The comments thread below arising from my piece on unfair dismissals having gone badly meta[1], let me extract one useful point and do a quick calculation. Suppose we accept the estimate by commenter x-anon that employers typically choose to pay out three months’ wages when dismissing someone for cause (that is, for reasons other than redundancy), rather than face the possibility of unfair dismissal action.
I’m going to guess that an upper bound for the proportion of employees annually dismissed for cause in small businesses is 4 per cent (for large businesses it would be smaller and for the public sector smaller again). Then that implies that the effect of the 3-months payout policy is to raise the average wage bill by 1 per cent. Unless all dismissals for cause are justified, there will be an offsetting effect, since rational employees who regard unjustified dismissal as a possibility will want a higher wage to offset the implied reduction in expected payments. Assuming justified and unjustified dismissals are equally common (here it’s the viewpoint of the average employee that matter), and disregarding risk aversion, the net saving falls to 0.5 per cent. Given a typical labour demand elasticity of 0.5 the net increase in employment demand is about 0.25 per cent for small business (the relevant distinction is those with less than 100 employees). If, say, 40 per cent of workers are employed in firms affected by the changes, the net increase in employment is 10 000 jobs. This is a once-off increase, not an increase in the annual rate of job creation.
Of course, this is a rather simplistic calculation, not taking into account effects on employer confidence, worker morale and so forth, but it gives a feel for the order of magnitude involved. A policy initiative that might generate 10 000 new jobs is worth looking at, but it ought to be put in perspective. Telstra alone has cut many more jobs than that in the past decade, which suggests that a focus on making it easier to get rid of people is probably getting the wrong end of the stick.
fn1. Godwin’s law invoked after only 30 comments.
John Quiggin 
The 10,000 jobs is not entirely a one off. As the labour market expands the 0.25% employment advantage of this policy will apply to the new parts of the market. So if the labour market grows by 100,000 then we get a bonus 250 jobs. Not a lot but nice to have regardless.
More to the point though this is as you said “a rather simplistic calculation, not taking into account effects on employer confidence, worker morale and so forth”.
I am on auto moderation now, so dunno if this will get through [personally, I find it far more offensive to be called a “liar” than a d***weed, the former questions my integrity, the latter is just silly, but its your blog]
I suspect you are underestimating by a factor of 2 or more, but your point still holds.
The real benefit in the IR reforms is the intangibles. Comparing AU with US is instructive. From my experience, The US economy is remarkably strong for three main reasons (not necessarily in any particular order):
1) they eat, breathe, sleep, and sh*t business over there.
2) the workforce is “flexible” (read, easy to hire and fire).
3) they have a humungous domestic economy.
Australia is not far behind on 1 (we’re pretty entrepreneurial by world standards). We’ll never be able to compete on 3. So transforming 2 to be more like the US is the one thing we can affect to get us closer to their productivity levels.
But it will involve cultural change. Easy hiring and firing reduces the cultural stigma associated with losing your job. It also encourages people to be on the lookout for their own interests, instead of necessarily assuming their employer will look after them (which, by the way, forces employers to try _harder_ to keep their good workers, because in such a flexible culture they are more readily poached).
Overall, I think Australia is well placed to get the best of both worlds: a flexible workforce without the huge social divide you have in the US (which, from my experience is caused by the US having much weaker social security and the fact that their most disadvantaged ethnic underclass (blacks) represents 10-20 times the percentage of the population as does Australia’s (Aboriginals)).
There are a few unknowns to be tested before the electorate gets to give the new IR experiment the formal seal of approval at the next Federal election, after a 2 tear trial. Clearly if the sky falls in for a sizeable number of marginal voters then the ALP/unions will be more than happy to accommodate their concerns.
The industrial landscape has changed markedly since Aus embraced a globalised world economy. Most workers understand that no job is guaranteed, irrespective of the size of the enterprise. In fact it’s often a case of the bigger they are the harder they fall. One spinoff has been the loosening of loyalty between capital and labour generally. Labour hire companies have emerged as a result of this trend. Firstly they do allow a more efficient marshalling of surplus(to full time jobs) labour for casual hire and secondly they have become a mechanism for many to move about within industry and commerce, where a ceiling of opportunity exists for their skills. This can be positive for many workers, by allowing them to achieve market rates for their skillset, enhance skills via broader experience and simply avoid the boredom of one narrow workplace. Also they have effectively been a defacto loosener of unfair dismissal laws.
Actual waiving of unfair dismissal laws for most employees may see a waning of labour hire companies and the possibility of individual workers capturing this premia for themselves. At present any small employer would always place an employee on casual probationary wage (20% above standard award), whereas there may be little point under new laws. Cut out the labour hire company profits and engage the employee directly on full-time rates. The cost of erring in long term choice would be minimised.
If we take annual dismissals as a whole(unfair or fair), they would be an infinitesimal proportion of the annual number of workers who regularly dismiss their employer and move on. Imagine all those movers, where each employer places them on probation for 3-6 months as they do now. The number of workers operating under this lack of protection of ‘unfair’ dismissal now would be large, as well as those who are placed on regular rollover ‘contracts’ of employment now. You get the impression that lifting all this defacto veil, would be in the interests of all but the odd few miscreants on both side of IR. Bring it on and we’ll see if the sky falls in as the doomsayers predict.
This is nonsense. The WORKPLACE RELATIONS ACT 1996 (1.4 MB text file) says:
Casual and probationary are different classes. The unfair dismissal provisions don’t apply to persons on a probationary period of less than 3 months, nor to casual employees who are employed for a “short period” (which is later defined as less than 12 months).
There is currently nothing preventing an employer putting someone on full time rates, on probation, for 3 months.
The 20% higher rate you claim for casuals is a furphy. In exchange for this, the employer doesn’t have to pay annual, long service or sick leave.
(sorry for my poor formatting of the Act)
The industrial landscape has changed markedly since Aus embraced a globalised world economy.
Cool observa, as distinct from a globalised global economy, and of course a worlded world economy.
“Casual and probationary are different classes. The unfair dismissal provisions don’t apply to persons on a probationary period of less than 3 months, nor to casual employees who are employed for a “short periodâ€? (which is later defined as less than 12 months).”
True and there’s nothing stopping employers of blue collar workers starting them on casual rates(up to 12 months) and moving them over to full time rates when they’re satisfied they are good employees. Granted this is probably more confined to blue collar employment. In any case you usually know if they’re any good within a matter of days, but it’s hard to fake it for 3 months, even on probationary terms. Employers are not interested in saving on holiday pay, sick pay,etc, but more in avoiding being saddled with a clever dud.
“their most disadvantaged ethnic underclass (blacks) represents 10-20 times the percentage of the population as does Australia’s (Aboriginals)).”
I don’t get this. Blacks in the US are 10% of the population. If they are overrepresented in the underclass by 10-20 times, then they must be 100%-200% of the underclass.
Anyway, comparisons with US miss the point totally. It looks to me like what Johnny H is doing is setting us up to look like the UK. He’s even (almost) copied the name of the key institution – the Fair (“Low” in the UK) Pay Commission. Not that the UK is anything to celebrate. It was all set up by Thatcher in the 80s, with the slightest of tweaks from Blair. But that is Howard’s model, not the United States.
if you want to make predictions about what these changes will mean for average wages, inequality, employment, etc, look at the UK.
bill posters, I’m a product of public education. Can I suggest a job with the SA Ed Dept mate?
Jack, my general point about labour hire companies still stands, although the Oanh vs Thiess case mentioned elsewhere, has put the cat among the pigeons there. All that will do is make employers churn workers through labour hire more often. Squeezing balloons mate. I have a hunch dropping unfair dismissals will decimate the labour hire industry. Room for adroit unions to pick up the slack, provided they concentrate on their core business, instead of going off on tangents like student unions have. Methinks the doomsayers on IR reform are protesting too much because deep down they know the sky won’t fall, just like floating the dollar, reducing tarriffs, GST and waterfront reform. Employees now regularly sack their boss, fairly or unfairly with no redress, on a scale of magnitude that dwarfs the reverse scenario. Evening up the legislative slate for employers is no longer the bogey of the past for this modern workforce.
Clarification:
Blacks = 10%-20% of the population in the US
Aboriginals = 1%-2% of the population in AU
(rough percentages – I am not certain of the exact figures).
Each is by far the most disadvantaged ethnically distinct underclass in their respective countries (maybe throw Native Americans in with Blacks in the US).
Hence, the most disadvantaged underclass in the US is 10-20 times the same size (as a proportion of overall population) as the corresponding underclass in AU.
observa, you completely misunderstand the dynamics of labour hire. These IR reforms are strongly supported by the labour hire industry, to the extent that federal take-over of state IR systems may even have arisen from labour hire lobbyists, as a solution to that industry’s fear that state governments were moving to clean up the industry.
I would like to write more and may do later, but I have to fly just now.
Be interested to hear your take on this Tony. Yes I do think the labour hire Cos are pushing this, but I don’t think they fully understand the dynamics of their existing role(ie defacto skirting around current sticky dismissal laws)and they’re gunna be in for a rude shock with their double edged sword in future. SMEs won’t need their ‘try before you buy’ workers in a brave new world. They can cut out the middleman and ‘try before they buy’ themselves. IMO that will cut out a big chunk of their current role.
“Methinks the doomsayers on IR reform are protesting too much because deep down they know the sky won’t fall”
Sure, the sky won’t fall in relation to wages and working conditions. But aside from their scaremongering, I suspect most union bosses aren’t thinking much about conditions. They’re worried about their own power. And hopefully the sky will fall in respect of that.
The labour hire firms act as a useful filter. Whether that constitutes enough value in the absence of wrongful dismissal remains to be seen.
My guess: for generic jobs, probably. For more specialist jobs, probably not.
Much of the to-and-fro in this thread is based on tweakings and re-tweakings of JQ’s back-of-the-envelope calculations. Subject to the acknowledged fudge-factors that impinge on these calculations, the discussion is an interesting and enlightening attempt to delineate the outlines of a policy whose effect is designed to enhance labour market efficiency.
However, this discussion does ignore the 800 kg gorilla crouching in the corner of the room. To wit:
How is labour market efficiency enhanced by creating a two-tier labour market: employees who happen to work in enterprises of fewer than 100 are to be treated prejudicially in relation to those who work for larger enterprises?
What makes an enterprise of 80 employees different in kind from an enterprise of 120 employees?
If the answer to the above question is “not much”, then the answer to my first question is that the distinction is driven by politics and not economics.
So if that is the case, shouldn’t the primary subject matter be political rather than economic?
To be quite pointed:
Why should people of good will accept the bona fides of Howard’s latest exercise in wedge politics?
Speaking of unions off on tangents and tilting at windmills try here
http://news.ninemsn.com.au/article.aspx?id=56282
In a globalised economy with no tarriff protection, what would be the logical outcome of forcing some Aust based award on TCF outworkers here? Achieving Pyrrhic victories must be immensely satisfying for union top brass these days. Time to really broaden their horizons with the Miscellaneous Can-Collectors and Leaflet Distributors Union I guess.
observa, the casual loading is 23% in Federal Awards. Though you may be talking about SA.
“Why should people of good will accept the bona fides of Howard’s latest exercise in wedge politics?”
Think of it as a ‘beacon of light’ without the need to get all bloodied with the dark 800kg gorilla for the time being. He can be easily rounded up and dragged kicking and screaming into the light when it’s obvious to most, the sun hasn’t fallen from their sky (ie that unions and awards are all that stand between them and slavery)
Doesn’t affect me in the Construction game Mark. Salaried or subbies, although you couldn’t get a tradey on basic award rate these days anyway. Jesus, even the apprentice electrician son reckons his employer is the only one not paying their apprentices over award. Big cushy rest home factory down there by all accounts, which suits the low paid plodders. He’s aware that some of his group apprentice mates have to earn their over-award payments.
“Think of it as a ‘beacon of light’ without the need to get all bloodied with the dark 800kg gorilla for the time being. He can be easily rounded up and dragged kicking and screaming into the light …”
So, Observa, you acknowledge that this policy is a wedge.
Mark Bahnisch,
Where do you get your 23% figure from? There is no such thing as ‘federal’ casual loading. they vary from award to award, from 15% to 25% and a couple at 30%. This may overall average 23% though, I haven’t done the maths on that .
I realise this thread is about the effects of unfair dismissal laws, but could we address the issue of labour productivity? I still want to know how labour productivity is improved by lowering its price.
I agree that the Howard stuff is more like the UK, but you should be aware of the restrictions on collective bargaining which is taking Australia down the US track, but without their formal commttment to representation rights once a recognition ballot has been won. BTW, it is interesting that despite all the blather about trade union bosses and how dearly employees just love their boss and just can’t wait to be freed of the shackle of their union so that they can bargianin 1:1 with their boss, surprisingly, Australian business is reluctant to test their view about how much workers hate unions and love them because they have never proposed that once employees vote for union representation they should have it as of right. You see there is already no such thing as a right to collective bargaining in this country, unlike the US. Funny isn’t it? Any one care to comment on this remarkable oversight of a basic democratic right?
“Any one care to comment on this remarkable oversight of a basic democratic right?”
I dunno, STR, perhaps you’d be better off directing your question to representatives of some of those US industries directly affected by the stellar productivity gains made possible through unionization enshrined in the NLRA. Eg, the thriving Pennsylvanian steel industry, General Motors or the bankrupt old airlines (United, US Airways)?
Commentator etc;
Mate, can you get a grip? All those indsutries were productive at their heights, until other industries in other countries (japan in automobiles, China and brazil in steel) overtook them. The reasons were hardly unions, since Germany also overtook US manufacturing in many areas with a far stronger and more combative union movement than the US has ever had. The reasons for Japan and germany were simply that they started off from nothing, that is their indsutry had been destroyed by the war, and they were able to take advantage of the latests technologies together with their own cultural approach to workpalce relations which were different in each country, but which worked for them. BTW, both of those countries are in the proces of being taken over by China and Brazil, albeit in China’s case, with liberal helpings of US and Japanese investment dollars. Which is my point really
As for the airline indsutry in the US are you aware that workers in the US airline industry have been voting for ‘give backs’ to their employers for years, spurred by the threat of closures etc; The result? nada, nothing. More of the same. That is my point. Lowering the price of labour creates more profit-that is true, and we can all have a debate about that, but I want you to address the point about the sources of productvity and I want you to set aside your instictive hatred of orgnaised labour for just one minute and address, rationally please, the issue of the link, if any, between lowering the cost of labour and improving its overall productivity. Thanks.
“So, Observa, you acknowledge that this policy is a wedge.”
Don’t know that you can call a ruddy great chasm between philosophies here, any more of repository for a wedge than it’s already been over the years Katz. Were the ALP and unions wedging the Coalition in the Senate all those times on IR legislation? Have the unions not always represented their interests as those of all workers rather than just their flock? They have been quite happy to pretend that unions can raise ALL workers wages and conditions, rather than some at the expense of others. Howard’s going to cut them off and presumably expose that historic wedge for all to see. His view is more market forces will produce the best outcome for the greatest number. We’ll see. I guess wedges is only wedges depending if you’re looking at them from the thin or thick end at any point in time. Side on they can often appear as sound pragmatic politics or softly softly catchee monkey. Naturally the dominant but waning gorilla in the story doesn’t want to be made a monkey of.
stoptherubbish,
I think you need to release your grip on something – perhaps to get one on reality. You are right that Germany and Japan were able to get ahead of the US in the way you say, but that can only go so far.
In the early days, when there was not enough labour, the unions were active in trying to help capital efficiency. That changed as capital reached high efficiency and the focus moved on to labour efficiency to try to inrease production per unit of input. Germany, in particular, is now seeing the results.
It is no coincidence that Australia and Argentina were two of the richest nations in the world around 1900 – just before both started regulating their labour markets.
IMHO, a regulated model of development only works (and even then less than optimally) while the path of development is both generally agreed and obvious. It follows, therefore, that it can only happen from a comparatively low base – as was the case in Germany, Japan, South Korea, etc. etc. after the last war and in varous other countries at various times. Where the path is not obvious and agreed (as we are now) then giving the people to go out and find that path is the only way to go about it. Regulation will only slow the process down and reduce the overall wealth of all the people in an economy.
So, Observa, your answer to my question is “yes”.
And, accordingly, do you agree that this discussion surrounding JQ’s “back-of-the-envelope” calculations is just nibbling around the edges of the question of labour market efficiency?
It is not the price of labour which is the issue. Barely qualified people are terminating interviews if they are offered award rate. Most employers have qualms paying over award. It is the cost of “non-labour” which is the issue. IE, the unfair dismissal laws cause an employer to be “married” to an unproductive & disruptive staff member. The difficulty & cost of removing those who swing the lead has cause the explosion in contracts & the explosion in labour hire.
If the unfair dismissal laws are revoked fully, as the treasurer is reported to have said this morning, then the labour hire industry will fade, & the clerical staff of the CBDs will have a permenant job, instead of perpetually being on a 3 month contract.
STR, your facts are way off. US steel went the way of the dodo because of union conditions that were not competitive. Eg US$80,000 for a foundry worker. There are profitable steel companies in the US today, but notably most are not unionized.
GM is saddled with insanely high pension and medical benefit liabilities, acceded to by management 20 years ago under strike threats from the union. What do you do when faced with that kind of blackmail? Give the unions what they demand even though you suspect it will slowly kill the company, or dig your heels in and potentially go broke anyway.
And the airlines. Fly economy on United to the US sometime, and see what US-style unionization does for service levels. And ask the flight attendants how much they make and how many hours they work per month [I did on my last trip]. If that’s the result of “give backs” then it is no wonder they are broke.
BTW, I don’t hate organized labour. If people want to organize that’s up to them. Bullying unions are the problem. I was one who believed in unionization as an idealistic young man, until my first summer job at University. The place I worked was unionized and the workers did almost _nothing_. Even they cheerfully admitted that by most estimates the place was overstaffed by a factor of 2-3. Demarcation disputes were rife. Being a naive student, I got myself into great trouble for unwittingly using an electric lift when I should not have (no operator license required). Apparently only the members of the electric lift operator union (or whatever it was called) were allowed to use it. I am sure if I had been anything other than a summer student a strike would have been called.
Unions are fine when protecting the (reasonable) conditions of workers. But that battle was won a long time ago. These days it seems to be much more about power. And that is what the ACTU is currently fighting the government for.
If you think that kind of union power should somehow be a democratic right, then I suggest you take a second mortgage on your house and sink all the money into the stocks of the most heavily and militantly unionized companies you can find. While you’re at it, put all your super there too, since you must believe it will have the best growth prospects with all those fine union officials looking out for the interests of the company.
BTW, you asked about the democratic right to organize. That’s what I am addressing.
Lastest poll folks:
The Federal Government has proposed that unfair dismissal laws be abolished for employers with one hundred staff or less. Australians are
overwhelmingly against this proposal, with 70% saying they disagree,
compared with 24% of Australians who agree with the proposal and 6% who couldn’t say, according to a special telephone Morgan Poll, conducted July 20/21 …
cs,
If the government went by polls the death penalty would still be in effect and detention centres would be expanded.
Polls should be an influence, but not a master.
cs, “unfair” is just a metaphor, and not particularly relevant in this context…..
You make far too many assumptions Andrew. In this instance, I’m merely a messenger … and the message clearly is that around a two-thirds majority of Australians presently don’t agree with the government on this one. Make of that what you will.
“sink all the money into the stocks of the most heavily and militantly unionized companies you can find”
That would be companies in the construction industry. They are very profitable. Bruno Grollo is not walking round with the arse out of his pants, I’ll give you the tip.
Then there is the motor vehicle industry. Very militant unions and, apart from Mitsubishi, also very profitable. In fact Toyota faces arguably the most militant unionists in the country in its Melbourne plant, and it is extremely profitable.
Chris Corrigan also seems to be doing quite nicely thank you very much, with 100 per cent MUA coverage still entrenched on the docks.
Katz, the immediate impact of reforms may be in that order, but Steve at the Pub, Andrew and Terje accord with my views. We have been moving along a more market IR approach since the ALP floated the dollar and Aus pulled its head out of its protectionist backside and embraced the world economically. Now we have the lowest unemployment in 3 decades. What does that tell you about the direction we should to continue to go in?(read Andrew again) Australians don’t need unions or public servants to tell them how to cut it economically now. The ALP is clinging to its union dinosaur past here, which is a shame because they instigated the sea-change in thinking under Hawke and Keating. Having said that, there’s still a place for the big biz, big union, big govt thingy. It suits them not to have to get too personal with each individual. They have extensive HR depts to weed out prospective duds and can better marginally afford the odd mistake anyway.
oh yeah cs, and that’s after the MUA got exactly what they wanted in the waterfront dispute. not.
I think that’s the exception that proves the rule.
So, Observa, if Howard’s approach to the demarcation between “big” and “small” being set at 100 employees is mostly a matter of political management, and there isn’t much difference between firms bigger or smaller than that arbitrary figure, then Howard may justify to himself the good policy of adjusting this watershed according to the kind of poll figures quoted by CS above, and according to how nervous his bankbenchers may feel facing the wrath of the voters at the next election.
Those poll figures suggest to me that Howard may discover a compelling argument for deciding that “big” business starts at a number considerably less than 100. Back to his original 20 perhaps?
The figure that Howard finally picks may turn out to be more accurate as an indication of voting intentions than all of the scientifically constructed opinion polls.
cs,
Chris Corrigan and the MUA have come to a new ‘understanding’, as will we all under new IR rules. In 5yrs time we can all ask the question we can ask today of those so vehement opposed to things a few years ago- Are you in favour of Roll-back now?
Big Biz and big unions go hand in hand with cutting edge technology, economies of scale, or high barriers to industry entry, which they both enjoy the spoils of. If you can get a govt monopoly together, then so much the better(a la old featherbedded wharves)
Chris Corrigan and the MUA have come to a new ‘understanding’
Er, I dare say Corrigan came to a new understanding, which is that unions are not against increasing profitability, if their members are given a fair share.
Katz, You know Howard always puts out an ambit claim with the junior officers and then the old general comes riding out of the sun to save the day for all. 100-50-20? these things are malleable.
We’re on the same page Observa.
Ex-Anon says “Unions are fine when protecting the (reasonable) conditions of workers. But that battle was won a long time ago”
So is the two dollars an hour paid to outworkers in the textile industry reasonable? By third world standards they are, but if we want Australians to be able to live decent lives then I would argue not. Granted the TCF situation is the exception not the rule today, but rather harsh conditions are more common than you might think.
The real question though is, how much more common will they become once the laws get passed. I’m not qualified to answer that, and it probably depends on global market conditions (when the economy is going well and unemployment is low few employers can get away with much). However, I’ve seen enough cases to know that in some industries, the problem is too little union power not too much.
My comments sit in JQ’s moderation queue too long for this to be much fun.
Adieu folks.
x-anon,
You said, “Unions are fine when protecting the (reasonable) conditions of workers. But that battle was won a long time ago.”
Unions are still active domestically in monitoring and ensuring compliance with basic health and safety laws. Without unions the number of breaches would likely increase.
Unions are campaigning internationally for basic work conditions. It is a battle yet to be won. One of the central planks of unionism is worker solidarity – doing away with Australian unions would have a negative impact on work conditions internationally.
I find the idea that we should do away with unions because the battle has been won to be poorly conceived. Many western institutions have ‘won’ their battles – over the centuries the courts and legal sector have won the battle for rule of law in Australia, should we do away with them? Laws are a burden on many companies afterall. The police have vastly improved law and order over the past couple of hundred years. Cut. We haven’t really needed our military for a while. Cut. Civil rights lawyers in the USA ‘won’ their battle in the sixties. Cut. I guess it fits with your libertarian streak…
cs,
The ‘new understanding’
equalsmay (I do not want to get sued) consist of the old understanding – we give you industrial peace, you give us higher wages than we deserve and you stiff the people trading through the wharves. If industrial peace is bought at the price of lower trade it is not worth it.Andrew, it’s a big argument that I’m not inclined to get into here (you can find some good articles on the ‘trade’ aspect in Prof Q’s archives). Let me say in passing however that it strikes me as counter-intuitive when the achievement of union objectives (better wages and working conditions) is held up as an argument against them. Unions are fine, provided they don’t work!
It’s just neo-puritan religious dogma for some people, cs. Facts and analysis aren’t necessary to support any of it, and the people who question it are heretics.
Just a minor factual point:
Mark Bahnisch Says:
stoptherubbish Says:
Mark, 23% is the number for Queensland. stoptherubbish is correct about the federal number being different for each award.
For those not aware of it, it is worth looking at the recent Senate Committee report into this issue (at http://www.aph.gov.au/Senate/committee/eet_ctte/unfair_dismissal/report/index.htm). Obviously it has its partisan elements, but it does explore the ‘evidence’ for the claims that significant amounts of jobs would come from scrapping protections against unfair dismissal.
Gentlemen, we won’t have to worry about the impending IR laws if Australia does not extract itself from the politics of the Middle East. In addition, now with the US of A taking on China, our problems are only just beginning, because guess which “side” we’ll be on. The fact that Australia no longer has a viable manufacturing industry (it is all in China!) means we will be caught between a rock and a hard place to defend ourselves. Weapons, clothing, shoes, computer gear…..ah, but we’re very very lucky, we still have Mr Howard directing traffic!