poor Lance Corporal needed rounds and maybe some claymore mines
when the bomb-laden truck was blazing through his post. The Rangers
needed tank support then. Our buddies going to Iraq need effective
NBC gear and lots of it now. Maybe that's why commanders get caught
in the trap of fighting the last war. They end up with the gear
they needed to fight the last war in the current fight. Maybe the
calculation problem for collectivist entities is one of the major
reasons why unleashing the dogs of war should only be used as a
last resort, if at all.

6, 2003

Khan [send him mail]
works as a risk analyst in Phoenix, AZ, where he lives with his


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