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Weekend reflections

October 27th, 2007

Weekend Reflections is on again. Please comment on any topic of interest (civilised discussion and no coarse language, please). Feel free to put in contributions more lengthy than for the Monday Message Board or standard comments.

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  1. John Bignucolo
    October 27th, 2007 at 11:12 | #1

    In Dead Cats Prof. Quiggin suggested that one thing the Howard Government could do, or should have done, to shore up its support would be to ratify Kyoto.

    According to a report by Lenore Taylor in today’s Fin Review, “Cabinet Blocks Turnbull on Kyoto”, Malcom Turnbull did exactly that six weeks ago during a Cabinet meeting. The report of the Cabinet meeting mirrored the arguments put forward in the comments to “Dead Cats”:

    It is understood that Mr Turnbull was not the sole voice for ratification at the meeting, held about six weeks ago, but that a clear majority of cabinet did not think changing the government’s stance was a viable political position to take.

    In an inteview, Mr Turnbull would not comment on the cabinet discussion, but agreed that signing Kyoto would do Australia no economic harm and that there were arguments for such a “symbolic” move.

    It’s interesting to speculate on what the effect could had been on the atmospherics of the Liberal’s campaign had cabinet agreed with Turnbull’s point of view. I think it would have taken climate change off the table during the election, making it much harder for the ALP to point to it as an area of substantive policy difference.

    One could argue that there is no substantive policy difference, but symbolism is a powerful shorthand for shaping perceptions, and in rejecting Kyoto, Howard has given the issue to the ALP.

  2. BilB
    October 27th, 2007 at 11:24 | #2

    Stubborn is as stubborn does!

  3. October 27th, 2007 at 13:28 | #3

    Australian dollar above 91c, crude oil above $91. Two very worrying developments.

  4. gordon
    October 27th, 2007 at 15:03 | #4

    If and when we arrive at the top of the Stairway to Kevin, I have no doubt that the incoming Cabinet (after they have located the executive toilets and made sure their wives and girlfriends have got their new phone numbers) to go for a long (about 3-year) lunch. Why not? They will have just got elected on a do-nothing, me-too platform based mainly on the Liberals’ failed bet on interest rates staying low and the unfortunate absence of boat people.

    This will leave the ALP another electoral cycle behind where they ought to be, which is doing what the German SDP is doing – contemplating a Left turn. Still, by the time the ALP gets there, maybe there will be some German ideas they can copy. They’re pretty good at copying.

  5. sdfc
    October 27th, 2007 at 20:40 | #5

    The Australian dollar is doing what it is supposed to do when the economy is experiencing a terms of trade boom. It is actually insulating us to some extent from the rise in oil prices.

    If the dollar had not appreciated consumer price inflation would be higher and so would interest rates.

  6. observa
    October 27th, 2007 at 21:39 | #6

    “It’s interesting to speculate on what the effect could had been on the atmospherics of the Liberal’s campaign had cabinet agreed with Turnbull’s point of view.”
    I don’t think it would have made much difference as Rudd and Labor have all the running on Kyoto symbolism. The only thing that would have mattered would be to come up with a serious and differentiated plan that ratified the underlying target and made the commentary sit up and take notice. Can’t see that happening now so it looks like symbolism and subsidies to landlords, etc after election day.

  7. BilB
    October 28th, 2007 at 07:37 | #7

    Australia is insulated from most negative forces by its massive mineral wealth relative to its population. Take that trade out of the equation and you will see what a miserable job Howard has done. We are indeed set up for the mother of all recessions if the resources boom pauses for any length of time. New Zealand is a far more successful economy because with out the mineral wealth it has become far more diverse with much stronger manufacturing, and arts sectors.

  8. October 28th, 2007 at 16:23 | #8

    If the dollar had not appreciated consumer price inflation would be higher and so would interest rates

    Actually, I think you’ll find the interest rate differential between the U.S. and Australia is responsible for much of the surge in the dollar’s value, not the other way around.

    The fact that Australians are insulated from the rise in crude oil prices is IMO a very bad thing. It allows us to keep driving big 4WDs and 6-cylinder family cars, built by government subsidised factories. It allows us to run a tax system that encourages car use (FBT-concession, lower taxes on imported 4WDs) over public transport.

    If you think low fuel prices are the way ahead, then vote for that Family First idiot.

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