InstaPatrick

Against state ownership

I am against state ownership because:

the property involved is usually acquired by violence (either in the form of taxation or outright appropriation) and I am against violence
the results are almost uniformly awful

“...usually acquired by violence”?

There are exceptions but they are rare. Chequers, the Prime Minister’s country residence, for instance, was a gift, so, I suppose I can’t really object to that particular example of state ownership. At least not on the grounds of how it was acquired.

So what makes you think the results are bad?

A few examples:

Council housing
British Leyland
British Airways
British Telecom
British Steel
National Coal Board
National Health Service
The Eastern Bloc in the Cold War
State education
Royal Mail
British Rail

So, what’s the story with British Leyland?

Oh, rotten cars, constant strikes, huge losses. See the Wikipedia article for some of the story.

But didn’t it at least provide jobs?

I always find the idea that jobs should be the objective slightly odd. Surely, the aim is to create wealth and how can you create wealth when you are creating losses? Profits are good, losses are bad.

And, the National Coal Board?

Huge strikes and huge losses. Plus, it might be added, the import situation. Foreign coal was cheaper but it wasn’t allowed into the country because otherwise the NCB’s losses would be even greater. So, the rest of us were denied cheap electricity and cheap heating.

So, what’s the story with council housing, British Airways, British Telecom, British Steel, Royal Mail etc?

So, why are state enterprises so bad?

For the same reason that freer is better.

Well, if state ownership isn’t so hot, maybe contracting out is the answer

I don’t think so.

Permalink • Economics • Last Updated: 14 November 2006

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