Jun 22, 2022
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The time has come for the triumphant return of the State Planning Committee

30 years ago, our country unanimously abandoned the State Planning Commission. But, as the classics said, history develops in a spiral. After 30 years, it becomes obvious that the State Planning Commission should return to us, but at a new stage, at a higher level of technological development.

When you think about the 1980s and perestroika, you remember, among other things, a total shortage of goods and empty store shelves. My parents and, to some extent, my peers went through these trials. People had money on hand, but it was impossible to buy enough food or consumer goods with it. We can recall the queues for washing machines, televisions, cars, etc. Later, we, economists, learned that inflation manifests itself in this form in a planned economy, which was indirectly confirmed by the fact that at that time the “black market” simply flourished.

But the problem was not only inflation… As statistics tell us, in the Soviet Union, not only all foodstuffs, but also most industrial goods were produced in sufficient quantities. It is clear that the USSR had obligations to support, including food, friendly regimes around the world (which, given the global role of the USSR, is quite justified). But even taking into account this factor, the total deficit is in no way connected with the scale of production in the late USSR. Soviet industry and agriculture worked, as they say, with a good margin of safety, but “everything and everyone” was sorely lacking …

And here we recall the very “notorious” Gosplan… Let me remind you that his idea was generally good and correct: it is necessary to see and plan all commodity and other economic movements and changes in the entire economic system. In any modern large business corporation, all such flows are planned and accounted for, as they say, “to the fullest”. Everything must be taken into account, starting with the plans for the supply of components and ending with the volume of finished products in warehouses. There should be no downtime of equipment or “overstocking” during the implementation, since all this is a source of additional costs, which means loss of profit, which shareholders are, of course, not ready to put up with.

This is how any successful private corporation really works, and the Soviet economy was a supercorporation, several orders of magnitude more complicated than any modern Boeing, Google or Amazon.

Solving problems of extreme complexity is a sign of the development of civilization. But as a result of the inevitable complication of economic relations at a certain stage of historical development (in those same 80s), our Gosplan faced the technological problem of the inability to take into account, control and plan all aspects of our common, ever more complex national economic development.

As a result, production plans in one part of the country began to disagree with sales plans in another, overstocking was superimposed on the deficit, “long-term construction” was accompanied by a slowdown in the implementation of the state housing program, etc. We observed all this in our own everyday life, but experts saw that neither Soviet computers, neither the most advanced automated control systems (ACS), nor economic and mathematical optimization models ensure the processing of the entire volume of information coming from the national economy. At that time on Earth (neither in the West, nor in the East) there really did not exist any information or technological solutions that would allow managing this whole “colossus”. After all, there were no computers of adequate power.

As is known from the general theory of systems, the control system must be more complex than the control one. And this law was clearly manifested in history with the impossibility of further effective planning in the late USSR. Gosplan as a planning (read – management) system turned out to be much “simpler” than the entire economic system, which it was called upon to manage.

What am I doing this whole conversation? Why all this historical and political economy excursion? With all responsibility, I intend to announce that right now the time has come for the triumphant return of the principles of the State Planning Commission, built on modern principles of digital development. For this event, I see at least three necessary, but already implemented conditions (or reasons, if you like).

The first condition: geopolitical. At present, our once “strategic partners” have put us in a situation where a significant part of the materials and components was suddenly unavailable to our manufacturers. This situation, by and large, is not problematic, and even more so critical, since for Western technological and other solutions there are certain domestic analogues or analogues in the foreign markets available to us. And at this moment, the State Planning Commission is needed. What is it connected with? Previously, almost instantly it was possible to freely buy anything in foreign markets. Now the situation has changed. However, the economy continues to work, people receive wages, and entrepreneurs open new industries. At the same time, any domestic manufacturer needs a clear planning horizon in one way or another, at least in order to ensure the modernization or expansion of its production.

Gosplan solves at least three tasks here: 1) determines the general need for certain products or materials (current and in the future); 2) allows you to build long-term contractual relationships; 3) allows you to establish certain prospects for the sale of finished products. In a situation where our manufacturer is often cut off from Western markets, a higher-level management system is needed, located above the market and outside the commercial interests of a particular entrepreneur, which allows building real production and commercial models. Practice shows that this system, as a rule, is formed by the state.

The second condition: national economic. In a situation of sanctions and foreign policy pressure, we all within our Russian economy, paradoxically, have become closer to each other. In fact, we are transforming from a disparate network of enterprises into a single national economic community. Accordingly, some questions can be transferred to a higher, common for the whole country level. Let me give you a simple example… We absolutely need to expand all possible logistics channels in the east and south directions. Business cannot do this alone. I will say more, not a single state corporation (even the most respected one) and not a single department (even the most powerful one) will hardly be able to do this alone. Large logistics corridors (“Far East-Pacific Ocean” or “North-South”) are national economic tasks due to their unambiguous complexity. This requires not only serious financial investments, but also political support, and even managerial support at the level of planning and coordination. You can also remember about import substitution, or rather, about import independence. It is also difficult to do without state planning. If we add about the need for Eurasian integration (at the level of the EAEU and the Greater Eurasian Partnership), then the management tasks become even more complex.

The third condition is technological. Now we can say with all confidence that modern digital technologies (as well as powerful computers) make it possible to solve the most complex economic problems. Blockchain, big data, artificial intelligence allow not only to operate with a huge amount of information, but also to build the most incredible models, forecasts and plans in terms of complexity. On a digital basis, it is possible to form a constantly working platform that operates with primary data that enters it in real time about all transactions, as well as about all movements of goods, services, capital and labor. On the one hand, we have complete information about all economic events, on the other hand, we have an array of proven technological solutions and capacities, and on the third, we can set ourselves a variety of ambitious tasks as a single national economic system. The Digital Gosplan as a platform is designed to convert the highest-level goals into specific plans for the country, industries, areas of activity, markets, regions or other national economic complexes based on digital technologies and primary data. The same “May Decree” and the national goals and strategic tasks of Russia’s development established in it can be decomposed into specific decisions, instructions and procedures.

An important note: in the conditions of the work of the digital Gosplan, the market is not canceled, commercial relations do not die off, and the opportunity to earn money remains unchanged. Commercial deliveries, as is known, are possible under the conditions of state planning. At the same time, digital tools (for example, blockchain) make these deliveries transparent and justified. Of course, nationalization in one form or another in the current economic conditions in Russia is possible and necessary, but this is definitely not a consequence of the implementation of the digital State Planning Commission.

The attentive reader will ask, if the necessary conditions for the revival of the State Planning Commission have already been implemented, then what about the sufficient ones? I also have an answer to this question: a sufficient condition is a political decision on the need, timing and organizational form for the implementation of the digital State Planning Commission.

Organizational form is a very important and non-trivial issue. As mentioned above, the digital Gosplan is a platform. But, as you know, any control system also needs to be managed, respectively, an operator or organizer of these platform solutions is needed. There may be several options for implementation. The most understandable and organic is the formation of a federal state body subordinate to the President of the Russian Federation and in coordination with the government and other authorities. Why not? The country is ready for this.

In conclusion, I would like to say that in this case with the digital Gosplan, we do not propose to “produce new entities”, we only want to restore the normal principles of managing a modern economy. If for this it is necessary to recall the experience of the Soviet economic system, then such an approach is quite justified, given the political and economic realities of today.

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