Crying poor

The Queensland government has cited an alleged financial crisis as one of its spurious justifications for the sale of public assets, but apparently it can find a spare billion or so to spray on yet another sporting event which will almost certainly return little or nothing in revenue. I had my say on the Commonwealth Games bid here and here. The ABC story includes Treasurer Andrew Fraser’s admission that the proceeds of the asset sales, which were supposedly going to finance schools and hospitals, are the source of this luxury expenditure.

I’m happy to say that on this occasion I was accurately quoted in the Oz. The reporter Roseane Barrett did her job properly, and there was no editorial interference, presumably because the story was critical of a Labor government.

41 thoughts on “Crying poor

  1. It will cost a lot more than “a spare billion or so”. The official cost of the Delhi games is US$2.5 billion but according to the Indian business magazine Business Today the real cost is US$15.47 billion (Source: Wikipedia). Now it’s true that, unlike Delhi, Brisbane already has most of the facilities but given the desire of games host cities to out do their predecessors, the cost is likely to be huge.

    I guarantee that if this bid goes ahead the Queensland government will commission a study which will show that the net economic benefits of staging the games will be strongly positive. I also guarantee that this study’s methodology will be, in effect, to assume the answer.

  2. If anybody wants to know about a Privatisation disaster involving rail, you don’t have to look far.

    New Zealand – Privatised. Private company ran down assets to the point where much of it was almost worthless. Government had to renationalise and reinvest at enormous cost.

    Tasmania – Rail run down so badly, government had to take it back and ask Queensland Rail’s engineers to come down and fix their track.

    Melbourne – A great deal of rotting timber sleepers, un-tensioned overhead wires and trains that turn off in hot weather and an on time running (OTR) of about 82%. RailCorp (Government) in NSW is 95%+.

    Great Britain – The greatest disaster of them all.

    In 1994, the number of passenger kilometres travelled was 28.8 billion.
    In 2009, the number of passenger kilometres travelled was 50.3 billion.

    An increase of 76.6%.

    Public subsidies in 1993/4 were £1,627m ($2,430.00 in 2008 terms adjusted by RPI)
    Public subsidies in 2008/9 were £5,212m

    An increase of 114.5%

    In 2007, the subsidies reached a peak of a whopping $6,308m.

    Then there was the disaster of RailTrack. Someone thought it would be a brilliant idea to be a infrastructure operator without adequate engineering skills within the organisation. After the Hatfield disaster, nobody had any idea how much of the network at risk. They more or less shut down large parts of the network or simply slapped on speed restrictions. Their profits turned to losses, and RailTrack asked the taxpayer to bail them out. The government had to eventually nationalise this giant disaster.

  3. @Alice

    It is not surprise to me…the real question for the US is how much real unemployment, ie people who want to work fulltime or as close to that as possible, is hidden among the unemployed running down savings, underemployed using undeclared income (cash in hand) to make it through a week, as well as those on the limited US unemployement benefit?
    I think it was 25% in the Great Depression for one of the years – yes, 1932 according to the book by Eric Rauchway, The Great Depression & The New Deal: A Very Short Introduction, Oxford University Press (2008), first paragraph on page 1!

    However, anything over 15% unemployment has to cause noticable social changes as much as economic ones. People lose lines of credit and also become very shrewd in the use of the lines of credit still available – eg, they buy goods on a credit card on a particular date to maximise the length of “free credit” before paying off the card in full at the end of the interest free period. Still others repair rather than replace clothing, put up with old worn furniture, and don’t watch payTV ad channels. Instead, they use computers for entertainment, or their i-Phones or i-Pods, assuming they already own one. Libraries regains their old membership rates through renewed interest in borrowing, rather than buying, new books. The nearest equivalent period, the aftermath of the Great Crash in 1929, people who were not even shareholders took the plunges of the stockmarket as a proxy for their own financial security, and acted accordingly. As Rauchway reports (pg 19):

    Facing a dubious future, Americans made important decisions not to buy. Particularly, they stopped buying the expensive durable goods like cars that they had learned to buy on credit. Each signature on and installment-plan contract represented a consumer’s prediction about his or her ability to pay in the future. Suddenly Americans no longer felt able to see far enough ahead to make sound forecasts. Within a few months of the crash new car registrations had fallen by almost a quarter of their September number. In 1930 spending on consumer durables fell by 20 percent. Factories closed and banks failed. Unemployment more than doubled its 1929 level.

    It is worth remembering the mad scramble to “save” car dealers and manufacturers in the first Rudd Labor government, and the utter failure of the opposition to appreciate the perils Australia was facing. Our current two-speed economy stands testiment to the Lib/Nat opposition’s incredible inability to learn from the pages of history, perhaps because they believe they are entitled to rule Australia rather than afforded the occasional privilege by the Australian voter. Some humility wouldn’t be amiss if tried out for size by the opposition – Tony Abbott the clown excepted.

    Still, after the two really bad years of the Great Depression, the growth rate of the US economy was nothing short of amazing: 8% growth per year from 1933–37 and 10% a year from 1938-41 (see last para, pg 5, Rauchway 2008). Unemployment returned to 1929 levels (pre-crash) in 1943, although it was trending downwards well before the Second World War began (ibid, pg 5). I haven’t checked, but IIRC the Dow returned to 1929 levels first in 1955. Perhaps someone could check it out; anyway, the real economy took until the middle of the Second World War to have unemployment back down to pre-crash levels, and that doesn’t account for the effect of war-time military drafts of the coercive kind. Starve on foodstamps or get a modest income and three square meals a day (until the fighting starts for your platoon, of course); not much of a choice for an long-term unemployed American.

    Getting away from that and focussing upon Qld, they are a major source of our coal for export. Unfortunately, climate scientists like Jim Hansen make a compelling case for why any response to our feeding of GHGs in the atmosphere must include leaving nearly all of the known coal reserves in the ground. Tony G and El Gordo are no doubt falling off their respective chairs upon reading this, so I’ll provide the quote sand references to them:

    Secondly, the belief that ice sheets are inherently lethargic is based mainly on the average rate which they grew and decayed during Earth’s history. The overal size of the ice sheets grew and decayed over tens of thousands of years. But the ice sheets responded so slowly because that was the time scale for changes to Earth’s orbit – the time scale for the forcings that caused ice sheets to grow or melt.These slow orbital changes imply nothing about how fast the ice sheets would respond to a rapid forcing.

    the paleoclimate data indicates that ice sheets are able to respond rapidly, with large changes in a century. Sea level 13,000 to 14,000 years ago rose at a rate of 3 to 5 metres (10 to 17 feet) per century for several centuries.

    [James Hansen, pp 142–143, Storms of my Grandchildren, Bloomsbury (2009)]
    In other words, as I have highlighted in bold and/or italics, it is only relatively recently that scientists have (approximately, but within physical constraints imposed by the data) settled the question of just how rapid a response might be expected from a given forcing, in so far as the north and south polar zones go. And it isn’t a good picture at all, in spite of the IPCC’s decision not to include such data (yet). As Jim Hansen says further on in his book [Hansen, pp 161–162, ibid]

    The natural source and sink^[for carbon dioxide] can be out of balance, such as when India was cruising through the Indian Ocean, by typically one ten thousandth of 1ppm per year. In a million years such an imbalance changes atmospheric carbon dioxide by 100ppm, a huge change.
    But humans, by burning fossil fuels, are now increasing atmospheric carbon dioxide by 2ppm per year. In other words, the human climate forcing is four orders of magnitude – ten thousand times – more powerful than the natural forcing.

    With regards to methane hydrates, the leading contender for several “rapid” interglacial warmings, Jim Hansen and others now believe (in the scientific sense of the word, not theological) that methane releases are a nonlinear feedback from natural forcings. To quote [Hansen, pg 162, ibid]:

    Unfortunately, paleoclimate data now unambiguously point to the methane releases being a feedback. If the PETM^[the Paleocene-Eocene Thermal Maximum, a rapid warming of at least 5 degrees Celsius] were an isolated case, that interpretation would be less certain. But it has been found that several PETM-like events in the Jurassic and Paleocene eras were, as with the PETM, “astronomically paced.” Huh? Tha means the spkes in global warming and light-carbon sediments occurred simultaneously with the warm phase of climate oscillation by perturbations in Earth’s orbit. In other words, the methane releases occurred at times of natural warming events.

    Hansen’s book is quite useful for the layperson – it is his attempt to synthesise his reasons for thinking that business as usual (BAU) is going to lead to inevitable rapid environmental change/challenges affecting a huge proportion of our planet’s biosphere, not the least of which includes us. He gives five clear points as to why we must aim for a 350ppm carbon dioxide target, which is already below the current atmospheric carbon dioxide content (around 390ppm). On page 174 Hansen has a graph (Figure 22) which illustrates how much of a given fossil fuel has been used, and what the estimated reserves are. We simply cannot get rid of cars overnight (although we may use them less) and coal is a cheap source of industrial heating, especially in metal production. It is certainly feasible to switch from coal to another carbo-rich heating sources

  4. @Donald Oats
    Don the sad truth is also that if they measured unemployment in exactly the same way they did during the great depression – it is already at 20% or around that mark. Thats the ting most people dont realise. Some US states and industry sectors are already even higher at 28% unemployment.

  5. @Ikonoclast

    I disagree with this sentiment quite strongly – I like the modern aesthetic, and I don’t think it has much to do with corporate capitalism, per se. I quite like that hobbity-looking house. It’s more modernist than traditional, though.

  6. BilB :If that is the way that you feel, Ikonoclast, then you might be more interested in this

    A nice cosy hobbit like house! 🙂 Very good. Does it pass building codes for safety? Especially the load bearing members? Otherwise I have no qualms. It’s an aesthetic I could get to like. The problem, as always now, is that 6 billion could not live like that. The planet has about 6 times the population it should have for sustainability purposes.

  7. @Donald Oats

    The clear conclusion is that rapid disastrous climate change is about 90% certain. Exhaustion of non-renewable resources is 100% certain. Our chances of adapting to all this and keeping our current civilization and population intact are functionally zero. Our chances of surviving as a species for another century… about 50%.

    The best scientists know all this. The rest of humanity is in ignorance or denial. Whether it really matters is moot. Personally, I dont think our species is special or important in any way; not in any ecological, evolutionary or cosmological big picture sense. Although I agree that what we thnik and feel on daily basis matters to ouselves. But thinking humanity itslef has some great overarching importance is just humanity’s conceit.

    I find I can think this and yet live existentially day to day. I also notice that despite my misanthropy I am not more cruel and I am considerably less exploitative than the average humans I meet. As W.B. Yates wrote, “The best lack all conviction while the worst / Are full of passionate intensity”.”

    It’s the fervent believers, like market funadmentalists who you need to fear.

  8. Yeah, most but not all, he’s done a self-build housing co-op and a number of houses close to the hobbity house we all liked. I have faint a suspicion I’ll never own a Picasso, but a guy can look)

  9. Ike @34,

    The Simon Dale hobbit house is just a quaint interpretation of the building class called “Earth Sheltered”. You might enjoy viewing the work of this style’s most respected modern proponent, Malcolm B Wells.

    As 90% certain global warming bites hard and people suffer from extremes of heatwaves, fire storms, cyclones, hurricanes, extreme hail, etc, you will further appreciate earth sheltered dwellings. Take a closer look. With this style there can be ultra dense accommodation …and… the green veneer of life that sustains us, along with the birds and the bees as well.

  10. @Alan
    Just had a look and yep that is the one, I reckon. While I certainly couldn’t have afforded that, plenty of people can, but the really interesting fact for me was the amount of the work that the couple did themselves to make it happen. Personally, I’d be pretty happy with a ramshackle cottage on a block with garden and veges, and a broadband – true broadband speeds – connection to said cottage. Stuff the sewage, who cares about boiling hot water or clothes dryers or multiple ovens, etc? A good long verandah with clean air and voila – drying space for the chilies and other fine plant offerings…Na, I’m dreamin’.

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