ss 1,2

prout.econ

Planned Market Economy

November 12, 1994

Q: If capitalism can be described as a market economy and communism as a planned economy, how should the Prout economy be characterized? What is the comparative role of markets and planning in Prout? What will be the relationship be between markets and planning?

The market economy propounded by the capitalistic system has one flaw. That is that there is no check and balance to curb the greedy actions of the entrepreneurs or the capitalists, so one human being might exploit many others for profit without any repercussions. There would be no curb on their actions and thus, in this situation, the society suffers and the human beings are in pain. So the capitalist system is flawed because there is no regulation of the vested interests of the primary capitalists. This leads to exploitation of the people. Because of this, one cannot support a capitalistic system.

In the communist system, this flaw is compensated, but there is another flaw. The human spirit is not allowed freedom of expression so there is no motivation for achievement. People feel suppressed. This is the flaw of the communist system. There is so much control that, though no one is allowed to exploit others, everyone feels they do not have the power to make their own way. Their spirit becomes suppressed. Therefore, it also is a flawed system. It leads to depression and lethargy in the people and ultimately the society suffers just as much as in the capitalistic system. Both systems are flawed, neither system promotes the human welfare. So the questions arises, how to promote the human welfare?

Now in the Prout system there is regulated economic freedom. There is political autonomy, local control of economy and regulated intervention. That is to say, there will be a free enterprise system, a market economy, but with regulation so that the vested interests of a few cannot outweigh the welfare of the collective. But at the same time, the initiatives of the individual is not suppressed, only the excess is controlled. So, in Prout economy, there is not suppression of initiative, but there is the regulation of activities. Therefore, there is a market economy with a planned market economy. Do you understand planned market economy? It means there is free enterprise but the free enterprise takes place within a certain structure and within that structure there are built-in controls so that greed and personal advantage may not outweigh the collective good. But yet, an individual may make a place for themselves, may gain more, may be prosperous due to their own initiative, as long as they stay within the guidelines that have been established. And those guidelines will not be overly strict. They will merely contain excess, not stamp out the initiative of the individual. So, it is essentially a market economy with planning. So this is the relationship between markets and planning. If more detail is wanted, specific questions should be asked.