I only performed a quick high level read of this thread, but I didn't see the core reason why communist nations fail.
The socialist calculation problem continues to be a devastating problem for communism and it's probably the biggest reason for China's current economic downturn.
I don't think people realize how complex a fair market value is. I can't imagine that anyone here has purchased or sold something major without looking online to see the market price. I doubt anyone here would accept someone else's word on a market price either, especially during a transaction.
As an accounting/finance professional, a functioning operating market is, sometimes, the only accepting method to value something. There are other methods to value something, but it takes very complex mathematics and lots of brain power. Simple valuation models like the Black-Sholes equation actually rely on Market Prices, and as such wouldn't work without a market place.
It's easy to take FMV for granted until you realize that the resources in this entire economy are allocated using FMV. A high FMV could indicate high demand, high quality or scarcity. This will in turn signal resource allocators to make more of these products or develop production means to reduce costs and perhaps lower the FMV.
A high FMV can signal investment into something that brand new. If investors start pouring money into some new company, it's usually a signal that this new company is doing something right and that the masses actually want what this new company is offering.
On the flip-slide, a company with a low stock price usually isn't doing something that the masses want. Or it is doing something the masses want but in a very inefficient manner.
Furthermore, very few people really can hear the pulse of the masses. Not in some social justice way, but in gauging the practical wants and needs of the masses. I can only name a handful, and these people are extremely rich or successful.
In a communist society, there is no means to assign value unless the administration uses super computers, detailed surveys, advanced statistical techniques and complex math. Then, how can they do that for every conceivable product in the economy? How do you properly value an apple or a steel ingot?
There very few people who can really predict the wants an needs of the masses. How can a administrator determine how many Cars to make? Or how many trucks to make? Or how many apples to farm? Or chickens to kill? Once again, I'd imagine it would take super computers and every citizen would have to wear some type of monitoring device like Google Now, that could collect enough data to accurately predict trends for every citizen.
On second thought... You know, honestly, I think we have reached a point where we could have functioning communist society. We have the data collecting tools, we have ultra powerful cloud computers, we have Google devices that can accurate predict one's wants, needs, future choices and future next moves. Furthermore, people are more than willing to allow constant monitoring.
We also have whole genome sequencing and CRisPR, so an administrator can accurately control skill sets of the population.
Maybe it could work? especially in place like china where people tend to confirm and behave like drones.
