Nothing visionary in stimulus package

Viewpoint by Mark Carter

Given the ongoing nature of many of the infrastructure projects funded by the package, the stimulus effect is likely to continue for some time yet. On the rail side, a raft of recent announcements by Australian Rail Track Corporation (ARTC) would seem to back this up.
A problem though, with the various rail infrastructure projects chosen to benefit from the stimulus funding, is that by and large, they are very much ‘same old, same old’. Many of the projects are for catch-up infrastructure that should have been undertaken years ago but have been ignored through lack of funding or government indifference. Others such as the Regional Rail Link in Victoria have been born out of an urgent and unexpected necessity to cope with burgeoning rail patronage.
At the end of the day, aside from perhaps the planned broadband network, there is little in the overall stimulus package that could be seen as visionary or could seriously fall under the category of nation building.
Switch for a moment to China.
Around two years ago China already had a vision in place for a 7,500 kilometre high-speed rail network. As part of its own economic stimulus package, further funding has been planned that will see this network double, with some reports suggesting China will have a high speed network of 16,000 kilometres in place by 2020. The current estimated cost for this network is US$300 billion and construction is already well advanced on a significant number of new lines that will make up the network.
The network will have two standards of operation. A secondary network of high-speed (200-250 km/h) lines feeding into a major 350 km/h trunk network linking Beijing, Shanghai, Guangzhou, Hong Kong and Lanzhou. As an example the current 11-hour overnight journey between Beijing and Shanghai will be cut to just four hours when the new line is completed in 2011.
With at least US$300 billion being spent on high-speed rail projects in China, some of the stimulus will extend beyond China with opportunities for overseas companies to get involved. In fact recent media attention has been focused on the involvement of Bombardier (signalling and rolling stock) and IBM (opening of the Global Rail Innovation Centre, Beijing) in China’s rapidly developing rail plans.
IBM said in a statement that the Rail Innovation Center will be “staffed by a global network of IBM rail consultants, software specialists, mathematicians and business partners. China is at the epicentre of revolutionising rail infrastructure and operations for the 21st century, introducing new high speed trains and a hugely expanded rail network at an unprecedented pace.”
So where does this leave Australia?
There is no doubt that there is a global high-speed rail revolution underway around the world, not just in China, that is being met with total disinterest in Australia. Even the good old US of A has indicated it will stump up some cash to get the high-speed rail revolution rolling over there. Unfortunately the $15 billion promised pales in comparison with China’s spending and one imagines that we will be well into the next global recession before any of the US projects are up and running.
At least in the US they are doing something, but in Australia, nothing.
Obviously Australia does not have either the population base or the economy to start building some grandiose high-speed rail network serving all of its major cities at the drop of a hat. But Sydney and Melbourne’s rapidly growing populations are already significantly greater than when Australia’s previous high-speed rail projects were floated. The corridor between the two also has one of the world’s busiest domestic air routes. It would bode well for the nation’s future if some preliminary bi-partisan planning and assessment was being undertaken to reassess the potential for a high-speed rail in Australia.
Stimulus plans are all well and good when they are used to patch up infrastructure that has suffered from decades of neglect – at least it gets us through to the next recession. But if we are serious about nation building and stimulating the economy to a point where it sees us not only through the next recession but beyond it, then a bit of vision is needed and in the current package I don’t see a lot of it.