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Old 15th Mar 2007, 04:57
  #14 (permalink)  
YesTAM
 
Join Date: May 2006
Location: Endor
Age: 83
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Dear Oh Dear! Here we go again........ If you spend any time with farmers, miners, manufacturers, they all say the same thing "I deserve a subsidy because I do good for the community by giving people jobs/exports/foriegn exchange/services/whatever".

I even recall seeing a letter in the local newspaper in Cloncurry from a farmer who said "why should I pay taxes? I send food to the city to feed the people. Without food they die, so I am essential". Of course he was neatly forgetting what the people in the city were sending him, starting with diesel fuel.

So point number one. Everyone has an argument why they should be treated as a special case - its called "special pleading" or "Rent seeking behaviour" in economic terms. The biggest group who still get away with it are the farmers, but their entitlements are slowly being wound back.

The point is that Governments cannot afford to give in to special pleading because it distorts markets something wicked. The Labor Government gave in to special pleading with a 150% tax deduction for R&D and the result was at least a three billoin dollar rorting of the tax system over about ten years, lots of useless tax driven research was done with zero outcome and the relationship between the merchant banking community and the sceintific establishment was poisoned.

I think I understand that a similar type of scheme (accelerated depreciation) was rorted by the aviation industry in the 1970's and the results of the tax driven over expansion followed by inevitable collapse are still evident from the fading names on hangars and offices around the country.

Certain institutions are capable of sustaining a "Public Good" argument, but that depends on demonstrating that the benefits of Government funding will flow to all the community and that it is inefficient for individuals to try and provide them on their own. The best example is the weather Bureau.

Unfortunately I cannot see any reason why airports fit the "public good" test provided that competition can be generated between them. The net result of treating them as a "public good" has meant that ordinary economic considerations have not been applied in the past, which is why you are so surprised to see large unused and unuseable chunks of airports being turned over to property development. To put it another way, the airport would never have been as big as it was if it had been provided by a business. If you want an example, go look at Boeing Field in downtown Seattle, or some of the LA airports if you want to see efficeint use of resources. Thats point number two if the goods are provided for free, they are inevitably not used efficiently.

So please stop banging your heads against a brick wall. User pays is here to stay and there is no getting over it.

On the other hand user pays = user says (my slogan) which means that if you are paying CASA for a medical, or paying parking charges to some airport, then you are entilted to scream blue murder if you do not get service - something you cannot do if that service is provided to you for free.
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