Thatcher Fallacy (6)

    

“Privatisation is bad for the consumer. It just lines the pockets of directors”

Firstly, we should not be deceived by ‘public ownership’. Rarely is public ownership better for the public than private ownership.

Of course there is the opportunity for directors to line their pockets, but this relies on their sensitivity to consumer demand and their ability to respond efficiently. In other words, the capitalist’s own self-interest serves the interest of the consumer.

Take sugar. It has to be produced, refined, packaged, boxed and transported to millions of destinations around the world every single day. There are thousands of companies involved in the chain; Cardboard and paper manufacturers, sugar producers, graphic designers, advertisers, shipping companies, haulage firms, wholesalers, supermarkets, banks, insurers, and so on. Each agent, motivated by their own profit, ensure that wherever there is demand for sugar it is met. Furthermore, each agent competes to offer their service for less, thus keeping the price of sugar down and widening its availability. 

Privatisation in the 1980’s forced state owned industry to compete and respond to consumer demand in the same way. British Telecom, British Gas, British Petroleum, British Airways, British Airports, British Steel, the water boards, electricity supply and generation, Rolls-Royce, Jaguar Cars, British Aerospace Systems, and many more were sold off. It was the biggest asset sale in history.

The result has been positive for shareholders and consumers alike. Coupled with deregulation of the stock market, privatisation resulted in millions more shareholders. It also resulted in some of the most competitive water, gas and electricity prices in Europe, and one of the most competitive airline sectors in the world, allowing more Brits to travel further afield than ever before.

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