Economy
Former socialist economist explains why central planning never works

From the Fraser Institute
Central planning from the inside—an interview with a Soviet-era economist
In our descriptions of socialism in Poland and Estonia, we often quoted firsthand accounts of Poles and Estonians who lived through the period. These were workers, consumers, victims of oppression and resistance fighters. One voice that we didn’t capture was that of the planner—the government official charged with making the economy work, despite socialism’s enormous handicaps.
To better understand that perspective, I recently interviewed Gia Jandieri, an economist who worked for the State Supply Committee in Georgia from 1984 to 1989.
In 1989 Gia cofounded the very first non-governmental organization in Soviet Georgia (the Association of Young Economists) to push for market economic education. And in 2001 he established a think-tank, the New Economic School, to promote economic freedom. The New Economic School has been a full member of the Economic Freedom Network since 2004.
Here’s our discussion (lightly edited for readability):
Matthew Mitchell (MM):
How did you become an economist and a Soviet planner?
Gia Jandieri (GM):
It was accidental. In 1984 my mother worked at the Gossnab (the State Supply Committee for the Central Planning Authority) and she offered to introduce me to her boss. At that time I was only 23 years old and had graduated from the Georgian Polytechnical Institute. My knowledge of economics was mostly from life and family experience (my parents worked at a metallurgical plant).
But as a student in 1979 I had had what I thought were a few strange discussions with a teacher of political economy. Like most teachers, he was no true believer in socialism (it was hard for anyone to believe at that time). But he was required to teach the propaganda. What surprised me was that he was willing to publicly agree with me about my suspicions that the system was failing and might even collapse. This was rare, and he was taking a risk. But it also inspired me. It is also important to note that he wanted to hide his hesitation about Marxism and the Soviet system and he also wanted me to stop my questions, and/or stop attending his lectures (which was of course not allowed). I recall he told me: “either I report you or someone reports both of us for having prohibited discussions.”
When I finished my university study of engineering, I was already sure I wanted to be an economist. So, when the opportunity arose in 1984 to work at the State Supply Committee, I seized it.
MM:
Tell us a little bit about the job of a planner. What were your responsibilities? And how did you go about doing them?
GJ:
Our department inside of Gossnab was responsible for monitoring the execution of agreements for production of goods and government orders. My task was to verify that the plans had been executed correctly, to find failures and problems, and to report to the higher authorities.
This included reading lots of reports and visiting the factories and their warehouses for auditing.
The Soviet economy had been in a troublesome condition since the 1970s. We (at the Gossnab) had plenty of information about failures, but it wasn’t useful. We knew that the quality of produced goods was very low, that any household good that was of usable quality was in deficit, and that the shortages encouraged people to buy on the black market through bribes.
In reality, a bribe was a substitute for a market-determined price; people were interested in paying more than the official price for the goods they valued, and the bribe was a way for them to indicate that they valued it more than others.
The process of planning was long. The government had to study demand, find resources and production capacities, create long-run production and supply plans, compare these to political priorities, and get approval for general plans at the Communist Party meetings. Then the general plans needed to be converted to practical production and supply plans, with figures about resources, finances, material and labour, particular producers, particular suppliers, transportation capacities, etc. After this, we began the process of connecting factories and suppliers to one another, organizing transportation, arranging warehousing, and lining up retail shops.
The final stage of the planning process was to send the participating parties their own particular plans and supply contracts. These were obligatory government orders. Those who refused to follow them or failed to fulfill them properly were punished. The production factories had no right or resources to produce any other goods or services than those described in the supply contracts and production plans they received from the authorities. Funny enough, though, government officials could demand that they produce more goods than what was indicated in the plans.
MM:
What made your job difficult? Let’s assume that a socialist planner is 100 per cent committed to the cause; all he or she wants to do is serve the state and the people. What makes it difficult to do that?
GJ:
There were several difficulties. We had to find appropriate consumer data and compare it to the data of suppliers (of production goods mostly). I was working with several (5-15) factories per year. I needed to have current and immediate information, but the state companies were always trying to hide or falsify their reports. In some cases, waste and theft could be so significant that production had to be halted.
The planners invested vast sums of money and time in data collection and each had special units of data processing.
This was a technical exercise and had nothing to do with efficiency or usefulness. The collected data was outdated by the time it was printed. The planning, approval, and execution processes could take many years to complete, and by the time plans were ready, demand had usually changed, creating deficits of what was demanded and surpluses of what was not demanded. The planners, no matter how dedicated or intelligent they might be, simply couldn’t meet the demands of the customers.
Central planning was not an easy exercise. The central planners needed to understand what was needed—both production supplies and consumer goods. But, of course, we had no way of knowing what people truly wanted because there was no market. Consumers weren’t free to choose from different suppliers and new suppliers weren’t free to enter the market to offer new or slightly different goods.
One of the more helpful ways to find out what people wanted was to look at what consumers in the West wanted since they actually had economic freedom and their demands were quickly satisfied. The government also did a lot of industrial spying to steal Western production ways and technologies.
MM:
Were most of the planners you encountered 100 per cent committed to the cause? Were they incentivized to serve the cause?
GJ:
Some of the staffers were dedicated to their work. Others were mostly thinking about how they could obtain bribes from the production factories as a reward for closing their eyes to mismanagement and failure. The planners were also involved in more significant corruption to allow the production factories to have extra materials and financial resources so they could produce for the black market or so they could simply steal.
Then the revenue from these bribes would be divided among all personnel from different agencies (like the Price Committee, Auditing (“Public Control”), and several other agencies charged with inspections). So, in fact, the system generated corruption as a substitute for official incentives. If anything was still operating, this was mostly due to these corrupt incentives and not in spite of them.
The planning system was quite complex and involved many governmental offices though the main decisions were made by the Communist Party. Planning authorities would report to the Party leadership what they thought would be possible to produce and Party leaders would inevitably demand higher quantities.
Gosplan was bureaucratic to its core, both in principle and character. Nobody was allowed to innovate other than planned/artificial innovation. Everyone had to work only by decrees and orders coming from the political leadership. The political orders and bribes were the only engines that were moving anything. Market incentives didn’t exist. Bonuses (premia) were awarded according to bureaucratic rules, and, paradoxically, these destroyed the motivation of the genuinely hard workers.
MM:
Moving beyond economics a bit, how did the socialist system affect other aspects of life? Culture, families, relationships, civil institutions?
GJ:
One of the examples is Western pop-music. Soviet propaganda tried to hide Western culture. Music schools mostly taught Russian classical music and some folk music of various Soviet ethnic nationalities, but it was mostly Russian.
Jazz and hard rock were not prohibited but very much limited. That of course encouraged smuggling and illegal dissemination, as in every sector. Soviet music factories were buying some rights to the music (for instance the Beatles, Louis Armstrong and Ella Fitzgerald). But these recordings were only available in limited quantities and were of bad quality in order to limit their influence.
Small illegal outfits would make unofficial and illegal copies of any popular western music (not classical).
Cultural institutions like theatre or cinema were harshly censored and mostly served the propaganda machine. The people involved in these sectors did what all producers of goods did. They needed to lobby their benefactors in the bureaucracy, bribing and currying favour with them in different ways. It was said that only one out of four films produced would be shown in the cinemas. The other three films were only produced so studios could steal the resources and obtain higher reimbursements.
Before Soviet rule, Georgia was a property rights and ethics-based society. We have ancient proverbs that testify to this. The Soviets killed the ethical leaders, the property-owning elite, and confiscated their property. The stolen property was supposed to be held in common. In fact, the bureaucracy took it.
State ownership of property opened the way to waste and theft of construction and production materials, office inventory, fertilizer, harvested agricultural products, etc.
In Georgia, one bright spot was underground education. Georgians succeeded in growing a network of informal tutors who effectively operated despite very harsh efforts by the authorities to quash them. These skillful teachers prepared the young people for university exams. This was so widespread that some successful young people (including my wife and friends, for instance) started offering private (completely illegal) teaching services when they were university students.
MM:
To this day, socialism remains alluring to many in the West, especially young people. What do you have to say to the 46 per cent of Canadians aged 18-34 who support socialism?
GJ:
Very simply, it is a mistake to think socialism fails because of the wrong managers. This mistake allows people to think that it’ll work the next time it is tried, if we just have better people. In fact the opposite is true—socialism invites the wrong managers. It doesn’t reward a great manager who tries to improve the system but a person who can adapt to and accept the corruption, waste and theft. Socialism also encourages corruption. When more resources are in the control of politicians and the bureaucracy, there is more favouritism, privilege, and discrimination. Jobs and business opportunities are based on privilege rather than market competition. This means naïve people will always be cheated by brazen liars and manipulators.
Poor people are told that the state is under their control but in fact the bureaucracy and political hierarchy control everything.
In socialism, nature and natural resources are abused and wasted. The Tragedy of the Commons runs rampant without private property, voluntary cooperation, and ethics. The government tries to manage everything centrally and totally fails because it lacks dynamic information, competitive discipline, and proper incentives.
2025 Federal Election
Mark Carney is trying to market globalism as a ‘Canadian value.’ Will it work?

From LifeSiteNews
By Frank Wright
A campaign to appeal to national sentiment is a strange gambit for Liberals – committed as they are to the replacement of the nation with globalist policies.
The storm over Donald Trump’s threatened tariffs over the Canadian border crisis has been baked into a vote-winning meme by Canada’s Liberal Party. Yet with an election only weeks away on April 28, can a sentimental appeal to a vanished Canada secure a win for Mark Carney?
Trump’s tariffs were expected to hit Canada on Wednesday’s “Liberation Day,” refueling a furor over Canadian sovereignty which has led some to say this is “shaping up to be the trade war election.”
Responding to the tariffs, which ultimately never came to fruition in the way the Liberals were warning, a meme war broke out with Carney responding to harsh reality with a feelgood slogan.
Elbows up, Canada. pic.twitter.com/0gJ2opnPjZ
— Mark Carney (@MarkJCarney) March 22, 2025
“Elbows up!” is the new Current Thing in Canada, a media craze designed to stir nationalist indignation in elderly voters who may even remember the 1950s origin of the phrase.
The elbows refer to those of Gordie Howe – a 1950s hockey legend from Saskatchewan – a conservative province – and from a time when Canada was populated by Canadians.
It bears all the hallmarks of an “astroturf” campaign – intended to look authentic, but in reality a manufactured mass belief for marketing purposes.
“Elbows up” seeks to inspire a fighting mood against the threat – or promise – of tariffs on Canadian trade with the U.S.
Carney will ‘cave’
It is a classic example of the manipulation of popular feeling into political allegiance. How will the feelings of aging voters affect the imposition of tariffs? Not at all. Nor will the Canadian Prime Minister be able to stop them.
Insider reports say that Carney will “quietly cave” to Donald Trump over the issue, if the U.S. president does indeed go forward with them.
Prepare for the Carney ‘cave’ on trade with the USA
Ian Bremmer is the boss of Gerry Butts and Mark Carneys wife’s at Eurasia Group. He just told US decision makers that:
“I expect Ottawa will quietly fold shortly after the vote….”
Ian, sitting daily with Carneys inner… https://t.co/PVQIeUzuFQ
— David Knight Legg (@KnightLegg) March 27, 2025
Silence over ‘devastating’ Chinese tariffs caused by Trudeau
Why? Carney has no alternative. He has already “caved” – to China – over the same issue. “Devastating” Chinese tariffs took effect over a week ago in Canada, as Global News reported:
Canadian agricultural producers are warning of devastating impacts from new Chinese tariffs that began Thursday (March 20th), which they say will compound the economic strain from the U.S. trade war.
The tariffs are severe, and will have a dramatic impact – as China is Canada’s second-largest trading partner behind the United States.
“China has imposed a 100 per cent levy on Canadian canola oil and meal, as well as peas, plus a 25 per cent duty on seafood and pork,” the outlet reported.
These tariffs cannot be corrected by hockey memes, and are a response to tariffs placed on Chinese goods by Liberal Prime Minister Justin Trudeau. The Liberal Party – seeking election over outrage on tariffs – has created a tariff crisis, whose costs will be borne by the people who vote for them.
There are no “elbows up” against China. In fact, their tariffs have been greeted with silence from Carney, who has said U.S.-Canada relations are at an end.
Corruption, drug cartels in Canada
Anger at Donald Trump obscures the serious problems which prompted his suggestion that Canada could be absorbed into the United States. “Elbows Up” is a cool way of making Canadians look past the fact that the crisis they inhabit has been created by the Liberals and their globalist agenda.
On February 1, Trump issued an executive order “Imposing duties to address the flow of illicit drugs across our northern border.”
Terry Glavin, writing in January for Canada’s National Post, dismissed Trump’s earlier claims of a crisis over Canadian “border security and drug trafficking” as a “pretext” for his “…declared objective of exerting ‘economic force’ to annex Canada as the 51st American state.”
Yet this too appears to be a fantasy inspired by national sentiment – which simply ignores reality.
As LifeSiteNews reported, Canada’s second bank has laundered over 18 trillion dollars in the U.S. and Canada for Mexican and Chinese drug cartels. The world’s largest fentanyl factory was discovered in Vancouver in February.
Canada a ‘failed state’?
The serious issue of corruption by Chinese Triads combines with a picture of impotent Canadian law and border enforcement to suggest that Canada may be, as Glavin warned, “approaching failed-state status.” When the memes wear off, this is the reality faced by Canadian voters.
Canadians have complained since 2017 that life is too expensive to have a family.
Now “a generation” cannot afford a home, and many struggle to pay for groceries. Help is at hand, however.
Their Liberal government supports Medical Assistance in Dying (MAID) – killing the elderly, poor and ill as healthcare – whilst promoting radical “gender” ideology to help sterilize children.
Will Carney come to the rescue?
Carney is a committed “Net Zero” fanatic, and is the kind of “Catholic” who fervently supports abortion.
His moral integrity is demonstrated further by the fact that his $25 billion “green” investment fund was located in Bermuda to dodge Canadian taxes.
As the Canadian Catholic Register cautions, “[Carney] is a well-connected globalist with deep ties to institutions such as the World Economic Forum, the United Nations, Bank for International Settlements, and the Financial Stability Board.”
Globalist ‘Canadian’ values
National identity is a strange appeal to make on behalf of a party which appears to be working hard to replace Canadians with immigrants, and which is now lead by a globalist technocrat.
It is the values of globalism, of course, which are presented to voters as “Canadian values”: open borders, LGBTQ “rights,” “gender” surgery and hormones for children, and the Net Zero deindustrialization program strongly supported by the Liberal leader Mark Carney.
How long can this appeal to save the nation of Canada from foreign influence convince Canadians to vote for more of the same? The Liberal Party has led Canada into crisis, presiding over corruption so severe that its police, judicial and border authorities are deemed incapable of being trusted by the USA.
This is not a charge made solely by the Trump administration, but also under Biden – with Antony Blinken pressing the matter of the insecurity of the Canadian border as far back as 2022. In the coming weeks, the real issues which have consigned Canada to a fond memory may well shrink the Liberal lead reported by the polls.
What do the polls say?
With some headlines trumpeting an “eight point lead” for the Liberals, others show a narrower advantage for the globalist Carney – and one leading firm has them tied with the Conservatives.
Abacus Data’s March 30 poll had both parties neck and neck at 39%. Abacus, who describe themselves as “Canada’s most sought-after, influential, and impactful polling firm,” “…were one of the most accurate pollsters conducting research during the 2021 Canadian election.”
A second poll shows a narrower lead, and a clear bonus for Carney for simply not being Justin Trudeau.
338 Canada showed a four point lead for the Liberals on March 31, and its graph clearly illustrates that their lead relies on disaffected NDP voters – and the collapse of the Bloc Quebecois vote.
Reality enters the chat
With the issues at home now overtaking Trump and his tariffs, the cost of living and those allied to mass migration such as housing are returning to the forefront of voters’ minds. The issue of reality – and who is the real Mark Carney – may well overtake the fake nationalism of “Elbows up.”
A campaign to appeal to national sentiment is a strange gambit for Liberals – committed as they are to the replacement of the nation with globalist policies – and of its people through mass immigration. Carney has been powerless to halt Chinese tariffs. He is powerless to halt those of Donald Trump.
If Canadians can see beyond cringe hockey memes these two issues are clearly a reaction to the actions and inaction of a Liberal-led Canada. This is the reason that Conservative leader Pierre Poilievre is campaigning on the harm done to Canadians by the “lost Liberal decade.” If Canadians can be persuaded by the argument presented by reality, it seems unlikely they will vote for another – whatever the polls may say.
Business
‘Time To Make The Patient Better’: JD Vance Says ‘Big Transition’ Coming To American Economic Policy

JD Vance on “Rob Schmitt Tonight” discussing tariff results
From the Daily Caller News Foundation
By Hailey Gomez
Vice President JD Vance said Thursday on Newsmax that he believes Americans will “reap the benefits” of the economy as the Trump administration makes a “big transition” on tariffs.
The Dow Jones Industrial Average dropped 1,679.39 points on Thursday, just a day after President Donald Trump announced reciprocal tariffs against nations charging imports from the U.S. On “Rob Schmitt Tonight,” Schmitt asked Vance about the stock market hit, asking how the White House felt about the “Liberation Day” move.
“We’re feeling good. Look, I frankly thought in some ways it could be worse in the markets, because this is a big transition. You saw what the President said earlier today. It’s like a patient who was very sick,” Vance said. “We did the operation, and now it’s time to make the patient better. That’s exactly what we’re doing. We have to remember that for 40 years, we’ve been doing this for 40 years.”
“American economic policy has rewarded people who ship jobs overseas. It’s taxed our workers. It’s made our supply chains more brittle, and it’s made our country less prosperous, less free and less secure,” Vance added.
Vance recalled that one of his children had been sick and needed antibiotics that were not made in the United States. The Vice President called it a “ridiculous thing” that some medicines invented in the country are no longer manufactured domestically.
“That’s fundamentally what this is about. The national security of manufacturing and making the things that we need, from steel to pharmaceuticals, antibiotics, and so forth, but also the good jobs that come along when you have economic policies that reward investing in America, rather than investing in foreign countries,” Vance said.
WATCH:
With a baseline 10% tariff placed on an estimated 60 countries, higher tariffs were applied to nations like China and Israel. For example, China, which has a 67% tariff on U.S. goods, will now face a 34% tariff from the U.S., while Israel, which has a 33% tariff, will face a 17% U.S. tariff.
“One bad day in the stock market, compared to what President Trump said earlier today, and I think he’s right about this. We’re going to have a booming stock market for a long time because we’re reinvesting in the United States of America. More importantly than that, of course, the people in Wall Street have done well,” Vance said.
“We want them to do well. But we care the most about American workers and about American small businesses, and they’re the ones who are really going to benefit from these policies,” Vance said.
The number of factories in the U.S., Vance said, has declined, adding that “millions of workers” have lost their jobs.
“My town [Middletown, Ohio], where you had 10,000 great American steel workers, and my town was one of the lucky ones, now probably has 1,500 steel workers in that factory because you had economic policies that rewarded shipping our jobs to China instead of investing in American workers,” Vance said. “President Trump ran on changing it. He promised he would change it, and now he has. I think Americans are going to reap the benefits.”
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