The Impossibility of Socialist Economic Calculation: A Problem for Grunts

Going 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.

According to a 60 minutes report, produced by Robert Anderson:

Troops 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.

Some 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.

Col. Hackworth and Soldiers for the Truth 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?

The 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 Action, Mises describes what he calls "the impossibility of economic calculation under socialism."

We 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?

The 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).

The 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.

In 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.

The 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.

Anyone 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.

An 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?

One 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.

March 6, 2003