In analyzing the general tendencies resulting from increasing state economic control in a mixed economy (Graph 2), the fundamental trends are toward worsening conditions and toward increasing interventionism. Governmental authorities find it advantageous to call for support of the newly nationalized industries (p. 5.4:59) as a patriotic or civic duty. Furthermore, the nationalization of each industry creates a political precedent, making the nationalization of additional industries more and more politically palatable and, at a later stage, politically desirable. The nationalizations and the subsidies that generally follow in their wake (p. 5.4:59) contribute to the trends toward rising prices and/or taxes, which in turn lead to lower standards of living. In particular, as subsidies and other statist privileges are extended to specific groups, other groups find their economic security threatened and their opportunities increasingly limited. They therefore clamor to be included under the umbrella of subsidies and privileges. Eventually, so few groups can feel economically secure that demand arises for a universal governmental "safety net." The accelerating growth in such subsidies and privileges of course contributes to rising prices, taxes, and economic distortion. General increases in regulation and nationalization distort the economic structure further.      Next page
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