Should the key industries of a nation be controlled by the state?

Excessive regulation and nationalization or excessive deregulation and privatization are detrimental policies a nation can ill afford. Upon evaluating recent history, one comes to the conclusion that the middle path is the best route to prosperity. Extremist policies have been tried and experimental by a vast spectrum of nations; capitalist U.S.A; well-fare socialist Britain and France; communist China and the mixed economies of Russia and India have all tasted failure in their experiments with extremism. All of these countries have made a return to the tried and tested stable policy of public-private partnership. There are, however, certain industries and sectors which remain in complete government control.

The energy sector is one industry that governments around the world continue to control with an iron grip; this is not without due logic and reason. In the 21st century, we find that energy resources, which drive an economy, have become relatively scarce and expensive. Without such energy resources, the economy will crumble: there will be no electricity for homes, business and schools; there will be no oil for cooking, transportation or power generation and basically every aspect of a citizens life will be forced to a standstill as a result of a possible energy crisis. To avert such a crisis from happening, the government manages this sector by assigning the most experienced officers available.. The government then creates short-term and long term goals to achieve these goals. The goals of any government are significantly different to the goals of a private enterprise; the government seeks to ensure a constant stream of energy flowing from power generation outlets to where it is needed.

Conversely, private enterprises are only concerned with profit and loss - and so long as they are able to create a profit they will continue to operate. However, if they see no profit in the present or the near future, they will cease operations immediately. Another major benefit that a public sector has is the potentially unlimited government investment it can take advantage of. With private sectors, an industry merely jumps from one owner to another. A good example would be that of the Karachi electric company. This is a company that has been assigned the task of ensuring electricity to all those in Karachi; .however, recently, this company has become a money pit for its owners. Hence, it has been constantly sold from one owner to another. Had this been under government control, then proper in vestment could be made and this company bailed out from failure.

Yet failure is something that most government sectors are used to: PIA and the metal industry stand as prime paradigms of complete failure for the government. Let us first discuss the Pakistan International Airways - once the 6th best airlines the world. Power in the hands of a good management team usually yields good results. However, over the past few decades, the PIA has been managed by government cronies who exist to send government officials on expensive tours and holidays. Naseem Ashraf, the former Pakistan cricket board chairman is said to have wasted millions of rupees in travel expenses. Decades of such sycophantic policies finally clipped the wings of the once majestic sky-bird.

Perhaps, as always, the moderate middle path would be a better option for most countries of the world. Government Interventionism should respect the private enterprise’s circle of freedom; a circle in the sense that when private groups go beyond that circle then they should be reeled back into the system. Ensuring that private enterprises run in an efficient and nation-friendly way is a sure path to economic stability and prosperity - however, this can only apply to non-essential industries. Industries key to a nation’s prosperity must be in the nation’s control - primarily the energy sector encompassing exploring, mining and processing. While other sectors should involve a balanced symbiotic public-private partnership not a parasitical one; multi-nationals must not be allowed to take the wealth away from a nation. Only then can the wealth gap be reduced and social injustices corrected.