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Brexit

Labour and Nationalisation

24 replies

littlebillie · 17/05/2019 06:54

In the press this week National Grid have spoken out against Labour's plan to nationalise the network.

It is in Labour's interests to leave so they could proceed

"Labour’s new Brexit position and the Market Pillar Directive could invalidate one of Labour’s key aims: nationalisation. The Opposition has announced its intention, if elected, to remove rail, water, energy and the Royal Mail from private ownership."

Mass nationalisation brings our key services under the control of the government - no competition or competitive investment. The current government is struggling to invest in the NHS so not sure how the economics would run if everything was nationalised.

I am very worried that post Brexit will will become a backwater where any investment could be seized by the government,

OP posts:
GhostofFrankGrimes · 17/05/2019 07:07

Well that’s privatisation for you it benefits the company and it’s shareholders not the customers. Thatchers glorious legacy. Take a look at the rail network and probation service for privatisation failure. The public
are always on the receiving end through poor service and high prices.

Brexit will lead to the privatisation of the NHS and that scares a lot of people.

littlebillie · 17/05/2019 07:16

Privatisation has been a success: 1.65 billion rail journeys are made annually, more than double the number before privatisation, while the volume of freight carried on the railways is up 80% since privatisation.6 Jan 2017

However if you take away private ownership where does the taxation come from to pay for other services, where is the "pot" to buy these assets.

Also Government has massive control over us and no market forces in play

OP posts:
GhostofFrankGrimes · 17/05/2019 07:30

Ask commuters that travel on outdated trains and suffer high prices if privatised rail network has been a success. How about the probation service that is moving back into the public sector?

Private companies have massive control over us particularly when union rights are reduced.

bellinisurge · 17/05/2019 07:31

Being old enough to remember life before privatisation, I would say that world was less efficient or flexible and rather third rate in terms of quality. A strong element of "just put up with it" which you see in the NHS still. I think there are no easy answers but I doubt nationalisation of EVERYTHING is one of them.

panelledreverie · 17/05/2019 07:33

Yes a be grateful for what you get culture rather than a customer service one. Not in any rush to get back to that in any of these companies

Reddedder · 17/05/2019 07:34

Yet another stupid Labour policy

JQBased · 17/05/2019 07:40

A return to a nationalised railway? No thanks! It was a mess and once again, there was no money in the pot! Privatisation may have it's faults, but we have no choice when the country is broke. Labour has always had these wonderful socialist ideas...That they can never afford. This is probably why in every Labour government taxation goes through the roof. All these ideas sound great, until you realise the cost involved. All roads lead to Rome, whether we have it privatised or nationalised there is always a huge cost at our expense!

GhostofFrankGrimes · 17/05/2019 07:41

Yes, privatisation is fine as long as you can afford it. The NHS is struggling because it is being undermined by people who want it privatised. Once that happens and there is an American style system the free market cheer leaders (ordinary folk) will be the first to complain. Reap what you sow.

GhostofFrankGrimes · 17/05/2019 07:43

The failed privatisation and subsequent renationalisation of the probation service will cost the tax payer millions.

MrsElizabethShelby · 17/05/2019 07:47

If they nationalise the energy industry thats me and 90% of everyone else currently employed by the energy suppliers and networks out of a job.
How do they propose to support us?

Nevermind as a PP said, where is the pot to buy us out anyway? The industry is worth billions.

littlebillie · 17/05/2019 07:48

I think every single person wants more efficient, cleaner and competitive services, but mass privatisation scares me. If we are going alone we need to have the potential as an investment opportunity for overseas companies

OP posts:
DippyAvocado · 17/05/2019 07:49

British Rail was rubbish but that doesn't mean nationalised railways are shit per se. I have lived in European countries where they have extremely efficient affordable nationalised railways services far superior to our privatised network. British Rail was just an example of how to operate one poorly.

Nationalised industries are not completely disallowed under EU rules either. There are certain things that are permitted, hence the fact many member states have nationalised or partially nationalised railways services.

maizieD · 17/05/2019 08:37

However if you take away private ownership where does the taxation come from to pay for other services, where is the "pot" to buy these assets.

Governnment spending is not limited by tax revenue. This is a complete myth which the country has been sold since the Thatcher era. People buy into it because it chimes with their own experience of running their finances but the idea that national finances run on the same lines as household budgets is entirely false.

The nation does not have an 'income' limited by the amount of money they can recoup in tax, nor is it limited by anything else. It used to be limited by the amount of gold it held but 'the gold standard' was abolished in the early 1970s and since then the government has been free to issue as much money as it pleases. Taxation has an important role to play but its prime function is to prevent inflation caused by too much money circulating in the economy. A secondary function could be to prevent inequalities caused by wealthy people acquiring yet more wealth, monpolising the money in the economy and not returning money to the economy through spending (and ultimately, taxation). But while ever resources are in plentiful supply and available for purchase there can be very little inflation.

(And please don't say Venezuela or Zimbabwe because their economic problems, while caused by an oversupply of money, have a very different basis. They are not mature democracies with a very long established central banking system. They are also rife with corruption, far in excess of any that might exist in the UK. Japan is a much better example of a stable country running a big deficit at no detriment to their economy)

It is the government, through the Bank of England, or through banks licensed to issue money, which issues money. That is why the government can spend vast amounts on quantitative easing and on projects like preparing for Brexit (and bribing the DUP). Vast amounts which are not funded by tax revenue.

As far as public spending is concerned, tories don't like it because it ostensibly deprives private enterprise of profits. However, when you look at it logically there is no reason why it should do so because all public services' resources are supplied by private enterprise. Medicines, equipment, food, uniforms, railway engines, etc. etc. We have no state enterprises supplying resources. The only thing that private enterprise is denied is the opportunity to make a profit by supplying the actual service.

There is a strange feeling in existence that money spent by the government on public services disappears into a big black hole and is never seen again. This is absurd. The wages of public servants are spent in the economy on things supplied by private enterprise and, as I've already pointed out, the actual services themselves purchase everything they need from private enterprises. Most of the money the government issues eventually comes back to it by way of taxation. The only money that doesn't is that which is saved in this country or that which is sent off to tax havens to avoid being liable for UK taxation. The so called 'deficit' is really people's savings or money squirrelled off abroad.

The current government is not 'struggling to invest in the NHS' (or any other public service). They could 'invest' as much as is needed; they are limited not by shortage of money but by ideology. They want to shrink the state in order to let private enterprise take over.

(And 'EU State aid rules are a complete red herring.)

If anyone is interested I suggest they read this explanation by Richard Murphy: www.taxresearch.org.uk/Blog/2019/05/10/pretty-much-all-that-most-people-need-to-know-about-modern-monetary-theory/

I'm old enough to remember pre-privatisation, too. I don't see any particular improvement in services since privatisation.

This is a huge topic which impinges on the 'real' economy as opposed to the money markets and I'm afraid I have no time for the next couple of days to defend my comments but I I hope that they provoke some thought.

jasjas1973 · 17/05/2019 10:08

The big problem with nationalisation is that Govt is incompetent, look at Grayling, Karen Bradley or our very own PM, Theresa May?

Is labour saying these sort of people know anything about power, rail or water?
Privatisation can work in some industries BUT needs much stronger regulation.

No, this obsession with nationalisation is to divert away from Labours wos on brexit, Brexit is the issue facing the UK right now, not some ideological debate on state v private.

maizieD · 17/05/2019 10:26

I don't think it is a diversionary tactic. Nationalisation was in the 2017 Labour Manifesto.

We have to do something about the way the country works. Tory economics isn't working. Labour proposals are perfectly practicable so long as you abandon the 'household economy' myth which seems to be the prime objection to them.

We have to make up our minds whether we want a country where the rich get richer and the poor go to the wall (accompanied by an 'it's all their own fault for being lazy spongers' narrative) or a country which cares for all its citizens. I've never found a convincing explanation of why a section of a society should accumulate most of its resources while the rest of its citizens live in straitened circumstances.

jasjas1973 · 17/05/2019 10:30

What i mean is that as we face the biggest national crisis since the 1930s, Labour are continuing to bang this drum, its something most Labour MPs will unit behind.

But its not the issue facing the country and Labour, unless they want to disappear into oblivion, then they need to provide leadership.

GhostofFrankGrimes · 17/05/2019 10:50

Brexit is about greater privatisation and less worker rights. The privatisation of the NHS is the one thing that would unite most against privatisation. By then it will be too late. It is absolutely right we have this conversation now. Privatisation and globalisation partly led us to Brexit as people are fed up with lack of opportunities and poor pay particularly in areas deindustrialised in the 80s. That of course is not the EUs fault.

DGRossetti · 17/05/2019 12:37

A return to a nationalised railway? No thanks! It was a mess

And it's not now ?

NotDavidTennant · 17/05/2019 12:46

The private sector works well when it is subject to competitive markets. There's no good reason why a national monopoly like the National Grid should be in private hands.

DGRossetti · 17/05/2019 12:54

The private sector works well when it is subject to competitive markets. There's no good reason why a national monopoly like the National Grid should be in private hands.

Growing up trough it, an awful lot of the rush to privatise was sold by pointing at the US and saying "isn't life there wonderful. That's because everything is privatised ...." which totally and utterly failed to account for the differences in geography, culture, society and politics that also exists between the US and UK.

The US is large enough to support several large companies doing the same thing quite well. The UK, less so. As proven by the explosion and then agglomeration of energy suppliers. From 2002, 4 of my changes in energy supplier have come about because the supplier I chose was taken over by one of the biggies - EDF/EON/BG/nPower.

So much for choice. I still miss Amerada.

There's also the unpleasant truth that in the main, all UK privatisations have done is extract the value into the investors bank balances, and then dump, shirk, or palm off the remaining liabilities - pensions being the main losers.

MockerstheFeManist · 17/05/2019 13:07

A Nationalised Railway!!!!!!!!

But that would be like Switzerland, Germany or the Netherlands.

1tisILeClerc · 17/05/2019 13:21

The UK ran 'nationalised' industries badly, there is no doubt however there is more to it than that. Having a privatised system by definition demands 'profits' and naturally the 'board' will find any way of maximising these profits. Usually the significant chunk of money is for staff, so minimising those is paramount. With investments and profits going overseas the UK will not benefit as a whole. There is perhaps a case where a nationalised industry being UK 'owned' COULD be considered part of the 'welfare state', so you might have employees who can have reasonable paying and stable employment, which may not be as 'efficient' as a ruthless privatised ownership could manage, but it actually helps the UK as a whole.
Having senior management and governance who can and do keep a watchful eye on the whole 'activity' is of course essential which is where the UK has previously failed 'big time'.
The work/life balance needs addressing, and a situation where more people have a living wage and perhaps more 'leisure' time should be the goal.

Namenic · 17/05/2019 13:30

Privatisation is just a short term investment of cash (injection of capital). Long term you get worse efficiency as the private companies will want to recoup investment AND make a profit. They are willing to give poorer service to pay dividends to shareholders. Railway franchises have promised too much and then collapsed leaving government to pick up bill.

prettybird · 17/05/2019 23:58

The East Coast rail line has twice been rescued from the private sector, run profitably as a nationalised "company" and then returned to the private sector to fail again Confused

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