Certainly during the USSR's time. But now you could issue every citizen a smartphone through which they could register their demand.
>the optimization then will lead to planning only for the type of production that can ensure basic survival and not much more.
Sorry, but I'm not seeing how this follows logically.
Unless they are expending a limited resource to do so, the same problem remains. In capitalist market economy that resource is money [1], and it's universal and fungible, both bid for goods and services (and not just in typically "consumer" markets) and bid against with offerings of labor. If you abolish meaningful markets for some goods and services—including wage labor—you limit the scope of utility signals you get—even if, as most real world state socialist systems have done, you retain exchange of currency for “consumer” goods and services.
[1] which, despite its utility, has significant issues, too. Nothing in this post is meant to endorse the optimality of capitalism, only to explain the problem of utility signalling in state socialism.
Limiting the scope of markets limits the utility-signalling function of money, even if it is retained (as, in practice, centrally-planned systems tend to.)
This is a problem of input data that technology that provides alternative mechanisms to collect the same data (cell phone purchasing) does not address.
You could still have money but needing money to live a normal life or being able to use money to invest or stockpile goods would represent a failure of central planning.
Certain basic needs are definitely not created artificially. So every human being has requirement for food, clothing, shelter and the very minimum. The more I think about it, the more it seems like, for instance, primary sectors could be handled so much better with central planning. e.g. instead of growing artificially subsidized corn, grow only an amount of corn that is required by the economy (perhaps a little extra). Continuously adjust production to meet demand if it increases.
Demand for fancy food is more artificial. Maybe I love oysters but you like quail instead. So there could be a free market operating for oysters and quails.
There's a reason why nobody tries to declare food a human right and give it away for free, even though people die if they don't eat.
The Soviet Union and East Germany seem to be the only states which attempted Central Planning genuinely, and from this article and other resources, it seems the problem was simply too complex even then... at that time.
Well, it would serve to optimize (or come close to doing so) some utility function, which might be labeled "satisfaction of demand". But who defines that utility function? Some central planner.
But how does that central planner know what I actually want? Yeah, I could tell them with my smartphone. That's going to tell them a pretty coarse approximation to what my actual desires are, though.
For example: Life Savers candy. People choose to buy the stuff. A roll of them costs, what, $1? But how many people are going to bother listing that on their phones? A whole lot fewer people than actually buy Life Savers, I bet.
[Edit: What's actually going to happen is that an element of politics is likely to creep into the definition of the utility function. "Oh, they shouldn't want that; they should want this instead."]
That is exactly why it is incompatible with free market. Central Planning, ultimately, only cares about what you need, not about what you "want".