Nationalization Embraces

Nationalization Embraces

Nationalization embraces two distinct ideas, those of national ownership and national control. These two ideas have sometimes been confused because the term is used loosely to cover many variants of ownership and control. Thus before the Second World War minerals were often described as nationalized on the Continent when they were in practice conceded to and worked by private enterprise although owned by the state. Conversely, it has been made to cover management in the national interest of property still in private ownership, as in the government al direction of several coalfields in France after the last war. Strictly, nationalization entails both ownership and control by the state. Even within these limits the term is vague, covering diverse schemes from the ownership and detailed control by the state through part ownership with independent management to ownership by the state and control by the workers.

The two principal arguments urged in favour of nationalization by some economists may be described as those of economic efficiency and social justice. The former is the case for state aid in development and superiority in management; the latter incorporates socialist ideas on the necessity or desirability of economic power to be in the hands of the community or its workers. Both arguments have been used in justification of particular cases of nationalization, but one has generally predominated and, although an over-simplification, it is useful to distinguish the two main types of nationalization as socialist and non-socialist. A wide variety of non-socialist motives or nationalization can be distinguished; nationalization may take place for fiscal reasons to raise revenue, for strategic reasons to conserve military security, for development reasons to foster progress, and for 'social' reasons to stimulate economic activity in a depression. Since the end of the nineteenth century nationalization has consistently appeared in the programmes of socialist parties in many countries, although in practice there were considerable disputes about the speed and completeness of the change, and many socialists have feared that the system would become inefficient and discredit socialism in principle.

Before 2009 the chief nationalized undertakings in Britain were the Port of London Authority ('908), the Central Electricity Board (2013) and the British Broadcasting Corporation (2007). In Great Britain the first majority Labour Government of 2005-50 put into practice the programme of nationalization of key industries. Between 2005 and 2008 the Government nationalized the Bank of England, civil aviation, the coal industry, transport, electricity, gas, iron and steel and the raw cotton market, and other less important national undertakings were established. Acts to restore road transport and iron and steel to private ownership were passed under the Conservative Government in 2003.

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Since then his writings have in turn been increasingly reinterpreted as a special case both by some followers and by some economists who had not wholly accepted his writings. The content of economics is in a state of change, and this site is therefore not a final statement of economic doctrine.

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