[AusNOG] News: Minister Conroy contemplating Government-Fundedundersea cable?

[Damian Guppy]

I think for the purposes of this discussion saying it is funded by debt
means it is paid for by taxpayers money and there is no expected direct
return on investment (ie no new revenue stream generated), and saying it is
an investment means it is being paid for by issuing
(additional) infrastructure bonds and will pay itself off over time (i
believe the target is 6%?). You can say this isnt accurate or correct, but
I believe it is all just semantics.

Having said that this discussion is quickly going down the rabbit hole of
political debate and probably isnt all that on topic for this mailing list.

--Damian

On Sun, Sep 30, 2012 at 6:45 PM, James Spenceley <james at vocus.com.au> wrote:

> For a government, any investment that isn't funded by surplus cash is
> funded by debt, end of story.
>
> The government calling it an "Investment" and taking it off balance sheet
> (i.e not including it in their deficit accounts) is exactly what Enron did,
> nobody notices when things are good.
>
> --
> James
>
> Sent from my iPad
>
> On 30/09/2012, at 5:00 PM, Mark Newton <newton at atdot.dotat.org> wrote:
>
> >
> > On 30/09/2012, at 11:15 AM, Tim McCullagh <technical at halenet.com.au>
> wrote:
> >
> >> Mark with all due respect I would suggest you stop believing the
> government spin
> >
> > If you think I'm being taken in by government spin, then perhaps you
> haven't been
> > reading anything else I've ever written about this stuff.
> >
> > Regardless of what anyone thinks of the NBN, it is inarguable that the
> Government's
> > current plan is to finance it by means of an investment, not debt;  and
> the Queensland
> > councils who want to build a fibre network from nowhere to nowhere in
> the middle of
> > nowhere want to do it with debt, not as an investment.
> >
> > Lets also pause briefly to consider the magnitude of numbers we're
> talking about.
> > Lets say the NBN costs $50b, roughly twice what the Govt is currently
> saying their
> > capital contribution will be.
> >
> > Sounds like a big scary number, because we don't often think in terms of
> billions.
> > To what can we compare it, to gain a sense of understanding about its
> magnitude?
> >
> > Pretty much any major defence procurement, I reckon.  For instance, the
> Howard Government
> > thought we should spend $36b on 12 submarines to replace our 6 Collins
> Class boats (so
> > there's an NBN worth of expenditure right there), and also that we
> should spend another
> > $23b or so on 100 F-35 JSFs (which are heavy, late and slow, and
> supported by no strategy
> > to explain why we'd need 100 of them, and despite the fact that it's
> 2012 and we originally
> > ordered 2008 delivery, we still haven't received one to try out to see
> if they'll meet
> > our specifications)
> >
> > So there's more than $50b right there, on a couple of white-elephants.
> >
> > Could also compare it to something that's actually useful like hospital
> expenditure,
> > by pointing out that the entire 15 year construction cycle, including a
> moderately
> > large fudge-factor for cost blowouts, will come out at less than half of
> the $121
> > billion the government spent on health in 2009-10 alone.
> >
> > And unlike the military procurement budget and the health budget, the
> govt plans
> > to get its capital back when it privatises the NBN later (whether it
> actually will
> > might be some cause for debate, but not a debate that'll make any
> meaningful difference
> > to whether the cost of building it is a big number)
> >
> > On the scale of spending the Commonwealth Government often undertakes,
> it's chicken
> > feed.
> >
> > If criticising the NBN on cost grounds is the best you've got, you've
> lost the
> > argument.  If you want to oppose it, you can probably find more
> effective ways
> > than that.  For example, you could perhaps start by asking yourself,
> "How come,
> > despite two parliamentary terms of boosterism, there are no ALP members
> (including
> > Conroy himself) who can credibly explain what our society will be able
> to do with
> > the NBN that we can't already do without it?" or, "In this debate that
> the
> > Government has characterised almost exclusively as being about speed and
> the
> > importance of 100Mbps-to-1Gbps into everyone's house, why are they
> proposing that
> > 12 Mbps is not merely sufficient for country users, but is actually the
> best
> > they'll ever get?"
> >
> >
> >  - mark
> >
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