How often do you see arguments such as that spending, say, $100m will create Y,000 jobs? Rarely do we even question the logic, let alone the arithmetic. But we should do both. For if inserting $100m into the economy creates jobs – and it does! – then it must be equally true that extracting $100m reduces jobs. It follows that if the Government is running a balanced budget, then money into the economy through government expenditure is equal to money taken out of the economy through taxes to finance this and there is no net increase in jobs. The situation is worse if the Government is aiming at a budget surplus, for then more jobs are lost than are created.
The jobs created are nicely gathered together and visible for the project at hand, they are even amplified by media exposure, but what you don’t see are the jobs that are lost, for these are spread across the economy.
Let’s face it, to keep its budget under control it will either have to cut back on other expenditure or raise taxes and charges. (Think back to the last ‘stimulus’ bill, is that not what happened a year or so later? The government encouraged construction then later reduced funding affecting maintenance amongst other things.)
And as to the secondary round of expenditure – by which those receiving the first tranche of largesse are expected to go out and spend, thus creating more jobs, what about the secondary effects of the jobs that are lost?
Yes, we want to believe that we are making the world better by building infrastructure and creating jobs but are we in danger of letting wish fulfilment overcome logic?
Moreover, when we are losing jobs all over the country in order to put up a new infrastructure project, how can we be sure that we are gaining, in real community benefit terms, more than we are losing? Maybe we are not?
Some days, it all feels quite hard. We know that infrastructure Asset Management requires a change in attitudes, in culture, and that’s no fun to anyone who just wants to get on and manage assets well. I teach AM, and always say that the tricky bit is attitudes, using co-operation and longer-term thinking as two culture shifts we need if we don’t have them.
But some days it seems more than this. Why does IT think IT assets are special, and so shouldn’t be subject to the same AM planning and prioritisation processes? Why doesn’t engineering care about information – not just as-built, but the need for any evidence for their decision processes. (“How do we know what benefit we will get from better information?”, an engineering department wrote recently in opposition to a data improvement initiative.) Why is Urban Planning not interested in any conversation about the current state and utilisation of the physical assets, and how did they come to despise maintenance (why does anyone despise maintenance)? Why do operations, executives think they don’t need KPIs? What do they think they are arguing for?
AM is on the side of good, evidence-based rationalism: wanting to do the right thing based on logic and facts. It is very hard for us to deal with people who are not.
Some days it feels rather like attempting to argue with an anti-vaxxer, or a Trump supporter.
Obviously, when they look at us, they don’t see champions of logic and good sense. Maybe they see a threat – but what do they tell themselves? Answers, please….
Sorry for long absence, I’m not dead, just been otherwise engaged. I am currently writing ‘The story of Asset Management: the first ten years’ (1984 – 1993) and as I read back through my old journals, it is easy to see why asset management has captivated me for so long and I thought some of the stories might captivate you, too. For example, try this:
1988 Scene: NSW Parliament House
In 1988 I attended a very heated debate on accrual accounting presented at the NSW Parliament House for elected members and selected others. It was memorable for a fight that almost broke out in the house. After much discussion on the pros and cons, one section of the audience was showing considerable disquiet. Eventually one of the group, a politician, stood up and angrily and loudly stated “If you reveal accrued liabilities we will be forced to do something about them”.
At this, the accounting professor on the platform, Bob Walker, replied neutrally “Accrual Accounting is simply an accounting system, it provides information, what you do with the information is up to you”. This was too much for the highly agitated politician who shouted “You’re just like Pontius Pilate, washing your hands of the whole affair”. Cheers broke out from that section of the audience.
What can we learn from this?
Now the academic was correct, if naive. It is true that accounting systems provide information that enable but do not enforce action. However awareness of information can be a propelling force to action, which the politician instinctively recognised. It is the old ‘ignorance is bliss’ argument, if no-one knows something needs to be done, then you cannot be blamed for not doing it. Once the facts are in the public domain, though, they may be far more difficult to ignore.
The information we develop as asset managers also presents imperatives to action – after all that is why we research, analyse and develop it. So we must be prepared for, and learn how to deal with, reactions like that of our angry politician and not go into the fray unaware. Yet how many times do we do precisely that?
The way in which our data or facts are presented is important, too. There may be no difference – in point of fact – between the glass that is half empty and the one that is half-full but the connotations are widely different. The truth is that facts can never ‘speak for themselves’. The language they speak and the message they give depends crucially on the way they are organised and presented. And this organisation and presentation is what politics is all about – influencing reactions. This is as true of internal, departmental politics as it is of larger scale national and international events.
We have developed a poor habit: decrying something as ‘just politics’ as if by doing so we can ignore it. But everything is politics! Better to learn how to play the game. That is, the game of presenting our information in such a way that the reaction we get is the one that we want.