“I completely hold up our hands, my hands, our hands”, remarked the disgraced chief executive of cruise liner P&O. Hauled in front of a Commons Select Committee testifying why he fired 800 staff without notice, Peter Hebblethwaite was a man overcome by repentance. His merciless slashing and burning of staff through pre-recorded Zoom calls stays true to Mr Hebblethwaite’s name being apt for a Charles Dickens villain, with his portly appearance and delicately soft hands a sign of a sedentary life spent indulging in excess champagne and foie gras.
There was little hiding for poor Hebblethwaite. The Chair of the Committee, Darren Jones (Labour, Bristol North West), hurled across at him “are you in this mess because you don’t know what you’re doing? Or are you just a shameless criminal?” A deserving comment given his intentional breach of the law, with many, including the Prime Minister, calling upon his resignation. However, we mustn’t allow too much sympathy for Mr Hebblethwaite. He will likely take his seven figure payout and use his newly found time captaining a second-rate Golf Club.
Alarmingly, this fiasco has also reignited much support for the age-old foe: nationalisation. Iain Dale took to his LBC soapbox and called upon the British Government to take ownership of P&O, a sentiment shared by hundreds of protestors throughout the nation. Even with the rightful outrage against P&O we must not stoop to think nationalisation is a desirable alternative.
In doing so, we find ourselves in a similar position. Introduced by then Secretary of State for Industry and dashing crown prince of the far-left, Tony Benn, the Government nationalised the shipping industry, marking a radical turning point for British industrial history.
Soon became apparent was its severe inability to turn a profit. Like a toddler evading their mother’s attempts to smear them with sun cream, the state-owned industry agonisingly resisted breaking even or showing even a mere slither of feasibility.
With the dawn of Thatcher’s government, a more hardline stance was taken. By 1982 the industry had closed more than half of their shipyards, and yet the widespread losses still persisted, losing some £251 million/year when adjusted for today’s rate. This situation became so perverse that each new vessel was built at a loss. With the great cost combined with low quality, it is little wonder that so few Brits chose to buy domestically built ships. In 1983, around 44% of orders from within the United Kingdom were placed with domestic producers – compared to the long privately-held maritime industries of West Germany and Italy, standing at 82% and 95% respectively.
Outcompeted by foreign rivals, maritime nationalisation did little besides undue harm. Despite intending to save the industry it created a hostile environment for wider business and squeezed away what little demand there was left.
In recent weeks, these fickle ideologues are once again rearing their heads. We must strongly reject their demand for the government to prod its bony finger into the market once again. Instead, the true culprits of this debacle should be directly targeted – the P&O executives. Mr Hebblethwaite’s decision to not consult with the trade unions prior to the mass culling was a conscious breach of the law, and he should be punished as is necessary. Nationalisation would spread punishment not just across the entire organisation, but also onto investors and consumers. Calls to do so are neither proportionate nor reasonable – and will bring great harm for punitive reasons.
This article was written for the Adam Smith Institute Blog, please find it here: https://www.adamsmith.org/blog/pampoh-dear