Originally posted by thebozeian
reply to post by RichardPrice
No Richard I think you misread Waynos's anger.
I dont believe he was falling into the sunk cost trap at all. He is merely pointing out, and quite rightly that governments have an onus of
responsibility to firstly, NOT waste taxpayers money. And second to recover all reasonable monies from taxpayer funded assets when disposed of.
Spending 1.5 billion pounds and then selling the entire lot for 55 million not long after is in no way responsible or excusable using the "oh its
just a sunk cost" get out clause.
But that is precisely the sunk cost issue - the RAF/RN upgraded the Harriers based on *their* requirements, *their* needs, *their* wants, and any
purchaser isn't going to want an RAF Harrier, they are going to want a Harrier for their own requirements, needs and wants.
The £1.5B isn't indicative of market price, its indicative of the cost of fulfilling the RAFs requirements - thats it.
What that means is that the £1.5B doesn't mean anything to a third party, unless they are looking for precisely those aircraft, those requirements
and those capabilities - and I'm afraid that the British Harrier force isn't what people are looking for.
The sunk cost fallacy is continuing to operate something on the basis of "oh, we spent money on it last year, so we have to spend money on it this
year". Thats it right there - it doesn't matter if this means that last years expense was "wasted", what matters today is how much you spend
tomorrow, and whether that is good value for money.
The British government is never going to recoup their £1.5B, its gone, never to return. If you asked for £1.5B for the fleet, they would continue
to sit wherever it is they are currently sitting, deteriorating in condition (unless of course *more* money is spent on maintaining them in
I find it difficult to believe that in the short time that the Harriers have been grounded that an exhaustive search of potential other operators was
conducted and no possible purchasers of the aircraft as a going concern could be found. Are we to believe that nobody be they India or Israel was in
any way interested in a late model STOVL jet fleet with the latest upgrades that was willing to pay more than 55 million pounds?
The list of potential operators is small, and getting smaller:
1. India, currently operating the FRS.1 Sea Harrier, walked away from a deal to buy 8 FA.2 models in 2006, which were to be stripped for spares. They
have never operated the Harrier II.
2. Spain, currently operating the Harrier II.
3. Italy, currently operating the Harrier II.
4. The USMC, currently operating the Harrier II.
The problem is, the RAF don't operate the Harrier II, we operate the GR7 and GR9, which although based on the Harrier II are not the same beast -
different avionics, different electronics, different software etc.
Anyone buying the RAFs fleet to fly will have to operate them as a separate fleet from the Harrier II, and the cost of heavy training requirements for
the Harrier II family puts the price above that for a new operator this late in the game (who would buy into a type today that is going to retired
from all other operators by 2020 or so? The fleet maintenance cost would skyrocket...)
So the other option is to buy them for mechanical spares - and thats a buyers market. The RAF doesn't want to spend any more money on these
aircraft, they aren't going to get £1.5B for them, so its best offer only.
It is exactly this kind of idiotic accounting irresponsibility that leads to governments finding themselves in these situations in the first place.
Just because the money has been spent doesn't mean it has just disappeared with nothing to show, any more than a governments responsibility. I simply
do not believe any realistic attempt was made to sell them to anyone other than the USMC as parts.
I can disagree with the last point first - the feelers have been out since the FA.2 retirement, no one is interested in them.
And no, the money doesn't just disappear, but as to whether someone else values the expenditure as much as you did when you spent the money...?
Thats where the difference comes in. You can spend thousands of pounds painting your house bright pink, but will that improve the market value? Its
all up to how much the buyer values the changes - they don't care how much you spend, its whether the item as it currently is matches their
There seems to be a rather bizarre English tradition that continues to this day which says, "If we cant afford them then none shall have them,
and we will prove that by running an axe through them, regardless of the loss and how stupid it is". In the nigh on 5 years since the retirement of
the Sea Harriers, exactly how much effort has gone into selling them as a going concern to other current harrier operators? Can we seriously say that
India would in no way be interested in some very low time very well updated airframes to bolster there accident depleted force? I dont believe any
effort has been put in at all. In fact I think quite a few bureaucrats have very likely hampered such efforts in order to simply make the problem go
away for ever. Out of sight, out of mind.
As I noted above, India was approached regarding the Sea Harrier fleet, a deal was agreed in principle for 8 frames, and a number of engines, and in
the end India walked away because they operate the FRS.1 and bringing the FA.2 into their fleet would have been cost prohibitive for them.
So yes, efforts were made to sell the airframes, but no one is buying (apart from museums and private investors. And probably Iran.)
I also dont believe that the USMC is in a worse hole than the RN. I think you are both in the same hole, except that one of you is still operating a
force of Harriers, the other has simply given up, but decided to spend billions on a couple of shiny new carriers anyway.
Well, with the carriers its either build them or spend the money anyways in cancellation repayments. The contractors on that job were, this time
round, quite astute in their contracts - having been screwed over time and again with regard to governments signing up for something, making them hire
a huge workforce to do the work, getting a short way down the line on the project, and then canceling - its the contractors that suffer the bad will
from the workforce and other contractors in that case.
So this time round they made sure they got their money. Hate to say this, but well done them.
( I dont believe they will ever operate F-35's of any flavour)
I'm hoping they don't, they are overpriced and seriously late - but I'm about to post an article on that.
But dont discount the USMC as they have several choices. Firstly there are a bunch of big deck carriers with far to few assets on them already so they
could just purchase SH or (and I try not to smirk here) F-35C and operate them from there as they have in the past.
I think you misunderstand my point - currently the USMC operates several command carriers independently of the USN, they have complete autonomy - they
lose that autonomy when the Harrier goes, if the F-35B is scrapped.
Thats quite a big loss in capability for them.
Or they could operate SH's off of their new LHA-6 carriers if they were to fit either catapults or a ski jump. It's certainly possible to do
this down to carriers of around 25,000 tons, far less than the LHA-6's 45,000 tons.
Something thats already been completely rejected by the USMC as a possibility - they have already shifted some of their F-35 buy to the F-35C, for
operating off the USN carriers, and are considering an interim purchase of SHs to do the same.
The LHA-6 class is under threat itself, and is one of the "linked projects" that will live or die based on the success of the F-35B. No one is
fitting ski ramps and arrestor gear to them, not even the USMC are.