There would still be the problem of collecting accurate data to permit the algorithm to work. This would be expensive and people could lie to their own advantage.

BUT! Most economic models assume acquiring the necessary information for decisions is free AND they assume your agents always faithfully serve your interests. So once again these modeling assumptions have made the world safe for central planning. Praise the economists!

There's a second problem with a centrally planned economy: when you put all the power in one place, corruption can occur; even if the central planner knows the globally optimal decision, they may be incentivized to choose a solution that is suboptimal, but favors some individuals.