ArcelorMittal: Do nationalizations work?

CGT Secretary General Sophie Binet and French President Emmanuel Macron clashed Tuesday over the merits of nationalizing ArcelorMittal in France. But do nationalizations work?

These can turn into fiascos, as was the case with the major socialist nationalizations of 1982, justified by ideology, that is, with the aim of forcing companies to serve political purposes. In 1982, there were 44 nationalizations, which concerned industries (Thomson, Saint-Gobain, Usinor, etc.) and many banks (CIC, Paribas, etc.). All these companies were weakened and fairly quickly became private again.

Political nationalizations only work in two cases: when the country's vital interests are at stake, and when the country's sovereignty is at stake. In 1946, nationalizations were justified by the need to rebuild the country. Virtually the entire financial and energy sectors were in state hands.

In 2023, Emmanuel Macron renationalized EDF to ensure the financing of future nuclear reactors and ensure our energy sovereignty. He also nationalized the STX shipyard to prevent it from becoming Italian.

Temporary nationalizations, on a case-by-case basis, work best. Here again, pragmatism must prevail to help a company that is experiencing temporary difficulties but is viable. In 2002, the British government renationalized the rail network operator Railtrack, whose privatization had been a failure. In 2009, after the financial crisis, the American government nationalized General Motors. This maneuver cost money, but the company was saved. In France, in 2014, the state acquired stakes in PSA, which was in trouble. As a result, the group has recovered.