apart from South Africa , which does at least have the excuse that its coal is exceptionally cheap , Britain and Soviet Russia now have the dubious distinction of using the most fuel per unit of national product of all countries in the world . if you have to run a country on the basis of Marxist economics and the labour theory of value , you must expect something like this . no doubt , according to official Marxist doctrine , the more coal you use the more valuable the products you turn out , because more labour is incorporated in them ; although even in Soviet Russia common sense sometimes breaks in . our policy , since the industries connected with fuel were nationalised , has not been avowedly Marxist as in Soviet Russia , but has been , perhaps unwittingly , based on many of the same ideas : fuel industries are basic industries , fuel ought therefore to be cheap , and the more that is consumed the better . this is the sort of muddled thinking which has already cost the country enormous sums . until the advent of cheap oil in the last three years , the produce of the nationalised coal , electricity and gas industries ought to have been sold at much higher prices , on the one hand in order to bring some revenue to the Treasury , and on the other hand to compel industrialists and consumers to economise as they do in other countries . Bernard Shaw was a great dramatist ; but nobody now would suggest that his views on economics should be taken seriously . many years ago he explained that the principal reason for nationalising the coal mines was that , as things were then , mines produced coal at a great variety of different costs , and that the primary duty of a national administration would be to average them out . Bernard Shaw &apos;s ideas , however , had great influence in the labour party , and one almost suspects that some of them still linger on in the administration of our nationalised industries . otherwise it is hard to explain their refusal to allow regional differences in prices , or their long hesitation before closing down uneconomic pits . it is true that there have been some economies in fuel consumption in Britain during recent years . but they have been slow and reluctant compared with the movements in other countries . the United States , up to the 1920s , used fuel lavishly , mainly because it was so cheap . but consumption per unit of national product is now lower than ours , even though fuel is still comparatively cheap in the United States . the detailed industry-by-industry comparison of trends in this country and Germany , reproduced in table 4 , presents a really alarming picture . an industry by industry comparison of fuel consumed per unit of product in U.K and Canadian industry , shown in table 5 , is also very revealing . in order to effect most of these economies in fuel consumption , costly investments are not required . we have some figures given in an official document , and similar figures were estimated by the late Professor Sir Francis Simon . a ton of coal per year for many years into the future could be saved by investing no more than &amp;pound;7 in economisers and other forms of heat recovery , &amp;pound;12 or &amp;pound;13 in new kilns and furnaces and in mechanical stokers , &amp;pound;17 in replacing and modifying boilers , or &amp;pound;25 in insulating buildings . with coal at anything like its present price , every one of these investments is extremely well worth while . our fuel consumption has now begun to fall , but it has a great deal further to go , judging by the experience of other countries . the national coal board for many years was unable to meet all the demands upon it , and had to import coal at high cost , which it then re-sold at a much lower price . nevertheless , the board seemed to like this situation , and in the programme of investing in coal which they published in 1956 they envisaged its indefinite continuance . the consumption of fuel , expressed as coal equivalents , had reached 254 million tons in 1956 . the figure subsequently fell , and rose only to 264 million tons in 1960 ; but the national coal board expected it to rise to 281 million tons by 1960 and 335 million by 1970 . to show how steadfastly a conservative government supports the administrators of nationalised industries we may quote a statement made by Lord Mills , the Minister of fuel and power , as late as 1958 , in which , while admitting that consumption had fallen to 250 million tons of coal equivalent for the current year , he still estimated that it would rise again to 300 million by 1965 . as coal became more difficult to sell , the government seems to have become more determined to defend the coal industry , quietly blocking imports of cheap oil and of liquefied natural gas ( for which the transport technique has recently been discovered ) . it seems all too clear that much of our investing in coal has been wasted ; and we can now see some of the reasons why . ( d ) . electricity . regarding electricity generation , which has taken a substantial share of the country &apos;s capital during the last decade , we do not see obvious signs of waste as we do in coal . at the same time , there has not been any real reply to the case made by Dr I M D Little in his book the price of fuel that electricity has been sold unduly cheaply to household and commercial consumers , to encourage its use for space heating , which could be more economically done by gas . the supposed purpose of nationalisation was to bring about a rational co-ordination between industries , but this certainly does not seem to have been done in electricity and gas ( any more than between road and rail transport ) . the administrators of the nationalised electricity undertaking seem to have got their ideas from old-fashioned electrical engineers whose main purpose in life was to drive gas out of business . the government has even permitted the nationalised electricity and gas industries to spend public funds , beyond the amounts reasonably required to make useful new equipment and processes known to the public , in advertising against each other . Dr Little &apos;s criticisms particularly applied to the fact that the scale of charges for household electricity gives consumers no incentive to economise during the peak hours , when electricity is most costly to the supplying authority , because expensive reserve capacity has to be kept in being to meet peak loads . experience in other countries has shown that there are practicable devices for adjusting meters in order to charge more for peak hour use . our nationalised electricity industry has stubbornly and irrationally refused to adopt them . the building of nuclear power stations has been criticized : though this form of investment is , I think , defensible on economic grounds , up to the point where the base or minimum load on the electricity system ( probably at 4 a.m on a summer morning ) , constituting perhaps one-sixth of total capacity , is all supplied by them . it does not serve much purpose to work out a series of comparative costs of thermal and nuclear stations , under various assumptions , in pence per unit . the right approach is by an analysis of opportunity costs . a nuclear station of 300,000 kw capacity , expected to last for twenty years , costs &amp;pound;42 million , plus &amp;pound;8.8 million for its initial fuel charge . such a station obviates the need for a thermal station of similar capacity - additional capacity is going to be needed , even if not at the rate at which we are building at present . the capital cost of the thermal station would be &amp;pound;15 million , with a life of twenty-seven years ; so we can credit the nuclear station with saving 20/27 x 15 = &amp;pound;11.1 million capital , and regard its net capital cost as &amp;pound;39.7 million . running costs other than fuel , which are virtually independent of output , will be &amp;pound;0.5 million per year for a nuclear and &amp;pound;0.33 million for a thermal station . if the nuclear station works at 80 per cent load factor , which seems a reasonably cautious estimate , it will produce 2.1 billion kwh per year at a fuel cost of 0.149 d &amp;sol; kwh , as against 0.420 d &amp;sol; kwh for a thermal station . after allowing for running costs the net saving will be &amp;pound;2.23 million per year , or 5.6 per cent on the net capital cost of &amp;pound;39.7 million . this , however , still only represents costs as seen by the electrical engineer . when we take the costs of the national coal board into account also , we find a very much greater saving . as soon as total output of coal began to go down , during the last few years , the output of coal per manshift worked , which had been stationary for a number of years , leaped upwards . this was brought about only to a limited extent by closing pits : mainly , it appears , by the closing of uneconomic seams within mines . the movement of the figures of output per manshift appears to indicate that marginal coal may cost as much as &amp;pound;4 per ton more than average coal . if we take this saving into account , as we are fully entitled to do , we obtain an additional return of 8 1/2 per cent ( or less in proportion if the above figure of &amp;pound;4 is too high ) on our investment in nuclear power . by all means invest in nuclear power - but close down more coal mines . ( e ) roads . at a special conference called by the institute of civil engineers recently , a case was made for very large expenditure on both rural and urban roads . the economic return on such investments , in the form of faster-moving and less congested traffic , can be fairly precisely calculated , and fully justifies them , probably even to the extent of the &amp;pound;3,000 million which , it was suggested , should ultimately be spent on our road system . but here again , this expenditure should render redundant a considerable part of the railway system , which should be dismantled . the expensive modernization programme for the railways was prepared on quite unjustified assumptions about the amount of traffic which they could attract . demand for transport , measured in ton-miles , has been increasing more slowly than national product , and its future rate of increase is expected to be not much over 1 per cent per year . road transport already carries over three-quarters of the ton-mileage of all traffic other than minerals and at its present rate of expansion will easily provide for this increase , and go on cutting into what remains of the railway traffic too . there can now be no doubt , and no denying , that hundreds of million of pounds have , since the end of the war , been wasted on misdirected investment in the nationalised coal , electricity and railway industries . because of this waste we have not been able to modernise the road system , cut taxes , or do the other desirable things that could have been done . there has been plenty of investment , but how much effective growth ? net capital investment from 1955 to 1959 inclusive was &amp;pound;8,949 million , which means an addition to the capital stock of 19 per cent . but the increase in the real net national product from 1955 to 1959-60 was only 9 per cent . have we been putting our money on the wrong horses ? 6 . the international investment league . the final section of this booklet might be described , in a certain sense , as an anticlimax . after Dr Aukrust &apos;s careful analysis of the Norwegian figures , and the extensive figures for other countries quoted above , it is going to be very difficult for anyone seriously to contend that increased investment is a sure way of increasing the rate of economic growth . however , there are many people , in responsible positions , who do not reason in this way . they reason in a simpler manner altogether . the procedure is to construct what is sometimes called a league table , ranking countries according to the percentage of their gross national product which they devote to investment ; and then to set out to show that their position in this table is related to their rate of economic growth . 