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punk rebel ecks posted:I really would like to know more about the nationalized industries. Were they all bad but NHS? Why were they bad? Could they have been fixed? Hopefully someone could chime in. The important point to remember is that the UK wasn't facing a "publicly owned industry crisis" in the 70s. It was facing an inflation crisis. You had inflation rates over 20%, at a time when the economy was moribund. One route of tackling inflation is to remove the wage protections, in order to cut consumer spending power. You can do this by breaking the wage negotiating power of labour (by breaking the unions), and by moving industries into the private sector where their wages can be allowed to decline against the currency (this method also involves letting unemployment rise, further limiting the average national wage). This wasn't based on any judgement about whether the public sector industries were good or bad. When it comes to serving the interests of customers and employees, publicly owned energy, transport and health industries will almost always outperform the private sector, for a number of well-understood reasons (cost of financing, the power of collective bargaining, information inequality and demand inelasticity). It's true that some of the denser Tory politicians really did buy their own spin, thinking that everyone would benefit by getting rid of the "inefficient" public sector, but most of Thatcher's inner circle were perfectly aware the main "inefficiency" of those industries was the fact they employed too many people, and paid them too good a wage. They new that their method of cutting inflation would cause unemployment and recession, but they felt it was, in the words of Norman Lamont, "a price well worth paying". This is why, incidentally, Thatcher's unemployment benefit policy was relatively "generous". Job seekers allowance was similar to current real-term levels, and there was considerably less risk of having it stopped for not looking for work. Thatcher's government actually wanted people to stay on the dole, rather than get a job and and boost aggregate spending.
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Mar 25, 2016 13:41
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| # ¿ May 21, 2024 01:42 |
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