As my father said; “A house built on top of a poor base will always collapse”. An reference of this, socialism has already born broken.
Socialism is based on the theory of labor value: If the value is objective then there is a objective calculation for example:
value + profit = price
value is the raw material and the labor imposed on production. profit is the exploitation of the capitalist. price is the value in currencies. For Marx, profit is exploitation, its system is:
value = price
But we have a problem, value and profit are references to price. Without knowing the price, it is impossible to calculate the value or profit.
But how to calculate the price:
Through the law of supply and demand, we apply calculations to determine who the target consumers are and how much they are willing to pay for the product or service, this is called pricing.
How to make the pricing on a system that takes control of supply and demand for itself? This is the problem of economic calculation.
Example: imagine a soda cost 5 dollars.
Value + Profit = $5
Knowing the reference, the economist can determine the value of the soda and the profit by analyzing the expenses or hours worked. Result:
$3 + $2 = $5 — value + profit = price
Socialist theory works only in a world of free allocation of resources. In a world where socialism was applied, such calculations would be impossible.
Imagine the simple publication of a book. How would the socialist system determine which book to publish and which to publish? How do I determine how many books to publish and who is the target audience? and how to determine if it will be a public success or just a waste of natural resources? This is impossible in socialism