In Defence of Nationalised Industry

National Coal Pic

Since the 1970s, nationalisation has had a bad reputation, caused by the inefficiency, poor performance and appalling quality of some of its products. The classic example of this was British Leyland, hit by a long series of strikes, producing cars of a poorer workmanship and much less attractive than its foreign, increasingly Japanese, rivals. Yet the authors of Socialist Enterprise: Reclaiming the Economy, Diana Gilhespy, Ken Jones, Tony Manwaring, Henry Neuberger and Adam Sharples show that in many cases this images is grossly unfair. They argue

The case for public ownership is as powerful now as it has ever been – just as it has never been more urgent to rethink the priorities for public ownership, the methods of achieving it, the accountability and internal structure of publicly owned companies, and above all, their responsiveness to consumer and community needs. Publicly owned companies should be a model for socialism in practice. Unfortunately, for many people, that is just what they have become: unresponsive, often inefficient and often just as brutal in cutting jobs as private sector companies.

In many ways, this public image is, of course, grossly unfair. Nationalised industries are major investors: over the past ten years they have invested three times as much-for every worker employed – as firms in the private sector; and investment per unit of output has been twice as high. Moreover, companies such as BP, British Aerospace, BL, British Steel and Rolls Royce are among Britain’s top export earners. Nationalised industries have also been highly profitable in recent years. Their productivity record has been impressive, outstripping the private sector. Without public enterprise Britain would have had no domestically owned company in sectors such as motor vehicles, aero engines, shipbuilding, microchips and computers.

The Tory government privatisation programme, on the other hand, means that only the most vulnerable companies starved of investment finance will be left in the public sector. Profits will increasingly reflect the abuse of monopoly powers, rather than the efficiency of the company, and the Government’s obsessive desire to cut public borrowing. These factors are, however, unlikely to win much sympathy for public enterprise. Popular opinion may not favour further privatisation but there is no positive desire for an extension of public ownership. This reflects a deep seated lack of confidence in publicly owned companies which predates the election of the Conservative government in 1979.

All of which is true. This was written in 1986, and after Thatcher privatised the nationalised industries we largely do not have domestic firms producing cars, aero engines and ships. And the sale of some industries to foreign investors was quite deliberate, like the helicopter company Westland and the defence technology company QinetiQ to the Americans. Britain’s economy has suffered, as well as her wider defence infrastructure.

As for public opinion towards nationalised industry, this is not as low as may have been the case when this was written. People emphatically do not want further industries sold off. This is most obvious in the case of the NHS, as two reports by the Conservative party have shown. The I yesterday reported that the people using the East Coast railway line do not want to see it privatised. Mike over at Vox Political has presented the statistics showing that most British people still support the public ownership of the utilities.

There is clearly a large number of people, who support traditional, ‘old’ Labour-style mixed economy. They are, however, ignored by all three of the main parties. Their voice, particularly in defence of the NHS, needs to be heard.

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6 Responses to “In Defence of Nationalised Industry”

  1. prayerwarriorpsychicnot Says:

    Reblogged this on Gangstalked and slandered.

  2. Mike Sivier Says:

    Reblogged this on Vox Political and commented:
    Let’s hear it for the old-style ‘mixed’ economy and nationalised industries – in particular the NHS. And let’s demand the re-nationalisation of private industries that are charging exorbitant prices instead of providing the cheaper services we were promised.

  3. kamsandhu Says:

    Reblogged this on and commented:
    In Defence of Nationalisation, a post reminding us of the importance of nationalising services, particularly the NHS, which hangs in the balance as the coalition sell off yet more contracts, leaving only the least profitable and most difficult skeleton to the taxpayer. Accountability and a focus on customer/people needs rather than profit, as well as cheaper services can be achieved through nationalisation of services, rather than putting people at the mercy of companies hellbent on profit, as we have seen in the energy industry.

  4. che Says:

    Least not forget, the most European railways are nationalised, and look how good they are compared to ours

  5. prayerwarriorpsychicnot Says:

    Take a look at Definition of Pathocracy

  6. The Politicoid Says:

    I agree wholehartedly. For me, as with almost any policy, it is all about implementation, as that’s where things always go wrong. Just look at Universal Credit…

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