The Guardian

The Guardian October 3, 2001

Culture and Life

by Rob Gowland

Public is better

It is touching to see the way private enterprise businesses keep running 
back to governments to bail them out whenever they get into serious 
difficulties. One has to compare their actions with the garbage they talk 
about the "superiority of private enterprise", "reliance on the market" and 
its alleged "efficiency" and the "failure of public ownership and central 
planning and regulation". These are the lines they trot out when they are 
moving in to scoop up profitable state owned enterprises and services.

Look at Ansett. It was once the misleadingly named Australian National 
Airlines (ANA), although it was never our national domestic airline. Most 
Australian passengers and freight flew with the government-owned TAA  
Trans Australian Airways.

ANA was owned by a consortium of ship-owners. It was on its beam-ends and 
on the verge of being obliterated by TAA when trucking magnate Reg Ansett 
bought it from the shipping companies. But Reg had a powerful friend named 
Bob Menzies.

As Prime Minister, Menzies suddenly discovered that it was somehow vital to 
the national interest that Australia have "two [domestic] airlines". That 
one of them was privately owned was unimportant.

Menzies decreed that all Federal Government freight and passenger flights 
be divided equally between the airline the government owned (so the money 
spent came back to the government) and Ansett's outfit, where the money 
went into Reg's coffers.

This largesse extended to insisting that all airmail be equally divided 
between TAA and its private competitor. Ansett happily took the 
government's money for carrying airmail but presumably in the noble pursuit 
of even higher profits, took to actually sending the airmail by road.

This regrettable ploy was revealed when an Ansett truck crashed on the Hume 
Highway and spilled airmail letters all over the road. The media played 
down the scandal and Menzies successfully kept his mate in business.

With constant promotion at the highest level of the "two airlines policy" 
as though it really was" a good thing for the country, TAA was even 
forbidden to refer to its government or public ownership in advertising. 

Ansett and the Libs knew that, for all their scoffing and denigration of 
public enterprises, the Australian public would support a government-owned 
airline if given the choice.

So they made sure people were not reminded of TAA's public status. They 
also restricted TAA's ability to diversify into other areas of the growing 
travel and tourism industry.

This changed when the Whitlam Labor Government was elected. TAA was able to 
branch out with its own coach, holiday and travel outfit, AAT (Australian 
Accommodation and Tours), but the new deal came to an end with the Fraser-
Kerr coup against the Whitlam Government.

Running an airline as a service to the public is one thing the state can 
and should do as part of its budget for public transport.

Running an airline as a source of private profit means making it 
subservient to the requirement to be ever striving to become bigger, to 
lift profits through increased exploitation of its workers and to 
monopolise by takeovers. It means putting the most technically complex form 
of passenger and freight movement into the chaotic, cost-cutting hands of 
the anarchic system of capitalism.

So Ansett, like many other major airlines worldwide, has gone belly up. 
Capitalism's pro-market propagandists are quick to assure us that the fault 
is not inherent in the system but is the result of "bad management".

In the public system there are numerous watchdogs to oversee and expose 
"bad management" before its effects become terminal. Such "interference" is 
of course anathema to the "free enterprise" system.

Now even the most reactionary of capitalist shouters, like the Daily 
Telegraph's business commentator Terry McCrann, are hastily calling for 
"government help to get Ansett planes back into the air". He hasn't really 
changed his support for private enterprise  he just has no qualms at 
picking up taxpayer's money to help keep the private enterprise system 

McCrann says it would be "sensible" but graciously allows that it would 
also be "acceptable". Big of him, I must say.

He has delivered a little homily to private enterprise defenders: "To take 
some sort of utterly pure, hard line ('let the market rule' and 
'governments-should-keep-their-hands-in-their-collective-pockets' line) is 
just silly."

He goes on to show that a "pure" line is a complete sham anyway by pointing 
out that, since "the atrocity in New York, the global insurance industry 
has cut the maximum insurance for damage done by a plane in a terrorist/war 
act to just US$50 million.

"No airline in the world could take the risk of keeping a plane flying with 
such limited insurance. The only reason Qantas is still in the air is that 
the Government has gone insurer of last resort up to $5 billion."

Once again, the free enterprise system turns to the public purse to bail it 
out and make up for its inability to function successfully within its own 
system. It's time for the Government to take over Ansett and add it to a 
national air fleet operated by a re-nationalised Qantas, if you ask me.

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