The idea of the university

Before we get bogged down in the election, I thought I’d do a quick post on this piece that caught my eye. It was a piece in the Age in the long-running dispute between Melbourne University Private and Senator Kim Carr, Labor Science and Research Spokesman. Here’s what caught my eye.

[Carr] claimed five of the 12 research publications MUP had produced up to June 30 this year did not meet Commonwealth Department of Education, Science and Training guidelines and suggested there were doubts about another five.

The university, in its final submission to the committee on Thursday, denied making any false claims, maintained its research report had been properly audited, and said its research publication rate was almost twice the national average (emphasis added).

I thought this must be a misprint. An entire university with 12 publications in a year? I get more than that[1], and so do quite a few other researchers. And how can this possibly be “above the national average?”
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It’s on !

PM Calls Oct 9 poll In the face of such a long-anticipated announcement, I haven’t anything new to say right now, so I thought I’d invite commenters to post their predictions. Any sort of prediction is welcome, but I’ll have a contest for the commenter who can give the most accurate forecast of the number of House of Representatives seats won by the Coalition. The prize, if any, will be announced later.,

Misleading reporting of surveys

A lot of people have pointed to a survey reported in the Telegraph and accepted the misleading interpretation of the results given by the Tele’s Malcolm Farr. First, the results. Of those surveyed, 47 per cent thought Howard had lied on children overboard, 31 per cent did not believe he had lied, and 22 per cent were uncommitted. On a second question, 60 per cent said it would not influence the way they voted, 31 per cent said it would and 9 per cent were uncommitted. The heading is “If PM lied, few care” and the opening para is “A large majority of voters have said the issue won’t influence their polling booth choice – even if they think the Prime Minister didn’t tell the truth.” This is wrong in almost every way a survey report can be wrong.
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Howard the spammer

The right wing of Ozplogistan has lined up fairly loyally behind Howard until now. There are plenty of people happy to vote for a liar. But is anyone out there loyal enough to advocate voting for a spammer ?[1],[2]

fn1. OK, it’s Howard’s son who actually does the spamming, but it’s Howard’s money and message.

fn2. While I’m at it, a quick note on my previous post on “legitimate” companies that employ spammers I emailed two of those mentioned (couldn’t find an email address on the website for the third) but got no reply.

I told the witch doctor

From what I’ve seen, lie-detectors are little more than a 20th century version of methods known to witch-doctors since time immemorial. If the subject believes the witch-doctor has the power to detect lies, they will give themselves away with cues that can be picked up by an alert human or mechanical observer. So when Mike Scrafton volunteered to take a polygraph test to show that he was telling the truth and the PM was lying, I didn’t put too much weight on the results. (As a way of keeping the story alive, and dramatizing it for a big TV audience, it was great, though). I wasn’t too surprised when Howard dismissed it as a gimmick.

But following a letter in yesterday’s Fin, I’ve discovered that the Howard government actually takes lie detectors very seriously, and has been trying them out in ASIO .This is being done, at least in part,at the behest of the US

On June 25 [2002], the Foreign Minister, Alexander Downer, signed a new, legally binding, pact with the US to protect classified information. Although no details were spelled out in the pact, the US wants Australian officials who have access to highly classified US intelligence material to be subjected to the same polygraph tests that routinely apply to American officials.

Whatever the merits of integrated defence in general, in this case I think we’d be better off hiring some witch-doctors.

Bail for asylum-seekers

In response to previous posts on asylum seekers, various commenters have suggested that there is no alternative to our current brutal policies, including the detention of children. A striking feature of these comments is that they treat the problem as if it is utterly new and unprecedented. In fact, we have lots of experience in dealing with people subject to judicial processes (such as criminal trials) and also with unauthorised residents such as visa overstayers.

Looking first at what should be done when someone arrives in Australia without authorisation, and claims political asylum, I’d suggest the obvious model is that of bail for people accused of criminal trials. That is, asylum seekers should be allowed to remain at liberty unless it can be shown, on the balance of probabilities, that they are likely to abscond or that they represent a danger to the community/

The comments seem to take the view that this is unacceptable because, inevitably, some people will abscond. But they don’t, I assume, take the same view in relation to criminal offences. At this moment, there are thousands of people at large in Australia who have outstanding warrants for offences ranging from speeding to crimes of violence. These people represent a much greater threat to the community than do illegal immigrants. But no-one suggests that everyone charged with an offence should be locked up until they have been tried.

And even within the category of illegal immigrants, there are tens of thousands who have jumped the queue the easy way, by overstaying a tourist or student visa. Most, though not all, of these turn up in the end, but quite a few manage to squeeze into one of the legal categories, for example by marriage.

If you read the discussion of this issue from supporters of the government, the general impression is that even the slightest breach in our immigration policy would be a national catastrophe, and that to avoid such a catastrophe we are justified in the kind of extreme measures we have seen, things that would normally be rejected outright in a democratic society. This is simply untrue, as should be obvious when you consider comparable issues like bail or proceeding by summons for (alleged) criminals.

This is only part of the issue, the other part being our general policy on refugees, which I will discuss in a later post.

The other deficit

I was looking at the latest US trade figures from the Bureau of Economic Analysis and thought, rather unoriginally, that this is an unsustainable trend. Despite the decline in the value of the US dollar against most major currencies[1], the US balance of trade in goods and services hit a record deficit of $55 billion (annualised, this would be about 6 per cent of Gross Domestic Product) in June. The deficit has grown fairly steadily, and this trend shows no obvious signs of reversal, at least unless oil prices fall sharply.

This naturally, and still rather unoriginally, led me to the aphorism, attributed to Herbert Stein “If a trend can’t be sustained forever it won’t be”. Sustained large deficits on goods and services eventually imply unbounded growth in indebtedness, and exploding current account deficits[2], as compound interest works its magic. So, if the current account deficit is to be stabilised relative to GDP, trade in goods and services must sooner or later return to balance or (if the real interest rate is higher than the rate of economic growth) surplus

But forever is a long time. Before worrying about trends that can’t be sustained forever, it is worth thinking about how long they can be sustained, and what the adjustment process will be.
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Gold for Gold

I was talking with colleagues yesterday about the economics of the Olympics of the medals and speculated that, with the East Germans gone, we spend more to enhance our chance of winning gold medals than any other country. This morning I received, from Jack Strocchi, a column on the topic from Andrew Bolt which makes exactly the same claim, giving an estimate of $50 million in public expenditure per gold medal.
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FTA vs PBS as the election issue

It’s looking increasingly possible that the conflict between the Pharmaceutical Benefits Scheme and the US-Australia Free Trade Agreement will become the central issue of the election. It is also increasingly apparent that, contrary to all the reassurances we got when the agreement was announced, that the FTA and the PBS are in mortal conflict, and that only one of the two can survive.

Today’s developments include a statement from US Ambassador Schieffer that the US may not certify that our legislation implements the FTA and more commentary from sources close to the government, all suggesting that this is a really big deal.

Reading Christopher Pearson’s column in particular, it is notable how thoroughly it undermines the claim that the FTA presents no danger to the PBS. He talks about the remedies available to the US in relation to Labor’s amendments. In addition to the possibility that the Americans will walk away from the agreement altogether, he points out two further possible courses of action.

The second aspect of the amendments likely to cause concern is that trade agreements are negotiated on the basis of “standstill”. In other words, once an agreement is reached, the parties are expected not to introduce legislation that would alter their relative positions.

Finally, the Americans could argue that the amendments are likely to give rise to a dispute under the “reasonable benefits” clause, in the event that their drug companies are unable to realise benefits that they anticipated would flow from the agreement.

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 correct[1], 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.

It is critical, in both policy and political terms, for Labor to hold its ground. Even without the threat to the PBS, this was a lousy deal. If the Americans refuse to certify, Labor should announce its intention to renegotiate the entire deal, this time on equal terms.

fn1. Pearson is clever and well-informed, but he’s never shown any previous knowledge of international treaty law. In the absence of references to independent experts, I think it’s reasonable to take these claims as coming from sources inside the government.