@jcraig - You are completely right with that assumption. I understand how at first it makes sense that in order to waterproof a wire one simply has to put more rubber on it, however, this is not the way to go about water proofing something that allows electricity to pass through something it should not.
The way to properly waterproof a wire is to use the appropriate rubber, so that it does not fray over time and to also make sure that it is tightly secured so that absolutely no moisture is able to pass through. By doing so you make sure that the wire will not short if it happens to be in a damp place.
For heavy, underwater wires it makes sense to use a stronger type of rubber, but to also wrap more rubber around the wire to be sure that a problem does not occur. With wires that are underwater all the time it makes sense to wrap more rubber around, keeping in mind that it has to be wrapped tight to prevent moisture and condensation from getting in.