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Monday message board

February 12th, 2007

It’s time, once again for the Monday Message Board. As usual, civilised discussion and absolutely no coarse language, please.

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  1. February 12th, 2007 at 13:35 | #1

    I have been unable to get the full CEDA report but from the summaries and your interview on 666 Canberra a couple of comments.

    You advocate an allocation of water at cost prices to everyone based on a head count. This becomes an administrative nightmare if the system is compulsory and is one of the operational reasons why we use Rewards where people join the system rather than it being mandated. http://www.waterrewards.org

    The problem is not that water is underpriced but is in spending the money that is collected. At the moment in many jurisdictions water is a taxation raising exercise and the money collected is not spent on water sustainability measures. For example Canberreans on average pay $1.65 per kiloliter which supplies more than enough money to fund the raising of the level of an existing dam. The government this year introduced a 55 cents per kiloliter abstraction charge and have said it will go into consolidated revenue and not even pretended that it would be used on water supply. The Pricing Commission will not allow the water authorities to raise the price of water unless they can see that money will be spent on water. This is one of the reasons we advocate Water Rewards as the way of distributing the funds for water infrastructure.

    Water trading based on an allocation cap – while it might appear theoretically attractive – is not something urbanites want to do. They want to know how much water is going to cost them before they use it and they do not want to be bothered with buying and selling water.

    These comments also apply to Carbon Emissions caps. The problem is not in collecting the money but in how the money is spent efficiently.

  2. February 12th, 2007 at 14:28 | #2

    Kevin Rudd seems to have pulled in some impressive poll numbers according to the Sydney Moring Herald. Interesting times.

  3. singe
    February 12th, 2007 at 14:30 | #3

    Well I must say you folks are way ahead of us Americans in the United States on these two topics. It is hard to find anyone here who even knows that the availability of water and its exploitation by the greedy around the world are issues. The same goes for carbon emissions caps. We will have to be dragged to the table of international planning screaming and kicking like wayward children…we want all the toys and we don’t want to share with anyone….and our presidunce rekindles the spirit of that…well that cretin and Objectivist ( what is with the no coarse language rule?? ) Reagan who preached that greed and hubris were pro-social qualities…looks like there could be much for this Yank to learn over here.

  4. still working it out
    February 12th, 2007 at 15:55 | #4

    Kevin Rudd’s numbers are interesting. He hasn’t really done very much. Makes you wonder that maybe all Labour has needed in a leader for the past decade is someone who isn’t boring, a windbag or slightly crazy.

    I have had a theory for a while now that Howard has been flattered by the low quality Federal Labour leaders. I am pretty sure he would not have been in power nearly as long if there had been a federal leader of the quality of many of the state premiers. Not that I think much of them, but they do know their politics.

  5. February 13th, 2007 at 00:09 | #5

    As for the quality of Fed Labor leaders, I’ve always said: If I was hoWARd, I’d want Beazley running against me.

    Call me a fanatical conspiracy theory sucker, but I’m sure he and his puppet-masters were also pulling the ALP’s strings.

    Let’s hope after those numbers by Rudd, no more!

  6. February 13th, 2007 at 00:22 | #6

    singe,

    I see some parallels somewhere else, a small and ingnored country. Yet history might indeed already be repeating itself. Think the privatizations of great Oz icons: Qantas, Telstra, Medibank, the Snowy scheme, the Murray’s Water, etc.

    There’s is one amazing example where similar actions eventually led to the fall of two governments and the resignations in disgrace of two presidents.

    Eventually they also led to the election of that country’s first ever Indigenous President: Evo.

    Yes, I’m talking about Bolivia.

    (I know, wishful thinking, to have hoWARd resigning in shame and then the people forcing a constitutional change that leads an Aboriginal President… in Oz, if only!)

    Check the full story here: Bolivia’s Water Wars

    money quote:

    …The company says it has fulfilled and surpassed all contract obligations (which exclude certain areas of the city) and has “always been sensitive to the demands of unserved populations in El Alto and always taken great care to cater for the needs of customers living under the poverty belt.â€? Greenwood further notes that prices and contract parameters are set not by the company but by the government.

    But as in Cochabamba, the underlying issue for the people is less the company itself than a system in which decisions impacting daily life are made by governments more responsive to global financial pressures than their citizens. The changes taking shape in Bolivia appeared to be aimed more at regaining democratic control of the country’s affairs than at particular multinationals per se.

    Oscar Olivera, who heads the organization that was at the forefront of the Cochabamba struggle, says the issue is not simply private versus public but rather the establishment of participatory local control of resources. “The people want to participate in the management of all that affects their daily lives,� says Olivera. “The people want to construct a new model.�

    Jim Shultz, who helped break the story of the 2000 Water War to the world from the streets of Cochabamba, notes a key factor in that case and the current one: the people never had a say in the privatization. It was imposed on them by a government under international pressure

    Much more here:
    http://www.democracyctr.org/waterwar/

  7. singe
    February 13th, 2007 at 06:31 | #7

    Carlos, I have been following the leftward movement of so much of Latin America following the big flop the “miracle of the market place” was for most people living there. I was not aware of the particulars of water politics in Bolivia and am thankful for you sharing that link. What is kinda of funny in a sick way here in the states is that folks complain about the price of gaseoline without realizing that bottled water often cost more per gallon! It will be a struggle to make clean water, clean air, health care and the other basic necessities of life rights instead of prizes for the richest or most ruthless and this struggle will not be led by America unless there is a serious turn around in political orientation but it seems it just might come from the third world and so hope really does lie in the proles….

  8. singe
    February 13th, 2007 at 06:34 | #8

    Carlos, one more thing. I am trying to understand some of the references at this site that are unfamiliar to me. The use of “Oz” refers to Australia? If so would you folks please get your goddam wizard out of our Whitehouse, he really has run amok!

  9. El Poppin
    February 13th, 2007 at 07:15 | #9

    Carlos,
    J. Brad Delong has a post where he takes a story from the NYT where the post effects of the Cochabamba did not look so rosy. The link is at
    http://www.j-bradford-delong.net/movable_type/2005-3_archives/001796.html
    I also seem to have read elsewhere that the ‘peoples water company’ could not secure enough money from any source to even maintain the current levels of services.
    To me the greatest failure of privatisation in latin america has been the transfer of government monopolies to private monopolies without any measurable benefits to the overall population. The second biggest failure is the privatisation of corruption. My last stint living in latin america left me flabbergasted how private company employees would openly tout for bribes.

  10. February 13th, 2007 at 08:19 | #10

    El Poppin, your experience in Latin America seems a fairly accuarate description, but to me is no different to some of the typical policies of the nmarket fundamentalists and the corrupt responses they lead to.

    From Argentina to Russia to SouthAfrica to Iraq, they always seem to lead to the privatisation of monopolies (and public property plus huge profits!) to the externalisation of risks, pollution and other “social costs”.

    Corruption can only follow when any means and consecuences are seen as justified. As we have seen in Iraq, there are enough mercenary companies that dwarf the economies and power of nation states. And they also help to hide the nitty gritty numbers (from stolen millions of US$ to the millions of injured and killed victims…)

    Now, all this is not simply a coincidence, but an essential part of their design.

  11. El Poppin
    February 13th, 2007 at 12:16 | #11

    Carlos,
    Corruption was there before privatisation and after. Not only that, corruption has occurred in all societies through all the ages. In ancient Athens the politicians would be bribed to declare war on the next city and then the ambassadors from that city would bribe them not to start the war. President Lincoln fired his defense secreary for corruption lamenting that the only thing he did not take was the kitchen sink because it was bolted in.
    As for the privatisation of monopolies it is also the case that these are the only things they have to sell. As far as I’m aware, with the exception of comunist countries, no government owns the corner milk bar.
    The real problem with the privatisation was the lack of competition that was not introduced, the lack of accountability in the privatisation, and that it did not take into account the externalities that you mentioned. Having said that I don’t believe that water supplies can be privatised as I don’t accept that a naturally monopolistic asset/service can ever be subjected to full competition.
    As for corruption, I wonder whether anyone has written economic and psych papers on corruption.

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