Asset sales- six good and simple supporting arguments

“No assets sales” was a slogan that recently brought a far left halfwit to power in the Queensland (Australia) elections. Annastacia Palaszczuk became Qld Premier although two days before the election she let slip that she didn’t even know what the 10% GST rate was.

Its a slogan that the Qld Liberal Party appeared to have no effective response to other than to say the “assets” would be leased not sold. A flawed argument that concedes the premise that sale is a bad thing.

Now we see the NSW Labor Party adopting the same strategy. Scare mongering on assets sales and once again the sitting Liberal govt seems to be stumped for a counter argument.

In actuality, there are plenty of good arguments against asset sales and it beats me why perceived “right wing” politicians like John Key, Campbell Newman, Tony Abbot etc apparently can’t think of them or articulate them.

1) The first and easiest argument is that we are not a communist society and that we believe in the concept of free enterprise and see it as underpinning our prosperity and freedom. If you want the govt to own things maybe you should be living in Cuba or Nth Korea.

2) Government intervention in markets should not exist or be kept to a minimum. See defunct Soviet Union for expanded reasons.

3) Further to 2) above, businesses run by government are often run on political rather than economic considerations. They dampen competition and make it harder for the private sector to offer quality services. Voters end up paying more for products that are inferior. (see Radio NZ)

4) Fully owned government businesses cannot go bankrupt, leaving the taxpayer on the hook for bailouts of uneconomic and or commercially worthless units.

5) Most of the reasons the left put forward for govt ownership are deeply flawed in logic and rationale. For every point the left have on the issue, there is a counterpoint to trump it.

Price gouging? Not possible in the competitive business environment we should be striving to foster.

Squeezing out competition? OK, I’ll trade you selling assets for regulation that enhances competition and restricts anti-competitive practices.

Big profits? No problem, buy shares in the successful companies. In a truly competitive market, companies that make high profits are usually only doing so because they provide a better service or product.

6) Most western economies are in need of capital investment. NZ for example sees most money going into houses. A thriving free market economy, ie one not hobbled by govt  intervention encourages investment in other areas of the economy bringing more jobs and higher wages.

I could go on but I’ve used up enough space. The bottom line is there has to be an argument made for asset sales that does not yield to the left’s faulty premises. I’d start by not using left wing language in the first place and replacing the emotional and pejorative phrase “asset sales” with “liability relief”. Or something like that.