One of our favourite, if odd, ideas
As rather the originators of the privatisation idea - based upon the clear observation that the British State could not succeessfully squeeze a wet teabag - it is possible for people to question the idea. If it’s the state that’s so bad at this then why are some of those privatised industries now run by foreign states? As with Polly Toynbee here:
Our nationalisation phobia has handed state assets over to foreign governments to make handsome profits that should have been ours. The French and Italian states own chunks of our railway companies, while nearly half our offshore wind capacity is controlled by foreign state-owned entities, including Denmark and Norway. If they can make them turn a profit, why not our own government? Thatcher’s mystical belief that private is always more efficient died long ago.
Obviously the Toynbee Test applies. We know that she’s wrong because this is Polly. Therefore the implied insistence is wrong. But that still leaves us with why is it wrong? Which is where this pet theory comes into play.
Yes, of course governmental bureaucracy comes into play. So too the ghastly inability to actually consider second order effects. This demand that the State guarantee payment for some foreign mined coking coal comes what was it, a week, 10 days, after the government denied planning permission for a mine to produce coking coal.
But the pet: a government is lousy at running a business in its own country and perhaps - you know, maybe - not so bad outside it. Because the British government, in Britain, is constrained by British politics. The British government, operating in, say, Germany, would be able to run a business upon purely commercial lines. German politics does not, after all, have electoral implications for the government of Britain.
Thus DBahn might be able to run a train service or three in Britain. Better, in fact, than DBahn runs train services in Germany. Because DBahn there has to accord with German politics while here it can be just a company attempting to maximise efficiency. Yes, an implication of this would be that Network Rail would run DBahn better but let’s leave whole absurdities alone.
This steel issue is a useful example. Those blast furnaces have not been “saved”. They will still be closed and replaced with EAFs. The only issue has been whether the blasts are closed now, or after the EAFs have been built and brought into service. At vast expense the decision is now that second.
Yet the past week and weekend have been filled with insistence that we must have blast furnaces for defence, national security, beat off the foreigners reasons. Which is odd. Because a blast furnace is designed to produce thousands of tonnes a day of basic steel (well, with the accompanying BOF). We don’t use thousands of tonnes a day of basic steel in defence. There’s no vision of a military future in which we would either.
More than that, the EAFs the country already has are what are used to produce the varied alloys actually used in defence and seeing off Johnny Foreigner. We even had one laddie insisting to us that a blast furnace is essential for producing armour piercing bullets. Now, true, there’s no need for everyone to grasp, all the time, the details of the metals business but the top end armour piercing stuff - the sort we use - is usually tungsten coated in cupro-nickel. Details, schmetails, we know, but just to assure all that no one does produce those in or using a blast furnace. Not even the right metals let alone techniques or equipment.
This being the problem. Politics doesn’t work on truth or reality but upon what people believe. And if everyone believes that the blast furnaces must be saved then they will be, at vast cost. Rather than the actual issue, which is that we don’t need blast furnaces, we’re not going to have them soon enough anyway but politics has just insisted upon keeping them for a few years at vast cost.
Yes, we know, there are those - Polly! - who insist that politics is the better way to run everything but that’s the very disagreement we have. The reason governments are bad at running things - OK, one of them - is that governments are subject to domestic politics. Therefore decisions are taken upon political grounds not those of truth and or reality. QED.
Anyone got DBahn’s number? We want to offer then Network Rail’s services. Even if the pet theory doesn’t work out at least the damage done will be over there, right?
Tim Worstall