Telecommunications Decision Damaging to Investment and Growth.
"The government’s plans to further regulate telecommunications would violate private property rights and devalue the assets of tens of thousands of shareholders", Roger Kerr, executive director of the New Zealand Business Roundtable said today.
Measures like forced unbundling have been described as infrastructure socialism ("what’s yours is mine", by government decree). By allowing competitors access to incumbents’ networks on non-commercial terms, the short-term competition they create is parasitical, not the dynamic competition we need from incentives to invest in new and enhanced infrastructure.
Overseas experience suggests that such regulation gives rise to endless wrangling and modifications of detailed rules, which developments in technology rapidly make even more distorting or redundant.
No publicly available analysis has been presented to justify such action. Indeed it runs counter to the revised advice of the Telecommunications Commissioner after an exhaustive process of inquiry. Such regulatory decisions should be made only on the basis of an open and transparent process, which includes consideration of compensation for regulatory takings of private property rights.
Mr Kerr said much myth-making and special interest lobbying surrounded the debate about broadband. Special interests accounted for much similar regulation in other OECD countries, just as they did for farm subsidies. Academic research had shown that New Zealand’s performance on broadband was not out of line with other countries with similar per capita incomes.
"Unless the government can establish a much firmer justification for its decision in a regulatory impact statement accompanying any legislation, parliament should throw it out", Mr Kerr said.
Such arbitrary decision-making can only chill investment in a rapidly changing industry, damage the long-term interests of telecommunications users, add to the growing burden of regulation that is slowing New Zealand’s growth rate, and raise regulatory risks for all businesses operating in New Zealand.
For more information contact:
Roger Kerr
Executive Director
www.nzbr.org.nz
I thought this was well said and dashed off an email to Roger which said:
Hi Roger,
I have a young Kowhai tree in the back yard that thinks that it is spring time and it is merrily flowering away to the delight of our tuis. I planted that tree and I like Kowhai trees but if someone else feels they need to chop their Kowhai tree down I would feel sorry for the tree but the owner has a perfect right to dispose of her own property as she feels fit.
Except if you are a PC socialist and believe that all trees belong to everyone. Then no-one has control over any tree anymore. All tree decisions then have to be made by local or central government. And so it goes!
Disrespect for property rights in small things is simply the thin edge of the wedge. First a local person with a tree next the biggest company in the country. I don’t have any Telecom shares so I am not bleating for myself, but sooner or later this government or the next one will come for me.
Now nothing is sacred. Perhaps if there was a national imperative we could agree to the Crown taking private property BUT only with full market valued compensation.
How much value will Telecom shareholders lose and how much will the government compensate them for their loss?
Nothing!
Phil Scott
Parties for Growth Incorporated
P O Box 10-282
Wellington
Telephone 64 4 972-4365
Mobile 64 027 229 1519
phil@partiesforgrowth.org.nz
www.partiesforgrowth.org.nz
© Copyright; Foundation for Economic Growth and various authors. Individual authors retain their own copyright.
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