A Costly Shibboleth

The nationalization of Britain's steel industry has long been an emotion charged shibboleth for British socialists. Clement Attlee's Labor government succeeded in taking over the industry in 1951 -- only to be driven from office eight months later, partly because it had muddled the steel industry so badly. The Tories put most of steel back into private hands. When he took over as Prime Minister in 1964, Harold Wilson tried to renationalize steel with his thin majority, but retreated when he saw how perilous ly close the vote would be. Last week, with a healthy majority assured since the March 1966 elections, the Labor Party finally had its way. By a vote of 306 to 220, it rammed the nationalization bill through Commons. To most Britons, the measure seemed almost anticlimactic; there was little fuss over what just about everyone had long considered inevitable. Under the bill the 14 largest companies, which account for 90% of Britain's steel output, will be merged into one huge state-owned Na tional Steel Corp. Smaller companies will be left in private hands. The cost to the government will be enormous: $1.5 billion to buy out the shareholders, plus millions more to implement ambitious reorganization plans. Laborites argued that the industry, which ranks fifth in the world (after the U.S., Russia, Japan and West Germany), needed to be modernized and reorganized to stop wasteful duplication. No one could dispute the fact that many of the plants are overstaffed, turn out shod dy, overpriced products, and are losing money. But many critics wonder if nationalization is the solution; Britain's other nationalized industries, notably airlines and railroads, have gotten sicker, not healthier, under state management. Besides, the timing seemed inauspicious for a Prime Minister who is busy wooing the Common Market with boasts that his Labor government is an aggressive champion of competition.

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