Socialism, that is, full government control of all economic activities, is impracticable because a socialist community would lack the indispensable intellectual instrument of economic planning and designing: economic calculation.
As soon as an undertaking is no longer operated under the profit motive, other principles must be adopted fro the conduct of its affairs. It's naive of the champions of nationalized and municipalized enterprise to say say that the public enterprise's duty is to render useful services to the community. Because every undertaking's sole task is to render useful services.
The question should be: How do we find out whether the scarce resources are used in their most appropriate way?
With private profit-seeking enterprise this problem is solved by the attitude of the public.
As the account of profit and loss is not to be considered the criterion of the management's success or failure, the only means to make the manager responsible to the boss, the treasury, is to limit his discretion by rules and regulations.
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