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Gordon Campbell on National’s plans for roads

Gordon Campbell on National’s plans for roads, schools and hospitals


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*****


Interesting that the National Party is seriously regarding the Australian experience with public private partnerships (PPPs) as providing a precedent for using PPPs to fund schools and hospitals in this country. Here’s what the Australian Institute of Project Management had to say in 2005 about the Aussie experience with PPPs :


Public Private Partnership (PPP) projects are promoted as adding value to society. Unfortunately, this high ideal has been lost to short term profit and political expediency to make budgets look artificially good. PPP projects have been taken over by banks and are clearly not delivering their promised benefits to society. PPP proponents promise better management, innovation, and a performance based risk distribution where the private sector through their commercial expertise, take on a high level of project risk.

However, the reality is far from the rhetoric. The Sydney Harbour Tunnel was our first example of PPP not delivering. Motorists saw a rapid rise in toll charges to cover commercial miscalculations. The Sydney Airport Rail is another example of the public purse coming to the rescue of a financial miscalculation, and now with Sydney’s Cross City Tunnel we see the public purse again used to support yet another commercial miscalculation.

On the other hand we do not see PPP projects giving back to the public or the public purse when they make windfall profits.

Nor are the teething problems safely in the past. Only this month, news emerged of huge cost blowouts on a $3.4 billion PPP roading project involving multiple tunnel constructions in Queensland. The details can be found here And here And further info is here.


The commonly found pattern of faults with PPPs marks this project. A consortium gets the contract by bidding low, with potential for ratcheting up costs later in the game. The BrisConnections consortium also vastly over-estimated the traffic flows ( and thereby under-priced the cost of the tolls involved ) that would pay for the project :

BrisConnections is banking on the $3.4 billion route being busier than the Sydney Harbour Bridge from the day it opens.

The estimate for Airport Link's combined north-south and east-west traffic flow was twice as high as a State Government prediction in its environmental impact statement. It was understood it was also double what the losing tenders estimated.

The increased traffic forecast allowed BrisConnections to reduce the cost to the Government, with the financial saving to taxpayers touted as one of the project's greatest assets.

Those cost savings are now rapidly evaporating, with a blowout from $47 million to $267 million on merely the initial costs. The contracting consortium - as this report by Stephen Mayne
indicates was also marked by potential conflicts of interests between banks ( who stand to benefit from any interest rate hikes on the contracts) and with other consortium partners in Queensland. Finally, when critics asked to get access to key documents, these were said to be private ‘intellectual property’ and therefore not publicly available :

Brisbane Lord Mayor Campbell Newman…. refused to release details of the unsuccessful rival tunnel bid by the BrisConnections consortium, except for a map, claiming it was "intellectual property".

Given this track record, voters should be very alarmed about plans to import the PPPs model wholesale into New Zealand, to build hospitals, schools and roads. PPPs stand to be as big a taxpayer rort as asset sales were in the 1980s. Lets invite the Australian Institute for Project Management to have the last word :

It is useful to look at the financial structuring of PPP projects. There is a capital investment made at project initiation and usually the project is sold /included in a publicly listed vehicle so that the promoters can obtain an early profit. The project has to be maintained over a period, usually 20 years, and at that point the project reverts to public ownership. For example, on a tollway, the setting of the toll takes into consideration the initial capital costs, interest, and maintenance costs. The only one of these costs that varies over the life of the project is maintenance, which should only change in line with CPI.

Unfortunately, this again has not been the case. Tolls have risen and risen with no justification other than to cover financial miscalculation or to artificially increase profits.
Our Governments are immature in the use of PPP projects and further use of PPP should be stopped until a more appropriate approach is established.
This new approach has to either include the public in benefiting in windfall profits with full financial transparency, or have PPP promoters accept the downside risks as well as taking the upside benefits.

PPP projects are promoted as providing greater benefit to society. The promoters market that the private sector will provide society with a better deal than Government. So let’s take them up on their promises and include the delivery of community service obligations in their contracts.

Blogging vs Journalism. As the New York Times said only yesterday The Year of the Political Blogger Has Arrived. Hundreds of bloggers - some officially credentialed, some not - are due to descend on Denver next week for the Democratic Convention. Some 400 of them will be situated in a tent next door to the Convention Centre. Great. Given the role political blogging has played in cranking up support and financial donations - especially among younger voters - for Barack Obama, it seems fit and proper they should be standing alongside the mainstream media at Obama’s coronation.

Alas, here in New Zealand, most talk about the issue tends to assume the worst about blogging and the best about journalism. Jane Clifton’s hand-wringing wail in the Listener – “it’s now the Wild West out there, because we can no longer easily tell where journalism ends and politics begins. We used to be separate species, but now we’re hybridizing “ - is no exception.

Clifton recognizes that the blogging trend is democratic, but like members of an elite fearful of losing privilege, she wonders whether the newcomers will remember to wipe their feet on the mat. Bloggers, she laments, have just not done the hard yards of daily journalism, put in the OIA requests and done the grind before earning their spurs as commentators. Why, some of this current rash of information providers strike her as being unreliable, or even “ simply malicious.’ It is too much, and “ could be “riskily confusing’ for the voter.

Oh, the poor voter. No longer safe and secure on the leash of mainstream journalism, and ripe for being led for astray by those wily or simply malicious information providers who thank the Lord, are never to be found lurking in the pages of the New Zealand Herald.


Well, newsflash for Clifton : bloggers also put in OIA requests. Some write backgrounders. Many do original research. And the main reason that ‘commentators’ are displacing what Clifton calls ‘news reporting’ is that the public has lost patience with a mainstream media that has been lazily content for years to report news morsels, routinely based on p.r. handouts, without context.


The idea that grubby democratic bloggers may now be endangering the truths rigorously guarded until now by the journalistic priesthood is quite absurd. It reminds me of the old journalistic cliché that truth is usually the first casualty in wartime. As Alexander Cockburn says, this overlooks the fact that truth can usually be found limping into the graveyard during peacetime as well.

Suffice to say, Brent Cunningham’s essay from 2003 in the Columbia Journalism Review still provides the best recent overview of the failings of ‘ objective’ journalism, and of the ease with which those in power can exploit its inherent weaknesses. The prevailing biases in journalism, as Cunningham says, are not the ones of the left and the right cited by Clifton.


“Reporters are biased toward conflict because it is more interesting than stories without conflict; we are biased toward sticking with the pack because it is safe; we are biased toward event-driven coverage because it is easier; we are biased toward existing narratives because they are safe and easy…” Not to mention the bias towards he said/she said comments as a substitute for context.

In most cases – and I’d throw myself in with this lot – the ‘para-ideology’ on display is usually “ altruistic democracy” to use the term coined by Columbia University social scientist Herbert Gans. It is a reformist impulse, not a revolutionary one, and neither conservative nor liberal. It tries equally hard to make capitalism more responsible, and socialism more pluralistic.

How does that relate to the current state of blogging? Blogging’’s strongest virtue – and one completely ignored by Clifton – is that it is not corporate journalism. It does not reflect a boardroom consensus about the editorial line that the company’s papers should pursue. The NZ Herald’s campaign on the Electoral Finance Act, for instance, relied on a sustained output of biased, inaccurate reporting that – if done by a blogger – would have drawn the righteous wrath of the journalistic priesthood down upon it.

On the other hand, the Shawn Tan affair has hardly been the blogosphere’s finest day at the office, and it underlines the blogger tendency to divide along partisan lines. Apparently, the EPMU has used the fine print of Tan’s employment contract to punish him for his political views, in standing as an election candidate for ACT. Some blogs on the left – the Standard as an example – have defended the EPMU’s actions, even though the left would have been screaming blue murder if an employer had done the same thing to a union delegate.

As No Right Turn has pointed out, the treatment meted out to Tan is not simply an employment issue.

'It's a matter of basic democratic rights - something any decent lefty should support even for their enemies. The left has fought long and hard for democracy - for universal suffrage, the secret ballot, and laws against threats and intimidation so that people's votes could be exercised freely and without fear. But democracy isn't just about the right to vote - its also about the right to contest elections and stand as a candidate. And that right needs to be protected in law, just as the right to vote is.'

For now at least, political partisanship is naked in the blogosphere and open to reponse , in ways not available in the mainstream press. Issues of partisanship aside, there is another more mundane difference. For sometimes better and often worse, mainstream journalism still largely makes the news, while blogging reacts and comments and provides the subsequent analytical framework . In that sense, blogging compensates for what is missing from so called ‘objective’ journalism, and the two pursuits are to that extent, complimentary.

That’s why I think the real blurring of the lines is yet to come, Soon, bloggers will routinely begin to interview the main players and break the stories as well as providing the analytical context that goes with it. It happens occasionally now, but is not yet the rule. The blogosphere needs to go on the front foot and takes over the news-gathering role as well as the interpretative one. When it happens, the television networks can provide the reaction shots. They do them so well.

Biden, Biden As predicted by Scoop last Thursday morning. Barack Obama has picked Joe Biden on Saturday night as his vice presidential running mate. Hidden among the traffic was a development that could earn Obama more votes than Biden can muster, and where it matters. Astonishingly, ultra-conservative country music megastar Toby Keith endorsed Obama last week.


This is the equivalent of Obama being hugged by Bill O’Reilly on Fox News. Since 9/11, Keith has made a career out of belligerent patriotism, with songs like “Courtesy of the Red, White and Blue” promising to light up the Taliban like the fourth of July. On August 3rd, Keith went on the Colbert Report to promote his low budget movie Beer For Horses, and to sing the title song which, according to some picky types, advocates lynching. A sample :

Well a man come on the 6 o’clock news
said somebody’s been shot
somebody’s been abused….
Grandpappy told my pappy back in my day, son
A man had to answer for the wicked that he’d done
Take all the rope in Texas

Find a tall oak tree,
round up all of them bad boys
Hang them high in the street
For all the people to see

This song, a duet with Willie Nelson, concludes : “We got too many gangsters doing dirty deeds/too much corruption and crime in the streets /It’s time the long arm of the law put a few more in the ground …” Any way you look at it, they’re not the sentiments you normally associate with the arugula eating candidate from Chicago.

So what does Toby Keith see in Obama that he likes ? "There's a big part of America that really believes that there is a war on terrorism,” Keith explained, “ and that we need to finish up. So I thought it was beautiful the other day when Obama went to Afghanistan and got educated about Afghanistan and Iraq. He came back and said some really nice things…I think he's the best Democratic candidate we've had since Bill Clinton.” Fabulous.

ENDS

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