Friday, March 23, 2007

Infrstructure and monopolies

Most of the press analysis of Labor's broadband plan shows why the authors are journalists talking rather than developing policy. Peter Hartcher is profound:
Labor could have found other ways of achieving the same internet policy aim without having recourse to the Future Fund. Instead, it has handed the Government a clear line of political attack. This is an avoidable political error.
But note how the IPA have used it to renew their crusade against access requirements for infrastructure. Says Alan Moran:
Rapid adoption of telecommunications advances is essential to our competitiveness. But by requiring any company undertaking the risky business of building a network to accept that it will be defined as an "essential facility" subject to government control is a sure-fire way of ensuring it will never be built by the private sector but be sorely missed. Peter Costello has accused the Opposition of economic irresponsibility, but the Government must share some blame. It has been in the thrall of a regulatory policy that seriously hinders the building of new infrastructure and it is within its power to correct this. To refuse to do so will make it inevitable that taxpayers again fund these facilities, with all the risks and inefficiencies that follow.
Yet voters would prefer that is if there are natural monopolies they be operated by the public sector. There were real reasons why infrastructure was provided by the public sector it wasn't just due to some mysterious zeitgeist of statism. We see a pattern with the renationalisation of state railway systems.



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