Comment: BT's share price says Labour's nationalisation plan will never, and should never, happen
The 1970s throwbacks in Labour central office never really got over the privatisation of BT. They long for the pre-Thatcher years of Buzby, the badly drawn BT mascot who promised to Make Someone Happy with a phonecall.
While Messrs Corbyn and McDonnell are stuck in the halcyon days of the three-day week, the rest of the world — and BT — has moved on. Here in the 21st century, nationalising Openreach would be so expensive, so disruptive as to be nigh on impossible. It won’t happen. That’s why BT shares haven’t collapsed.
Even if you misguidedly believe civil servants would get fibre rolled out quicker than the pros, the hurdles of seizing such a vast business from its owners cancels any benefit.
If Labour did find some magic way of taking the assets from UK investors, what would it do about the 66% of shareholders from foreign countries where Britain’s trade treaties prevent Venezuela-style forced asset expropriation?
Global legal actions would drag on for years. During that limbo, nobody — not BT, Virgin nor TalkTalk — will lay a centimetre of cable. Why would you if you knew it could get stolen from you?
One of the reasons UK fibre rollout has been slow is the lack of competition to BT. That’s finally starting to change; Talk Talk hooked up 300,000 homes in the past six months. Labour would scare off such new investment. Goldman’s CityFibre has already got cold feet over its TalkTalk deal.
Corbyn and McDonnell won’t care. Against all the evidence, they think state monopolies are the answer. As Buzby might say, their plans will make nobody happy.
