I’ve been a bit rushed and I haven’t had time for a thorough check of all the donations to the Global Fund Appeal However, I’m very happy to report that thanks to the generosity of contributors who gave more than they had promised, the total amount donated to Medecins Sans Frontiers exceeds $A1000. Thanks again to everyone who took part.
Etiquette tips, please
The Fin reprints this piece from the New Statesman by Nick Cohen
I think you can smoke in the Groucho[1], but you can’t in Waitrose or at any Islington dinner party I’ve been to in the past decade. The social taboo against smoking is becoming absolute, in the middle classes at any rate … it is social death to put a cigarette in your mouth, not to stuff cocaine up your nose.
I’m obviously out of touch here. I thought it was de rigeur to go to the bathroom to snort cocaine, and to go out to the porch to smoke. But now I fear total embarrassment at my next middle-class dinner party: obviously I should have the cocaine served at the table. Can anyone give me more details here – are individual salvers the way to go, for example, and is it OK to ask guests to bring some of their own?
The 7 per cent solution
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[1]. 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.
Creeping capitalism
In today’s Fin (subscription required), Sinclair Davidson tries to resuscitate the claim that Australian taxpayers are suffering from severe bracket creep, a claim I refuted in my piece last week (over the fold). The case is so thin that he spends half of his article restating a version of the claim I’d already refuted, before admitting that it is spurious (this is the claim that the abolition of the old 66 per cent rate, by making 47 per cent the new top rate, put more people into the top tax bracket. While this is trivially true, it’s also clear that this change was the opposite of bracket creep).
Davidson’s second argument, involves an interesting redefinition of the terms of debate. The standard approach has been to look at either the real income level or the proportion of average weekly earnings at which the top rate is payable. The real income level has risen over time and the proportion of average weekly earnings has been roughly stable. Davidson instead looks at the proportion of taxpayers paying the top rate. Obviously, if pretax incomes become more unequal, as they did over the 1990s, this proportion will rise, and this is what he finds.
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Not an appealing judgement
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[1], 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.
You can’t keep a good lie down
The long-discredited Oregon petition against global warming seems to be getting another run – presumably it is circulating somewhere in the wilder reaches of the blogosphere. Miranda Devine gave it a run in yesterday’s SMH, in a piece loaded with errors and inventions.
Her basic complaint is that efforts like the Oregon petition, Lomborg’s Copenhagen Consensus and so on, are unfairly attacked by greenies. Leaving aside the fact that these dishonest stunts deserved to be attacked, Devine is the last person who has any right to complain about excessive vitriol in debate. She can dish it out, but she can’t take it, apparently.
(Re)defining low interest rates
I was watching Costello discussing the likely increase in interest rates on the news last night and he said something “Whenever you have a single digit in front of your interest rate, it’s low”. I couldn’t see a reference to this in the papers today, and I wonder if any readers can locate a transcript or similar.
This is all relative of course. My first home loan was at 9.5 per cent and that was considered outrageously high. For those who experienced the economic management of Howard and Keating in the 1980s, such a rate came to seem amazingly low. But with the levels of indebtedness prevailing now, I’d have thought 9.5 per cent would be ruinous for many.
Monday Message Board
It’s time for the regular Monday message board, where you are invited to post your thoughts on any topic. Regular reader Nicholas Gruen has suggested that we discuss the possibilities of a single party holding government nationally and in all states and territories. I’ve taken the liberty of posting some of his message as a discussion starter.
Civilised discussion and no coarse language, please.
Iraqi election futures
In the weekend edition of the Fin (reproduced here), Justin Wolfers writes about a betting market on the Iraqi election turnout, run by the Irish betting exchange Tradesports. The bet turned on whether turnout would exceed 8 million and was roughly even money before voting began. The price of the contract rose sharply on early reports of turnouts over 70 per cent, then fell back again when to around even money when it became clear these reports had little basis. The final official turnout was about 8.4 million.
Attentive readers will recall that something very similar happened in the US election when early exit polls favored Kerry. Modifying an old aphorism to say that “two striking observations constitute a stylised fact”, I think we can now say pretty safely that political betting markets display the wisdom of crowds who read blogs.
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WA Election coverage
If you’re in WA, you’ve got a little more than 24 hours left in which to make up your mind (if my posts haven’t convinced you already). Nic White has comprehensive coverage of the issues. As always, Rob Corr is worth a read as well.
