Tuesday 14 August 2007

Look up: it's more FF bungling

Fintan O'Toole makes an interesting point when he shows how voters in the Clare and Limerick areas overwhelmingly voted for parties who had made it clear they'd support privatisation of Aer Lingus. O'Toole shows that support for FF + PD in the area is very strong (over 50%) and given that FG too were broadly speaking in favour of "a partial sale of Aer Lingus" the total support for pro-sale parties was huge. O'Toole says, you get what you vote for so how can people now complain.

My first response here is that this supposes that retaining Aer Lingus's Heathrow slots was a high priority for the majority of voters. But we don't actually know that. There has been a vocal response from certain business interests, but when cannot know without further analysis if the general population feel the same way. In particular we'd need to establish if they rated the retention of the Heathrow link higher than say, the priority of choosing (what they may have felt to be) stable government which favours low tax. Or they may simply have rejected other elements of say, Labour's, program, on the basis that they disliked it more than the idea of loosing Aer Lingus.

And to complicate matters more, it is extremely difficult to extract a stable and fair set of preferences from a set of listed numerical priorities thrown up by a voting system. Kenneth Arrow won the Nobel for his mathematical demonstration of this in a thoerem now known as Arrows Impossibility Theorem.

But the nub of this whole matter is not really about voting preferences. It's down to two separate issues which happen to intersect in this case.

The First is the debate between private versus public service. And in particular, which is best for an Aerline. Should the state (even on an Island) really be running an Airline? Right wing economists think it's absurd. But I did note that just around the privatisation Moore McDowell was asked by Vincent Browne, what advantage exactly will accrue from the sale of Aer Lingus, given that it was run very successfully (in recent years) despite being in government ownership. McDowell didn't really have a convincing answer - merely the usual stuff about government running the country and someone else running an airline.

I would argue that if certain routes can be shown to be strategic - whether regional or not - then we need to ensure their survival. If government ownership is the only way then so be it. We have no fear that Aer Lingus will start charging 600eu for flights to London - the Market is different now and those days are not about to return. But perhaps government ownership is not needed: perhaps the social or strategic goals, if you will, can be achieved by some form of regulatory framework or subsidy mechanism. This is applied with reasonable success in other areas (including the privision of internal flights to places like Kerry and Donegal). This model would be better, for it allows the Market to do all but a tiny part of the work.

The second major issue here is balanced regional development. This is whether the current and previous administrations have been dreadful. Almost everyone agrees that we need counterweights to Dublin (for its own good as well as to share out development). Yet the government's approach has been an utter farce: the decentralisation program which rejected their own fairly sensible spatial strategy in favour of clientelism. They peppered the departments out across the country willy nilly depending on which constituencies needed their seats secured or whether a minister lived at X or Y in a county. This was FF in its purest form. There are other aspects to this farce - like the very questionable 5bn metro to Dublin airport when transport around other cities is barely skeletal.

In the final analysis, the Shannon / Aer Lingus debacle is merely one example among a thousand where FF gets it wrong. The pattern is all too familiar. Government gets strategy wrong through clientelsim or, in this case, pure neglect (for Shannon and regional development). Localised uproar. Minsiter huffs and puffs blaming everone else. Issue dies down or superceded. Nothing done or, at best, some token gesture is made. And move on to the next blunder. Yip, that's FF for you

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