This article is a continuatin of the series of texts by Harry Ratner, a British longstanding socialist activist. Part I and part II have been published previously on our website. Parts IV is currently edited and will be up next week. Your comments are welcome.
Public Ownership or Merely Control?
Economic policy in Britain during the Second World War provides an example of how it is possible to combine effective planning of the economy with market mechanisms. Physical controls on the use of resources (raw materials) were imposed so that firms could only secure these commodities if their use was essential to the war effort. More significant was the establishment of state control over capital investment. Thus a firm was only able to secure finance from the banks for expansion of its productive capacity by applying to the Capital Issues Commission, which only granted authorisation if this was considered essential to the war effort, or necessary for the meeting of civilian needs within the overall parameters set by the War Cabinet. Similarly, the building of a new factory or the closure of an existing one had to be authorised, and was sanctioned only if it fitted in with the needs of wartime production. Despite the destruction by bombing, the U-boat blockade, and the strains of war, the system worked ? even though the banks and industry remained in private ownership.