The Platform Socialist Calculation Problem

The Socialist Calculation Problem refers to the difficulties planned economies have in co-ordinating production and consumption in even moderately complex societies. The Platform Socialist Calculation Problem occurs when computational resources are cheap, but inputs to the calculation are of low quality because of poorly structured social co-ordination.

One of the clearest and earliest presentations of the original Socialist Calculation Problem is by Hayek. With striking foresight, and concurrently with Shannon’s invention of information theory, Hayek pointed out that the economy is an immensely complicated computational problem. In a market economy, this computation is massively distributed, and mediated through the price mechanism, with many different people adjusting prices based on local information, and thereby propagating information on supply and demand throughout the entire system. 

Every attempt at socialist planning we’ve seen in practice has basically fallen over, due at least in part to this problem. The calculation is more or less a  linear programming problem with a truly enormous square matrix, every row and column of which is a different product in the economy. Even though computational power has increased by many orders of magnitude since the 1940s, there’s good arguments that it doesn’t match the staggering scale that such a combinatorial explosion requires. Cosma Shalizi’s informal, but very well-informed, left-wing re-presentation of the problem in terms of algorithmic complexity is a good summary.

Soviet central planning was the largest scale demonstration of this failure. For a fictional, but historically well-grounded, exploration of it, you really can’t go past Francis Spufford’s novel Red Plenty. It is beautiful, and computational, and sad. It weaves through the multiple perspectives of bureaucrats, engineers, farmers and intellectuals as they try to make the experiment of central planning work, and how it fails, on both the primitive computational hardware available, and the social gaming of the system that happens so that people can survive.

And yet.

A number of recent books and articles have made the argument that however scary the Big O notation for calculating a modern economy is in theory, in practice, the problem is tractable to a good enough approximation. The theoretical argument by people like Cottrell and Cockshott is that most of the goods across an entire economy are not needed as inputs to the entire economy, so most of the entries in the enormous matrices are zeroes. This simplifies the calculation. Building on that, the authors of The People’s Republic of Walmart argue in cheerful, accessible prose that giant computational planned economies have grown up in front of our eyes in the last twenty years. The most obvious of these are Walmart in the US, and globally, Amazon. The close links between WeChat, delivery systems, and the Chinese state is also notable. The basic idea of Platform Socialism is that a government could take over these economies and run them not according to wealth but according to need.

(You might also be asking: Why does it seem now like I’m reading a god-awful, capitalism-fellating airport business book? Suck it up. Socialism is about logistics, comrade.)

Phillips and Rozworski, The People’s Republic of Walmart

I think platform socialists may be onto something. We have so much more compute power now, and so much more comprehensive, cheaply accessible inventory, that I think there is a good argument that the computational aspects of the Socialist Calculation Problem are solvable in many practical settings, through good approximations. My view has shifted over the last twenty years. But so has the tech, and the logistical power of these companies; and I’ve also become aware how even in WWI the House of Morgan played a central planning role in the simplified war economy. 

But there’s a second aspect to the the problem of socialist planning, and that’s of needing an alternative input to prices to signal and resolve production and consumption needs and desires. This is the problem of feedback against material reality. Amazon and Walmart don’t suffer from this, because as big as they are, they still sit within a wider market economy, its prices, and the purchase decisions of hundreds of millions of consumers. 

The Soviet, and traditional planned economist, substitute for external prices, is that work units and/or living units go through a budget planning process on some annual cycle, then there are iterations that resolve conflicts, etc. I don’t see how this would be any less painful and detached from reality than the bureaucratic budgeting process in large corporations or government departments. I’ve read or listened to a number of expositions of such planning systems, and they are universally dire and unconvincing, usually in turgid Marxist prose that sounds like it was emptied out of the oil trap of an undermaintained Soviet tank, an expression of the authors’ secret wish for death over the prospect of living through departmental budget mud-wrestling splayed through every level of social interaction.

The answer given by PR Walmart is more interesting. They propose that something like product reviews at can be a more dynamic and useful input to the planning calculation, and the shadow prices therein. This would probably supplemented with lot of voting and discussion, often online.

The last two decades of platform experience is terribly reminiscent of just this kind of interaction. Instead of getting free or cheap stuff from governments in return for votes, we get free and cheap stuff from giant tech platforms in return for having ads served up to us. Generally, as a social form, it kind of sucks. In many ways it is worse than the pre-platform internet. As a result I am more pessimistic about socialist ratings being a solution than I would have been fifteen years ago. Make that economic ratings platform pervasive without some better structuring mechanisms and you won’t get farsighted climate solutions, you’ll get TikTok mobs stamping on a human Boaty McBoatface, forever.

This is an institutional design problem, in the same class of problems as parliamentary government itself: the Platform Socialist Calculation Problem. Feedback on material and social reality has to be timely, robust, and not vulnerable to spam and dumb mobs.

Socialism isn’t the only system with a calculation problem. Benjamin Bratton calls the failure of market economies to include inputs not easily represented as agent-centric numeric prices the Capitalist Calculation Problem. Climate change is the most obvious and urgent example. No agent represents the damage of excessive atmospheric carbon as a price, except, crudely and after much kicking, the state. Even then political will to set an explicit price reflective of the damage still isn’t there after more than thirty years of trying; what signals do exist are sent through carbon taxes and centrally planned net zero targets. So capitalism has a problem with feedback from social and material reality as well, though it has to be said that it kicks in at a much higher level of complexity.

The institutional nature of the problem suggests there may be constitutional solutions. I don’t really see any Western lefties working on it, except maybe two Marxist economists, and a few Ethereum DAO people (Distributed Autonomous Organizations). In China you have serious smaller scale experiments with social credit, but not with more material economic planning, that I’m aware of. The attempts to redirect monetary capital to social ends, like KlimaDAO, are more convincing (and Klima basically died). At any rate, across this selection, I have not been impressed by anything but the experimental gumption of the DAO soviets so far. One thing in their favour is that spinning up a small platform business/commune gives immediate feedback on and experience with these ideas; unlike the usual socialist fairy dust of “first we capture the state, then we get rid of capitalism, then we can invent the socialist economy”. Platform socialism that doesn’t learn how to help people to thrive from the ground up won’t be worth a damn.

We are learning to think of democracy not in terms of the history of an idea or the emergence of a social movement, but as the assembling of machines.

Mitchell, Carbon Democracy


Cottrell and Cockshott – Economic planning, computers and labor values

Hayek – Economics and Knowledge

Shalizi – In Soviet Union, Optimization Problem Solves You

Spufford – Red Plenty

Phillips and Rozworski – The People’s Republic of Walmart

Carbon Refactoring

The logic of carbon pricing is explained by economists as pricing in an externality. The problems of climate change in this view is one of deep insincerity – a computational civilization continually lying to itself about the ecological substrate at its foundational layer. We have been professionally fooling ourselves for decades. Networks of sensors are in place to measure the state of the system but adjustments only weakly feed back. Carbon pricing has sputtered along without entrenching a self-reinforcing process, while container-based political systems, stuck in Westphalian tile-borders, flap unsteadily through variations of supporting legal regimes. This is exacerbated by what Bratton terms the capitalist pricing problem: the tendency for markets to mistake short term liquidity signals for long term plans, or as Keynes put it, “the market can stay irrational longer than you can stay solvent”.

Carbon debt is technical debt. Technical debt is a term coined by Ward Cunningham and widely used and recognizable in software development. It represents the difficulty of working with the accumulated design limitations of a highly mutable system, including bugs, but also many partial and mutually irreconcilable models of the world in code. Working on a legacy system, one ridden with technical debt, is to face a human created artifact which evades human comprehension, let alone control. Carbon is a technical debt megastructure.

Addressing problems of technical debt involves redesign. An important set of software redesign techniques, those changing the design without change of function, are termed “refactoring”. Michael Feathers describes refactoring legacy code as establishing a design seam, and tests, then changing the system on one side of the seam without changing the behaviour. Each layer of a stack establishes such a seam, and they are omnipresent in software, at all scales. The point of refactoring is not to freeze the function of the system, but to improve the design in small steps to a point where functional improvements are safe, or perhaps just possible at all. Climate change, the long financial crisis begun in 2008, and technical debt are all crises of addressability: of being unable to trace causal relations through a massive codified system.

The story of renewable energy so far has been that of constantly working against the established infrastructure of the industrialized world: every improvement seems to require some other piece to be ripped out. Power stations have been the clearest and most successful point of intervention because the variation of power station inputs facing the need for power distribution creates design pressure for standard interface points at seams. For instance, power plug and voltage standards decouple network endpoints from each other. Though price points of solar vs coal tipped a year or two ago, that this happened despite the cancer-belching external costs being barely priced-in shows the immaturity of the system.

Bratton notes that Bitcoin inadvertently created a more direct link between exchange currency and carbon through the CPU- and hence energy-intensive process of proof-of-work mining. Other designers and startups are since sketching how similar Earth-to-User links could become more established parts of the Stack. Proof-of-stake coins like (some) Ethereum cut the energy usage by cutting the Earth-to-User link. More speculatively, Edward Dodge has proposed using the blockchain as a distributed ledger of carbon account, with mining based on a ton of sequestered CO2. Altcoin CarbonCoin (now seemingly deceased) replaced distributed mining of difficult to calculate numbers with mining by an environmental trust that uses six orders of magnitude less energy and puts profits into carbon mitigation.

A possible system linking these starts with carbon consumption endpoints. Forests and oceans are major carbon sinks, and prospecting rights could be claimed for blockchain coin mining, with satellite photography and other sensors providing the requisite proof of carbon. The mining claim is more important to the network than the legal title to the land, because double-claiming the carbon sink would make the carbon accounting invalid. For natural assets, the mining device need not be in the same location as the trees, though a maturing platform demanding more precision might call for devices on the ground, linking the Wood Wide Web to the internet and the blockchain.  This could be an Internet of Things (IOT) device that mints coins. A larger network of miners might demand a stricter proof of carbon, to retain the advantages of decentralized mining, including the incentives to participate. A previous post covered a design sketch for such a system.

Proof of carbon definitions can be captured as public software contracts, using Ethereum or a similar platform. A related idea is proof of location. The system is not totally trustless – it depends on independently observable weather data, and this might include state bureaus of meteorology for reference temperatures. (Neither is Bitcoin trustless for that matter – there is trust in the development team maintaining the protocol and in the open source process they run.) This also gives locals to the forest or ocean concerned a co-location advantage similar to that of high frequency trading systems to stock exchanges. The world’s greatest carbon sinks are not found in rich world finance capitals: this would give a small home town advantage to those local to say the Congolian rainforest, somewhat mitigating the colonial character of much international finance. (Introducing internet and trading connectivity to forests, who the most radical botanists are now arguing have cognitive processes, suggests future design mutations where animals or forests are also present as users of social and financial networks, perhaps in a mutually incomprehensible way.)

Other such designs are possible, including more centralized ones: the main feature is establishing a direct carbon-tracking data structure touching Earth layer carbon sequestration, Earth layer carbon emission and User-layer action (in the jargon of Bratton’s The Stack).

Refuge Stack

The Stack is a computational planet-system terraforming itself. Managing it is absurd, and changing it happens everyday. Humans working to deflect the system away from climate change processes that would kill them isn’t hubris so much as self-defense. Energy and commodity networks have always accumulated social power. Now it is here, computational society has obligation spam and sincerity leveraging algorithms organized in networks, and power also accumulates around them. To computationally address one from the other is an act of geopoetical network realism. If it results in gangs of telemarketing red guard killer whales demanding carbon coin reparations, we’ll have to cross that bridge when we come to it.

The Platform Biostate

Quarantine – perhaps we should say the first quarantine – has lifted here, and children have gone back to school. This is of course a matter of tremendous individual good fortune, which I am grateful for, while also wanting to snapshot the alien mindset of this moment into text before new consensus realities congeal and solidify. Perhaps the moment has already gone; the text is here nevertheless.

Governments did act during the crisis according to a different idea of the state. The nascent ideology was only partially realized, but does stand in contrast to what we might call financial neoliberalism. They acted as if the state was an extension of its hospital system, that the health of their people was the most precious asset to defend, and they used networked computing infrastructure as means to that end. They acted as Platform Biostates.

Declaring the death of neoliberalism has of course been a recurring hobby of many political professionals and dilettantes. Declaring COVID-19 the end of capitalism or even just liberalism seems very wishful thinking. But the specific financial neoliberalism that defined public policy from 1970 to 2020 seems intellectually over. This saw the state providing gardeners to cultivate and harvest taxes from markets that were desirable and pervasive. Nowadays even a lively True Neoliberalism Has Never Been Tried book like Radical Markets isn’t much about using money any more, but introducing tokens to voting or immigration to create markets which do not trade in everyday currency.

The basic causal model of financial neoliberalism was that the health of the state was downstream of the free market, free trading economy, and that the health and prosperity of people is downstream of the state and the market economy. Of course there is some truth to this, or neoliberals wouldn’t have been as effective as they were in creating wealth and gaining power for their nations, from China, to Germany, to Chile, to New Zealand. Financial neoliberalism was also so successful because it is a partial ideology. It dictates how to organize markets and where the state should switch from mover to referee, but it also mixes with Chinese Communism, army juntas, social democracy, or corporate liberalism.

Chinese Navy Hospital Ship Peace Ark
Peace Ark 和平方舟/ Daishan Dao 岱山岛

The Platform Biostate is also a partial ideology, but the causal model is different. The power of the state is downstream of the health of its citizens. Money and employment are a means for optimizing that dependency.


Sketching some features of the platform biostate, more descriptively than normatively:

Baseline medical welfare. The state looks after the base health of all of its residents. This is both an ideological commitment to care and a herd management technique. Keeping a persistently unhealthy group roaming around the community makes everyone much more vulnerable to communicable disease, so people in the community have to be fed well and have basic medical needs attended to.

Prestige Epidemiology. The science of disease management is the premier technical field. Other fields don’t go away, or stop providing insight, but they are politically secondary. John Hopkins’ COVID-19 dashboard is more urgently read than the New York Times, and the money-conscious watch an infection curve for signs of flattening, not (just) a zigzagging stock chart. Health is the lead department, rather than the Treasury or a Ministry of the Interior. The flawed WHO is more important than the flawed WTO. Oxbridge changes its major to Politics, Philosophy and Epidemiology. Economists already recognize this shift, and have been stunned at attempts to fix a virus with monetary and fiscal policy (consider Paul Romer‘s calls for massively expanded state-funded testing in the US). Economists also expect epidemiologists to be part of a public policy conversation they are not yet used to. 

[Distracted Man/Economists]

[Shocked Face/Explaining Sociology to Sociologists]

[Red Dress/Explaining Epidemiology to Epidemiologists]

External biosecurity. The platform biostate is a hospital system with a navy attached. It knows which people, animals, and plants cross its borders, and it imposes controls on those it wants to exclude. The Platform Biostate wears a mask. This doesn’t make it a hermit kingdom, necessarily, but one with good information about what is near its borders, able to open or close the borders quickly and effectively, and practised at filtering according to current health criteria. And yes, one prone to overgeneralizing the idea to memes, race, or other criteria less biologically grounded.

Internal biosecurity. Threats to community health inside the border can be detected and acted upon quickly. Isolation, testing and tracking are deployed specifically to maintain community health. Alcohol breath testing, mobile health apps, and the prison system state anticipate this. The tracking may be very explicitly individual tracking by a central system, or it may be distributed, but responsive to emerging threats. The social obligation to isolate when sick is a widely held value and backed by law and the police.

Asynchronous delivery / Remote synchrony. Logistics networks end at the house and the office again. Meeting is online by default, remote by default, virtualized by default, a routine piece of greenscreen theatre. Offices themselves fragment and partition. Automated supply chains are bioshock buffers.

Ecosystem complicity. Food, water and air – how casually we let them flow through us; how futile our pretence of the mind’s separation from them. So many more now know what it is like to be breathing death on people, and not able to see the effects until a fortnight later. Without doubting the human capacity for doublethink, everyone did just get an intuition crash course on the diseased exhalations of fossil fuel power.


Why now? What changed?

Well, meandering failure of the old thing, certainly. Epidemiology was an obviously relevant alternative idea lying around, and with some existing institutional forms, which is always important in a crisis. The platform elements of this form of governance – dashboards, rapid publication, gene-based tests, big data, smartphones – are also relatively new in institutional time. So in one sense we may care about COVID-19 because it is now cheaper to care about it and states may act as platform biostates because there are now technological platforms to use. Another common explanation is a shift of political consciousness – a sudden surge of social-mindedness. Perhaps. I doubt the wellspring of human sentiment has grown so very quickly without some other structural attractor.

Take a world with a wide difference in wealth and income between elites and most people, particularly the 0.1% and the remainder, but also where a top 10% of technically skilled managers and technocrats do quite well: our world of the elephant and Loch Ness monster graphs. This is also an era of dynastic capital, as Piketty has shown. Merit paths are important but so too is ensuring boomer-accumulated capital is stewarded in an orderly way to maintain the next generation’s place in society. As a purely instrumental matter, if you are a member of this 10 or 0.1%, crime, poverty, schooling, clean food, water and air can be protected against in a fairly individualized or family-level fashion. You can get bodyguards, you can live in a compound, you can have air-conditioning and an armoured limousine. It’s not a marvelous way to live, in my opinion, but it’s livable enough. Pandemic, though, is particularly hard to deal with this way; there are essentially three solutions if you’re trying to preserve dynastic capital.

  • Hygienic fortress. The normal compound solution isn’t enough for a contagious pandemic, especially one with an asymptomatic period. You need very strict lockdowns with all your servants and a biosecure epidermis. This is affordable for the 0.1% but not the 10%. For both classes it is in tension with the need to maintain a professional and social network to stay rich. You can’t go to restaurants or fly across the ocean. This era of capitalism works by assembling profit constructs from globally separated opportunities; people need to socially work a cosmopolitan network to navigate and construct that. You can do this online, and reach opportunities you previously couldn’t, but you can’t exploit all the senses for social advantage online; you can’t read body language as well, or catch people in the break of a three day conference. How do you decide when to let people into the fortress? – do they spend two weeks in the citadel hotel? It’s also inaccessible, in our current urban infrastructure, to the technocrats that actually manage the world, rather than owning it.
  • High fertility backup kin. The traditional farmer and landed aristocrat insurance against catastrophe is diversification through redundancy. Have plenty of kids, over multiple generations, and so have plenty of aunts and cousins as well, so that when war or disease does sweep through some of you survive. This is in tension with the multi-decade trend of urbanization and drops in fertility rates. The tendency is to have only a few kids, then hothouse-parent them into a career that will keep dynastic fortunes alive for the next generation (and your geriatric care). Perhaps it will flip the trend and people will start popping out more kids again, but even if it does, it will take decades, and there will have to be some default political worldview in the meantime.
  • Rawlsian contract. If you still want to leave the house and be near strangers, you are faced with a veil of disease ignorance. Especially with contagious diseases with asymptomatic periods, you don’t know whether you will be in the diseased or the healthy role after twelve days, when the veil is lifted. Rawls’ solution of distributive justice then applies – make sure that no-one is ever too sick or uncared for, and you reduce the risk of your own misery or death when the outcome is finally revealed.

Essentially the third solution, familiar in shape due to the historical welfare state, is what rich governments tried to implement in the first half of 2020. Some did it quite well, due to fortunate timing, advantages of population size and geography, or previous experience in biosecurity. For others – like the US or UK – it seemed like the levers of administrative government were no longer connected to any wires underneath. Those states (and sub-national states, like California) that did function, and treated population health as causing wealth, are already in a more powerful position than six months ago. They kept capable people able to work, protected their families, and limited their distress.

John Hopkins COVID-19 dashboard screenshot


Optimizing for overall population and ecosystem health as a generator of power will still create losers (like all state power). A hospital is very good at treating sickness. It is also a bureaucracy that can be indifferent to people in need and make stupid mistakes. Medicine remains very fixated on treatment and on big centralized buildings of sickness control, all put under tension by the needs of keeping a population healthy rather than reacting only to sick people queuing for doctors. The epidemiological view of people as a population – a herd – also leans a manager towards the idea that a herd might be culled for the greater good. 

The platform biostate is a partial ideology: it can be combined with luxury airport quarantine stratification by passport and frequent disease flyer status, or drone-delivered Universal Basic Mask provision, or ideological hygiene death squads, if you try hard enough. It could have a neoliberal variant too: it’s pretty technocratic. Still, I am sympathetic to centreing the state on health, and think it’s perfectly compatible with liberal democracy, which I remain fond of. Financial neoliberalism was pretty good at creating wealth, markets and inequality. The platform biostate could be pretty good at cleaning up industrial toxins, governing by health dashboard and nagging like a harridan when individuals choose fun today over health a decade from now. Some Leviathans may rot; others may send the corpses to pathology for some bloodwork and an updated infection model.

((This piece owes something to Benjamin Bratton’s 18 Lessons of Quarantine Urbanism, which has a wider scope.))

Mountain City

The mountain city of Mount Huan is acknowledged to be one of the wonders of my home district, even though many a year goes by when it is not seen at all. A few years ago, the lawyer Sun Yun’nian was drinking with some mates on his verandah when suddenly they noticed a lone apartment block on the mountain opposite, rising up far into the deep blue sky. They looked at each other in sheer disbelief, as they knew of no condominium in that vicinity and had not had a chance to buy off the plan. Then a vast number of skyscrapers with blobject glass curves, abstract sculptures, antennas, and wall-gardens came into view, an unsolicited message from city hall arrived reminding them to vape responsibly, and they realized it was the Mountain City of Mount Huan.
Presently the expressways and light rail of the outer city became visible, and within them they could distinguish countless storied buildings, temples and residences. Suddenly a great wind arose, dust blew in, and the city could scarcely be seen any longer. By and by the wind subsided, the air cleared, and the city had vanished, save for one tall tower. Each storey of this tower had been pierced by sixty shuttered windows, all of which had been thrown open and let through the light from the sky on the other side. One could count the storeys of the tower by the rows of dots. The higher they were, the smaller they became, until by the eightieth story they resembled tiny stars, and above that they became an indistinguishable blur of twinkling lights disappearing into the heavens. It was just possible to make out tiny figures on the tower, some hurrying about, others leaning, or standing.
A little while longer, and the tower began to decrease in size, until its roof could be seen. One by one, pieces the size of an apartment or a gondola would detach, descend at an orderly pace down the side of the building, and roll away, disappearing from view. The tower continued shrinking still further to the height of a stadium, and then a car, then a bean, until finally it could not be seen at all.
It’s said you can fly to Mount Huan, if you need to, and that maps work fine in the city centre, but are glitchy to the point of useless in the suburbs. You have to get a local app: I forget its name. A determined walker can take in the whole layout of the city – its markets, its users, its parks. It is in no respect different from a city in our world. The annual “Ghost City Marathon” has become popular in recent years, and is well regarded, though there are problems recording accurate times.


Pu Songling, Strange Tales From A Chinese Studio, Minford trans. Story 89 from Minford / Story 251 in Zhang Youhe is a model for this text.
Pu Songling, Liaozhai Zhiyi, 聊齋誌異會校會注會評本, Zhang Youhe ed, 1978.