KEY POINTS:
What is this thing, a "key strategic asset"? The words are intoned by opponents of the Dubai bid for control of Auckland Airport as though it is self-evident.
I know what an asset is and I thought I knew what a "strategic" one might be: the road network,
the electricity grid, Telecom's wires - connections that are vital to the functioning of the economy and too costly to duplicate; natural monopolies.
But an airport? Every town can have one. An airport is a strip of concrete and a shed. An international airport is a longer and stronger strip of concrete and a bigger shed. All the main centres have one. What is "strategic" about Auckland's?
It may be the country's main gate but it is not as though we had a stockade around the coast and allowed only one point of entry, like Albania circa 1977. We have many, including a second airport near Auckland if anyone were to buy control at Mangere and run it down.
It is hard to imagine why anyone would. Certainly Fay Richwhite did nothing for a junk railway and bailed out before smaller investors woke up, but nobody buys a profitable operation to let it rust.
The "key strategic" airport is now as profitable for its shopping centres and carparks as its airline services. Maybe that's the key. Rents and parking charges might also explain why the shareholding councils, rail enthusiasts otherwise, are not pressing very hard for a train-to-plane line that would save us the ridiculous road route to Mangere. Public stakes in commercial operations only compromise the public interest.
Auckland Airport is already in majority private ownership and several prospective buyers have lately knocked on its door.
Private owners are prepared to sell assets when somebody else sees more possible value in them; public ownership tends to hold onto them come hell or high water.
Auckland and Manukau councils are answerable in a couple of months to voters who, on the evidence of a DigiPoll survey of 400 Auckland City residents, overwhelmingly want to keep the shares.
Some people will not sell a personal asset at any price. They may move house and trade in their car when they have to, but otherwise their instinct is to hold on to everything they have. If somebody offers them a good price for an item they are pleasantly surprised to discover its potential worth but the discovery only makes them more inclined to keep it.
They don't realise an asset's worth depends on what the owner is prepared to do with it. It is better to sell something if someone wants to do more with it; better for the seller who receives some of the higher value in the price and better for the country because a harder working asset usually means better services and more taxable wealth.
Other people, like me, are just not very interested in business. They prefer to be paid a salary for work they enjoy and let different sorts of people run companies, watch sharemarket movements, keep customers content, make assets work and keep the rest of the population employed.
These are the people who get rich. The rest of us fall into two voting camps - those who believe assets work automatically and find it unfair the owners should be so lucky, and those who think it quite fair and better for everyone that those who take more risk reap greater rewards.
There must be many in the second camp among the 80 per cent of DigiPoll's sample who oppose the airport sale, but they probably oppose this bid for better reasons.
There are respectable concerns: Dubai Aerospace Enterprises may be too close to Emirates Airlines. Their offer incorporates some sort of debenture "stapled" to the cash, and the attraction of our little airport at the end of the line is hard to understand.
But not many airports are available to international investors. Xenophobia is everywhere; even America where another Dubai enterprise was refused the right to buy sea ports recently. Large, well-located economies can probably afford to indulge prejudice to this degree. We cannot.
We are a tiny corner of a vast integrated economy of countries that allow trade and finance to flow fairly freely across their borders. It is a richer economy than any of those created by protective egalitarian experiments last century, and New Zealanders own about as much of it internally as our population should give us to expect.
If an airport bid succeeds it will be interesting to see what high payers can do with it. But if it fails to impress enough private shareholders, their reasons can be respected. If, though, it falls short of the necessary 75 per cent because the councils are afraid to act on commercial judgment, their decision will be contemptible and the loss ours.
