A decade and several communications Ministers ago, I was complaining about how telecommunications policy was killing the prospects for a fibre to the curb broadband network in Australia. And the sidebar quote from Richard Alston was in response to my observation that partial privatisation was the worst of all possible worlds. It looks very much as if I’ll be able to keep on recycling both complaints for another decade or so.

As some point, presumably, policymakers will realise that the only way we are going to get a modern telecommunications system is for the government to build it, or direct Telstra to do so. But there’s no sign of this at present.

The breakdown of the Doha round of trade talks on agricultural trade is unsurprising, but still disappointing. Neither the US nor the EU is really willing to give substantial ground. In the case of the US, the option of negotiating one-sided bilateral deals like the US-Australia FTA seems much more appealing.

There’s been quite a bit happening in relation to Public Private Partnerships, most of it suggesting a diminished role for this kind of financing. Queensland has issued new guidelines, partly in response to criticism of the fact that there has so far been only one major PPP project approved (and that only just scraped in). The criticism is understandable: a lot of people in the financial sector are missing out on really big money every time the government decides to go with simple low-cost bond financing. It’s striking though, that the only state with no reason to reduce measured debt levels (Queensland has positive net financial worth) is also the one that has found hardly any PPP offers meeting the value for money criterion. It seems pretty clear that at least some evaluation processes in NSW and elsewhere have been corrupted by the determination of the parties to do a deal regardless of the economics. The recent NSW Parliamentary Public Accounts Committee report on PPPs doesn’t say this, but it certainly raises plenty of concerns about opaque processes.

Meanwhile, in the UK, it seems to be two steps forward and one step back. The nonsensical idea of an all-in-one contract for schools, in which construction is bundled with provision of “soft services” like procurement and HR is mercifully being abandoned, but new forms of PFI/PPP, such as Building Schools for the Future are emerging. The pernicious features of these “innovations” will no doubt become apparent in time, but for the moment, the Blairites are still keen.

I’ve been arguing for some time that the government should use the current period of strong demand to make a really strong push to reduce unemployment, particularly long-term unemployment. This piece in the Australian looks promising, though on reading closely it’s hard to see whether there is actually a serious commitment of funds and effort or just another rearrangement of the existing programs. If the government was willing to put the kind of money it’s repeatedly splashed around in tax cuts into a program aimed at driving the unemployment rate down to 2 or 3 per cent (by putting people into jobs, not by pushing them out of the labour force), they would win my support.

Tim Blair cites my recent observation that privatisation in Australia is political poison and goes on to ask for further advice on the issue

Take the next step, Quiggler; tell us which industries or businesses should be nationalised. People will like it, apparently.

I’m happy to oblige. The best case for (re)nationalisation is undoubtedly Telstra, minus peripheral bits like BigPond which should be wholly privatised. I’ve been making this argument for years.

Although Tim correctly points out the logical symmetry – if people hate privatisation, and clearly they do, then they should welcome nationalisation – he seems to be in some doubt about the politics. There are overseas examples to help here. Helen Clark’s government renationalised both accident compensation and Air New Zealand and didn’t seem to suffer any political damage, but of course, that’s New Zealand. More interestingly, the government led by Tim’s UK namesake renationalised Railtrack, to widespread applause, a couple of years ago.

What these examples have in common is that the privatisation was badly bungled, so that renationalisation was easy to sell. Although it isn’t, like Railtrack and Air NZ, on the verge of bankruptcy, Telstra is also a prime example of a bungled privatisation.

As Tim notes, given the deep public opposition to privatisation, exhibited recently over Snowy Hydro, there’s no reason to suppose that renationalisation would be unpopular. The problem is that the elite (not the people who drink cafe lattes, but those in both parties, banks and big business who actually run the show) benefit from privatisation and have no desire to stop it.

Update Tim liked this suggestion, and now he wants more. Next cab off the rank, in my view, should be airports. The privatisation of these monopolies was followed by massive increases in navigation charges, as well as a whole string of petty imposts on travellers. Another large part of the attraction, in Brisbane at least, was the ability to (mis)use the power of the Commonwealth to evade state and local controls on land development. And the involvement of politically well-connected types like Max Moore-Wilton only made the whole thing worse in every respect.

I’ve been working on a paper on employment in remote Aboriginal communities for several months now, which I’ve been asked to present at an Econometrics Society conference in Alice Springs later in the year (not that it has much econometrics it). This was always going to be a challenging task, but I didn’t anticipate that the usual backdrop of resigned neglect would be replaced by the glare of publicity we’ve seen in the last few days.

I promised to put forward some ideas on the current policy problems facing Aboriginal Australians, and particularly the problem of economic development. It’s always problematic for white ‘experts’ to tell black communities what to do and I want to make it clear that I’m not trying to do this. Although I have given economic advice to Aboriginal organisations on a range of issues, I don’t regard myself as an expert on the problems facing Aboriginal communities. My perspective on the issue comes more from a consideration of the general economic problems of rural Australia and particularly the general decline in population and employment.

Although the writing is going slowly, my general position is pretty much the same as that set out by Ken Parish. This isn’t surprising since he and I, along with Rob Corr and others, had a long discussion on this issue a few years ago, and this had a big influence on my thinking.

It’s fairly clear that the idea of making remote Aboriginal communities self-supporting in a market economy is not feasible: the disadvantages of location are too great without considering the other problems these communities have. But there’s nothing sacrosanct about the market economy. Lots of people could be engaged in socially useful work if the limited ‘work for the dole’ embodied in the CDEP scheme were replaced by a full-scale commitment to permanent job creation. This would be far more cost-effective, in the long run, than allowing communities to sink into despair as so many are doing at the moment.

That still leaves open the question of whether people should remain in these remote locations. The latest fad is to suggest that people should be encouraged to leave, with no real consideration of where they will end up when they move into towns and cities. I’m hoping to look into some more creative options drawing on the literature on migrant workers and remittances in development economics. But there are no easy answers here (or, maybe, there are too many easy answers, none of them right).