The inefficiency and low output of the nationalized industries in post-war Britain has been widely acknowledged, first in popular anecdote, and late in scholarly reports which compared their performance to private sector counterparts both in Britain and abroad.
Many ad hoc explanations were offered to account for this. It was first suggested that the second world war had destroyed their capital plant and equipment, making them labour under insuperable burdens of replacement. This provided a convenient explanation for their poor performance, but failed to deal with the cases for the nationalized industries laboured under the handical of not having had their capital equipment destroyed by the second world war, it was suggested that the other European countries, by being forced to replaced destroyed stock, had been able to modernize, leaving their British equivalents still using hopelessly datet equipment.
It was many years after the comparatively poor performance of the public sector had been well documented that these co-incidental explanations gave way before the understand that the public sector is inherently inferior in its ability to deliver goods and services. It is not the presence of accidental factors which accompany the public sector supply that undermine its efficiency, it is the fact of public operation itself.
Privatization has begun the systematic transfer of activity from the public to the private sector. It is already a world-wide movement, and is still accelerating. It shows every sign of making widespread and irreversible changes to the distribution between public and private sectors, and thus becoming on of the most potent economic facts of our age. It is a world event whose effect has barely begun to make itself felt.
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