The Growing Irrelevance Of Nationalization

Over the past two decades, democratic socialism has been beset by a di­lemma. A significant segment of socialist opinion seems to be deempha-sizing the orthodox concern with socializing all large-scale industry in favor of investigating the use of economic power by governmental authori­ties to achieve comprehensive social controls while preserving the institu­tion of private property.

The reason for this doctrinal shift is twofold. First, and most impor­tant, the economic resurgence of basically capitalistic economies in West­ern Europe has (at least for the time being) disarmed traditional socialist appeals at a time when workers are enjoying rising living standards. Sec­ond, actual nationalization in Britain and France have not, for many rea­sons, yielded the results predicted by their early advocates. Specifically, government-operated industries that incur financial deficits must ultimately be supported by tax revenues. It has thus become an electoral risk for so­cialists to advocate nationalizations that voters may feel will simply raise their own tax obligations.

The alternatives offered by the "revisionist" socialists are related to the concept of the "mixed economy" in which public and private sectors coexist, with the public sector formulating a plan that includes social con­trols over private industry and greater attention to public goods consumed by all. The general approach is one of pragmatic reform, with the public takeover of industry proceeding only in selected instances where other ave­nues of control have been exhausted.
Even such modest aims raise major questions about the minimum boundaries of the nationalized sector and the nature of the social con­trols exerted over the private sector. It is far from certain that socialists are prepared to face these issues squarely, but the broader scope of topics included under the socialist agenda indicates that nationalization is only the first among many possible forms of economic planning iif the modern world.

The organization of Part V gives cognizance to these developments that blur the distinctions between the institutional structures appropriate to capitalist and to socialist economic systems. Economic planning can occur in nations located at all points on the ideological compass.