Tuesday, 27 January 2009

Burning our money

I love the Burning our money blog, which you can find on my blog roll. Here is my local homage to that great blog.

I write this from experience, having seen this sort of thing happen in the public sector agency where I worked.

Krudd wants to spend our money to "get the economy moving". He could just give it back to us in the form of tax cuts, but that would not be "wise" spending. Krudd, being the All Knowing, can spend our money much more wisely than we can.

With that, it is worth bearing in mind the four ways to spend money.

You can spend your money on yourself - that spending gives good value.

You can spend your money on someone else - a present. Many presents are shockers, a complete waste.

You an spend someone else's money on yourself - think travel expenses. I always spend more lavishly on myself when I am spending someone else's money than my own.

You can spend someone else's money on someone else - which is usually an utter waste. All government spending falls into this category.

The fastest way for Krudd to crank up the spending is to expand existing spending programs. The bureaucracy is given $10 billion, and told to spread it around all the existing programs that the government is running.

Let's say for arguments sake that one of those programs is building heroin injecting rooms (of which we have one in Sydney, in Kings Cross). Forget the morality and effectiveness and all that - just assume that building them is seen as a Good Thing and that we need more of them.

There are about 150 councils in NSW. Let's say the program gets $150 million, so each council gets $1 million to build an injecting centre.

Most councils would prefer to spend the money on cracking roads and failing drainage and the like, but they are told they have to use it to build an injecting room, whether they need one or not.

Out our way, $1 million would buy you a small block of land, and little else. So the council might buy a vacant block and stick up a "Coming soon" sign, and then do nothing as the money has run out.

Out at Bourke, you are essentially given 50 acres for free, and the council builds the Taj Mahal.

Except in Bourke, they have no heroin addicts. The local member opens the centre, and then the promptly lock it up and board up the windows.

But I forgot one thing - the way Labor operates is via a spoils system, so the councils in Labor seats get $1.95 million each, and those in Liberal or National seats get a packet of Smarties.

So our council now has $950,000 to build a centre on its vacant block. Which it duly does.

Our local member, Angela D'Amore, ponces up and cuts a ribbon and declares it open. She makes a nice speech thanking Kevin Rudd for giving us the money (how can someone give us what was our money in the first place?). There is a nice brass plaque on the wall to commemorate the affair. Photos are taken and press releases are issued.

Six months later, it still hasn't opened for business.

Council can't afford to employ anyone to work there. The grant covered the cost of building it, but provided no funds to run it.

One year later, the place burns down, because no maintenance was done on the place. Council can't lodge an insurance claim, because they couldn't afford to take out insurance on the building.

The taxpayer, now homeless because the economy is on the ropes, uses the burned out shell as a place to sleep.

The heroin addicts don't care - they inject where they have always injected, which is in the safety of their Housing Commission flats.

Except for the one homeless addict, who lives in a culvert at the far end of the suburb. He never would have used the injecting centre, because it was too far from his culvert anyway.

This is the way Krudd and Co will "wisely" spend your money.


Margo's Maid said...

An excellent summary of the philosophy of spending...

Anonymous said...


I know you like to blog on education from time to time and I thought this joke (with a ring of truth) might amuse...

Maths 1970 - 2018 FUNNY

Teaching Maths In 1970

A logger sells a lorry load of timber for £1000.
His cost of production is 4/5 of the selling price.
What is his profit?

Teaching Maths In 1980

A logger sells a lorry load of timber for £1000.
His cost of production is 4/5 of the selling price, or £800.
What is his profit?

Teaching Maths In 1990

A logger sells a lorry load of timber for £1000.
His cost of production is £800.
Did he make a profit?

Teaching Maths In 2000

A logger sells a lorry load of timber for £1000.
His cost of production is £800 and his profit is £200.
Your assignment: Underline the number 200.

Teaching Maths In 2009

A logger cuts down a beautiful forest because he is totally selfish and inconsiderate and cares nothing for the habitat of animals or the preservation of our woodlands.

He does this so he can make a profit of £200. What do you think of this way of making a living?

Topic for class participation after answering the question: How did the birds and squirrels feel as the logger cut down their homes? (There are no wrong answers. If you are upset about the plight of the animals in question counselling will be available)

Teaching Maths 2018

أ المسجل تبيع حموله شاحنة من الخشب من دولار . صاحب تكلفة الانتاج من > ! الثمن . ما هو الربح له

Anonymous said...

To Boy on a Bike - I do like this accurate account of life on the mean streets of local government.

You say, correctly, "Most councils would prefer to spend the money on cracking roads and failing drainage and the like ..."

In my experience as a consultant from time to time during the last 2 centuries - when it comes to capital works grants council engineers ALWAYS find a clever way to siphon off something for grading roads and fixing kerbs, no matter what. It could be a grant for new tea urns in the CWA meeting hall, but the engineers will always find some obscure Australian Standard of pathway width that must be met for legitimate access by cripples to the kitchen holding the urns! Or equitable and "rideable" paths for the teaming numbers of octogenarian bicycle riders one always encounters in regional centres.

They aim for 30% minimum, don't build the footpath that financial year and spirit the funds away at July 1 to build the covered way from the council employee's carpark.

They are typically the most powerful department, because they produce something visible and tangible for the councillor to drape him/her self across for the grateful constituents; and also because they deal in plans and figures and a science unknown to dopey local representatives who are intimidated by the engineers' higher qualifications. The councillors have no professionally based ammunition to attack the engineers' recommendations, so they invariably get away with their smoke and mirrors routine.

And the chief engineer's pretend private sector employment contract salary relies on expenditure, not efficiency. The more spent the bigger the 4 wheel drive.

On occasion, using the same smoke and mirrors (of significant private sector project management success) I have mischievously suggested to the councillor that some of the engineering be outsourced, to achieve a quicker pre construction time and likely completion in time for the next election. Well, you oughta see the tut tutting about external engineers' lack of experience in the deep mysteries of public sector works - the specialised skills necessary to design - um - minor road works.

Calls are made and chief executives are wheeled in to make wise executive decisions citing special circumstances. I am convinced that there is a special module in the Council engineer's professional development book about secret storage, maintenance and retrieval of photos showing CEOs and senior officers of other departments doing unusual things with small furry animals.