September 10th 2005

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Articles from this issue:

CANBERRA OBSERVED: The Telstra sale and economic ideology

EDITORIAL: Telstra: a better way forward . . .

SPECIAL FEATURE: The human cost of sexual exploitation (Part 1)

BIOETHICS: Review of cloning and embryo research laws

ECONOMICS: What future for globalism?

PRIMARY INDUSTRY: Pork farmers under attack on two fronts

STRAWS IN THE WIND: Revolting students / Precondition for education / Drugs and Asia / Swallow insult / Waldheimer's disease / Warning shadows

INTERNATIONAL AFFAIRS: China frustrates Taiwan's bid to play bigger role

TAIWAN: Fostering democracies on the Pacific Rim

VIETNAM: Remembering the battle of Long Tan

CINEMA: Romantic comedy 'Wedding Crashers' lauds boys behaving badly

Competition Policy killing cane-farmers (letter)

Cornelia Rau not Australian (letter)

Elephant in the room (letter)

Profits for the people (letter)

Rights deprivation syndrome (letter)

BOOKS: The Criminalization of Christianity, by Janet L. Folger


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The Telstra sale and economic ideology

News Weekly, September 10, 2005
The National Party believes that voters opposed to the sale of Telstra can be placated with cash.

After years of the Howard Government and Telstra trying to convince the public how excellent telecommunications are in the bush and how they were improving all the time, new Telstra chief Sol Trujillo decided to try a different tack.

After being just a few weeks in Australia, Trujillo realised that the best way to convince rural and regional folk that Telstra should be sold was to state the exact opposite reality - that telecommunications outside the big cities was generally inferior.

Only by injecting large amounts of cash - courtesy of a full sale or government funding - could the imbalance be rectified, so Trujillo's brazen argument went.

The cynical turnaround in the bush Telstra rhetoric showed just how empty past claims about the benefits of selling Telstra have been, and how much the whole Telstra debate is based on the ideology of the market rather than the practical benefits for consumers and the nation.

The simple fact remains that the vast majority of Australians - particularly those in the regions - want to keep Telstra in government hands.

Public opposition

However, illogical or irrational (from an economic rationalist point of view) this opinion may be, polls consistently show that around 70 per cent of the voting public oppose the privatisation.

It is difficult to think of any other current issue with such clear-cut public opinion for one side from Labor, Liberal and Nationals voters.

While some of the "keep Telstra public" view is related to fears that a government-owned telco is a better guarantee of phone and internet services, others see Telstra as the last great symbol of a government role in the economy.

Furthermore, while the Nationals are blind to this, opposition to the Telstra sale exists irrespective of how generously the Government decides to fund rural services.

In effect, it does not matter to the voter whether the pile of cash set aside from the Telstra sale is $1 billion or $10 billion.

Neophyte Senator Barnaby Joyce understood the politics of Telstra better than anyone, and appeared to know instinctively that his party's future was inextricably linked to Telstra's future.

However, Senator Joyce made the mistake of underestimating the pressures he would come under by telegraphing his opposition to the Telstra sale as soon as he landed in Parliament.

Senator Joyce said he opposed the sale of Telstra and in his first week in the Senate received more than 2,000 emails, mainly from Queenslanders, urging him to hold the line.

However, with enormous pressure from his own side, bullying tactics and extraordinary intimidation from sections of the Government, and with the Queensland Nationals giving him the green light to vote for the sale, Joyce eventually buckled.

As part of the deal, the Queensland Liberals are likely to negotiate a joint-ticket arrangement for future Senate elections, but the most they will get is one National every second Senate term.

Nationals struggling

Fifteen years ago, the Nationals had four out of six Queensland senators; now they struggle to get one.

The fact is, the longer the Nationals are seen to be constantly marching in perfect step with their Liberal coalitionists, the less voters can see the need to separate the two parties.

The policy of absolute loyalty to the Liberals saw the Nationals practically wiped out in country Victoria when Jeff Kennett was swept from office.

And one by one, each retiring Nationals MP is handing over his seat to either an incoming Liberal or an incoming independent.

Senator Joyce's worst fear was that his decision to vote in favour of the sale would mean the beginning of the end of the Nationals as a force in Australian politics - yet he chose to go with the party majority, including the members of his own state council.

The rest of the Nationals believe, as in the past, that cash will placate the disappointed voter.

Only time - and the reality of telco services, once Telstra is sold off - will tell whose political instincts are correct.

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