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Australia, it's time to deregulate the skies

By Jonathan J. Ariel - posted Friday, 12 June 2015


Given their vocal disdain for consumers one can only wonder just who these two mouthpieces represent?

Is Truss really the Member for Wide Bay (Qld) or is he the Member for Qantas (QF)? Nothing new here. Former Federal Transport Minister and National Party leader, John Anderson was voted into the House of Representatives as the Member for Gwydir (NSW) but often behaved as though he was the Member for QF.

And what about young Joe? Member for North Sydney or the Member for Virgin Australia (VA)? Hmmm.

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As with any policy change, vested interests like QF and VA (as well as their supporters) are more than entitled to ventilate their views. And they did.

But it's the government's job to stand up for the rest of us and to oppose special interests.

Non-government supporters of current industry players, like former Qantas chief executive Geoff Dixon are also permitted to push their views. And he did, with gusto, recently describing the Robb plan as "a step too far even for northern Australia". …which could "seriously undermine" local airlines.

Unionists (both blue collar and white collar), including the Transport Workers Union and the Australian and International Pilots' Association got into the act, forecasting that the proposal threatens the local aviation industry and jobs.

Virgin Australia chief executive John Borghetti warned on 29 May that the airline would be forced to reconsider flying on marginal routes in northern Australia if the government adopted the plan.

"There is a reason no other country allows this", he added.

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The Virgin Australia boss seemed to be sharing speechwriters with Shadow federal transport minister Anthony Albanese when the latter labeled the plans to allow foreign airlines to fly domestic routes in northern Australia as "unilateral economic disarmament" and "we would be the only country in the world to do it".

What unites all of the opponents of competition is a pathological refusal to acknowledge, let alone admit, that what is in their interests is demonstrably not in the interest of the Australia's 23 million people who constitute the flying public. Airline industry types and their megaphones in Parliament trot out all the possible "costs" of deregulating the northern skies but cite none of the "benefits", chief amongst them being lower airfares and better products. This renders their arguments somewhere between misleading and deceptive.

Take Albanese's shriek that if Australia went ahead with opening up our northern skies, "we would be the only country in the world to do it".

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About the Author

Jonathan J. Ariel is an economist and financial analyst. He holds a MBA from the Australian Graduate School of Management. He can be contacted at jonathan@chinamail.com.

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