The UK industry was state controlled during WWII to meet basic population needs and support the war effort. This continued after the war, with key industries like coal, utilities and steel being nationalized. Nationalization provided subsidized materials and infrastructure, allowing UK industry to produce 25% of global goods by 1952. However, declining investment and rising wages abroad caused UK's share to fall to 2.9% by 2009. The document discusses alternatives to privatization, including rebuilding UK industry through public investment and ownership to serve common needs.
His 102 chapter 19 the industrial revolution spring 2013
The Spirit of 1945 and Where it Went
1. The Spirit 0f 1945
and where did it go?
Contribution of ideas to Ken Loache’s film
Ralph Blake
Financial Analyst former head of research & strategy
Goldman Sachs International
1
2. UK industry needed to meet::
basic needs of whole UK population
Materially support the war effort task
Private industry had little capital and organisation after 30s
depression
State planning and organisation need to fulfil the role
Capital came from USA
The equivalent of £200 billion of today’s money lent by US government
State control, regulation and borrowed finance was made in the
common good
Industry subject to state
control during the WWII 2
3. Was a key policy of the Independent Labour Movement
Success in transforming Soviet Union meant it had affinity with
some sections of working class
One of Labour’s key 45 demands
Industry in the service of the nation -
Houses for the people
Price controls on food & building materials
NHS
Cradle to grave welfare state
War dividend
Nationalisation and the
UK labour movement 3
4. At the end of the war apart from the USA & UK most of the world’s
industrial capacity had been raised to the ground or dismantled
UK had to help meet the supply of manufactured goods to meet the
world demand
little private capital after 30s & war
Private industry fragmented
Nationalisation provided subsidised:
Materials, energy, transport and infrastructure
By 1952 the UK was producing 25.4% of the world’s manufactured
goods
How did it fall to 2.9% by 2009?
1945 UK industry had to be
state controlled & funded 4
5. Coal
Utilities
Gas
Steel
Transport
Only steel renationalised by Tories but nationalised again in 1967 to subsidise materials to
industry
Later wave of nationalisations to deal with crisis of 1970s
Rolls Royce
British Leyland
British Aerospace
British Shipbuilding
What was nationalised and
what was reversed by Tories? 5
6. Rest of the world builds up it’s industry with more
investment and lower wages
UK industry profitability falls from 16.5% in 1950 -54 to
9.7% in 1970 on lack of investment
Economist coined the classic phrase “Profits first.
Investment later”
The UK losses it’s lead as
the world catches up 6
7. • a 30 year period of global expansion ends abruptly in 1974
• Over production of goods
• Over accumulation of profits
• Falling rate of profits
• And mass over capacity
• Led by the car, shipbuilding and aerospace industries
• Labour tries to save failing industries by nationalisation
• But capitalism needs to reduce capacity and increase profits
rates to compete with rest of world
• Enter Thatcher
The end of the boom 7
8. • privatise
• New owners will rationalise and return rate of profit
• The did the latter but not the former
• Rate of profit never competitive because of low
investment and higher wage rates
• Manufacturing has flown East where there are higher
rates of profit
Thatcher’s solution 8
9. Not on the basis of competition on the world market
But on the basis of meeting the common good
Cheap or free integrated public transport
Socially affordable sustainable housing
Cheap renewable energy
Any economy needs these to function
they would use some of the potential of our some 5 million unemployed adults and
young
Through a national investment bank instead of bank bail outs
A fair redistributive tax system instead of austerity
Take oil under public ownership and control
Close tax avoidance
Generate demand in the economy to create jobs in the private sector
Can UK industry be rebuilt? 9
10. Unlike Soviet & 1945 model
People’s industries would genuinely serve the
democratically decided needs of whole population
The industries would be participative and run by the
people that work in them to meet the needs of the
whole population
they would be protected from private competition
Industry under common control
& common planning 10