The Acquisitive Society

performance of function. It is essential therefore, if industry is to be professionalized, that the abolition of functionless property should not be interpreted to imply a continuance under public ownership of the absence of responsibility on the part of the personnel of industry, which is the normal accompaniment of private ownership working through the wage system. It is the more important to emphasize that point, because such an implication has sometimes been conveyed in the past by some of those who have presented the case for some such change in the character of ownership as has been urged above. The name consecrated by custom to the transformation of property by public and external action is nationalization. But nationalization is a word which is neither very felicitous nor free from ambiguity. Properly used, it means merely ownership by a body representing the nation. But it has come in practice to be used as equivalent to a particular method of administration, under which officials employed by the State step into the position of the present directors of industry, and exercise all the power which they exercised. So those who desire to maintain the system under which industry is carried on, not as a profession serving the public, but for the advantage of shareholders, attack nationalization on the ground that state management is necessarily inefficient, and tremble with apprehension whenever they post a letter in a letter-box; and those who desire to change it reply that state services are efficient and praise God whenever they use a telephone; as though either private or public administration had certain peculiar and unalterable characteristics, instead of depending for its quality, like an army or railway company or school, and all other undertakings, public and private alike, not on whether those who conduct it are private officials or state officials, but on whether they are properly trained for their work and can command the good will and confidence of their subordinates.

The arguments on both sides are ingenious, but in reality nearly all of them are beside the point. The merits of nationalization do not stand or fall with the efficiency or inefficiency of existing state departments as administrators of industry. For nationalization, which means public ownership, is compatible with several different types of management. The constitution of the industry may be “unitary,” as is (for example) that of the post-office. Or it may be “federal,” as was that designed by Mr. Justice Sankey for the Coal Industry. Administration may be centralized or decentralized. The authorities to whom it is entrusted may be composed of representatives of the consumers, or of representatives of professional associations, or of state officials, or of all three in several different proportions. Executive work may be placed in the hands of civil servants, trained, recruited and promoted as in the existing state departments, or a new service may be created with a procedure and standards of its own. It may be subject to Treasury control, or it may be financially autonomous. The problem is, in fact, of a familiar, though difficult, order. It is one of constitution-making.

It is commonly assumed by controversialists that the organization and management of a nationalized industry must, for some undefined reason, be similar to that of the post-office. One might as reasonably suggest that the pattern exemplar of private enterprise must be the Steel Corporation or the Imperial Tobacco Company. The administrative systems obtaining in a society which has nationalized its foundation industries will, in fact, be as various as in one that resigns them to private ownership; and to discuss their relative advantages without defining what particular type of each is the subject of reference is today as unhelpful as to approach a modern political problem in terms of the Aristotelian classification of constitutions. The highly abstract dialectics as to “enterprise,” “initiative,” “bureaucracy,” “red tape,” “democratic control,” “state management,” which fill the press of countries occupied with industrial problems, really belong to the dark ages of economic thought. The first task of the student, whatever his personal conclusions, is, it may be suggested, to contribute what he can to the restoration of sanity by insisting that instead of the argument being conducted with the counters of a highly inflated and rapidly depreciating verbal currency, the exact situation, in so far as is possible, shall be stated as it is; uncertainties (of which there are many) shall be treated as uncertain, and the precise meaning of alternative proposals shall be strictly defined. Not the least of the merits of Mr. Justice Sankey’s report was that, by stating in great detail the type of organization which he recommended for the Coal Industry, he imparted a new precision and reality into the whole discussion. Whether his conclusions are accepted or not, it is from the basis of clearly defined proposals such as his that the future discussion of these problems must proceed. It may not find a solution. It will at least do something to create the temper in which alone a reasonable solution can be sought.

Nationalization, then, is not an end, but a means to an end, and when the question of ownership has been settled the question of administration remains for solution. As a means it is likely to be indispensable in those industries in which the rights of private proprietors cannot easily be modified without the action of the State, just as the purchase of land by county councils is a necessary step to the establishment of small holders, when landowners will not voluntarily part with their property for the purpose. But the object in purchasing land is to establish small holders, not to set up farms administered by state officials; and the object of nationalizing mining or railways or the manufacture of steel should not be to establish any particular form of state management, but to release those who do constructive work from the control of those whose sole interest is pecuniary gain, in order that they may be free to apply their energies to the