REAGAN'S LEGACY

WE LIKE TO THINK that historians will remember Ronald Reagan for his economic legacy as much as for Armsgate and other misadventures. One facet of that legacy, an important one, is the worldwide movement away from state-operated industry toward private enterprise.

Just last week British and foreign investors snapped up the initial public offering of British Gas PLC, the former state-owned gas company, paying as much as 30 percent over the offering price on the first day.Similarly, France's public offering of stock in the Saint-Gobain SA glass and building materials group met strong demand in France and from abroad. Overnight, more than 1.5 million French citizens became shareholders in the former state-owned enterprise. It was the first of 65 planned denationalizations of French state enterprises, only some of which were nationalized by the Socialist government that ruled France between 1981 and 1985.

In this country, the prime example of privatization is the government's pending sale of its stake in Consolidated Rail Corp., or Conrail.

Paradoxically, Armsgate threatens Mr. Reagan's commitment to deregulate U.S. airlines, railroads and other important sectors of the U.S. economy while the idea catches on around the world.

Even the Soviet Union is beginning to move away from a totally state-run economy. It is giving freer rein to its state enterprises, so they can now deal directly with foreign companies in the private sector which can own up to 49 percent of joint ventures. Monsanto, Occidental Petroleum, Coca-Cola, Sandvik of Sweden and a host of other U.S. and foreign companies are taking the plunge into joint ventures with the Soviets because it seems that for once a Soviet leader means business.

Hungary notably among East Bloc countries took steps toward privatization even earlier.

Watching the experience of the U.S. - and that of its economic pupils, Japan, Korea and Taiwan - governments of every stripe have seen the light. We want to get rid of bureaucracy," Kazi Zafar Ahmed, Bangladesh's deputy prime minister and minister of commerce, told editors of this newspaper in a recent interview in New York. The poor South Asian nation, once with an economy under tight state control, has opened its doors wide to private enterprise. Among other things, it has established a new foreign investment center under the direct control of President H.M. Ershad to spur foreign investment in Bangladesh.

Other nations looking more to the private sector include Canada, the Philippines, Greece, Brazil, Italy, and Trinidad and Tobago. Mexico, for one, is having trouble finding buyers for the state enterprises it wants to sell.

There's still much xenophobia in Britain, France and other countries surrounding government efforts to sell off state-owned enterprises. As the Japanese are teaching America, such countries may come to realize that foreigners sometimes can do more to revitalize a company or an industry than the natives can. Deregulation of the financial markets in Britain, France, the Netherlands, West Germany and Japan will in time enable foreigners to effect takeovers, just as the U.S. financial markets do.

We think the momentum of free enterprise is too strong at home and abroad for it to be stopped by Armsgate. Mr. Reagan should stand fast on his economic agenda no matter how intense the heat gets from the opposition. He has indicated he will do so.

There is an analogy in the woes of Richard Nixon. Despite Watergate, he still rightly gets credit for one of the most important diplomatic and economic achievements since World War II - the opening of the door to China. And look at how China is joining in the drive to a more market-oriente d economy.

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