John Quiggin

I think this whole debacle shows how little most non economists (which is almost all the general public) understand about opportunity cost.

The fact that so many sandgropers were in favour of this idea before costs had been estimated or alternatives considered is staggering.

I was sure that if you sat these people down and said:

“If and when it is considered we will need to increase our freshwater supplies, it would be best for everyone if we achieved this at the least possible cost”

they would understand. Am I living in a fantasyland – I dont know anymore.

At least there was SOMEWHAT more sophistication in the argument that there would be spin-off externalities for Aboriginies in the proposal, but again, dont people understand that you could generate freshwater for far less then spend the difference on improving Aboriginal welfare, and we would all still be better off?

I am still shaking my head

Chris,
This was a political decision, not an economic one. Colin was trying to demonstrate that he was capable of making decisions, in contrast to “Good News” Geoff, who only seemed to put in an appearence once it was established that a decision had been well received. If it was a bad one the relevant minister would take the blame.

Granted, Andrew, but the fact remains that this proposal was seriously considered prior:

1) to any discussion of its cost; and
2) without any consideration of lower-cost alternatives