The body of Jake Kovco has finally returned to Australia. It’s hard to imagine what his family must be going through, starting with the news that they had lost a husband, a father and a son, and then compounded with the series of dreadful bungles (or worse) that we’ve seen.
It would be good to think that somewhere in the chain of command, someone will step forward to say “This happened on my watch, and whether or not I personally did anything wrong, I’m responsible. I offer my resignation”. So far, there hasn’t been any sign that anything like this will happen, but there’s still time.
A year or so ago, I was surprised to find out that a fair bit of the news on US TV is actually advertising produced by corporations and fed into news broadcasts with spurious “reporters”. The NYT has an update, with a report by the Center for Media and Democracy on the extent of the practice.
My piece in yesterday’s Fin is over the fold. I go into full free-market mode attacking the government’s deal with the monopolists. Ken Davidson in the Age goes the other way, arguing for tight regulation in the public interest, but I can’t see this ever happening to Murdoch or even Packer jnr. On the other hand, I guess we’re not going to see their spectrum taken away and auctioned off either. On the whole, though, I think the only useful intervention here is support for a strong public broadcasting sector. As far as the commercial networks go, the best hope is to encourage the kind of outside competition made possible by digital technology.
The point on which Ken and I agree, I think, is that we now have the worst of both worlds: lots of intervention, but in the interests of monopolists, not the public.
The US recorded a trade deficit of $725.8 billion or 5.8 per cent of GDP in 2006. That’s roughly equal to Australia’s entire GDP. With short-run interest rates having risen, the income component of the current account deficit is bound to start growing rapidly soon. If the trade deficit doesn’t turn around this will generate an unsustainable explosion in debt and deficits.
People who’ve been following the debate about global warming closely will be aware that the economic modelling used in projections of future climate change by the IPCC has been severely criticised by former Australian Statistician Ian Castles and former OECD chief economist David Henderson. The critique emerged in a rather confused form, with a number of letters and opinion pieces before finally being published in contrarian social science journal Energy and Environment. Responses, including mine, have been similarly partial and sporadic.
I’ve finally prepared a full-scale response to the main claim made by Castles and Henderson, that the use of market exchange rates, rather than “Purchasing Power Parity” conversion factors for national currencies, biases estimates of future emissions upwards. My conclusion is that although PPP measures are preferable in comparisons of national welfare, the biases introduced by using market exchange rates are not important in modelling emissions and will, on average, cancel out. You can read it all here.
Update: Ian Castles has sent a response which I’ve posted here. It doesn’t seem to me that Ian responds to my argument except to deny that the MER/PPP issue was the main point of the critique.
I should also note that Holtsmark and Alfsen (2004), whose paper I’ve just found, present much the same argument as mine.
Further update In the comments discussion, a fair degree of common ground has been reached. Ian clarifies that he and Henderson object to MER conversion factors, but not because they bias projections of emissions, saying
I agree that these arguments (about the errors in GDP growth and emissions intensity reductions cancelling one another out) are sound as a first approximation.
Ian makes the valid point that use of MER conversion produces the incorrect conclusion that the energy-intensity of LDCs is about the same as prevailed in developed countries when their income was similar. This could lead to misleading policy inferences, for example with respect to mitigation policy and should be corrected.
I agree with Ian that it is better to use PPP measures consistently, and that the sooner the IPCC does this the better. On the other hand, I think it’s important to make the point that the widely-repeated claims that IPCC projections of emissions are fundamentally erroneous because of the choice of exchange rate are not supported by careful analysis.
In every sense of the term.
(Only too believable section). Lott’s results support current Republican talking points.
Johnno by David Malouf. The main interest for me was the setting, the Brisbane of the 40s and 50s, starting out as a combination of overgrown country town and sleazy wartime garrison town, then gradually metamorphosing into the repressed provincial city that I remember from visits in the 70s and 80s. Malouf mentions the closure of the brothels (where the protagonist creates some havoc) as an instance of this.
Of course, brothels and gambling dens continued to operate with the protection of corrupt police. This ultimately led to the collapse of the seemingly invulnerable Bjelke-Petersen government following the Fitzgerald Commission.
As a generally left-wing columnist for a generally right-wing paper, I naturally spend a fair bit of time thinking about how to keep my spot. So I was interested to see this piece by Gerard Henderson on why he got sacked from the Age (Hat-tips to Philip Gomes and Tim Dunlop), where he had the converse position. Henderson’s explanation is that the Age is moving to the left and attributed his sacking to the fact that the Left was offended by his last three columns, which
* said that Evatt was to blame for the Labor Split of 1955
* attacked the Labor Party’s opposition to the Vietnam War
* claimed that Australia’s involvement in the Gallipoli campaign was justified.
Having read the columns, I’d say Henderson was half-right. They probably contributed to his sacking, but on commercial rather than political grounds.
There’s a lot happening and plenty I don’t have time and/or expertise to cover. A few selections. Over at Crooked Timber, Henry Farrell looks at the rejection of the proposed EU constitution by a referendum vote in France. Mark Bahnisch looks at welfare and unemployment. And Gary Sauer-Thompson covers DIMIA’s (mis)handling of detention.
I happened to notice a story in the local suburban newspaper about the midnight opening of Revenge of the Sith which begins “Hundreds of fanatics will brave the cool to be among the first to see …”
In my first post on the Bagaric-Clarke paper advocating torture, I said “I havenâ€™t seen any comment yet from pro-war bloggers, but I hope at least some of them will repudiate this terrible proposal”.
Andrew Norton stepped up, pointing out that Bagaric has previously been identified with leftish positions, and criticising his current views. And regular commenter “Razor” on this blog says “As a confirmed RWDB and ex-soldier I canâ€™t support the use of torture”.
Apart from that, I’ve come up blank. It’s easy to find pro-war bloggers and commenters supporting torture with more or less tortured arguments, defending Bagaric and Clarke’s right to speak and staying mum on the substantive issues, or just blogging on about Newsweek. I won’t bother linking to them – visit the obvious sites and you’ll find them. No doubt there are exceptions I’ve missed, but they aren’t very prominent.
This is a bit disappointing, but it provides a useful lesson. Next time you read one of these guys talking about Saddam and his crimes, remember it’s just a factional brawl within the pro-torture party. If Saddam had stuck to fighting wars against Iran, and torturing Iraqis, instead of invading Kuwait, he’d still be “an SOB, but our SOB”, just like Karimov in Uzbekistan.
Further update In comments, Andrew Norton advises that he was pro-war but didn’t blog on it directly, and Andrew Leigh is in a similar category. I can’t read Currency Lad’s blog (for heaven’s sake ditch the wallpaper!) but I’m not too surprised to learn from the comments that he is opposed to torture. And that’s it so far. Of the legion of noisily pro-war RWDB bloggers (a group from which I exclude CL), not one has so far taken a position any different from that of Saddam Hussein, and most of the noisiest have eagerly lined up with Saddam.
fn1. I should say that I haven’t actually seen anything Andrew’s written on the war, so I’m only guessing that he fits into the pro-war anti-torture category. I’ll be happy to correct this if it’s wrong.
My AFR piece tomorrow will deal with the expenditure side of the Budget, but I also plan a piece on the tax side. My immediate reaction is the same as everyone else’s – these cuts are amazingly skewed towards upper-income earners, with no-one on less than $55 000 per year getting more than a $300 tax reduction. This is about 9 months worth of bracket creep for someone on $40 000/year, but it’s apparently supposed to last for the rest of this government’s term in office, given the allocation of future tax cuts to the top end.
I’ll try to have a more detailed analysis soon.
Nick Caldwell, who kindly helped me out yet again with the site design has asked me to write a post on what I like about cultural studies, following up similar posts on John Howard and postmodernism.
Nine Australian service personnel were killed in a helicopter crash during earthquake relief operations yesterday. This kind of work is always dangerous, and these brave men and women have given their lives to help others in danger. They are an example to us all, and their memory should be honoured.
There’s an interesting story in today’s Fin (subscription only) about a study of a remote NT Aboriginal community which found that government spending per person there was substantially less than the average for NT residents in general. I don’t know how general this is, but I’ve seen similar results before. The idea that “we have spent massive sums of money on Aboriginal problems and have nothing to show for it” is based on dubious empirical assumptions. A common source of this thinking, at least when ATSIC was around was to look at the total amount allocated to Aboriginal health, education and so on, without netting out the amount that would otherwise have been spent through the mainstream health and education budgets.
Also in today’s Fin, I have a piece on oil prices. Most of it will be familiar to readers, but I’ve put it over the fold anyway.
… that reduces presumably rational people to babbling incoherence. In today’s Age, Christopher Scanlon of RMIT writes
Australians want monarchs who maintain the fantasy of monarchism, who embody the impossible ideal of monarchy …The problem with the Windsors is that they’re just too much like us. Their lives are as complex and contradictory as our own. And because of that they’ve soiled the fantasy of monarchism as some kind of divine state.
and two paras later
The Danish royals appear enough like us to be comfortable; they’re not aloof like those stuffy dysfunctional Windsors.
BTW, I found the same problem myself. I was going to write on this topic and suggest that we pass our own Act of Succession, offering the Australian throne to the highest-ranking European Royal willing to marry an Australian. I thought this would go over well with both monarchists, republicans who care only about having an Australian head of state, and aspiring princesses/princes, between them enough to make up a majority. Then I realised that, unless the legislation was drawn up carefully, we might end up with Prince and Princess Michael.
fn1. I see Mark McKenna has much the same idea.
If you’re trying to reconcile unlimited wants with limited resources, and someone is willing to lend you the money, borrowing looks like a neat solution. For nations, collective borrowing is measured by the current account deficit. Until quite recently, however, it seemed to be generally accepted that there was a limit beyond which such borrowing was imprudent and that the limit was around 5 per cent of GDP.
There are some good arguments against the traditional view, and we’d better all hope they are valid, though I fear they are not. I’m working on a big piece on this. More soon I hope.
fn1. More precisely, by the capital account surplus which is equal and opposite to the CAD.
This kind of thing makes me think that the NSW Court of Criminal Appeal has some sort of death-wish. It has overturned a conviction in a lengthy drug trial, on the grounds that the wrong person signed the indictment, although it was common ground that this had no effect on the fairness of the trial. Following a series of disastrous decisions to hold retrials in gang rape cases, which have already led to amendments to the law designed to repudiate the Court’s judgements, I’d have thought the judges would be cautious about playing this kind of game with technicalities.
A decision like this is bound to produce a further reaction, and probably an over-reaction, from the legislature. We could easily see changes to procedures, designed to preclude further appeals of this kind, that eliminate important safeguards against unfair trials. In their quest to protect the niceties of some imagined ideal system of law, appropriate to a world of unlimited resources and costless trials, the Court of Appeal is gravely damaging the system we actually have to live with.
fn1. For example, the Tayyab Sheikh case elicited an amendment to rules about publicity, and the recent successful appeals by the Skaf brothers have produced rules allowing retrials to be conducted on the basis of transcripts.
My piece in today’s Fin puts the argument that long-term US interest rates must rise in view of the many pressures (increasing inflation, massive trade and budget deficits) in that direction, and that intervention to hold them down will eventually fail. (I’ve put it over the fold)
Coincidentally, the US trade deficit for November came in at $60 billion, easily breaking the previous records, and despite lower prices and a sustained devaluation relative to the euro, $A and other currencies (though not the Chinese renminbi).
This was, as far as I can tell a surprise to the markets (unchanged at $55 billion) was the par prediction, and the US dollar promptly weakened. But the 10-year bond rate remained unchanged. This makes no sense at all, but I’ve given up expecting financial market outcomes to make sense. General Glut has a chart from Robert Scott of the Economic Policy Institute on another aspect of the puzzle as well as detailed commentary on the trade figures summed up by the observation This report is ugly 1000 ways till Sunday
I think a partial resolution of the puzzle in the Scott chart is that the last turnaround in the trade deficit was achieved through a combination of depreciation, budgetary tightening, higher interest rates and demand contraction (that is, a recession). The same was true, broadly speaking, in Australia. There is, in general, no painless way of fixing a trade deficit on this scale.
The weekend Fin (subscription required) has a profile of the eminence grise of right-wing Melbourne poltiics, Ray Evans. It includes a comment from this blog on the various Astroturf organisations Evans set up when he was working for Hugh Morgan at Western Mining (not greatly to the benefit of WMC shareholders as far as I can see). Here’s the quote used by the Fin
Australia has a string of such [Astroturf] setups, all apparently created by Ray Evans of the Western Mining Corporation. The most egregious is the Lavoisier Group, an organisation for climate change contrarians (about as plausible as creationists calling themselves the Mendel society) . If you move along to the (anti-Aboriginal rights) Bennelong Society youâ€™ll find an almost identical website with the same postal address, shared with the (anti-union) HR Nicholls Society . The (monarchist) Samuel Griffiths society is from the same production line, though not quite as brazenly so.
So what is it about names like these that screams â€œAstroturfâ€?? Most named institutes are either named in honour of the founder, or are explicitly partisan institutions whose name indicates their affiliation, as with the Evatt Chifley (Labor) and Menzies (Liberal) foundations. Itâ€™s not clear that those named would always agree with what is published in their names, but thereâ€™s some reasonable basis for presuming that this might be the case.
There’s been a lot of discussion on the Monday Message Board, responding to a piece by Gerard Henderson asking why Australian ex-Communists aren’t treated with the same disdain as ex-Nazis (Louis Nowra has said something similar). Meanwhile over at Catallaxy, they’ve been debating Mark Lilla’s book The Reckless Mind: Intellectuals in Politics This gives me a chance to repost my thoughts on this topic from last year.
Here’s a neat example of creative giving. For 24 hours (this has apparently been extended a bit), Michele Agnew is promising to give a one dollar donation to Oxfam for each (non-spam) comment posted on her blog. The place to comment is here
Thanks to Scott Hagaman for the tip.
This is a blank post, put here to deal with problems linking to the top post on the page.
I’m still in relaxation/holiday mode, so I don’t plan a permanent fix of the problem for a while. Thanks to Yobbo, who has pointed out a diagnosis and possible solution in the comments.
I watched some of the telethon last night and was impressed by the amounts of money being raised. The entertainment was a little less to my taste, but I suppose you can’t please everybody, so the aim is to attract as many as possible.
The worldwide response to the tsunami disaster has been equally impressive, though no more than was merited by a tragedy on such a large scale. But tsunamis are not the only disaster affecting humanity. Preventable diseases kill millions every year, and the disability caused by diseases like malaria is a huge drain on economic growth in many poor countries. For $US50 billion a year, we could implement the program proposed by the Commission on Macroeconomics and Health which would, quite literally, save millions of lives. Based on our share of developed-country GDP, Australia’s share of this would be only about $1 billion. The US could finance the entire program with the money currently being spent in Iraq. Europe and Japan could easily meet their shares by scrapping farm policies that harm both domestic consumers and poor farmers in less developed countries. Or the whole thing could be done out of private donations of around fifty dollars per person per year – well below one per cent of personal income.
If we could only make the kind of concern that’s been displayed over the past couple of weeks a permanent feature of our personal and political priorities, the world would be a much better place.
Update Reader and Uni of Maryland colleague Darrell Hueth points me to this piece by Nicholas Kristof arguing that the use of DDT in anti-malarial programs should be expanded. This issue has been debated at length on this blog, and I think Kristof gets the balance abotu right. Also, if you’re interested in an economic take on the costs and benefits of malaria prevention, the chapter by Mills and Shilcutt in Bjorn Lomborg’s book Global Crises, Global Solutions , coming out of his Copenhagen Consensus exercise, is well worth reading.
fn1. As I’ve previously observed, the Copenhagen Consensus, considered as a ranking exercise purporting to private that action to mitigate global warming is a bad idea, was a dishonest political stunt. But a lot of resources went into it and they weren’t all wasted.
Even though 2004 was a pretty awful year, there was at least some good news. At the global level, Europe has continued to give an example of a path towards spreading democracy that is not carried on the end of bayonets. The peaceful resolution of the crisis in the Ukraine and the election of a government committed to integration with Europe was one instance, as was the decision to open negotiations with Turkey, which has made great progress in the last few years towards providing a model of an Islamic democracy. As a couple of commentators have already pointed out, there are big challenges ahead and the whole enterprise may fail. Still such challenges have been overcome in the past as the admission of ten new members shows.
Russia’s decision to ratify the Kyoto protocol was another hopeful development. But we’re going to need more than Kyoto and it seems unlikely we’ll get it as long as Bush is in the White House.
At a local level, it’s worth remembering that the loss of life from even the worst disasters that have affected Australia is tiny by comparison with the continuing carnage from road crashes. In this respect, at least, we are making progress. New South Wales recorded its lowest toll in 55 years in 2004, and Victoria its second-lowest
Finally, there is some hope that the response to the tsunami disaster may go beyond the usual short-lived outpouring of sympathy and half-delivered promises of aid. Criticism of the stinginess of the initial response struck a chord, and focused attention on the weakness of the rich world’s aid effort, a weakness made more striking by the willingness to spend hundreds of billions on war. If we must have international rivalry, a race to see who can give most to help others seems like a good outcome.
Update An important piece of good news I forgot to mention was the signing of a peace settlement between the Sudanese government and the southern rebels. Assuming it holds, this will bring to an end a war that has lasted for decades and cost hundreds of thousands of lives. Unfortunately, the fighting in Darfur (in the western part of Sudan) which began more recently is still going on. The world’s attention to this problem has been fitful and inadequate, but perhaps we’ll see something better in 2005.
It didn’t take long for the government’s FTA chicken’s to come home to roost. Not surprisingly, the US government repeated its earlier statementthat it had serious problems with the amendments introduced by Labor to stop ‘evergreening’ of pharmaceuticals (a device to extend effect patent life using trivial variations on existing patents).
More interesting is that Big Pharma is already acting as if the agreement is set in concrete, heavying the Howard government over its own election promises. All of this is as I predicted, using the arguments of Christopher Pearson. Following Pearson’s summary of the arguments Big Pharma could use against the Labor amendments, I observed
What’s critical to note here is that these points have nothing to do with the specific content of Labor’s amendments. They apply to any legislation concerning the PBS that an Australian government might seek to introduce in the future and, arguably, to any administrative decisions made by Ministers. If Pearson is correct1, the FTA gives the Americans an effective veto power over anything we might attempt to do to improve the functioning of the PBS. It’s notable that Pearson’s points are almost identical to those that have previously been made by critics of the deal, and pooh-poohed by the government.
If there was ever a time for Howard to earn the “Man of Steel” moniker hung on him by George Bush. He should demand an exchange of letters from the US side making it clear that we can take whatever action we deem necessary to protect the PBS. If this isn’t forthcoming, he should walk away from the deal and see what he can get out of the next US Administration, or the one after that if necessary.
fn1. After some hamfisted interventions on other issues, the US did the right thing in waiting until after the election to raise these concerns.