From: suter@fawlty8.eng.monash.edu.au (Mr D. Suter)
Subject: Re: Will Victorians vote stupid yet again...?
Organization: Monash University
Distribution: aus
Date: Mon, 5 Oct 1992 01:04:10 GMT

In article <1992Oct3.054516.20755@mel.dit.csiro.au> ajw@squid.mel.dit.CSIRO.AU (Andrew Waugh) writes:
>Victorian governments have always financed assets from borrowings.
>Right from the start of 'reponsible' government. Consequently we
>have always had to pay interest payments. 
Never say otherwise. The problem is that the debt has risen to
such huge proportions. This is even worse when the Kirner govt
completely lacked the resolve to do anything about it.
>
>The 'rational' for financing assets from borrowings is that the assets
>benefit future generations; it is only fair that these future
>generations help pay for the assets. 
This is stupid rational. Morevover, the reality is that they
are being shckkled by debt levels so that they can't even finance
their own needs - hence they pass on a bigger burden to subsequent
generations......
>
>In practice, however, I suspect that there was no other way assets
>could be funded. Initially Victoria had almost no revenue stream;
>consequently the only method of raising funds to buy assets was to
>borrow. Without assets, of course, Victoria couldn't have been
>developed. Once a state debt had been built up, however, it was
>politically impossible to switch to funding from revenue. To do so
>would have required the Government to simultaneously fund i) paying
>back the interest and capital of the original loans and ii) purchasing
>assets. This could be done either through high taxes or the ceasation
>of asset purchases. Neither has ever been popular with the electorate.
So you are saying nothing more than they were guilty of failing to take
responsible (but unpopular) action. 
>
>>As for the principle of selling off government enterprises/assets -
>>again you didn't read my posting. I'm not really against this.
>>In fact I'm generally for it. But the point is that you
>>ought to be making headway on reducing debt if your selling
>>off all of your assets NOT INCREASING IT!
>
>To be fair, the Government has faced many problems in selling assets.
>Some of these problems are a consequence of their policies (but not
>all) and very few of the problems will go away with a change of
>Government.
>
>One obvious problem is that the Government is being forced into
>selling into a depressed market. The requirement for forced sales
>won't change tomorrow. Nor will the prices obtained for assests
>increase. Melbourne CBD property prices, for example, won't increase
>for years, neither will world aluminium prices.
And again you say no more than they came to grief because
of they stupidity in not tackling the problem EARLIER.
>
>I doubt the Liberals will be any more successful in selling assets
>than Labor was. But I won't judge them harshly for this.
Kirner said the same (first sentence). (Interestingly, in so
doing she implied - along with other statements about her
parties lack of resolve and desire to do anything positive -
exactly what I am complaining about - she still doesn't
have the resolve to try to do anything about it!)
If the Liberals don't do anything about significantly reducing the debt
then I will judge them harshly. I don't really see why you should
be so tolerant of either party throwing your money away either.

All this bullshit excuse by Cain and Kirner (well would you
rather do without the schools and hospitals if we hadn't borrowed so
much/had paid off the debt) neglects the OBVIOUS fact that
we are currently throwing away money that could build hospitals/schools
in interest payments AND WILL continue to do so! If you can't see that theirs
was a bankrupt policy (financially AND MORALLY) then that's a sad affair.
If you do see this but fail to hold them accountable then that's equally sad.
d.s.


-- 
David Suter - Dept. of Electrical and
Computer Systems Engineering, Monash University,
Clayton, Vic. 3168, Australia
ph 565 5682 Fax 565 3454