From: sp@osf.org (Simon Patience)
Subject: Re: Currency Problems
Organization: Open Software Foundation
Date: Mon, 5 Oct 1992 13:40:49 GMT

In article <1992Oct2.142735.11940@bristol.ac.uk>, smee@bristol.ac.uk (Paul Smee) writes:
> This [delivering different water suppliers water down the same pipe]
> is technologically possible, and similar methods are used
> presently in a lot of the world's major gas/oil pipelines.  Indeed, you
> COULD arrange for all commodities which can sensibly be shipped by pipe
> (a surprising assortment) to be shipped down a single shared pipe.
> However, it is, as a general solution for 'small' deliveries,
> inefficient.

I am certainly not suggesting that the same pipes are used for different
commodities. I don't think this is really workable for the reasons you are
about to explain.

> It costs a lot, in switching technology in a 'tree' structured pipeline
> system, to make sure that, when the delivery of water which I've
> ordered from company X arrives at a pipeline branch which leads towards
> my house, it gets routed there.  Second, there is an unavoidable waste
> owing to mixing, at the interface where the pipeline switches from
> shipping one 'product' to shipping another.  Finally, it requires that
> I, and each of my neighbours, have large enough storage facilities on
> our properties to accept a bulk delivery (probably several day's worth)
> of water when it arrives.  An expensive way to solve the problem.

However if the only commodity is water then I don't see the problem. The
consumer could buy the water supply from a water supplier and it doesn't
really matter which molecules of H2O actually arrive providing the
customer/provider idea has been honored. A supplier could be stopped from
contributing to the network if the water quality drops below the
acceptable level (and presumably the customer has to select another
supplier). Alternatively the consumer buys from the pipe provider who then
buys from the lowest tender of providers.

> Now, to the first.  Water.  It is, of course, to my advantage to have a
> reliable supply of clean water delivered to my house.  Further, as
> demonstrated by things like the typhoid epidemics which ultimately led
> to 'piped water' in this country, it is to my advantage to have a
> reliable supply of water delivered to the house next door, and to the
> house next door to them, and ...
> 
> Now, admittedly, my interest in any particular house having clean water
> is lower as the house involved gets further away, but if you integrate
> this over all households in the country, you find that, ultimately, it
> is to everyone's benefit that everyone have such a supply.  Further,
> see above, 'personalised' delivery is inefficient.  I see no
> difficulty, therefore, in the concept that 'society' as a whole should
> band together, and decide to save themselves some money, by arranging
> to deliver such water to 'society' as a whole, and to cut out the
> profit-taking middleman.  Indeed, I see it as the most cost-effective
> solution to the problem.  Ergo, government water.  

Have another think about the above idea without the confusion of trying to
bulk deliver water and see if that fails any of your tests. I claim that
not only that it won't but it will also deliver a reliable source of
water, more efficiently and more cheaply. (oh yes, and remove the
governments role, other than deciding the acceptable level of cleanliness)

> The first (and simplest) is that even as a private industry, it will
> have no real competition -- you've simply exchanged a national monopoly
> for a privately owned one.  Where does that get you?

Which is why, at most, I would accept that the pipeline provider could be
a government agency. It could also ensure that no-one is cut off from a
water supply, even if laying the pipes would otherwise be uneconomical (or
unaffordable for the consumer).

> Second is trickier, but incredibly fundamental.  It is obviously
> possible for the government monopoly to be more efficient, and so
> cheaper.  

I don't see this at all. It is not obvious to me and in fact in goes
against past experience I would have thought.

> Plus, you need the separate governmental quality monitors.  The company
> still has to have their own, to make sure they stay within the
> guidelines, but you need extra ones to keep them honest.  This is also
> going to cost some positive amount, so the total cost is now X+Y+Z.
> Thus, the POTENTIAL cheapest solution is for government provision.

You could always contract it out of course.

> Or, in short, yes, some things are better done by industry.  Some can
> be done totally acceptably by 'industry plus monitoring'.  But some
> things really are society's responsibility, and so ought to be done
> by society as a unit.

I still think that the only thing that is essential here to be done 'by
society as a unit' is laying down the rules that the companies play by.

Simon.

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  Simon Patience
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