Due to monopoly a second airport will not pass go
There’s something dreadfully wrong somewhere along the line when Sydney can get a second casino, but not a second airport. While Melbourne is talking about a third major airport, Sydney can’t get its act together to build a second, let alone, third airport that’s likely to be needed soon after any second airport is built.
Do we really need a second Sydney Casino? You be the judge. Do we need more problem gamblers or are we simply going to rely on the so-called `high rollers’ from overseas to make the second casino viable?
Well, we don’t need more problem gamblers and repeated references to so-called ‘Asian high rollers’ are now getting a bit tiresome and border on the offensive. If any other cultural group was being referred to in such a potentially exploitative manner we would probably be hearing calls for an apology.
Leaving aside the obvious willingness to identify particular groups of so-called `higher rollers’ as the pretext for a second casino, one really has to question whether there is any pressing need for another casino? You would think that your local RSL or Leagues club is effectively a casino. In any event, if there is some proven `need’ for another casino, why don’t we just allow your local RSL or Leagues Club to offer gaming tables?
So why all the fuss about a second Sydney casino? Well, you have a very rich private investor who wants to get his hands on a casino license for the very simple reason that it’s a license to print money. There’s already effectively a monopoly on the provision of gaming tables in Sydney and a second license would just turn that into a duopoly. And we only need to look at Coles and Woolworths to see how lucrative duopolies are!
What’s really amazing is that we can fast track a second casino, but any progress towards a second airport occurs at a snail’s pace. Given how slow the process has been, a snail would probably have already completed a few laps of the existing runways at Sydney airport. That’s provided, of course, it hadn’t been squashed by the ever increasing flights in and out of Sydney airport.
We have Canberra and Adelaide airports expanding and Sydney’s once great Kingsford-Smith airport at Mascot is suffocating. There’s only one major road into and out of the domestic terminals. Whether it’s 7am in the morning or 7pm at night there’s traffic chaos leading to Sydney’s domestic terminals. It’s no better at other times of the day.
Taxis are queued for hours, but there never seems to be enough of them. The train line would offer some respite, but train tickets are hyper-inflated because of the financial disaster that accompanied the building of the airport train line.
The traffic into the domestic terminals is very poorly managed by Sydney Airport and various pedestrian crossings are not controlled by traffic lights which mean that there’s a constant stream of one or two passengers from the parking station who can significantly disrupt the motor vehicle flows into the domestic terminals.
That’s all because the airport is too stingy to put in extra traffic lights to better manage the flow of passengers from the parking station that’s between the two domestic terminals. In fact, that’s the problem with a monopoly like Sydney Airport. It likes to gouge airlines and passengers using the airport with ever increasing charges.
For the poor old passengers they get ripped off at every turn. Parking charges seem to climb as fast as a plane taking off from the airport. Let’s not even mention the possibility of a parking fine for stopping in the wrong place at the airport that would make any local Council parking fine look cheap.
Even the airlines get hit with increasing charges. There’s no doubt that having a monopoly like Sydney Airport is good for its owners, but bad news for everyone else. Monopolies are good at raising prices and reducing service standards. That’s easy to do because they don’t have competition.
It’s no wonder therefore that Sydney Airport fights strenuously against any suggestion of a second airport. That would mean competition. It’s obviously a huge market failure when a monopolist is allowed to stop the entry of a competitor.
Now, interestingly, the owners of Sydney Airport have a first right of refusal on building a new second airport. In fact, they paid a lot of money for that privilege. As a result, Sydney Airport can effectively delay, if not, stop a potential competitor airport in the Sydney Basin. That means that a private business can delay or even stop a much needed infrastructure project that would benefit passengers, airlines and Sydney itself.
There’s certainly a market failure when a private business can delay or stop competition from an independently owned second Sydney airport. In fact, that may even amount to a possible misuse of market power under our competition laws. Where’s the ACCC when you need it?
With the ACCC Chairman, Rod Sims, recently getting excited about competition and productivity issues at Australian Ports, we can only hope Sims gets equally, if not more, excited about the need for a second Sydney Airport which would no doubt boost competition and productivity in the aviation market.
As we wait for Governments to get the backbone to deliver a second Sydney Airport we should also be thinking about other possible competitors to the existing Sydney Airport. Why don’t we do some serious thinking about a high speed rail link between Sydney and Canberra? In fact, why stop there? Why don’t we have a high speed rail link between Sydney and Melbourne that goes through Canberra?
That would be brilliant as that would solve many problems. First, there would then be a realistic and effective competitor to not only Sydney Airport, but also Canberra and Melbourne Airports. Second, given that Sydney to Melbourne is one of the busiest air routes in the world, moving passengers from the air to a high speed train would significantly reduce the number of flights in and out of Sydney Airport. That would free up lots of capacity at Sydney Airport and even delay the need for a Second Sydney Airport.
Finally, with strategically placed stations along the Sydney to Melbourne high speed rail line many New South Wales and Victorian regional centres could be serviced by a standard of railway that the Europeans have enjoyed for decades.
You would think that such a nation building exercise would be promoted by the New South Wales, Victorian, ACT and Federal Governments. But, inevitably such suggestions would bring out the friends and lobbyists of Sydney Airport and Qantas with all the types of self-interested arguments that the free market fundamentalists are best known for. It seems that monopolists and dominant players, as well as their supporters and apologists, don’t like the injection of competition.
Where’s the Federal Government when you need it to stand up to monopolists and dominant players? Meanwhile, Sydney is likely to get a second casino before it gets a second airport. It seems that the so-called high rollers can get a better deal than the millions of Sydney taxpayers that pay lots of taxes to the New South Wales and Federal Governments.
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