The joys of privatisation
So they've privatised water and electricity. And now people are screaming that their bills have skyrocketed. What a coincidence...
Do they not understand how it works?
Do I have to explain it?
[sigh] OK. It works like this:
Now you have your water and electricity run by corporations which have a legal obligation to provide a good return (profit) for their shareholders (or the shareholders will run away to where better profits can be had and the corporation goes bust.)
With me so far? Good.
Now, let's say a good return is 10%. So now you have the monopoly corporation's bean counters setting up a price structure to suit.
one year out = 110%
two years out = 121%
three years out = 132%
four years out = 145%
five years out = 160%
That's just to keep the share holders happy in a zero inflation game and without factoring in any costs of infrastructure increase or upgrade.
And these corporations aren't silly - they will do only the minimum maintenance. They know that when the system gets to breaking point the government must bail them out to the tune of the required upgrade because by then the government will be entirely dependent on the corporation. So then massive taxpayer slugs will be required on top of the already exorbitant usage charges.
Keep voting for the Lib-Labs, guys...
Do they not understand how it works?
Do I have to explain it?
[sigh] OK. It works like this:
Now you have your water and electricity run by corporations which have a legal obligation to provide a good return (profit) for their shareholders (or the shareholders will run away to where better profits can be had and the corporation goes bust.)
With me so far? Good.
Now, let's say a good return is 10%. So now you have the monopoly corporation's bean counters setting up a price structure to suit.
one year out = 110%
two years out = 121%
three years out = 132%
four years out = 145%
five years out = 160%
That's just to keep the share holders happy in a zero inflation game and without factoring in any costs of infrastructure increase or upgrade.
And these corporations aren't silly - they will do only the minimum maintenance. They know that when the system gets to breaking point the government must bail them out to the tune of the required upgrade because by then the government will be entirely dependent on the corporation. So then massive taxpayer slugs will be required on top of the already exorbitant usage charges.
Keep voting for the Lib-Labs, guys...
posted by The Editor at
10:22 AM
1 Comments:
oh I hear you.
here's another creepy thing about privatised utilities:
back in the olden days when they were de guvnmint, the fine-print allowed them unfettered legal access to your/our/my premises, any time they chose to, without warning.
I wonder how we can allow that now, when so many of them are private/foreign owned (- Origin is Singapore etc)
Shareholders are ALL disgusting.
No different to/than/from betting on Race 5 at Dapto dogs.
Current London swindle scandal is perfect illustration of my point.
x x
Post a Comment
Subscribe to Post Comments [Atom]
==========
<<<<< Home
==========