Dwarkesh Patel

I think the even more interesting question is why a system that was so centrally planned, monstrously inefficient, brutal, a colonial land empire, how such a country could survive for so long into the 20th century.

So I feel like that's the thing that actually needs explanation.

How did this regime last for 74 years?

So dictatorships can certainly sustain themselves for a long time, but the Soviet Union was special in that by the 60s and 70s, they have a GNP that's 60% of America.

It's this incredibly dynamic economy.

In the 40s and 50s, they have much higher growth rates, so much so that prominent economists like Paul Samuelson are saying that by the 90s, based on what they're seeing at the time, the Soviet Union will have a bigger economy than America.

And this is just...

Quite surprising that they would have such high growth rates.

If you just think about how central planning works, people are going to tell you how much steel you can make and which company gets to use the cotton fabric and cement and et cetera.

And you have hundreds of millions of people living under the system.

And it's just actually quite shocking that they actually had notable growth rates after World War II for decades on end.

But my favorite example of this is, so there were top-down commands that you had to produce a certain amount of steel.

And a steel factory would then be incentivized to make thicker bars of steel rather than thinner bars because that would counter its greater production.

Except a lot of

inputs actually do require the thinner sheets.

So then the other factories have to thin down the steel, but that also counts towards GDP.

So producing the inefficient steel and then cutting it down to size is both being double-counted towards GDP.

I wonder if one thing that's going on is in the early and mid-20th century, you have economies where,

which are much simpler, at least compared to today.

So even then, obviously, command and control is less workable than capitalism.