Vultures circling over "fibre future"
State worshipper David Skilling of the NZ Institute proposes the government establish and partially fund a coercive monopoly called FibreCo to "roll out" national broadband and deliver dividends to rent-seeking crony capitalists who participate. "For now, this country's fibre future remained reliant on investment decisions taken by Telecom," says the Institute, which faces "weak incentives" to invest significantly in a fibre access network. The whole panegyric to rent-seeking cronyism is here.
Those "weak incentives" by the way include the continued support for local loop nationalisation from the likes of Skilling and David Farrar and of course Obergruppenfuehrer Cunliffe himself -- not to mention all those competitors of Telecom who wish to take advantage of its networks without any investment themselves -- and of course the dismemberment of Telecom forced upon it by Cunliffe in an effort to boost his ministerial ranking.
In other words, the faces of those "weak incentives" are themselves and others like them who support the ministerial jackboot being applied to Telecom's private property, and the sort of coercive resnt-seeking proposed by Skilling.
People like Russell Brown, who while continuing to celebrate the ongoing nationalisation of Telecom's existing networks, regularly celebrates how the faster broadband he's now getting in Pt Chev is already allowing him to steal even more films and TV from the internet.
Good to know why he's so keen on faster broadband, anyway.
Perhaps these luminaries could read and reflect on the comments of Telstra's Sol Trujillo last year when a similar public-private partnership was proposed by Kevin Rudd -- Trujillo called this a "kumbaya, holding hands" theory he wanted no part of; said Trujillo: "We are only going to participate in the things that we own and control." And how else could you justify the sizeable investment involved? What incentives are there?
Perhaps too they could reflect on Morgan Tsvangirai's argument for the importance of reinstituting property rights in Zimbabwe and think about the importance of drawing up such a programme for New Zealand, instead of continuing to bang the drum for their destruction.
UPDATE: Paul Walker comments at his blog: "Its not clear to me how a state guaranteed monopoly would speed up anything... Competition gives the best incentives, especially in rapidly changing, innovative markets." Perfectly correct. Doesn't stop Rod Drury and, lamentably, Bernard Hickey (who should know better) joining the chorus in praise of the corporatising/nationalising state. "It goes against the grain for me to recommend that a government effectively nationalise a private asset," says Hickey, who doesn't let the splinters slow his slide into the nationalisation chorus.