Mises Daily Articles
Planning Is Socialism
In the first line of his book, Planning for Freedom, Ludwig von Mises, the famed Austrian economist, observed "Planning is socialism." I will admit that my first acquaintance with government planners was a planning class in my Master's program, where I was given the party line about how important it was to plan for growth. I read dozens of books, by some very brilliant writers, bemoaning the fact that our society doesn't plan growth, and I was treated to descriptions of the planning utopia that would exist if we just "planned" our growth.
I then sat on a City Planning Commission.
Anyone who thinks that planning for "growth" is anything other than a exercise in futility is still experiencing the mind-altering visions that their college chemicals visited upon him or her so many years ago. Today's planners meet in little rooms, draw pretty pictures on paper maps, use the prettiest crayons they can find, and — whamo — the city has a plan. Wonder and utopia are supposed to follow, and never again will the city experience traffic congestion or cosmic disharmony.
We also don't have enough houses, apartments, or commercial buildings. More important, these necessary commodities all end up in the wrong place, and their placement seems to increase traffic and school congestion. The great plans, drawn by the learned planners, in search of community utopia, have all failed.
The fact is, people build stuff where they want to build it, when they want to build it, and how they want to build it, no matter what the government says. The only reason they don't build it is that the government will throw them in jail if they don't comply with the plan. The only people that don't build the right stuff in the right place at the right time are those that work for the government. In other words, we don't have traffic congestion because of developers;we have traffic congestion because planners don't build roads, and the government has more planners than they have road builders.
When the government draws up a plan, the plan works if the people who own the land agree with the plan (that is, if they think they will make money if they follow the plan). If they don't think they will make money, the land stays vacant. Interestingly enough, even developers don't decide what will get built, as they are also subject to market forces. Homebuyers and retail customers decide by choosing to visit the business or buy the homes that are built. Nobody builds a home that no one will buy, or starts a business that no one will visit. Customers and home buyers decide; not business, not developers, and particularly not government planners.
That is why I chuckle whenever I hear my colleagues in Sacramento talk about "ten year plans." This week, the Legislature had a bill for a "ten year" road plan. Of course, in California, it takes 23 years to build a freeway, because we plan and plan, and never build. The Legislature's solution? Another plan. We have planned so well in this state that today our roads are extremely congested, our houses cost entirely too much, our schools are horrendously overcrowded, our budget is out of balance, and we are running short on water, electricity and gasoline.
And we continue to extol the virtue of government plans. We know that socialism is a failed experiment, as demonstrated by the failure of the Soviet Union, socialism's most devoted practitioner. My socialist colleagues in the Legislature, however, think that they are smarter than the Russians and that socialism will work here in California if we just have the right plan. The most recent polls tell us that the public is not satisfied with how we are doing our job. Maybe we should try something different, like freedom and free enterprise, the principles that made this country great.