Reading the threads the latest with farmers and lack of water is just another way to say politicians of today are useless, gutless, visionless and stupid. I wrote a post last night but in summary of that post Australia has no aspiration and soon everyone we just see the economy as a Ponzi scheme on how much my house is worth (or how much it is falling now). Visionlesss we will simply export jobs and crowwd our cities further as regional Australia self destructs even further - just look at farming and consolidation of farms into foreign ownership, as we have seen with resources.
The issue been highlighted from farmers plight to lack of infrastructure is essentially one where the government of all influences has lost long term vision. In fact they don't have one and when someone wants to put up some foresight the idiots talk about debt/cost rather than what it means for future generations. In WA some might recall Colin Barnett wanted to pump water from the Ord River inland to Perth but then everyone went ballistic with short term dummy spats about cost, role of private sector, rates of return in the short term as against looking at long term outcomes. This is why Australia is truly stuffed and our long term competitiveness is going down the toilet. farmers are now just pawns in this game too and just show how useless and out of touch the city loving National embers have become of the LNP.
A private monopoly is worse than a public monopoly as you get price gouged. Just look at your electricity bills after privatisations exacerbated by ineffective energy policy. The lack of planning and foresight in water, power generation, transport infrastructure (the list is endless) by government is appalling - it started with privatisation in the 1990s. You know, because the private sector uses high hurdle rates of return in project investments long-life infrastructure is what suffers btw and why Australia lacks foresight in providing long life infrastructure
It is quite simple, today's politician's believe totally in the free market. They do not understand economic principles around long life assets - private sector wants asset recovery (pay back periods) of 10 years or less, whilst for things such as dams, water provision, hydro, ports, rail, gas pipelines etc they don't get there returns for over thirty years (unless they are required as part of a huge resource development). Simple reason, the infrastructure cannot be done in increments - it is one lump sum oversized investment meaning demand needs to catch up to the supply capacity overtime and within your typical discounted cash flow models, where discount rates are used, this means any revenue stream after 10 years is heavily discounted to almost nothing, so the private sector won't build it. Yet governments believe it will be built and the circus continues.
It is a simple concept: "market failure", role of govt in providing 'long life economic asset's, 'free rider', 'public good' - all concepts lost to today's idiots we call politicians. Google the terms if you need to understand there meaning.
Imagine today's morons living in the past - there would have been no Dampier to Bunbury gas pipeline in WA (which in effect was the reason why the NWS project started in the first place , subsequently expanding to LNG and opening up the north west of WA to oil/gas) or the Goldfields Water Pipeline which opened up the Kalgoorlie region in WA and I am sure many of you can think of other examples. Yes they may have come at some point, but when they would have come is anyone's guess. And growth requires labour, capital and technology, so if capital is missing well that means in economic terms negative productivity growth arising a lot earlier and lower growth.
With the way things are will take time before long life infrastructure reappears and when it does we will be playing catch up waiting for the private sector to build it. As I said it might be built as part of a resource development project (ports for example) but then the company concerned will want exclusive use. and not want to share it with anyone else (so hence the role of govt in providing lumpy economic long life infrastructure.
As I said politicians in today's media cycle are only interested in the short term opinion polls as against providing long term solutions to Australia's growth through iconic infrastructure. They are all worse than each other, fighting for how much lower than can drive Australia into the ground the morons. None have a strategic vision for Australia. GDP growth in today's pollies life is about a false economy driven by a housing Ponzi scheme and immigration so the GDP numbers stay positive, but all Ponzis come to an end and what will Australia then do - nothing because the politicians today are inept and just compare todays lawyer/teacher qualified Parliament who know didely squat with yester years policiticians who new plenty and built iconic lasting infrastructure.
All politicians think about is the polls but none are like a Charles Court, WA Minister and then Premier 60s and 70s) who opened up large swathes of WA to mining development, encouraging Australian companies in but the lot of late, at both Federal and State level, are useless and getting progressively useless (a race to the bottom is Australian politics these days).
We have lots of resources but are too stupid to further process them IMO. We are also too stupid, because of our fixation on laisser faire economics to understand market failure concepts and build iconic infrastructure to facilitate economic development. The fools we have in power at State and Federal level these days would never have built Snowy, Dampier to Bunbury Gas Pipeline, Goldfields Water Pipleine etc etc, with the Milton Friedman rubbish economics people use these days.
FFS China is using our coal and gas and raw inputs to produce manufactured commodities and soon they will be using our lithium to produce electric vehicles whilst we have closed our manufacturing sector. Seriously it ain't about labour costs but idiotic governments who can't see the wood from the trees, because if it was all about labour costs why is Germany doing so well then. Distance to markets is not a factor because we export a crap load of coal and iron ore btw so that is not the answer as well - transport costs - but maybe a part answer given they are lower valued economies when compared to resource processed commodities and we can transport them.
China must be laughing at our stupidity.
Rant over
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