Archive for July, 2013

Other people’s money

Friday, July 5th, 2013

The following quote is often bandied about.
“The trouble with socialism is that eventually you run out of other people’s money” — Margaret Thatcher.
Quotes and stories are often stretched to fit the occasion, so when one goes to the internet verification site, Snopes, the following explanation is found.
“Although the quote has been simplified a bit, it does essentially reflect a statement made by Margaret Thatcher during an interview with journalist Llew Gardner of the television program entitled, “This Week” which aired Feb. 5, 1976 – a year after Mrs. Thatcher became the leader of the Conservative Party, and three years before she became prime minister. 
In response to a series of questions by Mr. Gardner about the timing of Conservative plans to bring down the Labour Party majority in parliament, Mrs. Thatcher replied: “I would much prefer to bring them down as soon as possible. I think they’ve made the biggest financial mess that any government has ever made in this country for a very long time, and socialist governments traditionally do make a financial mess. They always run out of other people’s money. It’s quite a characteristic of them. They then start to nationalize everything, and people just do not like more and more nationalization. They’re now trying to control everything by other means. They’re progressively reducing the choices available to ordinary people.”
Both the quote, and the context cast a reflection on Manitoba. Manitoba PC leader Brian Pallister has been opposition leader for about a year. He finds himself facing a long-standing government with a definite socialist bent. It may be two or three years before he becomes premier. The Manitoba NDP really like to spend other people’s money and in a way that they decide. The two consecutive years of very high tax hikes prove that very clearly.
What is the alternative? The alternative to government increasing taxes will not likely come soon out of the NDP and it may not come from a conservative government either. With an ever-increasing demand for both services and capital expenditures, it’s hard to imagine any alternative – but I believe there are alternatives. 
On the services side, there has never been a thorough audit as to what services actually cost and whether there is a return in line with the expenditure. It’s easy to pick on health care as having bloated budgets but nearly every government department could do more with less. There are whole departments that we may not need. It might mean busting a few public service unions, but that in itself, wouldn’t be a bad thing. 
Unions have little or no place in the public service. Unions are sometimes needed in the private sector to counter balance the power of owners but have little or no use in the public sector.
On the capital side, it’s much easier to lower the demand on taxes. Countless studies have shown that when the government builds, the price (cost) goes up. Everybody wants a government contract – they are lucrative. If we simply let the private sector build hospitals, care homes, schools, bridges and even roads on long-term lease arrangements, I believe there would be savings in the hundreds of millions annually.
Simply put, if a company was in charge of the design, the financing, the construction, the maintenance and the long-term operation of a building, one can be rest assured that at every step of the way costs would be saved. 
Faced with having to maintain a building for a 50-year lease would assure that every effort would be made to make sure the building was well designed, well built, well maintained and well financed.
In a typical government built and owned project, the architect blames the engineer, the engineer blames the contractor, the contractor blames the plumber and the plumber blames the framer. After all the blame is spread around, the government (taxpayer) ends up paying for everybody’s mistakes.
If the capital construction process was under the jurisdiction of one company from start to finish, quality at every level would be guaranteed. Even more so, if the same company had to stick around, the results could stay favourable for the next 50 years.
We need a huge shift in thinking in this province. Hopefully it will come before we run out of everybody’s money. This is a Sunrize Group internet solution (204)226-2247