BUSINESS & POLITICS: People over politics where infrastructure is concerned

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A really interesting article today by Alan Kohler on the politicization of infrastructure projects in Australia and the broader region. In Australia, our inherited Westminster system of government, increasingly influenced by cashed up lobby groups, can hold the nation to ransom by putting needed infrastructure projects in stasis to protect minority interests.  The Westminster system is very easy to influence by lobbyists tapping the ‘not in my backyard’ reflex wherever major projects cover constituencies of strategic political interest, invariably consigning such projects to the too hard basket. Sadly, it’s not the projects that are too hard, it’s the politics.

One example which former prime minister John Howard liked was the national water grid, based on The Bradfield Scheme.  Bradfield’s idea was to build a massive network of irrigation channels and pipes to get excess water in the north to much drier lands in southern and central areas.  In addition to irrigating these areas with regular water supplies, the Bradfield system would double as a hydro-electric power generator to inland townships and communities.

The Bradfield scheme is a simple idea built on common sense logic.  The northern parts of the country experience annual, bankable monsoon rains while the southern and central areas experience regular, albeit less consistent, periods of drought.  Ask any resident of Toowoomba, Roma, Dalby, et al about water problems in their towns, then compare those stories to the recent experiences of residents in towns like Bundarra and Eurobadalla which received money under the Federal government’s ‘exceptional circumstances’ drought support fund until 2012.

In all, A$ 4.5 billion was provided to communities suffering through drought between 2001 and 2012.  A$ 4.5 billion would not come close to funding Bradfield’s idea to completion, but the idea is worthy of serious consideration.  Consider the environmental benefits for one.

Decades of clear-felling on the eastern Queensland coast has meant much more of the monsoon freshwater ends up in the Barrier Reef bleaching the coral and threatening marine habitats.  Consider too the cost savings to flood relief, clean up and insurance an end to regular flooding in Queensland would mean to the country’s finances.  Then consider the economic benefits of growing our regular, bankable arable lands in southern and central areas, a hugely important opportunity as we aim position the country as Asia’s breadbasket for the 21st century.

So how much would it cost to build Bradfield’s dream?  Hard to say exactly and few in favour of the idea have the political capital necessary to fund a serious costing. However, a potential benchmark exists in South Korea where a similar project was completed in 2011.

The Four Rivers project, designed to revitalise South Korea’s four major rivers – the Han, Guem, Nakdong and Yongsan, includes development projects on the rivers’ 14 tributaries and revitalisation of smaller-sized streams within broader environs.  The objectives of the project were to sure up fresh water resources, implement comprehensive flood control measures, improve water quality for wildlife and restore river ecosystems, create new multipurpose spaces for local residents, and encourage regional development centered around the river systems.  More than 929 km of streams and rivers were restored as part of the project, with a follow-up operation planned to restore more than 10,000 km of local streams.  More than 35 riparian wetlands have also been reconstructed as part of the plan.

With a price tag of around A$ 22 billion the Four Rivers project is expected to directly result in over 340,000 new jobs in South Korea.  In higher-cost Australia, where the distances required to deliver the Banfield scheme are considerably larger, a price tag of around A$ 80-100 billion is probably a realistic ball park.

Now, try to image a project like the Bradfield scheme happening in Australia.  Difficult isn’t it?  In the current political climate we seem incapable of putting the national interest ahead of the local, the state, the political, the tribal.  This is despite the fact that credit has never been cheaper and our debt to GDP is low by international standards.  In short, the window for nation-building projects has never more open than it is today.

In Alan Kohler’s article he points to China’s creation of the Asia Infrastructure Investment Bank (AIIB) as an initiative designed partly to serve broader geopolitical goals by cutting out the US from major development projects in the region.  Say what you like about this goal, at least the Chinese are linking it to ‘development’, and with this one expects, regional prosperity.  This is an example of majority needs trumping those of minorities and if the CCP (Chinese Communist Party) gets to crow about the fruits of it’s idea at the UN or elsewhere, I for one will toast their success.

Like the Three Gorges damn project, the AIIB is a stark illustration of what political capital looks like.  It’s far more valuable than any paper currency and sadly, in western democracies like Australia, in very short supply.

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