Changes to RBA Act will further entrench the depoliticisation of economic policy and reduce democratic accountability
Today, I consider the latest development in the entrenchment of neoliberalism in the Australian policy…
It is Wednesday, so just a few snippets and some music. My main comment today is on the report released yesterday (December 15, 2020) by the national body Infrastructure Australia. The report – Infrastructure beyond COVID-19: A national study on the impacts of the pandemic on Australia – once again demonstrates the way in which mainstream macroeconomics, which has restricted government investment in essential instrastructure over the last three decades or so, has created poor outcomes and has failed to prepare the nation for the future. This sort of myopia just repeats itself across all nations. Hopefully, the fiscal response to the pandemic, even though in many countries it has been inadequate, is demonstrating that the mainstream approach is deeply flawed and provides no guidance for the way policy should be conducted into the future.
Yesterday (December 15, 2020), the national body Infrastructure Australia released an important report – Infrastructure beyond COVID-19: A national study on the impacts of the pandemic on Australia.
The Report’s findings once again demonstrates the way in which mainstream macroeconomics, which has restricted government investment in essential instrastructure over the last three decades or so, has created poor outcomes and has failed to prepare the nation for the future.
The largest national infrastructure project that Australia has embarked on for decades – the National Broadband Network (NBN) – is a object lesson in how not to conduct government policy when nation building.
I have written about this topic before:
1. The neo-liberal infestation – Australia’s broadband fiasco gets worse (August 2, 2017).
2. Australia’s crawling Internet speed signifies wider fiscal failure (September 9, 2015).
3. Public infrastructure does not have to earn commercial returns (December 20, 2010).
4. Free public broadband is required (April 20, 2009).
5. Australia’s broadband disaster has lessons for a Green New Deal strategy (August 6, 2019).
For international readers, the NBN refers to the development of a fibre-based national broadband network to replace the archaic, slow network that exists now based on dated technology (copper wire).
It was touted as offering high-speed broadband access to all Australians whereas at present many regional areas do not have any access.
We were told that the NBN would be a grand nation building piece of infrastructure that would ensure Australia was at the forefront of network technology for decades to come.
The promise from the previous Labor government was that there would be optic fibre to the home (premises) to replace the old copper wire telephone system that the Internet is reliant on in Australia.
What we were told and what has emerged are two vastly different things.
While the network was promised to deliver 100Mbps connectivity (download) tp 93 per cent of users under Labor’s plan, users now report that the speeds they are getting in the evening are worse, in many cases, than what they were able to get under the previous ADSL network, which the fibre NBN network replaced.
Because when the conservatives took federal office in September 2013, they announced they did not have enough “money” and that the NBN that was being constructed was a ‘Rolls Royce’ that we did not need.
So they scaled down the ambition and only connected optic fibre to hubs in streets (mostly) and maintained the old copper wire system, which was badly degraded and constantly unreliable.
And because of the hybrid technology required, the construction costs have risen alarmingly and the timelines have been pushed out.
It was a disastrous example of austerity inflicting higher costs when it was meant to be cutting costs.
Many people are also arguing that the compromised NBN network is already being superseded in performance by the pending 5G Wireless offerings from the major telecommunications companies.
So the ‘Rolls Royce’ might become a ‘white elephant’.
The Infrastructure Australia report describes and analyses how Australians have changed behaviour during the COVID lockdowns and how these changes have impacted on the existing infrastructure – Transport, Social, Telecommunications, Energy, Water, and Waste.
The Report devotes a chapter to ‘Telecommunications and Digital’.
It says that:
As the COVID-19 pandemic spread, Australian governments took early action, introducing travel bans, lockdowns, and border controls and supporting domestic supply chains. Communities adopted social distancing and moved to working from home. While these early measures successfully contained national case numbers, they prompted profound changes to the way people moved, consumed, and worked, changing patterns of infrastructure use.
A major change was the “shift from physical to virtual services at a rate that was previously considered impossible, with students accessing online learning, city and remote patients accessing mental health care through telehealth, and online shopping growth in remote areas matching cities.”
Some of us are definitely Zoomed-out!
The summary result is that while network and telecommunications use has skyrocketed and diversified:
NBN network congestion grew to an average 60 minutes per week per service in March 2020 with increased levels of customer complaint … Higher internet usage was evident both during work hours and in the early evenings as more people stayed home
The network congestion led to considerably more outages and access issues.
The previous commercial model imposed by the government on the public company whereby NBN Co had to recoup the costs of the investment through user pays charges through the profit-seeking internet service provider retailers has resulted in very high Internet connectivity charges.
So, going into the pandemic, while “11.8 million Australian locations (i.e. homes and businesses) are able to connect to the NBN network but only 7.8 million locations (i.e. homes and businesses) are now connected to a plan as of October 2020.”
For many the cost of connection is beyond their financial capacity – such is the level that is being charged.
This has led to massive issues about digital/information poverty.
The Report says that:
The Australian Digital Inclusion Index (ADII) measures digital inclusion
– affordability remains the key barrier to digital inclusion and is likely to be exacerbated by COVID-19 related economic slowdown
– approximately 800,000 (20%) of the 4 million primary and secondary students in Australia are from households with the lowest income bracket (under $35,000). These households record an ADII score of 52.9, 10.1 points lower than the national average (63)
– COVID-19 may have further impacted disadvantaged individuals where public services were unavailable (e.g. internet at local libraries) during lockdowns
The lockdowns and increased use of the NBN have further increased strain on household budgets, such that there is now “a widening affordability gap between the lowest-income and highest-income segments”.
Segments are people by the way!
The other problem is that the system is not technically robust (given the compromised design) and the COVID-19-induced demand increases have caused “frequent dropouts or low speeds” to be worse than before.
So overall – a classic example of austerity compromising the quality and scope of essential public infrastructure.
This is what I have been listening to while working this morning.
I actually like the 1993 Aswad/Yazz – version – of this song the best.
But the following version is also pretty cool and is performed by the person who wrote the song in the first place – Paul Carrack – which gives it extra credibility.
He has a long CV in the music industry and has played with some great bands and musicians.
You can hear his keyboard playing on a lot of very popular albums as he built a career as a session player in studios in the UK.
Apparently, he wrote the song because the bass player in the band was working with another band (a rival) without telling his bandmates what he was doing.
When exposed, the bass player apparently rejoined the band.
Band politics. Ever present and usually go beyond the classic ‘musical differences’ excuse.
My band – Pressure Drop – has not been able to play since March 2020, due to the COVID-19 lockdown and related restrictions.
Now that more than 5 people from different families are once again allowed to be together in Melbourne, we will be streaming a live concert via YouTube starting at 20:30 from a studio in Melbourne.
The stream will go live at 20:00 Friday. Click then or go to our YouTube Channel.
1. Melbourne 20:00 Friday
2. Tokyo 18:00 Friday
3. Helsinki 11:00 Friday
4. London 9:00 Friday
5. New York 4:00 Friday (too early sorry)
6. San Francisco 1:00 Friday (too early sorry).
That is enough for today!
(c) Copyright 2020 William Mitchell. All Rights Reserved.