Sunday, October 13, 2013
World of Finance: Nationalization vs. Privatization
I have been meaning to write about it for a long time and maybe out there in my blog I may have dwelt on it combining in different posts but this is purely dedicated to this topic. I know some Americans may not know about it since we have so many things which are in Private hands but so many we have which are still in government hands and some recently were secretly nationalized in the name of saving them and you know what in mean, like the Car making companies, some insurers, banks and some mortgage companies. In fact, some companies actively seek this government backing since they believe that it will give them unlimited amount of government backing (read: Tax payers) and then there are some which don’t have any choice and have to give in to the tax payers money and go public since they cannot get loans, private backing or whatever you want to call it for keeping in private hands. So what is nationalization anyway, in the U.S. it may be a dirty word but in most of the part of the world, it is a way of life and actually people like it and sometimes demand it. Nationalization is roughly when governments in the infinite wisdom think that an industry cannot be handled by private people or it is some strategic industry where the national interests are supreme than private matters and they take our that industry sometime with compensation but mostly just take over without compensating the aggrieved party which may or may not kill the incentive to start something new because the fear is it may also be nationalized.