24 thoughts on “Monday Message Board

  1. Malcolm Turnbull’s ban on ministers bonking their own staff leaves the door open to them bonking each other’s staff, either casually or as part of an organised swinging staff swap. They could even have a 70s style key party and not breach the new rules.

  2. Tricky argument will be she[probably] was part of a party pool not the “Member’s staff” please forgive the potential puns.

    Like the travel allowance particulars if you do not define relationship clearly and similarly the penalties for breaching them the whole system of codes of conduct is a joke. Do not forget Peter Slipper who was prosecuted for breaching travel allowance guidelines. Though initially convicted was dramatically acquitted on appeal as there was a lack of sufficient definition of entitlements. This sleaziness to which Malcolm is a party rots the core of his governance.

  3. my “sin”cerely held beliefs excuse whatever double standard i think i’m entitled to get away with

    and

    any one who dares disagree is fair game.

    greenie punks?

    god bothering (sorry) fearing with “family values’n bullets”

    that creepy 80’s vibe.

    rant!

  4. Something that struck me about an hour back thinking about a point raised a bit back by Nick Rowe on perfect price discrimination a bit back

    http://worthwhile.typepad.com/worthwhile_canadian_initi/2018/01/the-inefficiency-of-perfect-price-discrimination.html

    [read the article, but the key conclusion is summed up as: “It’s like if you won the lottery, but everyone knew you had won the lottery, and would be prepared to pay more for the goods you buy, and so raised prices to capture nearly all of your extra consumer surplus. Your lottery ticket wouldn’t be worth very much. Only you have to work extra hours to get a winning lottery ticket. So it’s not worth it, because you don’t like work. So nobody works. So nothing gets produced. So it’s not efficient.”]

    Now… apply this logic to housing. Rent and sale transactions are small enough in number that you can put the effort into fine-tuning the prices for each of them, and the determiners of ability-to-pay are fairly widely known.

    So in housing we can get a damned fine approximation of perfect price discrimination. And that means that housing will rise as high as people are willing to pay… which given that you need some form of housing to live, will be… everything.

    We cannot run housing through markets. It will literally destroy the entire rest of the economy. And competition doesn’t help. They might be competing, but they all want to charge the most you want to pay and that’s the same for each of them. And… the chief determiner of price under this model isn’t the quality of the service you pick but your ability to pay for it: a rich person might try “downsizing” to a smaller house, but the landlord/vendor is under no obligation to charge less for it].

  5. @Smith
    So what? The problem with sex within a hierarchy is the hierarchy. Abuse of power is an omnipresent risk. It scarcely arises with somebody else’s subordinate. Well, it could if the dishy intern was trussed up and giftwrapped for a colleague, but that is fantasy not reality.

  6. @James Wimberley

    It would still be within the same organisation. They all work for Malcolm Turnbull, ultimately. The AFL last year sacked two executives for having relationships with young women who worked in the AFL. Neither worked directly to the men with whom they were in a relationship.

    The problem with writing down rules in situations like this is that either they can never cover all the relevant situations or they are so general they become open to interpretation with each case.

  7. @david
    Peter Slipper was acquitted on appeal, because the prosecution presented no evidence about what he did, in company with a staffer, on the relevant trips to Murrumbateman area wineries. The problem for the prosecution wasn’t lack of definition of entitlements: it was lack of evidence that Slipper had not engaged in (sufficiently) work activity.

    It’s hard to know whether the prosecution didn’t consider the need to establish what Slipper did, or whether they knew and chose not to offer that evidence.

    The argument that using paper CabCharge dockets, and using more than one for a round trip, was fraud was a narrow technical argument. Is this failed argument what is now suggested to show a lack of definition of entitlements? But the travel entitlement is the same, however it is arranged or paid.

    Bronwyn Bishop’s helicopter ride from (legitimate) business in Melbourne to (exclusively partisan) Party function in Geelong and back, went unprosecuted. But there, too, there’s no ambiguity or uncertainty in the definition of entitlements. Partisan or party business was then, and is now, expressly excluded from counting as work activity giving rise to travel entitlements.

    The problem with the entitlements is like the problem with Barnaby Joyce’s staffers transfer and promotion. It’s refusal to apply the rules, not uncertainty about what the rules are.

  8. Point taken BUT:-
    Absent the evidence of Inge and Knapp the Court on appeal said though no adverse inference could drawn against either Slipper or the DPP and as such the circumstantial case may still accommodate the possibility of “Parliamentary business” being undertaken.

    The evidence at para. 32 was that 1. “Parliamentary business” was not defined by the enabling Determination and per Mr. Miles in practice it was really left to the individual MHR if what was undertaken was parliamentary business. I feel a ludicrous situation. cf no definition of “partner” n Malcolm’s Code of conduct

    per the Court at para. 58 “.. it is not possible to give a definitive meaning to the term.”

  9. @david
    That’s to say, had evidence been presented there might have been an issue about what is ‘parliamentary business’. Sure: and there might not (that is, on the facts, the court might have decided that whatever theoretical uncertainty there might be about some aspects of ‘parliamentary business’ there was no uncertainty about applying the term to what actually happened).

    There’s never a bit of regulatory or legal drafting that has no uncertainty or ambiguity. The practical question is whether there’s an uncertainty or ambiguity that renders the drafting unusable. That’s a question that requires identifying what use you want to make of the drafting, and how the drafting allows (or precludes) that use.

    Of course, any drafting at all will do if you won’t apply it or seek the facts on which application would depend.

  10. @Collin Street

    The post you linked to is interesting but your argument is inconsistent with what is probably the most fundamental stylised fact about housing markets—something which is true in Australia and broadly characteristic of other developed countries—that real rental prices are essentially constant overtime. They fluctuate a bit, but they don’t trend upwards. (They also rise in some locations and fall in others as the relative desirability of different places changes.) To the extent that renting is a substitute for alternative ways of consuming housing, rental prices are a valid indicator of housing costs more generally. Households’ willingness to pay for housing certainly increases a lot over time as incomes rise, but increased real expenditure almost exclusively takes the form of increased housing consumption.

    ‘Would like to capture the entire consumer surplus but face competition’ characterises all competing firms.

  11. Slipper v Turner [2015]ACTSC 27.

    Paragraph 57. “.. to express it figuratively, you cannot reject the proposition that evidence will not fit into a particular mould unless you know the shape of the mould.”

  12. @Luke Elford

    “… real rental prices are essentially constant over time”.

    Given the large rise in real prices of houses, flats and apartments in the last 30 years, from about 3.5 times average annual gross salary to at least 7 times, it is hard to believe that rents would remain flat in real terms. If they have done so where is the incentive to own real estate for rent? It could only be in the capital gains (and negative gearing) expected. Some set of people is still paying, in taxes and opportunity costs, for this transfer of wealth to landlords.

    The real costs of an increasing tenant/landlord system to the entire community, other than to the rentiers themselves, has risen. It represents a transfer and concentration of wealth under capitalism. Bourgeois economic analysis fails to uncover this or deliberately obscures it.

    Footnote: Real Rental prices are are also not constant, or equivalent, over geographical spread. Average rents can range from about 20% of average wages in regional areas to about 40% of average wages in Sydney. But let us put that aside and look at the your basic proposition.

  13. Local government and police protection… for Adani!?
    “Anti-Adani documentary screening axed for safety reasons, not politics, council says”
    “abc.net.au/news/2018-02-21/council-denies-politics-behind-axing-of-stop-adani-documentary/9468218”
    Beside farcical I am tending towards another f word. Fear. For all sorts of reasons.
    Has anyone seen the doco? If we can’t safely show a doco, good bad or indifferent I too fear what is happening in Australia.
    https://chuffed.org/project/stopadani-film/

  14. Ikonoclast prices reflect, inter alia, borrowing costs. And borrowing costs have nosedived, so prices have soared. But when borrowing costs are low then for exactly that reason the prospect of investment returns in the form of capital gains are excellent and the need for huge cash flow to cover the borrowing less urgent; investors will happily live with a lower rental return rate. Bottom line: residential sale prices are tightly and inversely correlated with interest rates but residential rents far less so.

    As a proportion of incomes and adjusting for quality, rents have not in fact risen much in most of Australia in recent decades, and in some cities have actually fallen. We don’t all live in inner Sydney or Melbourne.

  15. Given the large rise in real prices of houses, flats and apartments in the last 30 years, from about 3.5 times average annual gross salary to at least 7 times, it is hard to believe that rents would remain flat in real terms.

    It’s actually substantially stupider than that.

    The post you linked to is interesting but your argument is inconsistent with what is probably the most fundamental stylised fact about housing markets—something which is true in Australia and broadly characteristic of other developed countries—that real rental prices are essentially constant overtime. They fluctuate a bit, but they don’t trend upwards. (They also rise in some locations and fall in others as the relative desirability of different places changes.) To the extent that renting is a substitute for alternative ways of consuming housing, rental prices are a valid indicator of housing costs more generally. Households’ willingness to pay for housing certainly increases a lot over time as incomes rise, but increased real expenditure almost exclusively takes the form of increased housing consumption.

    Or:
    + because real rental prices are regarded as not changing, this means they haven’t changed
    + real rental prices can be regarded as a good proxy for total housing costs
    -> Essentially — literally — “everyone says that rents don’t change so you must be wrong”.
    Paragraph 57. “.. to express it figuratively, you cannot reject the proposition that evidence will not fit into a particular mould unless you know the shape of the mould.”
    Also, I’m just going to note this here.

    Also, it’s worth having a look at this one. One of my sentences is “They might be competing, but they all want to charge the most you want to pay and that’s the same for each of them”; this is a declaration that competition is irrelevant. I mean, I could be wrong on that point, but it’s certainly doesn’t express any agreement on my part that competition is a significant limit on behaviour.

    In that context, this line
    ‘Would like to capture the entire consumer surplus but face competition’ characterises all competing firms.
    … is kind of difficult to justify, no? The quoted parts are — because quoted — imputed to me, when in fact my belief is explicitly stated to be different. It’s hard to avoid the conclusion I’ve been comprehensively misunderstood.

  16. @david
    The Court was not saying, and did not say, that ‘parliamentary business’ had no meaning and could not be tested.

    Slipper v Turner [2015] ACTSC 27 at para 60: ‘A journey will be for the purpose of parliamentary business where it is for the purpose of conducting a meeting, no matter how brief, relevant to the business of the Parliament or the MHR’s duties as a parliamentarian. A journey will also be for the purpose of parliamentary business if its purpose is to obtain information relevant to some issue before the Parliament, or to the MHR’s role as a parliamentarian. From the evidence of Mr Miles at [32] above, it appears that such a purpose will extend to travelling with a staffer to conduct a meeting with the staffer at a location other than Parliament House. It is a matter for the MHR to judge whether that was necessary or appropriate. There is nothing in the Determination or in the Members Handbook to suggest that there is some requirement for a MHR to only conduct parliamentary business in offices provided at Parliament House.’

    That is, we know (pretty well) the shape of the mould.

  17. Important update here by Beerling et al (including James Hansen as clickbait) on enhanced weathering as a carbon sequestration strategy – no paywall link:
    *****www.nature.com/articles/s41477-018-0108-y.epdf?author_access_token=w1xYBFb3g3BwKnjkBD1cJtRgN0jAjWel9jnR3ZoTv0NSaZpth7Zz94N6_lHXNgths4xErTsML30mZS8Ql0FCuzY9k6ePi5nMsoEvmCXoU5g65l-c0C09tp3iWQMGMdfvbuwlRhm5_snv9tqy8Kc6ig%3D%3D
    (H/t Steve Hanley at Cleantechnica.)

    It’s a development from Schuiling’s original proposal using olivine. The basic chemistry is the same. They recommend using other basaltic rocks, which allows spreading of finely crushed rock to farmland. This is already done on a small scales. and has substantial benefits to soil quality.

    Australia gets a mention:
    “Such a changed nutrient balance could also beneficially preserve or increase downstream food web and fisheries production because diatoms are the preferred diet of pelagic and benthic grazers, mostly copepods and bivalves, and increase marine biological CO2 drawdown and storage with economic benefits in particular regions. For example, the Great Barrier Reef is adjacent to the main sugarcane growing regions in Australia, where adding crushed basalt to soils may not only enhance sugarcane production, but also improve runoff and ground water chemistry while countering ocean acidity via the addition of alkaline leachate.”

    This al needs real research money, big field trials, and Action This Day. Find it by turning off the tap on research on nuclear reactors, coal plant CCS, and wave power, all dead ends. Sentimentality stops me from adding fusion.

  18. @Collin Street

    I’ve spent some time trying to compose a reply but I can’t because I don’t understand what you are disputing.

    Are you disputing the evidence regarding rents? You can check for yourself by downloading the CPI data from the ABS and dividing the rent index by the all groups index. There’s some fluctuation in real rental prices—for the capital cities combined, they’ve been falling since 2015 after rising sharply between 2006 and 2013. But there’s no long-term upward trend that parallels income growth as implied by your theory of perfect price discrimination.

    Or are you arguing that this evidence is not inconsistent with perfect price discrimination in the rental market? If so, you’ll need to explain further.

  19. @Ikonoclast

    The increase in housing prices that you refer to in part reflects increased housing consumption, but yes, the rental yields that investors are willing to accept have fallen a lot, so the cost of renting a given dwelling has only increased a bit—15% between the end of 1987 and the end of 2017 for the capital cities on average. Whatever the role of tax policy changes in Australia, it seems unlikely that they account for all or even most of the reduction in rental yields, since similar declines in yields have occurred in many other developed countries.

    Apart from the reduction in interest rates that DD referred to, as location has become a more important factor affecting rents and prices, a greater share of the value of housing has become a pure locational premium. Dwelling structures and neighbourhoods have running costs, depreciation costs, and will need to be improved if rents are to increase in line with household incomes; home owners, including investors, must pay for these costs directly or through rates. But the locational premiums that tenants are willing to pay are pure economic rents; moreover, they can be expected to increase at least in line with household wage income. They are thus a growing perpetuity whose current payment is capitalised at a discount rate of r – g. Moderate differences of, say, $100-$200 a week in how much renters are prepared to pay for a typical metropolitan versus non-metropolitan location—which make sense in terms of differences in wages—can easily have a present value of hundreds of thousands of dollars.

    A lot of debate about housing in Australia comes down to the question of who captures these locational premiums and the role of monetary policy in affecting their present value.

  20. @Ikonoclast

    Yes, rents vary a lot spatially, though less than housing (asset) prices. It makes sense for them to vary with wages, but we shouldn’t expect them to vary one-for-one with wages. Other things being equal, we should expect variation in nominal incomes (for a worker with given characteristics) to be matched by variation in the price level so that real incomes are constant across space. But housing is only one element of expenditure, and housing costs only one component of the price level, and other prices don’t vary nearly as much across space. So, rents should be expected to vary more than one-for-one with wages.

    What happens to rental expenditure, however, depends on how people respond to higher housing costs—responses might include occupying smaller dwellings or sharing dwellings with more household members. According to the most recent (2015-16) edition of the ABS publication ‘Housing Occupancy and Costs’, on average private renters in Sydney spend 21% of their gross household income on housing, which is the same as in the rest of NSW (if medians are used instead, the percentage is 24% in both cases).

    At the national level, the share of income that private renters spend on housing has been roughly constant for at least the past 20 years, varying within the range of 18-21%.

  21. It appears that Barnaby Joyce is about to resign as Deputy Prime Minister and leader of the National Party. If so, he will have learned the hard way a lesson that most people learn as children, which is that actions have consequences.

    It is a lesson he can contemplate as he lives his life as a backbencher with his baby and his baby mama, after his to-be ex-wife is awarded five sixths or so of the marital assets, and a good chunk of his (much reduced) income.

  22. Tony Windsor was correct both for NZ Baanarbeee and UK Clownshoes.

    Now we have section 44 Gillespie being touted as Leader of the Nationals.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

w

Connecting to %s