The “House of the Future,” circa 1965
Whoa! I just had to take the opportunity to do some “sky blogging,” as I’m on a Scandinavian Airlines flight that offers in-flight wifi access (for $9.95 for 30 minutes). This is too cool. I’ve checked email and figured I’d post my first aerial blog entry. We may not have such great video phones yet (like the ones I thought so cool when I visited Disneyland’s “House of the Future” when I was a boy), but so much else that was once fantasy has been delivered by science and capitalism. And so much else that is now reality — like the internet and sky blogging — wasn’t even a fantasy just a few years ago. Free market capitalism isn’t merely efficient. It isn’t merely just. It doesn’t just deliver more and better goods for more and more people. It’s cool.
P.S. I’m confident that someone will point out that SAS, on whose plane I surfed the internet, is partly state-owned (50% private share ownership and 50% state ownership through a consortium of Danish, Norwegian, and Swedish state holding companies). But even the semi-private SAS operates within the context of a global capitalist economy. Were there just one state airline, I doubt that we’d see much innovation, falling prices, or customer service. Imagine the case if the various suppliers were all socialist enterprises, as well. And were capital markets controlled by the state, we’d be back to the disgusting Aeroflot flights of years past that I remember so unfondly.)
Interesting points about state ownership. I have come to realize that for a firm to be state-owned isn’t equivalent to it being centrally planned, nor tax financed, and hence it’s not inherently incompatible with a firm competing fairly in the marketplace.
State ownership is still undesirable, since the state 1) has no business using citizens’ funds to purchase private businesses, and 2) has the power and perhaps the incentive to begin adding some central planning, or a soft budget constraint, or some other politically-motivated intervention.
All the same, it is possible for a state-owned, or partially-state-owned, enterprise to compete in a free market.
State owned corporations aren’t exactly desirable, but I’m with Charles, they aren’t as bad as other things. As long as they are forced to operate under market order and aren’t bailed out by the state, they’re a better alternative to state planning. Eventually, the logic would follow that the entire lot would be sold to the highest bidder, but I think we can at least accept that route for the time being if our only feasible options are it and complete state command and control.