I've been reading quite a bit about the 'socialist calculation debate' over the last year. It's interesting how much it continues to shape present political dilemmas. The argument that Mises and Hayek put forward was devastatingly simple, and like all the most irresistable arguments, basically circular. This was that (I simplify further) even if a society did have a set of common needs, which the state or planning boards could efficiently satisfy, we would have no way of knowing what these would be, at least not in a complex, modern, industrial society. So the Rousseauian and Durkheimian idea of 'society', as a collective with a common interest, is left philosophically in tact, but technically unfeasible.
You can see shades of this argument in response to Ed Miliband's proposal to cap the retail price of energy. In a way, it's astonishing quite how much an outcry the policy provoked - but this is indicative of how deeply the Misean/Hayekian worldview has permeated elite policy thinking. Ultimately, Miliband was claiming an authority for the state that the vast majority of business leaders (and probably the public) no longer credit it with. As Philip Mirowski has repeatedly stressed in relation to neoliberalism, its core justification is epistemological in nature, hence the challenge to Miliband would be - 'who are you (or your regulators) to know what the correct price of energy is?'
This also relates to some of the most interesting analyses of financialisation and its limits. Greta Krippner's Capitalizing on Crisis is a superb analysis of why financial markets were given a free reign from the late 1970s onwards. Her answer, simply put, is that US politicians and regulators were tired of becoming embroiled in normative questions of credit allocation, on the back of the culture wars. The beauty of the market, from a political point of view, is not that it is necessarily efficient or optimising, but that it relieves public figures and institutions from having to take moral positions on things. It is a way of absenting oneself from a thorny normative issue. This is effectively what Mises argued right back in 1920, drawing on Weber. Krippner goes on to show how policy-makers never dreamed that the supply of credit would expand to the extent that it did (largely because nobody foresaw the US becoming such a massive net importer of credit), hence there was nothing deliberate about how financialisation worked out.
Another fascinating sociological analysis which suggests this is Martha Poon's study of the rise of consumer credit-rating, which was a necessary (but not sufficient) condition of the explosion in consumer debt from the 1980s onwards. It was due to liberal legislation passed by Congress in the 1970s, aimed at reducing racism by lenders, that automated, statistical techniques for credit-rating were introduced. The 'social' nature of banking was thereby replaced by an 'instrumental' alternative, which was ultimately more conducive to an explosion in credit and securitisation.
One thing which occurs to me, which I've not seen discussed (though I'm probably missing something here) is the very unusual solution to the socialist calculation problem offered by Keynes, which is still available to policy-makers. This is, effectively, that politicians don't need to pursue goals that people actually want, they don't need to know what people want or value. It is perfectly OK for states to do things purely for the sake of it, regardless of whether there is a need for them. Hence the famous Keynes quote about paying people to dig holes and then fill them in again, as a plausible way of getting an economy moving. Equally, there are some policies (such as HS2) for which policy-makers do not seem so anxious about their popularity. For those who understand macroeconomics (or claim to), this makes good sense. But the public cannot grasp it, and the Misean challenge returns.
In terms of post-neoliberal political economy, it seems to me that there are two alternative modes of valuation emerging, which challenge the authority of markets to settle normative and epistemological disputes (because it is, after all, their ability to settle such disputes which grants them their untouchable political status even amidst crisis, and not their alleged efficiency).
Firstly, there is the rise of 'wellbeing' as a new unit of calculation, which draws on medical, neurological, cognitive and behavioural analyses. By returning to Bentham, this directly contradicts one core feature of the neoliberal argument, that only prices are capable of calculating utility. I discuss this a bit here. Although there is some emancipatory and transformative potential buried deep inside this agenda, its popularity with global elites (it was a major feature of the 2014 Davos World Economic Forum) makes me doubt that it can retain the ability to challenge economic power. The concern with this concept of value is that it will be increasingly medicalised, and administered via new networks of quasi-medical, quasi-managerial expertise.
Secondly, more promisingly, there is the notion of 'life' as it is appearing in more critical policy discourses. This is as in 'living wage', 'cost of living' and 'livable cities'. Here it is the conditions of 'life' that are being demanded for all - energy, food, shelter, childcare and so on. Miliband is in fertile territory here, but is still largely stuck at the level of rhetorical attacks on predators. Interestingly, Oskar Lange (the leading opponent of Hayek and Mises in the debate) suggested that planning boards would collect information on 'life conditions', which would then be channelled into investment decisions and production. To my knowledge, and with the greatest respect to the New Economics Foundation who are typically excellent on this sort of thing, the Left of today has not yet set about building the valuation frameworks which would accompany the political rhetoric of 'life' and 'living'.
If I were Owen Jones, that would be where I would go next. Until measures, comparators and standards of valuation are available, which are not reducible to prices, then financial markets will continue to let rip, for the political reason that (aside from the Tories being effectively owned by the big banks) politicians lack the legitimacy to challenge their allocations. And where market mechanisms themselves manifestly seem to fail, elites have medicalised versions of the 'wellbeing' agenda ready at hand, to provide alternative forms of government. The challenge right now is to value life, but in ways that are neither price-based nor purely biological.