What did Great Britain get from India? Tea and cotton, soldiers. What else?
That does not say that entrepeneurs are shy Little creatures that hide at home when so-called socialists are in government, and have to be encouraged by the nice consies.
And I disagree that “entrepeneurship/ Entrepeneurs” are the heroes keeping the economy afloat, or creating new Jobs.
To use a simplified Version, Economy works:
Companies (not single entrepeneurs) make products. Shops sells the products to customers.
Companies offer Services. Customers pay for the Services.
Many customers also are employees of the Companies.
Now, the factors which can influence economy positive or negative are many, some small, some big, some based on Actions by the government, some outside the government control. So just off the top of my head:
- if certain/ all goods are rationed, no amount of “entrepeneurship” can boost economy (black markets are usually forbidden)
- if companies pay low wages, many customers will not be able to afford the products/ Services, no matter how high demand. (Ford knew this, but everybody else has forgotten this)
- if domestic products are much more expensive than products from abroad, customers will likely buy imported more. Govt. can intervene with tariffs, restrictions etc. In agriculture, another way is usually for subsidies to the farmers, and low tariffs, so that farmers get paid and consumers get cheap Food.
- if domestic products are of Shoddy Quality, consumers may prefer foreign goods despite high tariffs.
- if Companies treat workers well (good wage, good conditions) and the workers feel pride in good Quality products they make, more customers might buy the product out of loyalty.
- if there is a sudden rise in demand (because things were rationed before) and importing is difficult (low amount of ships) then domestic consumption will usually rise. Usually, this means companies produce more = more offer, and pay higher wages = more buyers.
- if demand is filled (everybody has a fridge) and the companies didn’t plan ahead, the market will Crash, workers will be let off, economy will spiral further down. (That’s also why it’s smart to pay welfare, unemployment etc.: People spend this Money, at least on Food).
- if People believe that times will get worse (lay-offs coming) they might save and curb spending, leading to a downwards spiral.
- if People believe that times are improving, they will spend more, leading to an upwards spiral.
- The government can simply forbid energy-inefficient fridges starting next month. Or they can require all fridges to be tested at a state lab (neutrality) and put the result in a big sign on the outside “A++ very efficient, or D rather inefficient” and let consumers decide, and Phase out everything worse than D over 15 years, so companies can adapt.
- Government can build trade Schools to get skilled workers to improve Quality, if competition over Price is not possible.
Also: if the government wants to “encourage entrepeneurs” - this means encouraging companies. Which type - the multinational big Company with 10 000 employees, or the shop around the Corner that employs 10? Because what helps the small Company doesn’t help the big one, and vice versa.
If a government wants to help the small Company, they start a Research Institute that does dozens of material tests, and publishes them, because the 10-man shop can use that. The big Company has their own R&D department, they don’t Need that.
The government can lower taxes on profits, which mostly benefits big Business, but not the small shop, which Needs an easy credit specially for small start-ups. And so on.
Socialism gets used so often that any Definition is not practical in international discussion, for a timeframe with different attitude.
Were the miners paid better than before? Did the government take steps to find new branches once the end of coal was visible? (As the Rhine Region did starting with the 1960s?)
The Bank of England was not a government bank from the beginning? 
I thought the NHS was started during the war, as benefit to the workers for short wages?
You mean, all those branches were private before?
So aside from the rich People owning These companies being disenfranchised - what was the effect on the workers and the consumers?
Because the consumer usually doesn’t care if the Train is privately owned or belongs to the government: they care that it runs on time, the tickets are affordable, the comfort is acceptable, the safety is high. Nationalizing a dozen different companies is a Chance to improve Service, by improving Connections, standardizing Equipment, loaning Trains or conductors from one route to the other…
And all I’ve read about when National Rail was smashed during / after Thatcher is that things got worse again with a dozen different companies.
Similar for electricity, telephones and so on - the demand is there, the importance is offering good products/ Service at reasonable Price and paying good wages. Since government is not required to turn a Profit, they can potentially lower Prices or pay higher wages.
(Why privatization is not good, just look at the mess with London drinking water many years back: privatizing it meant Prices rising about 30%, None of the necessary infrastructure work being done = leading to contaminated water and loss of fresh water - and after the Investors had milked it dry and made out like bandits, they handed the whole mess, in a worse state than before, back to the government).
So why did they not reverse the rest? Was it because consumers and workers were mostly satisified with the state of affairs?
Outside libertarian/ conservative circles, Thatcher selling almost everything off is not regarded as “doing what is good for the Country/ helping the economy/” but rather as “selling off what should be kept communal for good reason” because real life Facts Show that privatizing essential Services leads to higher costs and less Service. After all, the Managers at the top want to make a Profit first, not provide a Service.
You mean this Comparative advantage - Wikipedia ? I don’t see how that theory is proven fact.
Besides, if the Advantage was for international competition, not joining the EG right next door and concentrating only on the far-away Commonwealth contradicts that course.
Tax rates over a 100% are obviously nonsense. (Though even Sweden did it once - Astrid Lindgren famously wrote a Satire about it, and it was quickly retracted).
How Long was the >100% rate in effect?
But the question of at what Level it applies is the crucial Point. The US middle class was not negativly affected by 70% top rate; but profited greatly from the infrastructure built from New Deal; the GI bill; housing, and so on.
And a broad middle class has more consumers than a handful of rich People.
That’s quite the opposite of what I said.
But nothing in the Definition you cited in post #71 says anything about “job-creation”.
And the Facts Show that most Job creation is not the big companies, but small to mid-size ones. The Facts Show that rich People don’t put the Money into the economy - they invest it into the capital market to get interest. The average worker will buy clothes/ furniture/ save up for a car if his wage gets higher or taxes lower.
The rich guy, if his taxes get higher, will put that Money in stocks or funds or similar, which do not increase consumption.
I know what Research would be necessary: look at the economic data from 1945 till 1975 for GB, how much % was for each branch, how much was internal and how much was Export, make a graph.
Then go through all laws and Projects started, and try trace their Impact on the economy, directly or indirectly.
Look at the soft factors, like consumer confidence (or despair over loosing the empire). Make a graph or table, and colour in which government did what.
Then repeat for France (since similar Population size, also Empire, also another war to Keep colony, also expensive nuclear program, also strong unions, also some socialist governments), for NL, Austria, Germany, Italy…
And compare all those results: where did most governments implement similar policies? Where did policies differ drastically? Where did Population react differently to attempts at Change?
However, I don’t have the time/ energy/ inclination to spend the next several years digging through this data, so I hoped somebody else(s) has already done that - not spouted some political assertions, or economic ideology, just crunched data - and then drawn conclusions from the data.
I don’t know - that’s one of the Facts that would Need to be looked up. Though wasn’t tea back then still expensive? Importing a huge amount of tea for cheap from their own colony vs. buying it from elsewhere at market Price afterwards could influence the Budget.
Similar for Cotton - if masses of it were cheaper than other countries, than clothes would be cheaper, too.
I still don’t have numbers how much of a factor of total GDP Export to the colonies was before the War and after they lost them. (And how much conditions changed under Commonwealth).
A sudden drop of say 20% in a strong export-oriented Nation would leave economy as a whole reeling, trying to re-orient either towards other Export, or changing branches, with many workers maybe unemployed, some companies going broke etc.
[QUOTE=constanze;20747320Though wasn’t tea back then still expensive? Importing a huge amount of tea for cheap from their own colony vs. buying it from elsewhere at market Price afterwards could influence the Budget.
Similar for Cotton - if masses of it were cheaper than other countries, than clothes would be cheaper, too. [/QUOTE]
I was thinking more along the lines of selling tea, cotton and whatever else India produced in Europe. India is of course large, and may have had sizeable agricultural production.
India doesn’t appear to be a rich country now, and don’t know how much money Britain made from it.
Before the war the UK coal industry produced 235 million tons in 1939. The UK Coal Boards goal was to mine 250 million tons per year. The highest they ever achieved was 228 million tons in 1952 and 1957. Production went under 200 million tons in 1960 and kept falling after that. There is no way to know what would have happened under private owners but it is obvious that the UK coal industry declined by huge margins after nationalization both in terms of market share and total amount mined.
The Bank of England was owned by shareholders until 1946.
No, the NHS was started in 1948.
Yes, they were.
Generally, nationalized industries are less efficient and less innovative, for the worker that means lower wages and for the consumer it means higher prices. For the overall economy it means lower standards of living. Since the question is why was Britain poor and most economics predicts that a country with nationalized industries would be poorer than one without, it seems the economy reacted in the predicted way. For example, water privatization, after privatization the World Bankfound that investment in the system almost doubled, the water quality improved, and service has improved as well.
Good economics is not always good politics in the short term.
The facts speak for themselves before Thatcher the UK grew slower than the rest of Europe and after Thatcher the UK economy grew faster than the economies of the US, France, Germany, Italy, Sweden, Australia, Canada, and Switzerland. This is because under privatization managers only get paid if consumers choose their services whereas under government ownership managers get paid regardless.
You should look closer, comparative advantage is true.
That is contrary to all reports I’ve read on the Topic of private vs state-owned companies.
I would have to look that up in relation to other Actions.
Um, what? Did you miss the development in the US from 1980s (Reagan) onwards, of the “shareholder” view? Managers of private companies get high salary plus Bonus, plus stock Options, even if the Company is loosing. When Banks crashed during the financial crisis, bank Managers still got obscene bonuses, because it was written in their contracts.
Also, Managers of big companies are hired by other Managers - they don’t Need to be competent, just be self-confident, and maybe have some old pals. If the government Appoints Managers, they can easily replace them if the customers are unhappy.
That’s aside from a Company with a quasi-Monopoly (e.g. Comcast) providing crappy Service and still demanding high Prices.
That’s why in many essential Services privatization is worse, because companies want to streamline only their profitable customers, not those who cause lots of work, but if government owns it, the Service is provided to all. See mail: mail delivery in cities can be done privately, but delivery into the lone Island off the coast, and the high mountain top, and 3 hours drive into the rural area will not be done by a private Company, or with a higher Price.
Your ideology seems to affect your Facts.
Thanks for those numbers - but was it related to mismanagement, or where the seams exhausted? That’s why Germany started a Long program to Switch away from coal and steel in the 1960s - while it was booming at that time, experts said that surface coal was exhausted, and deeper mines would be much more expensive than imported coal.
By slowly switching to other industries, the effect was buffered, and while it’s still not as well-off as during the boom, the Rhine Region isn’t a wasteland like Detroit or former coal regions in Pennsylvania.