Bitten by an icon

There was a time, not so many years back, where a national airline was seen as an essential element of national identity.

For Australia that airline was Qantas, born just a stretch up the road from where your correspondent is sitting in rural Queensland.

Now ‘just a stretch up the road’ in Queensland is not a Sunday afternoon drive, you generally need to pack more than just a picnic lunch, so despite the sparse population it is a fitting place for the birth of this once proud national icon.

Qantas began with fragile biplanes carrying one or two passengers in open cockpits, and serviced the vast outback as the Queensland and Northern Territory Aerial Services Ltd.

Despite the fact that the airline has now become just an airline to many Australians, an election year is not a clever time to see it fly overseas for good into the hands of foreign investors.

Now the international group behind an $11 billion takeover bid are attempting to stare down the Howard Government as nervous backbenchers agitate for restrictions on the deal.

It is all a bit late of course, Howard signed off years ago on liberalising foreign investment, without too much pressure from the US and others.

In fact he has been a major advocate, and still is, of increased trade liberalisation – just not the family silver in and election year. But regardless of bluster it is highly unlikely the takeover can be stopped under revamped laws.

Ironically, if the flying kangaroo was to move offshore it would be a great help to Howard or his successors Australia’s trade balance widened last month, with drought being cited as a primary cause. But on the other side, purchases there is always a spike when new aircraft are bought by out various airlines.

The biggest and most expensive, of course, are the international monsters preferred by Qantas. Okay, it was only a couple of hundred million bucks, but the we are just 20 million people.

There was some irony in the other spike factor as well, oil. While Howard just shaved through on avoiding a rate hike, because of lower fuel prices it is claimed, higher oil imports added to the debt imbalance.

There are enough indications that, like the US, Australia is on treacherously thin ice economically. It is all very well to massage one indicator, but the reality soon starts leaking out of another.

Bush is not the only leader being isolated by the current trend within the new Democratic majority to jettison trade liberalisation and revert to protectionist policies, the Howard government is also caught with its pant down.

Thus exposed, those trade liberalisation policies are turning around to bite Howard on the bum, in an election year.