The dispute between planned and market economy.
All we know how it was ended.
But maybe the planned economy has hurried to surrender some decades before her complete morale victory?

I saying about situation with costs of production.

Let's imagine the isolated city where two firms produce some goods (cars for example). These two firms completely cover need of those goods for this city.
Some time later the third firm that produce those goods was open.
The number of those who needs those goods has not grown.
For preservation of profit in the given situation, firms should compete among themselves involving clients by quality of services, assortment of the goods, advertising etc...
All this will demand additional expenses for advertising agents, managers on sales, designers and other parasites.
The assortment of production should be updated every year.
Then the costs of production of those goods in thats city will grow.
There is two ways to compensate those costs:
1.To reduce cost of manufacture.
2.To rise the price.
Both ways are limited.
The first is limited by activity of trade unions and a level of technological progress.
The second by a level of incomes of the city population.
Gross national product of city will grow, but savings of the population will be reduced. As an additional bonus the society of this city will receive consumer idiocy.

In planned economy there is only one firm - the state.
And it aspires to reduce costs of production.
There will be only few types of those goods (models of cars), which will be produced for years, by numbers sufficient for a society.
The costs of production will be minimal and the price of those goods will be low.

Today we observe a situation when the majority of spheres of real production and trade in the USA become unprofitable.
The costs of production is TOO high.
The result - manufacture is translated to the countries with low production costs, and the debts of trading firms growing without stop.

The question is not in what system are better.
Free market are the best for the people.
The question is - may the society provide it to itself?
Whether has the future the free market and if yes, whether that exists border where the free competition should be stopped by force?
Or the phantom of communism does not sneak any more across the Europe and goes on the world to full growth?

sorry for my english.

Your basic assumptions are wrong.

I concur with Shiva's assessment.

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Libertarian/Authoritarian = -7.08
Economic left/right = 6.62

"The only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or moral, is not a sufficient warrant." -John Stuart Mill

Chinas success is not based on planned economy. Ironically Chinas success bases on the worst kind of ultra capitalism that Europe and even the US have already abandoned in the very late 19th century.

There's no reason that would be ironic.

In any case, the regulatory climate is tighter and more inefficient in China than in the US. it's not laissez-faire and the problems with it (and with 19th-century America) have to do with the stage of development it's in rather than the amount of control the government has in the economy.

If you wanna see an example of the ultra-capitalism seen in America and Europe in the 19th century, look a little south to the city-states of Hong Kong, Macau and Singapore (And notice how successful those places are).

__________________
Libertarian/Authoritarian = -7.08
Economic left/right = 6.62

"The only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or moral, is not a sufficient warrant." -John Stuart Mill

Yes that is irony (situational) because China was founded based on anti-capitalistic principles and now they are more capitalistic than most other nations.

It doesn't matter what the reasons are for the current situation. I talked about the result. The result is ultracapitalism in large parts. (At least in those regions that matter economically)

The European countries never claimed to be communist in any way in the 19th century, thats where the irony arises from. A communist country today (and may it be by name only) hosts some of the worst sorts of ultracapitalism.

Where did I say that China can not be successful therefore? Even though I do not know what Singapore has to do with China, it's right that those acquired parts like Hong Kong and Macau are different. I don't know the situation in Macau, but Hong Kong has a high grade of autonomic law and as important law enforcement.


But when we are making those historic parallels, I am already eager to see if in China this ultracapitalism will climax in the formation of truly independent unions as well, that will take up a real fight against it, one that really changes the country.

That would be even more ironic in fact. A workers revolution against the ugly face of capitalism in a "communist" country. I am really sorry if you can't see the potential irony in such a scenario.

The smaller city-states and capitalistic countries in Asia are a prime example of how capitalism works. The hyperactive growth of the US in the 19th century and during WWII in the 1940's is do to the work-ethic of the society of the time.

Many newly rising Eastern European capitalist nations (freed after the Cold War) have adopted capitalism but not the ethic of the time. While the work ethic of the Asian nations like Hong Kong, Singapore, and Taiwan, have fueled them into a massive economic growth. But when compared with China we can see how China has fallen short.

In 1963 Taiwan was 13% of the 1963 US GDP (per person) while Hong Kong and Singapore were are 27%. Come 2003 Taiwan is now just below 60% of the 2003 US GDP and Hong Kong and Singapore are at 80%.
In 1963 China was 5% of the US GDP and grew to only 13% of the US GDP, the population does skew the curve a little but not that big of a difference.

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If money makes the man, then who owns who?

It's not really fair to parallelize China's growth timeline with those of its smaller, freer neighbours, because during Mao's reign of terror from 1949 until 1979, China experienced long-term stagnation and possibly even decline (the Great Leap "Forward" ring a bell?). China started growing in 1979, when it started liberalizing the economy.

__________________
Libertarian/Authoritarian = -7.08
Economic left/right = 6.62

"The only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or moral, is not a sufficient warrant." -John Stuart Mill

It is my beleif that China in the near future will have a key impact on the price of oil.
China will also be a key factor in the higher search for alternitive fuel.