There are those who think that it would be much much better if we were to do away with these chaotic and wasteful market things and simply allocate resources to where they are needed, those wise people at the centre making the decisions about what should be allocated where for us. To a greater or lesser extent this is true of anyone suggesting socialist measures: from those who want the full out planned economy to those who merely bleat that some things are too important to be left to the market.
A little lesson as to why they\’re wrong:
GP surgeries across the country are experiencing problems after deliveries of vaccine changed from weekly to fortnightly.
Deliveries were supposed to stay at the same level but many practices have found they have received just a fraction of their normal vaccine allocation.
It means that despite there being no shortage nationally many surgeries do not have enough jabs as parents bring their babies in for routine immunisations.
There\’s been no change in the number of vaccines ordered, no change in hte number delivered centrally, so what\’s the problem?
The Department of Health calculated how much vaccine each surgery would need and distribution company Movianto, which makes the deliveries in temperature controlled vehicles, then wrote to surgeries informing them of their allocations, which were supposed to be based on the ordering history of each surgery.
Errors were made in the calculations but discovered before the new deliveries started and the Department of Health assured practices that they would receive the correct number of vaccines.
However, yet more errors were made in the second set of calculations and so some surgeries were given too few vaccines.
Aaaa….those socialist calculators screwed up, not once but twice. Now note that they were not trying to predict demand, they weren\’t trying to work out the price they would have to pay to get the vaccines manufactured, nor the price they would need to pay doctors to do the vaccinations. No, they were simply trying to change the distribution system from a weekly one to a fortnightly one. And they cocked up twice.
So, think how much more disastrous it would be if the same planners were trying to plan the incentives in the economy, rather than this much more simple distribution of something already to hand. Think if said planners were trying to plan, say, 150,000 relative prices…..you\’ll now understand why the Soviet System left people so staggeringly poor, as such errors cascaded through the system.
You\’ll also get an idea of why the NHS and the education systems are as they are….worse than they need to be given the resources spent on them. For they are indeed planned in such a manner.
Large scale detailed planning (yes, in either public or private sectors) doesn\’t work: it\’s called the socialist calculation problem and no, it hasn\’t gone away with the advent of computers and spreadsheets.