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The Forum > Article Comments > The people infrastructure equation > Comments

The people infrastructure equation : Comments

By Ruth Spielman, published 1/5/2015

So here is our first task - we must remind governments that more people requires more spending on infrastructure.

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An aspect of this that's not mentioned in this is why we need to have so many people travelling to jobs in or near CBDs. There has been some exploration of alternatives but overall far to little.

Travel into a single geographically small area with limited opportunity to dramatically improve transport routes because of existing high density occupancy for large numbers of people will always lead to congestion at key times of the day.

I doubt that for a lot of jobs full time working from home is an ideal solution (much though I would like to do more of it) but there is certainly plenty of scope for outer suburban office hubs in many of our cities. People would still need to commute but not to the same concentrations in a single area.

It would require some different ways of organising a lot of offices, for instance greater use of teleconferencing if an organisation has workers spread around a city but many organisations already successfully deal with geographically dispersed workforces and teams.

I don't think there is one single solution and we should be exploring a range of alternatives that could be part of any fix rather than pouring lots more money into trying to make what we do now work better under worse conditions.

R0bert
Posted by R0bert, Friday, 1 May 2015 6:06:35 PM
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Here are three projects for the author to carefully consider and report on. The Myki ticket, the Victorian desalination plant and the North South pipeline. All three in Victoria and organised, if I can use that word, by the same government/public service.
I am one of the suckers paying the billions of dollars and suffering the resultant debt.
Perhaps the author can understand I am going to suggest the way to pay for anymore infrastructure spending is to sack her and her dopey organisation. Also reduce immediately all upper echelon public service and politicians salaries and pensions.
Posted by JBowyer, Friday, 1 May 2015 6:49:40 PM
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Aidan,

You say, "This little bit of debt isn't directly causing us any trouble whatsoever".

You pointedly say 'direct' but do not refer to any 'indirect' harm. No matter, you are clearly a disciple of Bill Shortonsense, who is in complete denial of the awful truth about the economic mess that Rudd/Gillard/Rudd left us in.

Going into debt as Rudd did was not a "responsible course of action"; it was particularly stupid. It is not a good idea to go into debt unless there is a guaranteed chance of return on the money borrowed. Rudd's GFC spending bash was a hideous debacle, leading to death (pink batts) and unwanted and unused toilets and school halls - just as were the same blunders of overseas goverments who employed the long-discredited socialist idea that you can spend your way out of debt.

That's what addicted gamblers do. It's totally inappropriate for politicians, using other peoples' money.

Since Keating and Costello, there hasn't been an Australian treasurer who would walk away from the "Shark Tank" with a loan.

And, by the way. I don't remember Gillard doing anything about a surplus, as you claim. I do remember Swan promising a surplus sometime down the track at least 5 times, even when he was still spending borrowed money like a madman.

Coalition governments only are capable of leaving surpluses behind for Labor socialists to blow in a short time.

But, there will be no surplus this time if Abbott and Co get tossed out. I wonder how the socialists would travel with that!

We could have been on the way to recovery now, if it wasn't for the crackpot blocking by the socialists, whose 'expertise' you admire, and the silly senate - all economic illiterates like you.
Posted by ttbn, Saturday, 2 May 2015 12:06:55 PM
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RObert, "An aspect of this that's not mentioned in this is why we need to have so many people travelling to jobs in or near CBDs"

I thought you might be entertained by this example from Canberra. because it is the will of knobs to be with each other and their restaurants and clubs are centralised,

http://www.canberratimes.com.au/national/public-service/tuggeranong-one-couldnt-possibly-move-there-says-finance-department-chief-jane-halton-20150325-1m6fry.html

Proof too that women knobs are no different from any other (knob).

The problem of business being done in the cbd is multiplied by the gentrification of inner city areas. That is to the very sad ejection of retired people and age pensioners, many of whom are widows, from the homes in which they have raised their families.

Also, the formerly cheap boarding houses and flats that serviced single people both young and old (different houses served the different ages) have been put out of business. That was done by local and State governments at the behest of tenants unions and RTAs (driving unrealistic requirements of owners), but succeeding in closing down the economic accommodation instead.

The biggest influence however are the overseas investors building posh apartment buildings for the well to do. That wipes out the available accommodation for middle class and below, pushing them to the outer city fringes.
Posted by onthebeach, Saturday, 2 May 2015 1:33:17 PM
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Aidan,

The problem with your argument is that there are diseconomies of scale as well as economies of scale. For example, a rich coastal city that outgrows its natural water supply can desalinate water, but the desalination plant is a prodigious consumer of electricity and the desalinated water is 4 to 6 times as expensive as dam water. If you look at the links in my previous post, the Productivity Commission wasn't able to find any sort of big economic benefit from mass migration, even though our cities are already a lot bigger than they were 30 years ago. Among the developed countries, there is no link between prosperity and population size, density, or growth rate. There is a negative correlation between population growth and prosperity in the poorer countries (compare, say, Thailand and the Philippines). There is no link between growth in productivity and growth in population in the OECD countries (scroll down to the first graph)

http://theconversation.com/the-tenuous-link-between-population-and-prosperity-38291

You want to blame our inadequate infrastructure and other problems on the fact that our politicians are incompetent clowns, but if there were such a benefit to be had from a bigger population, then all the other countries in the OECD must also be run by incompetent clowns.

I am not disputing that there are cultural and educational benefits to having some immigration, or that there are some very talented people who would be an asset anywhere (leaving aside the issue of poaching), but we don't need hundreds of thousands of migrants a year for such benefits. Nor do I dispute that there were probably benefits from high population growth in the past when our population was a lot smaller. You need to accept, however, that it isn't 1900 anymore, or even 1950. It is good that your bones were growing when you were 8 years old, but if they are still growing in the same way when you are 40, then you have a very serious problem.
Posted by Divergence, Saturday, 2 May 2015 4:34:50 PM
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ttbn, I obviously didn't make myself clear enough. Apart from the harm caused by the politicians' reaction to it, the debt the Rudd government took on has caused no harm whatsoever to the Australian economy.

Failing to spend more at that time would have been grossly economically irresponsible, as Australia would have then fallen into recession. This would have resulted in a decline in tax revenue, so Australia would still have gone into debt but would have nothing at all to show for it.

And before you yell "China", look at what happened to the ore prices during the GFC. It wasn't China that kept us out of recession.

With hindsight, the safety standards for roof insulation were totally inadequate. But many people benefitted from the home insulation scheme, and so did the environment. And the school halls scheme was good value except where state governments outsourced the running of it to the private sector. Surely the most important lesson we can learn from it is we need a capable public sector?

It would of course have been better if we'd had some better value shovel ready projects to spend the money on. But we didn't, and I don't think Rudd had been in long enough for that to be his fault.

I don't watch Shark Tank, so don't understand the reference.

Under Gillard, Swan made significant cuts, trying to achieve a surplus before the economy was ready for it (a futile exercise) and this has only accelerated under Abbott and Hockey. Fortunately the Senate protected us from the worst of the cuts they tried to make, but you only have to look at the unemployment rate to see how much worse they've made things.

Look at http://blogs.crikey.com.au/pollytics/files/2009/09/cashbalance.PNG and you'll see the budget outcome depends far more on the economic cycle than which party's in charge.

If we go for growth (with bigger deficits now and cuts after the private sector's fully recovered) we will return to surplus much sooner than if we try to cut now.
Posted by Aidan, Saturday, 2 May 2015 5:35:56 PM
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