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That works very well and is used in many countries. What didn't work well is a state-owned economy. Two different things.

• qaq 9y ago
  OK give a single example that is not related to raw material extraction or power generation. (A company receiving massive government subsidies to not go bankrupt would not be considered a good example at least in my opinion.)
  • Daishiman 9y ago
    Most European public transportation companies have a majority stake by the government, and they work exceptionally well in executing their mission. A huge amount of banks are government-owned and they're as profitable as their private counterparts. There's a huge number of examples (https://en.wikipedia.org/wiki/List_of_government-owned_companies https://en.wikipedia.org/wiki/List_of_government-owned_compa...).
    • qaq 9y ago
      Most public transportation companies are subsidized. I never dealt with gov. bank that was run well but there are might be some that are. I def never heard of gov. owned software company that was doing well though.
      • BerislavLopac 9y ago
        That is the whole point. State-owned companies make total sense when their goal is to ensure some common benefit (like mass transport, public utilities, health care etc), as opposed to making profit. With that in mind, subsidies are logical, because the alternative is to have a purely state-owned system (like police or military) which has no income except for government subsidies. Essentially, if you think of government subsidies to private companies as assistance in making profit (which happens often when a government wants to promote a certain industry, even if it's only in form of a tax cut), having commercial companies to take care of common utilities is a way to assist the government paying for those utilities.
• TomMarius 9y ago
  Can you post some examples where it works well?
  • allendoerfer 9y ago
    VW, the largest car company in the world, is partly state-owned. Same for Deutsche Bahn, KfW bank and a few others. They don't always work perfectly, but they sure can compete or are even market leaders.
    • qaq 9y ago
      VW is not run by government appointed managers and gorvernment does not have control of the votes. Now even if it did I doubt we want to use VW as an example of good corp. citizen.
      • allendoerfer 9y ago
        VW basically does what everybody else is doing (see news about Daimler and BMW). The state-owned aspect changes nothing, it just says that 30% of VWs profits go into the pockets of the German state of Niedersachsen instead of the pockets of a private investor. That was the key point of the original discussion about Gates' money and rising inequality, so the example is very valid.
        • qaq 9y ago
          It's valid in a sense that if government does not control voting rights and plays no role in day to day operations sure there is no difference. If you start taxing the stock and transferring stock to government eventually government will have control of all entities though.
    • TomMarius 9y ago
      >They don't always work perfectly, but they sure can compete or are even market leaders. Most of the time it's because these companies are government-approved monopoly (no other company can enter the market) or because they're heavily subsidised using taxes (no other company can enter the market practically because competing against someone who you fund at the same time is impossible and because the prices are below the actual expenses) and are actually losing huge amounts of money. Typically railways all around Europe are not profitable at all. Volkswagen is a very special case, but you're partially right. I'd say it's an exception to the rule though.