Saturday, April 26, 2008

Fibre - the new 'public good'?

For those of you who have decided fibre is the new 'public good' and should be paid for by the tax-payer, answer me this.

National wants to put in $1.5 billion and says it will need to be matched by the same and more coming from the private sector. (Maurice Williamson puts up some very persuasive arguments as to how and why the private sector will come to the party - he should listen to himself and ask why, then, government needs to get involved?)

So let's say it's going to take $4 billion to lay fibre to 1,000,000 homes.

That's just 4 grand a home.

If I got a call tomorrow from a salesperson trying to sell me fibre for $4,000 I would tell them quite firmly to piss off. Would you?

So why are you happy for the government to use your money buying something you wouldn't fork out for privately?

As usual with big government subsidies the majority end up paying for the benefit of a minority. Just like social welfare. But this is called corporate welfare.

5 comments:

Unknown said...

Yes I'm quite surprised at how many right wingers agree with this given that they normally howl in agony when tax money is 'wasted' on the Left's pe t election bribe projects. The hypocrisy over at Kiwiblog in particular is laid bare: 'as long as it directly benefits me then I'm quite happy to spend other peoples money'. Quite shameful really.

As you said in another post, perhaps a lesson in what 'free market' actually means would help them. Then again, they are all from the same mould as the Left - they just prefer different toys.

As for Rodney I would've preferred it had he come out clearly against it as per his free market principles rather than just saying we should have more detail. More detail be damned - it is wrong, both economically and morally. It is an election year bribe in just the same way as the interest free loans was.

Anonymous said...

Yes DPF's comment...

"[DPF: There are more than one million homes but regardless a one of capital cost of $4,000 is quite minor - $400 a year for 10 years, which is less than $10 a week.]"

...pissed me off big time.....thats the arrogant "we know best" crap we expect from the Left.....now a Nats saying it......what real choice will we have at this election?

Anonymous said...

National's policy is that socialism is bad ... when Labour does it but good when they do it. There real complaint is not the type of polices that Labour implements but that they aren't the ones implementing it. Farrar knows better himself than to endorse this.

Amazingly there is fibre optic cable service available all over the US and yet it didn't take the government to create it. If National doesn't believe that the incentives of a free market will provide this then they should be honest and say they don't think free markets work.

Key's entire campaign seems to be: We are just like Labour in every way but I'm not Helen so vote for me.

Anonymous said...

It would be OK if you got your $4K share back if you didn't want fibre optic to your house.

Brian Smaller

Eric Crampton said...

$4K one off cost per house...I'd almost certainly be willing to pay that for my place instead of paying $100 per month for broadband access charges. Just plug that amount into the handy-dandy formula for figuring out the present value of an annuity stream: $1200 per year at 8% interest is $15,000 in present value. If I can spend $4K now to avoid spending $1200 per year in perpetuity, it's well worth it.

Those kinds of numbers also make it well worthwhile for a private firm to be willing to invest in fibre-to-the-home. Except, of course, if the regulatory environment is such that it's likely that any such investment would be expropriated by the government, either via actual nationalization or via access and price regulations tantamount to nationalization.

I'm not saying that National's plan here is a great one or that a national broadband plan paid for largely by government is a good thing. But, I can understand the argument for it where government's been the one that's stymied investment in the area and where the government can't stop itself from behaving badly.