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Thursday, 14 October 2010

The Standard wrong on Bolger

The Standard notes Jim Bolger's comments on privatisation, saying that the former PM :
"...has announced that the neoliberal privatisation agenda has been a failure. He says we sold the wrong things, sold them the wrong way, got too little money, and created private monopolies. Of course, what we should have done is hold on to our assets, rather than turning them into cash cows for foreign owners."
Now, Bolger didn't actually say that, or at least The Standard's interpretation is slightly wrong. Reading the Herald's article, it seems what Bolger was saying was that there was a better way of going about privatisation. He blames Roger Douglas for getting it all wrong, and defends National's privatisation of NZ Rail in 1993.

On those two points, Bolger is right. Telecom should have been split into competing parts then floated on the share market, while NZ Post should've kept Postbank, as long-term that has shown greater value for the business than the declining revenues of postal services. In fact all privatisation should've been via public floats, as National required with the sale of NZ Rail (eventually allowing the government to buy it back), Air New Zealand and Contact Energy.