atw: Re: National Broadband Network and empathy
- From: Rod Stuart <rod.stuart@xxxxxxxxx>
- To: austechwriter@xxxxxxxxxxxxx
- Date: Sun, 22 Aug 2010 18:32:35 +1000
Sorry for the delay. I've been busy making a living. Here are a couple of
quotes.
“Giving money and power to government is like giving whiskey and car keys to
teenage boys.”
“Every government is a parliament of whores. The trouble is, in a democracy,
the whores are us.”
P.J. O’Rourke
First of all, as I had tried to explain before, government can only function
through coercion. It is exactly the same sort of coercion as is involved
when the mafia extorts weekly payments from a shopkeeper for “protection”.
It is through force or threat of force.
Nothing involving government is voluntary — as it would be when a private
ompany does something. One way or another, there is compulsion in every
overnment activity:
· The government forces someone to pay for something;
· The government forces someone to do something; or
· The government forcibly prevents someone from doing
something.
There is no other reason to involve government. What basis is this for a
society, in which an elite group of individuals is allowed to extort from
the remainder?
The proposed NBN is a good example of this. Everyone is forced to “invest”
in the capital cost whether it is of any use to them or not. Furthermore
there is already discussion about forcing people to sign up if it comes by
their door. And in a free society, it can’t be an “investment” if a person
can’t sell it.
Several of the comments on this list carry the usual leftist disdain for
profit. Profit is a good thing. Potential profit provides the incentive for
voluntary investment. In the case of the NBN, there is a very real
possibility that it will be obsolete technology long before the project is
viable for sale (the implementation plan suggests up to 20 years). In order
to persuede people to invest in such a scheme requires “risk capital”, so
must have some potential for profit far more than the “risk-free rate”.
Some of the folks on this list that just ache for faster download speeds and
someone else to pay for them probably don’t realise the size of the
expenditure. $43.6 billion is enough to purchase a million SUV’s five meters
long (for instance a Pajero might cost $43,600). So as a graphical indicator
that amount would purchase SUV’s arranged tail to bumper from Hobart to
Karratha. And there is a pretty good chance that before it is finished it
would purchase Prado’s to line the road back again.
*Governments are run by politicians, not businessmen. *
Politicians can only make political decisions, not economic ones. They are,
after all, first and foremost in the re-election business. Because of the
need to be re-elected, politicians are always likely to have a short-term
bias. What looks good right now is more important to politicians than
long-term consequences even when those consequences can be easily foreseen.
The gathering disaster of Social Security has been obvious for years, but
politics has prevented needed reforms.
Politicians tend to favor parochial interests over sound economic sense.
Consider a thought experiment. There is a national widget crisis and Sen.
Stephen Conroy is chairman of the Senate Widget Committee. There are two
technologies that are possible solutions to the problem, with Technology A
widely thought to be the more promising of the two. But the company that has
been developing Technology B is headquartered in Sen. Conroy's state and
employs 40,000 workers there. Which technology is Sen. Conroy going to use
his vast legislative influence to push?
*Politicians need headlines.*
And this means they have a deep need to do something ("Sen. Conroy Moves on
Widget Crisis!"), even when doing nothing would be the better option.
Markets will always deal efficiently with gluts and shortages, but letting
the market work doesn't produce favorable headlines and, indeed, often
produces the opposite ("Sen. Conroy Fails to Move on Widget Crisis!").
*Governments use other people's money.*
Corporations play with their own money. They are wealth-creating machines in
which various people (investors, managers and labor) come together under a
defined set of rules in hopes of creating more wealth collectively than they
can create separately.
So a labor negotiation in a corporation is a negotiation over how to divide
the wealth that is created between stockholders and workers. Each side knows
that if they drive too hard a bargain they risk killing the goose that lays
golden eggs for both sides. Just ask General Motors and the United Auto
Workers.
But when, say, a school board sits down to negotiate with a teachers union
or decide how many administrators are needed, the goose is the taxpayer.
That's why public-service employees now often have much more generous
benefits than their private-sector counterparts. And that's why the public
school system has an administrator-to-student ratio 10 times as high as the
Catholic school system.
*Government does not tolerate competition. *
Some governments create state insurance to compete in the auto-insurance
marketplace with profit-seeking companies. Eventually the product becomes
subsidised by tax dollars. Has a government entity ever competed
successfully on a level playing field with private companies? I don't know
of one.
Telstra is a case in point. It is what it is and behaves the way it does
because it began as a State monopoly. You are correct when you say “Telstra
ain’t free enterprise”.
*Government enterprises are almost always monopolies and thus do not face
competition at all.*
Your comment about privatisation of the electricity market failing to
deliver lower electricity prices. D’uh! That’s because State owned
electricity is subsidised through theft (taxes) from other sources!
Competition is exactly what makes capitalism so successful an economic
system. The lack of it has always doomed socialist economies.
Telstra’s origins date back to 1901, when the Postmaster-General's
Department was established by the Commonwealth Government to manage all
domestic telephone, telegraph and postal services, and to 1946, when the
Overseas Telecommunications Commission was established by the Commonwealth
Government to manage international telecommunications services.(The process
was called "postalization," a word that should send shivers down the back of
any believer in free markets.) But despite the promise of lower prices,
practically the first thing the Post Office did when it took over was . . .
raise prices.
Cost cutting is alien to the culture of all bureaucracies. Indeed, when cost
cutting is inescapable, bureaucracies often make cuts that will produce
maximum public inconvenience, generating political pressure to reverse the
cuts.
*Successful corporations are run by benevolent despots.*
The CEO of a corporation has the power to manage effectively. He decides
company policy, organizes the corporate structure, and allocates resources
pretty much as he thinks best. The board of directors ordinarily does
nothing more than ratify his moves (or, of course, fire him). This allows a
company to act quickly when needed.
But the Commonwealth government was designed by the to be inefficient, and
inefficient it most certainly is. The Prime Minister is the government's
CEO, but except for trivial matters he can't do anything without the
permission of two separate, very large committees (the Commons and Senate)
whose members have their own political agendas. Government always has many
cooks, which is why the government's broth is so often spoiled.
*Government is regulated by government.*
Some have noted that "all monopolies should be regulated”. Government
ownership would be an unregulated monopoly. It is government's job to make
and enforce the rules that allow a civilized society to flourish. But it has
a dismal record of regulating itself. Imagine, for instance, if a
corporation, seeking to make its bottom line look better, transferred
employee contributions from the company pension fund to its own accounts,
replaced the money with general obligation corporate bonds, and called the
money it expropriated income. We all know what would happen: The company
accountants would refuse to certify the books and management would likely --
and rightly -- end up in jail.
But that is exactly what the Commonwealth government (which, unlike
corporations, decides how to keep its own books) does with entitlements.
Already within the current administration, run rumours of doing just that
with folks’ Superannuation.
Capitalism isn't perfect. Indeed, to paraphrase Winston Churchill's famous
description of democracy, it's the worst economic system except for all the
others. But the inescapable fact is that only the profit motive and
competition keep enterprises lean, efficient, innovative and
customer-oriented.
On 20 August 2010 10:26, Geoffrey Marnell <geoffrey@xxxxxxxxxxxxxx> wrote:
> Hello Rod,
>
> It's good to see the passion return to this list, but can I ask a favour.
> For the edification of all those still interested in this thread, can you
> provide some solid, empirical evidence that the private sector is always
> more efficient than the public sector. Here is my anecdotal evidence to the
> contrary. I have, over many years, been employed by both sectors and have
> contracted to both sectors. While inefficiency (encompassing waste,
> mismanagement and general ineptitude) has been fairly evenly spread across
> both sectors, the instances of greatest inefficiency I has witnessed were in
> the private sector. Two segments in particular stand out: start-ups (who
> seem to think that money grows on trees) and the large, long-standing,
> highly profitable behemoths (lulled by blinding complacency into thinking
> that they must be doing the best they can). Nothing came close in the public
> sector.
>
> Secondly, do you think that the private sector can always provide services
> more cheaply than the public sector? I mentioned yesterday that governments
> can fund their activities more cheaply than private companies, and they are
> not driven by shareholder appetite for profits and ever-increasing profit
> growth. But let's look at some examples. The anti-government government of
> Jeff Kennett privatised electricity in Victoria, assuring voters that this
> would lower electricity prices. Of course, the exact opposite occurred.
> Likewise water distribution. And take a look at Melbourne's privatised
> public transport system. Grossly inefficient, more and more expensive and
> incapable of retaining private-sector interest without the government
> tipping in a few hundred million dollars every year. So here's a case where
> necessary infrastructure is of no interest to the private sector unless it
> gets a government grant. (Or perhaps you consider a railway system not
> necessary infrastructure at all.)
>
> To my mind, reliance on the private sector is a recipe for the Hobbesian
> jungle.
>
> Cheers
>
>
> Geoffrey Marnell
> Principal Consultant
> Abelard Consulting Pty Ltd
> T: +61 3 9596 3456
> F: +61 3 9596 3625
> W: www.abelard.com.au
> Skype: geoffrey.marnell
>
>
> ------------------------------
> *From:* austechwriter-bounce@xxxxxxxxxxxxx [mailto:
> austechwriter-bounce@xxxxxxxxxxxxx] *On Behalf Of *Rod Stuart
> *Sent:* Friday, August 20, 2010 8:39 AM
> *To:* austechwriter@xxxxxxxxxxxxx
> *Subject:* atw: Re: National Broadband Network and empathy
>
> And the best way......no, the ONLY way to make life easier for the end user
> (that's all of us) is to get government our of everyone's face. We're
> over-governed, over-taxed, over-regulated, and on top of that INEFFICIENTLY
> governed taxed and regulated.
>
> On 19 August 2010 22:20, Anne Casey <writan@xxxxxxxxxxxxxxx> wrote:
>
>> At 10:03 PM 18/08/2010, you wrote:
>>
>> So what you are saying Anne is that the whole nation should have to cough
>> up just so that you can get broadband? Living away from infrastructure has
>> its price.
>>
>>
>> Actually, Bruce, you are wrong. I (deliberately) live close enough to the
>> local exchange to get ADSL2, according to Telstra - except the local copper
>> is so poor that I can only get unreliable ADSL. Telstra has no interest in
>> fixing the problem. It's not about what I am prepared to pay, but whether a
>> private company could be bothered.
>>
>>
>> I'll be generous though Anne, I'm happy to say "those using it when there
>> is copper nearby should pay for it" if that helps, but it still sounds like
>> you want the nation to pay for a safe, well-built, fully paved road to every
>> farm and outlying doorstep. Oh hang on, I still haven't read that you were
>> willing to pay for my road toll costs.
>>
>>
>>
>> You didn't ask; you just assumed I'm only interested in my own welfare.
>> I'm not in favour of toll roads. On the other hand, I could say that the
>> fact that you're required to use a toll road is because you chose to live
>> away from infrastructure (heavy rail) - and you have to pay the price. I on
>> the other hand choose to live walking distance from a train station; and yet
>> I would support a rail extension to improve your access to public transport.
>>
>> I've come to realise over the last couple of days that there is something
>> I look for in a technical writer, apart from the usual skills list - the
>> ability to empathise with end users; to some extent to want to make their
>> lives easier.
>>
>> Any thoughts?
>>
>> Anne
>>
>>
>
>
> --
> Rod Stuart
> 6 Brickhill Drive
> Dilston, TAS 7252, Australia
> <rod.stuart@xxxxxxxxx>
> M((040) 184 6575 V(03) 6312 5399
>
--
Rod Stuart
6 Brickhill Drive
Dilston, TAS 7252, Australia
<rod.stuart@xxxxxxxxx>
M((040) 184 6575 V(03) 6312 5399
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