Exactly, a well-functioning society requires a balance between individual initiative and collective coordination. Market forces can play a role, but they cannot be the sole guiding principle. I would make an analogy with complex organisms having a central nervous system and a brain to coordinate the actions of different organs towards a common purpose. A similar mechanism is necessary for seeing the big picture and making decisions that benefit society as a whole.

Such an institution is uniquely equipped to analyze information about available resources, population needs, and potential threats. By comprehensively assessing these factors, it can develop and implement strategies to ensure efficient use of resources. Moreover, a holistic perspective allows the central planning body to recognize the interconnectedness of economic and social systems, understanding how decisions made in one area might have consequences in others.

These types of institutions are indispensable for coordinating large-scale collective actions that demand substantial resource allocation and sustained commitment. History abounds with precedents of ambitious public initiatives that would have been inconceivable without central planning. These projects demand not only the efficient allocation of resources but also the ability to navigate political intricacies, manage diverse stakeholder interests, and adapt to evolving circumstances over extended periods.

Building a cross-country high-speed rail network, for example, is a monumental undertaking that requires immense capital investment, complex engineering expertise, and long-term commitment. Such projects often involve navigating challenging terrains, acquiring land rights, coordinating with various government agencies, and addressing potential environmental concerns. The upfront costs are astronomical, and the payback period can stretch over decades. Without the guidance of a central planning body, such projects inevitably flounder due to short-term thinking, conflicting priorities, and a lack of coordinated effort.

Even from a purely profit-driven perspective, such ventures are not attractive to private businesses. The massive initial investment, coupled with the uncertainty of long-term returns, makes them inherently risky. Private companies, guided by the need to generate shareholder value, simply won’t commit to such long-term, capital-intensive projects. However, the social benefits of such infrastructure projects far outweigh the desire for immediate profit. A high-speed rail network bolsters economic activity by facilitating the movement of people and goods, create jobs, improve social mobility, and enhance overall quality of life. These positive externalities, while not easily quantifiable in financial terms, contribute significantly to the long-term health and prosperity of a society.

Governments, unlike private businesses, have the capacity to take a long view and invest in projects that generate significant social benefits, regardless of their profitability. They are able to mobilize resources, coordinate diverse stakeholders, and ensure that infrastructure projects are aligned with broader societal goals and priorities. The success of projects of unprecedented scale and ambition in China is a testament to the power of central planning.