Statistics are people too


On 20 October, the ABS released its labour force survey data for September 2016. The media duly reported the drop in unemployment from an upwardly revised 5.7% for the previous month to 5.6% but most also picked up that this was largely a result of a drop in the participation rate, from 64.7% to 64.5%.

Firstly, a few explanations. The participation rate was traditionally a measure of all those aged between 15 and 64 (the ‘working age population’) who were ‘in the workforce’ and, of course, owing to students and stay at home parents, and other factors, this would never be 100% — around 70% was usually very good. However, the ABS now uses the total population aged 15 and above which I think can be a little misleading because it encompasses many elder retirees — including over 450,000 people aged 85 and over, who I doubt would be considering work.

‘In the workforce’ includes those who are actually employed, whether full-time or part-time, and those who are unemployed but are looking for and are available for work. So a fall in the participation rate usually means that people have dropped out of the workforce and given up looking for work — at least for now. It should also be noted that to be counted as ‘employed’ a person only needs to have worked one hour in the week of the survey — not what most of us would call ‘employed’ but it is the international definition and the ABS uses it, arguing that even an hour’s work is contributing to the economy. What that does mean is students and retirees who may be working no more than a couple of hours a week are included in the employment count.

The ABS also provides raw figures, ‘seasonally adjusted’ figures and ‘trend’ figures. I will mostly use the seasonally adjusted figures which attempt to smooth out known large variations, such as the number of school leavers entering the workforce at the end of each year and seasonal workers who come and go from employment at particular times. The trend figures can be interesting for what they show statistically in terms of where the figures are heading. Except where otherwise referenced all the data I have used comes from the ABS website, including downloading some of their Excel spreadsheets for more detailed data, so I do not separately reference each of these individual sources.

Having said all that, and leaving aside debate about the quality of the ABS labour force data (which has been questioned), I want to pay attention to what these percentages actually mean in terms of people.

The 0.1% drop in unemployment meant that there were 12,500 fewer people unemployed. That may sound like a reasonable improvement but even at 5.6% the number unemployed is 705,100 and that is a lot of people whichever way you look at it — without including their families. But somehow, the government, the bureaucrats advising them, economists and even most of the media seem to overlook the scale of that number by focusing simplistically on the percentage. That is over 705,000 people whose spending power is limited which not only makes life hard for them but, through reduced consumption, also impacts the economy.

The situation is exacerbated when we consider the long-term unemployed — those unemployed for 12 months or longer. As at August 2016 there were 169,000 long term unemployed (based on ABS data) or about 24% of the unemployed. But in September the Department of Social Security released data showing it had 290,161 long-term job seekers on Newstart Allowance in August. No matter which figure you use, that is a large number of people ‘doing it tough’ for a long time and many of them will have little chance of ever finding suitable work after such lengthy periods of unemployment.

Considering the participation rate is a little more difficult given the way the ABS now calculates it. On their calculation, it would seem that almost 40,000 people have dropped out of the workforce but, as that now includes all people 15 and over, a number of those could be retirees. Focusing just on the working age population, at least 25,000 people (probably more) have stopped looking for work. Not large numbers in the overall scheme of things but significant in terms of the number of people involved.

Employment dropped by 9,800 but that partly hides the fact that 53,000 full-time jobs were lost (part-time employment increased by 43,200). That is on top of the continuing loss of full-time jobs over many months now. While the seasonally adjusted monthly figures vary, including both rises and falls, the trend estimates for full-time employment have been consistently lower for each month since December 2015, suggesting full-time employment is on a downward slide.

The September figure for full-time employment is the lowest since June 2015 and since a peak of 8.217 million in full-time employment in December 2015, 102,000 people have lost full-time work (or 54,000 in trend terms and 271,000 on the raw numbers). In that same time, part-time employment increased by 162,800 but, as this includes all those working one hour or more, much of it may not involve significant hours of work.

Even that is only part of the story. Since July 2014 the ABS has been providing data on ‘underemployment’ in the workforce: this includes those engaged full-time but actually working part-time ‘for economic reasons’ and those employed part-time who would prefer more hours. In the first category, there were 75,900 people, predominantly male (60,800), an increase of 3,700 over the August figure. There were 979,900 part-time workers who would prefer more hours, including about 600,000 females (that was a decrease of about 30,000 on the August figure). That is almost 9% of those employed.

If we add the unemployed, for total ‘underutilisation’ of the labour force, we get 1,760,900 people not able to contribute fully to the economy even though they wish to do so — that is about 14% of the workforce. How can our economy be going well if 1.8 million people are not contributing to production and consumption as much as they could? In economic terms they have less scope for discretionary spending: it is normal that as income falls a greater portion of it has to be spent on essentials, such as food and utilities.

To make things worse, we can also consider the data the ABS provides on those ‘not in the labour force’ (NILF) as it reveals more information about ‘hidden’ unemployment. The most recent data I could find was for 2014 (released in February 2015). A further explanation is required here. In the labour force surveys people are asked if they looked for work in the week of the survey and if they could start within four weeks: if they do not meet those criteria they are classified as not in the labour force. The 2014 NILF figures show 21,700 people who were actively looking for work but could not start within four weeks and another 53,200 who were ready to start work. In addition, there were 851,000 people who wanted work, could have started within four weeks, but were not actively looking, including 102,100 ‘discouraged jobseekers’ a majority of whom were over 55. There are many reasons why people are not looking for work, including family issues and illness, but they remain interested in returning to the workforce. While the figures may have changed since 2014, it is clear that we are talking about hundreds of thousands of people who would like to be in work but for a variety of reasons, including just giving up, are not. So now, including these ‘hidden’ unemployed, and those ‘underutilised’ in the labour force, we are talking about something like 2.5 million people. Imagine what could be done if we created sufficient jobs and hours of work to meet that demand!

Total hours worked in September increased by 4 million hours to 1.66 billion hours. This is more interesting in trend terms: an increase of 2.2 million hours and the fourth consecutive increase after declines in the previous five months but still 2.4 million hours below the December 2015 peak. Overall, total hours worked has been trending upwards since 2000 but that is largely driven by population and workforce growth. Callam Pickering from CP Economics pointed out that work hours have actually been trending downwards over that same time when calculated per person. That is a sign of the increase in part-time work.

Ad Astra recently wrote about Turnbull’s planning black hole and it is no more evident than in the lack of response to these figures. What is the government doing to provide work for the 705,000 unemployed, or to provide more work for the one million who are underemployed? What is it doing to encourage people to remain in the workforce, rather than dropping out through the sheer frustration of being unable to find suitable work? I would suggest that many of those dropping out of the workforce have found the ‘cost’ (in economic terms, which includes effort and time as well as money) of finding work too high. I have little doubt that the onerous Centrelink job search requirements would be contributing to that ‘cost’. Increasing the time before which a person is entitled to receive Centrelink payments will not help. And what will the government do to address the ‘hidden’ unemployed, those not in the labour force but who would like to be?

The government’s approach seems to be that it should all be left to ‘the market’, to businesses, both large and small, to provide employment — eventually! That does nothing to support people in the present nor even to offer hope of employment or better hours in the short term. And even in the medium term it may be no more than a mirage. As I pointed out in ‘Are governments ready for the coming economic and social changes’, we are witnessing the rise of the ‘gig economy’. While that may provide some entrepreneurial opportunities, many businesses will move to a labour-force model of part-time or short-term employment. Perhaps the rise in part-time work already evident in the ABS data may be its beginnings. Australia now has the third highest part-time workforce in the OECD, representing 32% of those in employment.

Simply relying on business to create employment, without government support, may also be fraught. The recent NAB quarterly business survey showed ‘weaker profits and softer trading conditions have led to a moderation in business conditions’. Businesses did think that conditions would be reasonable over the next three to twelve months and capital expenditure plans remained strong.

ABS data, however, suggested that business investment fell 5.4% in the June quarter, and more than 17% over the year but much of this was said to be driven by the winding down of the resources boom. Despite that qualification, the NAB survey found that ‘a broader non-mining recovery appeared to stall in the September quarter’. There was also a deterioration in the retail and wholesale sector — to me, not surprising if we have 2.5 million people with lesser income than would be provided by any work, full-time work or more hours of part-time work.

Other business indicators showed sales from manufacturing rose 0.2% (but ‒0.6% and also down 2.9% over the year in trend terms). Companies’ gross operating profits rose 6.9% but were flat over the year (or flat in the June quarter and falling 4.3% over the year in trend terms). While profits may have jumped in the June quarter, wages rose only 0.8%. So where is that money going? — not into new jobs!

All in all, the government is ignoring that labour force data is about people, not just a series of percentages. It is ignoring the unemployed, the ‘hidden’ unemployed, and ignoring the problems created by underemployment and the loss of full-time jobs. Turnbull seems to believe that businesses will come good and provide the jobs or that people will create their own jobs, all part of his new innovative and agile economy. But how do the long term unemployed fit into that scenario? How do 705,000 unemployed survive until the economy comes good with little or no government intervention? How do one million people find the work hours they are seeking? How much production and consumption are we losing by having 2.5 million people not fully engaged in the economy? How are those 2.5 million people faring? — has anybody in government bothered to ask that?

As Ad Astra asked, where is Turnbull’s plan to make job growth happen? After all, this is people we are talking about.

What do you think?
Why do the ‘experts’ talk in terms of percentages rather than the number of people affected?

Why is the government ignoring the scale of this problem and claiming success when there are marginal shifts in the percentages?

Let us know in comments below.


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Trump is just part of the problem



There are two outcomes of the US presidential election that should horrify us all: Trump wins or Trump loses.

The horror of his winning leaves little to the imagination. We can see from his words and actions that on the personal front he is an ugly misogynist and a womanizer, yet is disrespectful of so many of the women who have entered his ambit, women whom he regards as his property, to do with as he wishes. He labels as liars the continuing procession of women who have accused him of sexual predation, insisting that all these claims have been ‘proven false’, and that he will sue them after the election.

We know too that he is a bully, and has a nasty streak that shows when he calls his opponent ‘Crooked Hillary’. He labels her a ‘criminal’ because of her email difficulties, although no charges have ever been laid by any authority. He calls her a liar, accuses her of ‘having tremendous hate in her heart’, attacks her over her husband’s alleged womanizing, and suggests she should be drug tested before their debates, as ‘he doesn’t know what’s going on with her’. He insists that it would be a total disaster should she be elected since, among other calamities, ISIS and Muslims would take over the country, international relations would become even worse, and the economy, already 'busted', would sink still further.

At the second debate he informed her that if he won he would appoint a special prosecutor to investigate her e-mail habits as secretary of state, and when she expressed relief that someone with a temperament like his was not in charge of the law, his rejoinder was, ‘Because you’d be in jail.’ Subsequently, at his rallies his supporters have chanted: ‘Lock her up, lock her up’!

In the third debate we saw more of the same. At first more disciplined, he could not sustain that demeanour; halfway through he broke out into his usual ugly Trumpisms. Just 24 hours later they continued throughout the Al Smith Charity Dinner in Manhattan, a traditionally light-hearted event attended by both candidates, one usually devoid of nasty barbs. But Trump could not contain his nastiness, as the videos show in this article in The New Daily.

We know too that his policy platform includes banning Muslims from entry, with what he likes to term ‘extreme vetting’, building a wall across the border with Mexico at Mexico’s expense to keep out Mexican ‘criminals, drug dealers and rapists’, scrapping trade deals that ‘rob Americans of their jobs’, and smashing ISIS by ‘bombing the shit out of them’, all in the cause of ‘Making America Great Again’. He shows his admiration for tough man Vladimir Putin and exhibits his willingness to cozy-up to him, contrary to contemporary US policy.

Apart from these outrageous policy positions, his campaign is largely policy-free on such matters as health, education, and foreign relations. He has threatened to ‘cancel billions in payments to the UN climate change program’ agreed to in Paris, as he considers global warming to be a hoax.

His latest assault on American democracy is his accusation of voter fraud, his assertion that the presidential election is rigged, and that the media is culpable, dishonestly representing his and his opponents case for election. Even close colleagues will have none of that accusation, which many see as Trump’s attempt to give himself an excuse for losing, which many of his colleagues and numerous social commentators believe will be the case.

Barack Obama’s response was apt: he reminded Trump that it’s ‘unprecedented’ for any candidate to try to discredit an election before it began, and advised Trump to ‘stop whining’ and get on with making a case for winning more votes. But as Women’s Agenda reminds us: “Trump has previously embraced the label of “whiner”, telling a CNN interviewer last year that “I do whine because I want to win and I’m not happy about not winning and I am a whiner and I keep whining and whining until I win.”

Trump’s threat to not honour the election result no matter the outcome, covert in his earlier utterances, became the defining moment in the third debate when in response to a direct question on this matter he replied: “I will look at it at the time”, hardly reassuring for those who expect the traditional smooth transition to the next president. If his thinly veiled threat becomes reality, we can expect a level of discord and disruption never before seen post-election in the US. The following morning he reiterated that he would accept the result, but ‘only if he won’! Now he’s insisting that the opinion polls that put him well behind are 'phoney', and that he’s really winning!

Many Americans share the horror of a Trump victory, particularly a large majority of women (although sadly not the majority of American men), and are fearful of what a Trump presidency would bring about. There is a strong consensus among leaders of many other nations, and commentators worldwide, that a Trump presidency would be disastrous. Many of his Republican colleagues share this view. Some have disowned him and his views and have distanced themselves from him lest he spoil their chances of re-election; some have contradicted his bizarre statements.

While many express fear about what a Trump presidency would do for the global economy, world stability, and international relations, how many have seriously contemplated what might come about should Trump win, a highly unlikely but not impossible outcome, and how world leaders would cope?

But while a Trump loss could hardly be worse than a victory, it would be foolish to believe that it would be without trauma at many levels. This piece attempts to tease out the possibilities.

Trump’s blanket condemnation of the mainstream media suggests a plausible post election defeat scenario: Trump will establish his own extreme right wing media outlet, one that would rival the existing one – Fox News. Trump is a billionaire businessman who has had experience in reality TV. It would come naturally to him to establish a TV network to compete with Fox News with even more extreme conservative, Republican and anti-Democrat views, and he has a readymade audience of supporters keen to lap up its every utterance. Not only would such an outlet be able to push neoliberal ideology, but it would also be a bridgehead from which it could assault a Clinton presidency, and make governing near to impossible with rancorous publicity and continuous condemnation. Fox News is bad enough; ‘Trump News’ would be even more vicious, vindictive, vitriolic, vengeful, venal and vile, should Trump seek to take out his revenge on the one who defeated him and all those who supported her.

This is not an idle thought, an improbable outcome, a fanciful scenario; it is one that Americans should contemplate, fear, and prepare to counter. Several commentators now acknowledge that possibility. One clue to Trump’s TV intentions is that he invited Roger Ailes, former CEO of Murdoch’s Fox News, who resigned from Fox last month over sexual harassment claims, to be his adviser. The latest though is that after just a few weeks they have parted company as Ailes realized that Trump “couldn’t focus, and that advising him was a waste of time.”  

Media commentators are seeing Fox News as an ailing, ageing network that needs rehabilitation and refreshing – the removal of 76 year-old Ailes is part of that process. No doubt Trump sees the audience Fox once enjoyed a ripe takeover prospect. He sees himself as the alternative right of the American national establishment, which he criticizes so vehemently, insisting it is introspective, corrupt and unresponsive to the needs of the people.

So don’t be surprised to see Trump TV News emerge early next year, with lots of beautiful presenters and experienced commentators, poached from Fox News and other networks, which will make billionaire Trump even more money.

In my view the greatest danger when Trump loses though is how his large base of supporters will react.




His supporters follow him because he gives them hope, albeit false hope, that he will fix their problems, improve their situation and make them, like America, great again.

These folk feel left behind in the wake of globalization, technological changes, and free trade, all of which have robbed them of their jobs and left them less well off, often dependent on welfare, and feeling hopeless. They are angry. They see no future for themselves or their children. It is not surprising then that when a ‘saviour’ appears and promises to make their unhappy lives better, they respond as Trump’s supporters have.

Trump cannot help them anymore than could preachers in a bygone age that promised eternal life in heaven among the angels to those oppressed by poverty or illness during their earthly existence. Yet his followers believe him fervently. Moreover, they also believe his anti-Clinton rhetoric and at Trump rallies rail against ‘Crooked Hillary’, heatedly shaking their fists at her. Having convinced them that the ‘corrupt media’ and Clinton’s allies have rigged the election, and that there will be widespread voter fraud, you can imagine their anger when Trump loses. He will tell his supporters they were ‘robbed’ by a corrupt system. We should be very fearful if Trump decides to stir up fury and resentment post election.

It’s too easy to dismiss Trump’s supporters as a rabble of discontents, as Hillary Clinton did when she labeled them “a basket of deplorables…racist, sexist, homophobic, xenophobic, Islamophobic — you name it.”

But their feelings are the direct result of inequality in the American economy. Many have lost their jobs, notably in the rust belt. They are poor and struggling. The American dream has passed them by. Many are homeless, on welfare, lacking healthcare, deprived of education – the flotsam and jetsam of American society. And they are understandably angry, just as were those involved in the ‘Occupy America’ movement.

They have swallowed Trump’s trickle down economic plan of giving massive tax cuts to business. They believe his promise that these cuts will stimulate business, create jobs and increase wages, classic neoliberal trickle down thinking that we know so well. But Trump also intends to get rid of ‘Obama-care’, which had given health insurance to so many who previously could not afford it, and he will also cut welfare, which one would have thought would upset his followers, but seemingly his other promises outweigh these drawbacks. History shows that people often vote against their best interests.

On the other hand, Clinton offers a classic progressive strategy of increasing wages, taxing the rich, and stimulating the economy through government spending, such as on infrastructure, just as Democrat governor Mark Dayton did so successfully in Minnesota where the economy is booming. In contrast, in neighbouring Wisconsin where Republican governor Scott Walker implemented a classic neoliberal strategy of cutting taxes and welfare, job growth has been among the worst in the region, income growth is one of the worst in the country, it has a higher unemployment rate than Minnesota, and the budget is in bad shape.

We cannot condemn Trump’s supporters for lapping up his promises, for not seeing through the fallacy of his economic strategy. They are the manifestation of inequality, which we know leads to discord and social disruption. They feel disenfranchised, distressed, despondent and despairing. Who could blame them for embracing Trump and his offer of hope, no matter how phoney?

What is fearsome is not their understandable faith in Trump’s false promises, but the spectre of Trump stirring them to unbridled rage when he loses, as he seems likely to do, unprepared as he says he is to accept the will of the people, ‘unless he wins’. Add to that the likelihood that he will stir up even greater hatred for the winner – ‘Crooked Hillary’, ‘the criminal who should be locked up’. Can you imagine how much civil unrest Trump could inflame, and how easily he could do so? That is frightening. That would be evil. That is what should terrify all who value the democratic process.

To return to the title of this piece: ‘Trump is just part of the problem’, it is his followers, those who adore him, those who hang on his every word, those who turn up to his rallies and shout insults at his opponent, those who really believe he can lift them from their dispossessed state to a glorious sunlit land of hope and prosperity, who are a powder keg waiting for Trump to light the fuse and blow democracy to smithereens.

Trump is just part of the problem!


What do you think?
What do you think and feel about Donald Trump?

Do you believe he will become president of the United States of America?

What do you think would be the consequences if he did?

Let us know in comments below.


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Ian Narev, CEO of the Commonwealth Bank, was the first to appear before the committee and set the tone for the CEOs of the other ‘big four’ to follow — they sang from the same hymn sheet or, dare I say, had colluded beforehand to ensure the substance of their answers was so similar as to be almost the same.

There were apologies and promises to do better. There were mea culpa but of limited culpability when examined carefully.

Shayne Elliot from ANZ admitted (from The Guardian’s live blog of the inquiry):
I think as an industry we have lost touch with our customers. It’s taken us down a path that’s created bad behaviour, some poor culture and really not treated customers with the respect they deserve.
And Brian Hartzer from Westpac said:
It is clear that a trust gap has opened up, and we as an industry and as individual banks need to work to close that gap.
Generally, each bank claimed commercial confidentiality not to reveal the profit they made from housing loans or credit cards although ANZ did suggest that its profit from credit cards was only ‘a couple of hundred million dollars’ out of its total profit of $7.5 billion.

While a number of financial planners who had given customers bad advice had been dismissed, it became clear that not one manager or executive had been fired or resigned as a result of some of the banking scandals. Whatever happened to executive responsibility, ‘the buck stops here’? — now blame is shifted down the ladder, not only in the banks but also in government (but that really requires another article).

The same argument about executive responsibility was raised in the US when Wells Fargo CEO John Stumpf appeared before a US Senate Committee after Wells Fargo staff, in an effort to meet sales and revenue targets, had been found to have opened millions of fake credit, savings and other accounts for customers without their consent. US Democratic Senator Elizabeth Warren, a former Harvard University law professor, said to Stumpf:
So, you haven’t resigned. You haven’t returned a single nickel of your personal earnings. You haven’t fired a single senior executive.

Instead, evidently, your definition of accountable is to push the blame to your low-level employees who don’t have the money for a fancy public relations firm to defend themselves. It’s gutless leadership.
It’s a pity our parliamentarians didn’t follow such a line. (Stumpf has since stood down.)

The banking scandals have been spread over a wide area of the banks’ activities.

ComInsure, the CBA’s insurance arm, has refused to make payouts on the basis of dubious medical definitions and has even rejected a coroner’s ‘cause of death’.

ANZ has allegedly been involved in rigging the ‘bank bill swap reference rate’ (BBSW) which is used to set interest rates on business loans, also influences credit card and other loan rates, and is the rate at which banks lend to each other. This is similar to the LIBOR (London inter-bank offered rate) which has world-wide implications and four London traders have recently been gaoled for their role in rigging the LIBOR.

And banks have conceded their wrong doing by paying compensation to some of those who were affected by faulty financial planning advice.

Earlier this year at a Senate inquiry into white-collar crime, two economists presented an argument that banks were regularly fudging the numbers relating to clients’ income when making mortgage loans so as to make their loan portfolio appear ‘safer’.
The banks have trashed their lending standards over a prolonged period of time with significant evidence of banks massaging people’s incomes in their loan application forms to make them look more creditworthy than what they really are, which is essentially fraud.

The banks would do this for various reasons. One is the highly competitive environment between the banks. Second of all is profitability.

The safer your mortgage book looks, the lower it costs you to do business — simple as that. If you show that your borrowers are very creditworthy then you are going to get cheaper funding costs, and that’s a win-win for the bank …
Some of this results from the pressure on staff to meet sales and revenue targets. The Finance Sector Union surveyed its bank members on this and one member responded:
Managers have told us to tell clients certain things in order to get results that will generate bonuses for everyone.
The FSU’s Geoff Derrick said:
[staff] … are being pushed to deliver on sales targets to the point where some feel that they have no choice but to do anything they can to keep managers off their backs, including selling bank products to consumers who don’t need them.
Despite all that, the government’s decision to call the banks before the Economics Committee was based not on those scandals but the banks' decision not to pass on in full the RBA’s last decrease in its cash rate. The ABC provided a calculator to show how much additional interest people were paying on mortgages owing to decisions taken by the banks on interest rates. An example of a CBA mortgage of $300,000 over 30 years taken out in 2011 shows that in the last five years the person would have paid $5,214 in additional interest, made up of:
  • $1,745 because of additional rate rises outside the cycle of RBA rate increases
  • $228 from delays in the bank passing on RBA rate cuts
  • $3,241 from the bank not passing on the full RBA rate cut
The result of the banks’ decisions on interest rates is that they have increased their margin above the RBA cash rate. In 2011 the mortgage rate was on average about 3.25% above the RBA cash rate but in 2016 that had risen to 3.75%. Half-a-percent may not sound like much but when we are talking in billions of dollars it soon adds up to significant amounts (0.5% of 1 billion dollars is $5 million, so on a profit of $7 billion at least $35 million of that could be from this increase and that is just profit — the resulting increase in income would be many times higher).

Before the Economics Committee, the banks consistently listed many reasons for this embracing the actual cost to them of raising funds, including overseas funds, the requirement to hold more cash reserves, and pricing risk into their products. Since the GFC, however, the ‘big four’ have operated with a government ‘guarantee’ which, it has been estimated, saves them 0.2% on their borrowings compared to smaller banks — again a tiny percentage but amounting to millions when we are dealing with billions of dollars.

The banks also consistently rejected further regulation with arguments such as the cost of regulation would need to be passed on to customers or that there could be unforeseen consequences. They suggested that strong banks (read profitable) are necessary for a strong economy.

The government still thinks a Royal Commission is not necessary and instead announced a banking tribunal which customers would be able to approach with complaints without the need for lawyers. One consumer group suggested, however, that decisions of such a tribunal would likely be subject to appeal in the courts (as are decisions by the Administrative Appeals Tribunal) which would then mean the banks, with all their money, could tie up issues for years in the court system.

But why should we be surprised by this? It has been going on for centuries. Lehman Brothers (before its collapse) had identified that there were 11 banking and financial crises in the eighteenth century, 18 in the nineteenth century, and 33 in the twentieth century.

In Australia early in the 1890s there was a banking crisis, including a ‘run’ on banks (people withdrawing their deposits) and a number of bank closures. It was at its worst in Victoria and had been fuelled by a boom during the 1880s with increasing speculation and investment in the property market. At the time the financial sector was essentially unregulated and factors contributing to the problem included:
  • property market speculation
  • credit growth
  • unrestricted capital inflows from overseas
  • the degree of risk management within the financial system (with risk assessment being lowered to cash in on the boom)
  • competitive pressures in the financial system (which also contributed to lesser risk assessment as banks and building societies fought for their share of the boom)
Overseas factors led to a reduction in the inflow of capital, property prices crashed and the system came crashing down.

If that sounds familiar, it should. Mortgages have grown in importance in recent decades as a source of bank business and now represent 57% of the loan portfolios of Australian banks (up from about 30% a couple of decades ago). That core of property underpins the banks’ capacity to borrow overseas. Low interest rates have encouraged borrowers and allowed them to borrow larger amounts (also contributing to rising house prices). Using negative gearing and capital gains tax concessions, people have also invested in property, further fuelling the market. Competition between the banks, and the low interest rates, have encouraged the banks to lower their risk assessment of potential borrowers and, as suggested earlier, even led to ‘massaged’ income figures.

As in the 1890s, it will not take much to cause this system to crash. An increase in interest rates (becoming more likely) may well impact borrowers who have borrowed to their maximum capacity — encouraged by the banks — leading to loan defaults and pressure on the banks.

The risk is increasing and only a few days ago APRA (Australian Prudential Regulation Authority) issued an information paper on Risk Culture and indicated it would be taking a more intensive approach in its reviews of risk culture within financial institutions, including the influence of bonus payments.

In the latter half of the 1940s Ben Chifley moved to nationalise the banks by bringing them all under the then government controlled Commonwealth Bank. Although that move was not successful, some of Chifley’s comments in support of his action remain relevant:
Whatever regard they may claim to pay to the wider concerns of the nation, their policies are dictated in the last resort by the desire to make a profit and to secure the value of their own assets.

Experience of the past has been that private banks increased their lending in good times and contracted it in bad times …
He said that in 1931, as the Depression bit, the ‘trading banks refused to cooperate in proposals by the Commonwealth and States for the relief of unemployment and the revival of business activity’. Rather than helping provide a stimulus the banks had restricted new lending and called in loans, exacerbating the situation. ‘This should not be allowed to happen again,’ he said.

Chifley correctly saw that the flow of money was a major factor:
No single factor can do more to influence the welfare and progress of a community than the management of the volume and flow of money. Mismanagement of money, on the other hand, has contributed to the greatest economic disasters of modern times — booms and slumps, mass unemployment, waste of resources, industrial unrest and social misery.
The current neoliberal emphasis on the ‘free market’ means governments still do not have control of the flow of money and we are still subject to the booms and busts often caused, respectively, by capital inflows and lack of such inflows.

The banks in Australia did not cause the GFC but the collapse of the financial system in the US led to the drying up of capital on international money markets, restricting the ability of our banks to borrow necessary funds. That led to our government’s decision to provide a ‘bank guarantee’ — and then also to spend money to stimulate the economy.

In a paper by J Bradford De Long of the University of California comparing the financial crises of the 1890s and 1990s, one of his concluding remarks was:
A look back at history shows no easy way of controlling the macro-economic instability that large-scale capital inflows create. History does leave clues that a strong, credible, and credited commitment to unalterable exchange rate parities would do some good but we do not know how to create such a commitment in the age of mass politics by any means short of dollarization.
(‘Dollarisation’ refers to linking all currencies to the US dollar as was done in the Breton Woods agreement following WW2, or in some cases even adopting the US dollar as a national currency.)

So our banks are causing us problems — nothing new there. Our banks are contributing to a property investment boom that may not be sustainable — nothing new there. Any reduction in our banks’ ability to borrow overseas may lead to a credit crisis here in Australia — nothing new there. Our banks insist they will pass the cost of regulation on to us, their customers. The neoliberal economic approach adopted by our current government means it will not increase regulation so the banks will be free to continue as they are. The banks themselves claim, strong, profitable banks are necessary for a strong economy, and our government will not disagree even if the banks’ current profits are among the biggest corporate profits in Australia — in other words, the banks may be ‘strong’ but the rest of the economy isn’t.

While many things have changed in the past one hundred and thirty years, it appears banks have changed little.

What do you think?
Is the current devotion to the ‘free market’ simply allowing banks to do as they wish irespective of what is in the best interests of the country?

Has competition gone too far when banks bend, or even break, the rules to ensure profitability for their shareholders?

Let us know in comments below.


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Let’s stand back from the daily tumult of federal politics momentarily, hard though it is to ignore, and look into the distance. What do we see? Given that politicians believe their role is to make this nation a better one for us all, where is the evidence of them planning to make it so? Where is the Turnbull
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Planning - Turnbull’s black hole



Let’s stand back from the daily tumult of federal politics momentarily, hard though it is to ignore, and look into the distance. What do we see? Given that politicians believe their role is to make this nation a better one for us all, where is the evidence of them planning to make it so? Where is the Turnbull Team's much touted 'Plan for a Strong New Economy' that the logo promised?

Let us start with a recent calamity – the electricity blackout in South Australia. The complexities of how this came about will be explained by Chief Scientist Alan Finkel’s enquiry. This is not the place to predict its outcome, but already there is evidence of a lack of planning that has contributed to this disaster.

Although the States and energy generators and providers have responsibility for energy supply, the federal government has overriding responsibility for energy security – indeed Environment and Energy Minister Josh Frydenberg declared the day after the calamity that "Energy security is the federal government’s number one priority." Did anyone hear him uttering these weighty words anytime before it occurred. No. This was a newfound mantra, now so important that it supplanted the Coalition’s top priority – national security. Turnbull concurred.

Which raises the question of exactly how much planning the feds had made to ensure energy security. Had they contemplated the effect that intermittent (or asynchronous) energy generation from renewables might have on the electricity grid and the constancy of supply?

They have known for years that renewable energy generation has been rising steadily. At the end of 2015 there were 77 wind projects, with 2064 turbines generating 4187 MW of power, with a further 365 MW under construction. Almost a year later there are many more. As at March 2015, in addition to household solar panels, there were over one hundred solar projects generating 4,100 MW of photovoltaic solar power.

This is not restricted information – it is freely available on the Internet. Yet there seems no evidence that the federal government and its Energy Minister have undertaken any planning to integrate intermittent power generated by wind or sun into a network that hitherto has been powered by regular base-load power generated from burning fossil fuels. There are complex arrangements already in place to modulate the level of power in the grid, which allow changes to the levels of power occasioned by intermittent power inputs. These arrangements are said to have failed during the fierce SA storm with its gusts of up to 140km an hour and over 80,000 lightening strikes, which took down 22 power transmission pylons and three transmission lines.

The consequent sudden drop in energy frequency in the network triggered an automatic cut at the interconnector with Victoria to protect the national network. SA Premier Jay Wetherill said: "The system behaved as it's meant to behave to protect the national energy market", but the federal Energy Minister and the PM seemed not to understand this reality, nor were they prepared to take any responsibility for this vulnerability despite trumpeting that ‘energy security was their top priority’. What they did do immediately though was to make political capital by castigating State Labor governments for their ‘unrealistic and ideologically-driven targets for wind power’; thereby insinuating that reliance on wind power was a prime cause of the disaster.

Frydenberg then called an urgent meeting with State energy ministers to discuss how the national electricity grid might be better protected in future. Why was this the first such meeting?

If ever there was an example of a gross planning deficit at a federal level, this is it. A Turnbull planning black hole!

Marriage equality
The marriage equality issue is another example of poor planning. Propelled by the promise to his right wing to continue Abbott’s policy, Turnbull has persisted with the plebiscite idea, which will be stone dead once the Senate rejects it.

Turnbull, despite his personal support for marriage equality and his proclaimed confidence that both the people and the parliament would support it strongly, has no Plan B. For him, Plan A, the plebiscite, is all there is. Other leaders have been able to change their mind in the face of an alternative view in the electorate (Mike Baird springs to mind), but so controlled is Turnbull by his conservative rump, which refuses to even consider a Plan B, that he will not to listen to the increasing public clamour for marriage equality and the rising desire for a parliamentary vote rather than an expensive and divisive plebiscite. A sound planner would have anticipated that the long and loudly voiced resistance to a plebiscite by Labor, the Greens and several crossbenchers in the Senate would eventually kill the plebiscite plans, leaving him with nothing.

Bernard Keane of Crikey has this cryptic view: “…there is a Plan B, even if the Prime Minister won’t discuss it. It’s to hope the issue that has hovered over federal politics for more than a year goes away, put off until at least the next election!” 2353NM analyses this issue at length in Turnbull – Abbott from a better postcode.

Turnbull’s lack of an alternative plan for introducing marriage equality is another planning black hole, one that is distressing to the LGBTI community. He ought to have anticipated the outcome now upon him and have planned an alternative approach.

Budget planning
This constitutes another black hole.

How long have we had to endure the ideologically driven budget planning that started with Joe Hockey and was continued by Scott Morrison and Mathias Cormann? We know that it is based on supply-side (trickle down) economics, which benefits the top end of town but penalises those lower down the pecking order. We know that the touted benefits of increased investment, more jobs and better pay for the workers are illusory, unsupported as they are by historical evidence accumulated over many decades. Yet they persist, driven by their ideological disdain for the ‘leaners’ whom they insist depend on the ‘lifters’ who work hard and pay their taxes.

You might be interested to view this You Tube video by economist Robert Reich, former labor secretary to US president Bill Clinton, which addresses this issue:



It goes on still. Only last week the Coalition, backed by Labor, passed a bill that embraces trickle-down economics – the Income Tax Relief Bill – which will drop the marginal tax rate for the $80,000-$87,000 bracket from 37 to 32.5 per cent. This was reported upon comprehensively in The New Daily, an abbreviated version of which follows:

Treasurer Scott Morrison sold it as an income tax cut for “middle income” workers, but The Australia Institute insists it’s not a cut for middle earners because average income earners don’t earn anything like $80,000 a year. Anyone on $80,000 a year is in the top 25 per cent of income earners, and this figure doesn’t include age pensioners, the unemployed, and the disabled. If they were added in, it would push those on $80,000-plus close to the top 10 per cent. While it’s true the average full-time worker earns just over $80,000, that figure is misleading; the Institute’s economist pointed out that when part-time workers are factored in, the average wage drops to $1575 a week, which works out to roughly $60,000 a year.

It’s even worse for women. The average female worker earns only $925 a week, which is about $48,000. Female workers constitute only 39 per cent of those who earn $80,000-plus.

Not only will the tax cut not benefit ‘middle’ Australia, but it will cost the Budget $3.9 billion over the next four financial years.

Giving an extra $315 a year to low-income earners would ensure it was spent immediately, resulting in much-needed economic stimulus, whereas higher earners are likely to bank more of their tax cut – trickle down will not occur.

There are other approaches. Take Mark Dayton, Democrat governor of Minnesota, who won office in 2010. This is what the US blog Mic had to say about his approach: 
“Since 2011, Minnesota has been doing quite well for itself. The state has created more than 170,000 jobs, according to the Huffington Post. Its unemployment rate stands at 3.6% - the fifth lowest in the country, and far below the nationwide rate of 5.7% - and the state government boasts a budget surplus of $1 billion. Forbes considers Minnesota one of the top 10 in the country for business.

“Given that Dayton is a well-connected millionaire whose family controls the Target fortune, one could be forgiven for thinking this was the result of embracing the corporate world. But in fact, over the past four years, the state has undergone a series of policy reforms that most of the corporate world decries: It has imposed higher taxes on the wealthy and raised the minimum wage. (My emphasis)

“When each of these progressive policies was initially proposed, Minnesota Republicans made dire predictions about their effects on the economy, and argued that bleeding-heart concerns about economic fairness would stifle growth. Despite all the warnings, Minnesota's economy hasn't tanked. Instead, it's sailing with greater force than it has in years.”
The Mic article contrasts this with the situation in the adjoining state Wisconsin.
“As Minnesota has enjoyed economic success, observers have often compared the state's situation to that of its neighbor Wisconsin. Republican Scott Walker also won the governor's mansion in Wisconsin in 2010, but pursued a deeply conservative agenda for managing the economy. He made huge spending cuts to vital services ranging from education to health care. He reduced taxes on the wealthy, and got rid of tax credits for low-wage earners. (My emphasis)

By a number of measures, Wisconsin hasn't fared as well as Minnesota. As the Milwaukee Sentinel Journal documents, Wisconsin's job growth has been among the worst in the region, and income growth is one of the worst in the country. It has a higher unemployment rate than Minnesota. And the budget is in bad shape.
This is just one example; there are others. But it illustrates two vastly different approaches to economics: one that increases taxes on the wealthy and increases the minimum wage, and the opposite: one that reduces taxes for the rich and cuts services, and shows that the former is superior.

Why can’t Turnbull, Morrison et al consider approaches other than the traditional conservative one of cutting services and giving tax breaks to the well off? Why haven’t they got a Plan B? The truth is that this is another Turnbull ideologically driven planning black hole. So driven are they by their supply side ideology that believes economies are stimulated by giving tax cuts to the top end of town, that they are unable to consider an alternative approach. The have a Plan A, but no Plan B. This planning black hole leaves them shackled to a discredited economic policy.

In their economic planning, have they ever considered the merits of Modern Monetary Theory as described by Ken Wolff in Modern Monetary Theory and will it help? The answer is: 'almost certainly no'.

What Government planning is evident as we approach an economy where many jobs will be automated, both manual and cognitive, and unemployment and underemployment will rise? Have they thought about and planned for the ‘gig economy’ described by Ken Wolff in Are governments ready for the coming economic and social changes? The short answer is: ‘not that any of us can see!’

Economic planning is among the government’s poorest efforts, leaving us all vulnerable, and many of us worse off.

Inequality
There is now abundant evidence that inequality is a social burden for millions of people in our country and in many others. A large part of the phenomenon we witness day after day as America prepares for its presidential election is the direct result of vast swathes of the nation feeling left behind, while the political establishment does little to elevate them from their impoverished state. Thus people like Bernie Sanders, who press for more equality, excites many followers, and even the arch-capitalist Donald Trump attracts supporters by promising to fix the ‘corrupt’ political establishment that he claims cares little for them.

We know too from the work of Professor Michael Marmot that health inequality runs parallel to economic inequality. Those with the least, those with the poorer jobs, have the worst health.

In The neoliberal execution of democracy, Ken Wolff describes in detail how neoliberal politics promote inequality. He quotes Noam Chomsky: “Neoliberal democracy, instead of citizens, produces consumers…The net result is an atomized society of disengaged individuals who feel demoralized and socially powerless”

Where are the Turnbull government’s plans for decreasing inequality? The Coalition is doing nothing to ameliorate the growing inequality that exists; indeed their neoliberal actions are making it worse.

Climate change
Here is where planning by the Turnbull government is so appalling. We know that its Direct Action Plan, Plan A, is a fraud. At this historic time when the world has crossed the threshold for the Paris agreement to take effect, the United Nations is challenging Australia’s policy. A report in The Age only last week read:
“Australia is facing renewed international pressure to explain what it is doing to tackle climate change, with a United Nations review finding its emissions continue to soar. Several countries are calling for clarity about what it will do after 2020. Countries including China and the US have put more than 30 questions to the Turnbull government, asking for detail about how Australia will meet its 2030 emissions target and raising concerns about a lack of transparency over how the government calculates and reports emissions.

“It comes as the federal government has been facing calls at home - sparked by its own criticism of ambitious state renewable energy targets - to reveal what it would do on climate change and clean energy beyond 2020. An expert review commissioned by the UN found, based on data submitted by Australia, its emissions would be 11.5 per cent higher in 2020 than they were in 1990.”
The Turnbull government has no Plan B for mitigating global warming even although Plan A continues to be ineffective.

GST in WA
Malcolm Turnbull made a big pre-election political play when in Western Australia about its unfair share of GST revenue and promised to fix it. Several months later there is no fix, nor is there any plan to do so. In his quest for a fairer share of GST for WA, and in the absence of any action by Turnbull, Brendon Grylls, (who is also attempting to regain his position as Leader of the WA Nationals), is promoting a mining tax, which would increase WA’s GST take. He is highly critical of Turnbull for having no plan to match his words.

Here’s another planning black hole with which the Turnbull government is riddled!

I could go on and on, but let’s finish with a laughable procedural planning shemozzle.

Procedural non-planning
With just a one-seat majority, it would be reasonable to expect careful planning in the area of parliamentary procedure. But already, in just a couple of months, the Turnbull government has suffered three defeats on the floor of the House because some of its members decided to leave on an early flight home, and last week Kelly O’Dwyer managed to embarrass the government through a procedural bungle by accidentally endorsing a bill amended by Labor, which criticized the Government. Of course she, the Manager of Government Business, Christopher Pyne, and the PM tried to play down the incident, but observers see it as a metaphor for the awful planning of the Turnbull government.

Whichever way we turn, wherever we look, we see either no planning in critically important areas, or faulty planning that imperils the Turnbull government, and of course we the citizens who depend on government to do those things that keep us safe, that enhance our prosperity, that give each of us a fair go, that enable us to be part of an integrated multicultural society which cares for all its citizens, rich and poor, able and disabled, healthy and ill.

The Turnbull government is letting us down badly because of its many planning black holes.
And sadly there is no sign that planning will improve in the time ahead.




What do you think?
Let us know in comments below.

Can you think of Turnbull's other black holes?

What evidence do you have?
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Donald Trump, in his mind anyway, is the next President of the United States of America. Last week, he was in deeper hot water than usual when a tape of a conversation between Trump and a reporter from Access Hollywood regarding his sexual exploits with women, made a decade ago, was released. Trump released an apology around midnight on 7 October (US time) and where he did state
“I’ve said some foolish things,” Trump said in a taped apology posted on his Facebook page. “But there’s a big difference between the words and actions of other people. Bill Clinton has actually abused women.”

Turning to his Democratic rival Hillary Clinton, Trump accused her of having “bullied, attacked, shamed and intimidated” her husband’s “victims.”
It’s a classic ‘look over there’ approach, that demonstrates that while there is an apology on record, it’s a pretty safe bet that Trump’s campaign team told him he had to do it, rather than some intrinsic understanding that the original conversation was just wrong. The apology went for 90 seconds and the text is available on the CBS News website here.

While Trump’s supporters are also apparently ‘looking over there’, some Republicans are less convinced. According to CBS, his choice for Vice-President, Indiana Governor Mike Pense,
was “beside himself” and his wife was furious, according to a person familiar with their thinking. That person spoke on the condition of anonymity, because they were not authorized to share the private discussion.
CBS also reports the head of the Republican Party was, if anything, more direct
“No woman should ever be described in these terms or talked about in this manner. Ever,” said Reince Priebus, who had stood by Trump through his past provocative comments.
According to the CBS report, Trump’s justification for his actions in the original interview was “When you’re a star they let you do it,” Trump says. "You can do anything."

So Trump is a misogynist. At the time of preparation of this article, Trump is refusing to stand down as the Republican Party’s nomination for US President. It’s not the first time that Trump has made derogatory comments about women, immigrants foreign countries, welfare recipients or the current President, just to name a few. The actor Robert De Niro was asked to film a spot for a ‘get out to vote’ activist group in the US, which contains a really interesting Trump character assessment:
"I mean, he's so blatantly stupid," the Academy Award winner, 73, said of Trump, 70, in the clip. "He's a punk, he's a dog, he's a pig. He's a con, a bulls--t artist, a mutt. He doesn't know what he's talking about, doesn't do his homework, doesn't care, thinks he's gaming society, doesn't pay his taxes. He's an idiot. Colin Powell said it best: He's a national disaster. He's an embarrassment to this country. It makes me so angry that this country has gotten to this point that this fool, this bozo, has wound up where he has."

De Niro continued, "He talks [about] how he wants to punch people in the face. Well, I'd like to punch him in the face. This is somebody that we want for president? I don't think so. What I care about is the direction of this country, and what I'm very, very worried about is that it might go in the wrong direction with someone like Donald Trump. If you care about your future, vote for it."
In 2012, Prime Minister, Julia Gillard rightly called out then Opposition Leader Tony Abbott on misogyny



The speech reverberated around the world. It’s probably fair to suggest that Gillard’s speech was not just a reaction to Abbott’s claim that Gillard was supporting then Speaker of the House Peter Slipper (who probably wasn’t the most moral character in the house), it was a reflection of the years of continual sniping at Gillard’s gender and her ‘lack of fitness’ to be Prime Minister as a result. Abbott’s wife runs an apparently successful business and he has three daughters. He obviously supports and respects his family’s successes and supports their endeavours. What Abbott didn’t and probably still doesn’t realise is continual sniping of a person based on their gender (as Abbott did to Gillard) is not fair game because the victim has differing opinions, it is as Gillard suggested – misogynisy.

Both Abbott and Trump are extremely conservative political leaders. While Trump could claim that he has reflected on his 2005 comments and knows better and Abbott did suggest that Gillard over reacted, is there a common theme here?

Prime Minister Turnbull committed to retaining Abbott’s plebiscite on marriage equity when he rolled Abbott in 2015. While the contents of the 2016 Coalition agreement are secret, is widely believed that the commitment remains – as Turnbull has brought the legislation to Parliament and if it was passed, the plebiscite would have been held on 11 February 2017.

Those who populate a number of religious organisations around Australia as well as organisations such as the Australian Christian Lobby will tell you any family that doesn’t consist of a husband and wife in a deeply committed loving relationship will lead to problems for the children later in their lives. In some cases, they are probably right; however, there are plenty of people with problems later in life that came from married couples with deeply committed and loving relationships as well.

In a perfect world, it would be wonderful if every person was valued for their potential contribution to the world and treated accordingly. Apart from creating ‘ideal’ families, this ‘perfect’ view of the world would also close the detention centres on Nauru and Manus Island, stop the bombing in Syria and provide food and shelter for those who are incapable of supporting themselves across the world. No Virginia, the world is not perfect, and those who are proclaiming the need for ‘ideal’ families are not similarly vocal about the conditions on Nauru, the various wars and human emergencies around the world.

This is where the moral and ethical problem is. For example, the top of the Australian Christian Lobby’s Home webpage looks like this:

Given that most religious groupings, be they Christian, Buddhist, Muslim or Jedi (it was accepted as a choice in the last Census) probably desire a compassionate, just and moral society through having the tenets of their particular religious text reflected in the political life of the nation, it would be seemingly obvious that ethical and moral issues such as treatment of refugees, treatment of young adults in custody and attempting to assist those around the world would be amongst the issues at the top of their mind, after all most of the religious texts request their believers to ‘do unto others as you would have them do unto you’. None of those issues make the ACL’s ‘hit list’ contained on the 377 pages of ‘latest news’. Unfortunately, the actions of people like the Trump, Abbott and conservative groups such as the ACL do not reflect their claimed values. Unsurprisingly most of the ‘hot topics’ on the ACL’s list relate to marriage equity or sex education in schools.

Trump and Abbott clearly do not actually give women the respect they have claimed they do. The ACL has a very narrow view of Christian faith if it just stands by without calling out the Australian Government’s actions in regard to refugees, detention centres and recurring efforts to further marginalise those who can least afford private health care, private schools or even private rental homes. When others called out Trump and Abbott on misogyny, Trump’s response was to suggest that the husband of the Presidential candidate was worse than he was and Abbott suggested that Gillard ‘over reacted’. The ACL’s CEO, Lyle Shelton will make whatever claim he believes will further his argument such as
“Research clearly shows the quickest pathway to poverty for a child is for their biological mum and dad to break up, that's just a fact.”
to argue for his preferred position of the ‘ideal family’. Shelton’s Lobby group is also potentially one of the beneficiaries of the $7.5 million Turnbull would have given the “NO” case should the plebiscite legislation have passed Parliament. As it seems that his public utterances have no factual basis, as there is certainly no collaborating evidence for the issues they claim others are going to implement made in the “Latest News” section of their website (although to be fair the entire 377 pages of items were not checked), and while Trump, Abbott and the ACL are entitled to believe they have done the right and honourable thing, the reality is somewhat different.

There are numerous reasons why a child may not grow up with their biological mum or dad. One parent may have died, the parents may have separated, a parent may have to work in a different town, be in jail or even stuck in a detention centre operated by the Australian Government. Logically, most of these kids will have mental and physical issues to work through as a part of that process. Shelton’s comments (and a large proportion of the anti-marriage equity advertising that has already gone to air) giving the ‘traditional’ view of marriage will not assist the mental health of those kids who have a different reality – regardless of the reason for that reality.

Trump, Abbott and groups such as the ACL all claim to be good Christians who are upholding the values of society. Yet, Trump admits to abuse of women physically and mentally, Abbott certainly treated Gillard (and other women) as second class citizens and conservative groups such as the ACL seem to feel that there is no need for the facts to ruin a good story. If the values of society are those that suggest that the actions above are acceptable, let alone desirable attributes of ‘traditional’ society, we should be re-imaging society so that all people are equal, regardless of their gender, beliefs or attitudes.

In addition to the cost of a plebiscite that isn’t binding (estimated to be $160 million), Turnbull has decided to gift $7.5 million to both the ‘YES’ and ‘NO’ cases for the plebiscite, allowing further attacks on the mental health of those kids that don’t live in the conservatives’ ‘traditional’ families and their caregivers. According to news.com.au, the ACL has already planned to use some of the funding to widen the argument to include sex education in schools.
Deputy Opposition Leader Tanya Plibersek today said she had concerns about “the idea that we’ll have a $15 million publicly-funded battle, when we’ve already seen the sort of material that’s been put out against marriage equality”.

“And we’ve got organisations engaged in this debate saying anti-discrimination law and rules around advertising should be suspended,” Ms Plibersek told ABC Radio.

She wanted to know what they intended to say during the campaign that currently was illegal.
It is a truism that sunlight is the best disinfectant. Political leaders legitimising abuse of other people, advertising legitimising only certain forms of family life and so on creates victims. While abuse of women, discrimination based on gender, preferences or beliefs may have been acceptable in the ‘good ole days’ of ‘traditional’ families, victims have to know firstly that they are victims, secondly there is help available and thirdly how to access that help. If conservatives try to push these issues back into the closet, they are deterring those who are having problems from putting their hand up and asking for help. World Mental Health Day is 10 October and in Australia, the week including that date is Mental Health Week. It’s a shame and not healthy for our society that Turnbull is again being held hostage by the conservatives on his side of politics and plans to fund advertising around a non-binding plebiscite that effectively seeks to de-legitimise a number of loving and sharing families around Australia.

What do you think?
Let us know in comments below.
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The Turnbull endgame - again?



It was Karl Marx who said History repeats itself, first as tragedy, second as farce. Malcolm Turnbull gives contemporary credence to these words.

Seven years ago, in August 2009, as Malcolm Turnbull’s time as Leader of the Opposition seemed close to its end, I wrote The Turnbull endgame? Four months later he was gone, replaced by Tony Abbott by just one vote.

The leopard has not changed his spots. What was written about him then, applies now. This piece highlights the striking parallels between now and then.

I shall intersperse in block quotes clips from that earlier piece, with contemporary comment to illustrate my argument.

The Australian today [6 August 2009] abounds with talk of replacing Malcolm Turnbull as Coalition leader. Dennis Shanahan and Matthew Franklin wrote a piece Desperate Liberals look to replace Turnbull with Robb, and Shanahan has a blog It's a loser or the last man standing. The sixty comments that followed are evenly divided between support for making a change and leaving Turnbull there, as Robb would be no better!

Jack the Insider has a blog Turnbull artistry no match for the numbers. He concludes “...the hard heads in the Coalition will soon reach the view, if they have not already done so, that the continued existence of the Liberal Party depends on a change in leadership.”... Most of the 240 respondents, even those with Liberal leanings, agreed that a change was necessary.

The Political Sword has long maintained that while Malcolm Turnbull was an accomplished journalist, barrister, businessman and banker, he was not a politician and would have difficulty in the political milieu.

On 19 September last year [2008] in Will the real Malcolm Turnbull please stand up?, it was argued that after starting so promisingly when he entered parliament, when this independent thinker and decision-maker was being forced uncomfortably into a political mould as a Howard Government minister, his authority faded and he became less convincing. He seemed to not have his heart in what he was saying.

Then in The Turnbull Report Card 10 days in posted on 26 September 2008 soon after he became leader, after acknowledging his pluses, concluded “...where he falls short is when he is not on his favoured turf, when he’s challenged with uncomfortable facts, when he attempts to advocate causes in which he does not have his heart, and when he has to defend untenable positions. As political life abounds with such circumstance, unless he can overcome this flaw, he will have difficulty convincing the people of the merit of his approach and his capacity to manage a nation beset with many contemporary challenges and complexities. Leading a nation is so much more complex and demanding, so different from life at the bar and managing a merchant bank.”
Sounds familiar doesn’t it!

Despite the unhappy memories of the Turnbull of 2009, when he toppled Abbott in September last year the sense of relief among the general public that finally the calamitous Abbott was gone (at least from the top job) was so great that memories of the earlier Turnbull were erased from the public’s mind. Great hope was held out that at last we had a leader that was prime ministerial in appearance, demeanour and speech. At last our embarrassment of having Abbott as our leader was behind us.

His prime ministership started well, but soon doubts began. Had he learned from his previous period as leader? Had the Turnbull nature changed? The public was at first prepared to give him the benefit of the gathering doubts that people had.

Let’s look back again to 2008:
In Malcolm’s at it again posted on 15 October [2008], when he was beginning to qualify his support initially given to the first Rudd Government stimulus package, he began to sound less persuasive, became circumlocutory, and arguably lost his audience. The piece concluded: “Kim Beasley was criticized for his prolixity, and unable to overcome it, eventually people stopped listening. Indeed this was a major factor behind the move to replace him as leader. Leaders who lose their audience – Beasley and Howard are examples - lose elections. Turnbull’s minders would be wise to point out this defect to him, and try to rectify it, always providing Malcolm’s ego will tolerate such a move.

To quibble or not to quibble, posted the next day when Turnbull again quibbled about his support for the stimulus, concluded “As said so many times in this blog, when Turnbull does his own thing and promotes his own views, he looks impressive and sounds authentic; but as soon as he’s forced to toe the party line, he loses his lustre and becomes an ordinary politician...When will the Coalition learn? When will they realize that sometimes it’s better not to quibble?”
Sounds familiar again. Balanced journalists have commented time and again that Turnbull is under the thumb of his right wing members, the very ones who extracted promises from him for their vote when he challenged Abbott for leadership.

Now we hear him arguing strongly in support of the Coalition’s paltry Direct Action Plan although he vowed previously never to lead a government that did not put a price on carbon pollution. Just as before, he now sounds unconvincing, and is marked down for being a turncoat.

Although a strong supporter of marriage equality, he persists with his intention to hold a plebiscite. His rationale is that it was an election promise, but more importantly it was a promise to his right wing. The fact that recent polls show that the public’s desire for a plebiscite is waning and that they want parliament to get on with its job of legislating for equality, has so far not persuaded him to reverse his stand and show the leadership they hoped he would. Although he knows how close he went to losing the recent election, he realizes that his prime ministership depends more on the support of his right wing than on the support of the people. He knows where the power rests.
The emerging Opposition strategy, posted on 13 November [2008], described the strategy being adopted by Turnbull and the Coalition: attacking everything the Government did, criticizing everything Kevin Rudd and Wayne Swan proposed, and attacking them personally, labeling them as incompetent and reckless. At the time Crikey’s Bernard Keane said “The risk with Turnbull’s tactics are that they backfire, and create a public impression of a smart-rse, someone who failed to get behind the Government as it tried to manage a global crisis...The risk at the moment is that he cruels his public image before that can happen. Once the public has an image of you, it’s very hard to shake it off.”

The TPS piece concluded “So it’s hard to see any logic to Turnbull’s strategy and tactics other than his belief that if he throws enough mud, some will stick, and that by repeatedly attempting to discredit Rudd, Swan and the Government generally, he will gain traction, the scales will fall from the voters’ eyes, and he will emerge as the indispensable statesman who can restore Australia to the ‘glory’ of the Howard years. On the other hand, as Keane suggests, his strategy may inflict so much damage on his image that recovery will be difficult, if not impossible. Some are already punting he will not survive as leader to the next election; what he’s now doing may ensure that this becomes a discerning prophesy. Unfortunately for him, his impatience, his ego and his determination to use a ‘do whatever it takes’ strategy no matter how politically opportunistic, may be his undoing.”
The pattern of Turnbull’s behaviour was becoming clearer:
The ‘deficit’ wedge posted on 25 November [2008] was written when the deficit and debt slogan was launched. The piece concluded “What this amounts to is an opportunistic ploy by the Opposition to wrong-foot and embarrass the Government about the much-talked-about deficit, and to paint it as incapable of sound economic management if it finally does go into deficit for the good of the nation. That the Coalition’s wedge campaign flies in the face of sensible economic management in these troubled times is of no importance to them; political advantage and the wistful hope of winning the next election is all that counts...Since his election to leadership Turnbull has posed as a financial guru, but he has gained no traction in two party preferred terms in the opinion polls...The people don’t seem to be buying his rhetoric...Turnbull needs to be careful that his blatant opportunism doesn’t backfire.”

Turnbull’s benchmarks for failure of 30 November [2008] described his three benchmarks for Rudd Government failure: going into a deficit, rising unemployment, and recession. The piece concluded: “Economist after economist, commentator upon commentator agree that under the current economic circumstances a deficit occasioned by a well-targeted fiscal stimulus is necessary to limit the risk of recession. They agree with Rudd and Swan, not with Turnbull. His demand that the Government avoids a deficit, although this would be detrimental to the economy, to jobs, and to the nation, is irresponsible. But will contrary opinion be enough to stop him? Laurie Oakes doesn’t think so. Writing in the 29 November issue of the Daily Telegraph: ‘Turnbull falls into deficit’, he suggests that even if he is wrong, Turnbull is never in doubt about the correctness of his position. So it’s unlikely Turnbull will change tack – no price is too high for him to achieve political traction. If one can judge from the latest opinion polls, Turnbull is spinning his wheels. He desperately needs traction. But his strategy is risky. The people are watching. When they see through his glib talk, he will be the one who fails.”

The ‘stop at nothing’ pattern was emerging.
History repeats itself.

In the wake of the disastrous storms that blacked out South Australia, we have Turnbull in full political mode, lambasting Labor states for having ‘aggressive and extremely unrealistic targets for renewable energy’, insinuating that South Australia’s high use of wind power was a significant factor in the catastrophic failure of electricity supply to that State. He persists with this line despite energy providers and experts in power generation, as well as renewable energy providers and advocates insisting that the blackout was caused by the unprecedented disastrous weather event that hit the State, and not the use of renewables. As he condemned Kevin Rudd and Wayne Swan for their actions during the GFC (now shown to be life-saving for our economy), he now condemns Labor premiers for their support of renewables, and piously (echoed by energy minister Josh Frydenberg) boasts that ‘energy security is the Coalition’s top priority’ (apparently national security has slipped down the list). Again accruing political capital is his object, not the wellbeing of the nation.
The 2 December [2009] piece Why does Malcolm Turnbull make so many mistakes? concluded “History may show that Turnbull’s biggest mistakes are underestimating Kevin Rudd and Wayne Swan, perpetually insisting they ‘simply don’t understand’ financial or economic matters, consistently condemning their every move, changing his tune whenever it suits him, flying in the face of competent economic intelligence, failing to exercise strong leadership, continuing to make political points at a time of unparalleled financial turmoil and steadily losing credibility as he does, indulging in obfuscation and circumlocution while avoiding answering questions asked by interviewers, and most significantly failing to notice that the people are not behind him.”
He is now in similar mode, asserting that Labor does not understand energy security, that it is obsessed with renewables, that its targets are wildly unrealistic, all the time neglecting to set national targets to guide the states, or even to carry out modeling for the very modest emission reduction and renewable targets he agreed to in Paris. He is dragging his feet while castigating the Labor states which have filled the void. Again, he is failing to provide leadership. He seems oblivious to the increasing demands of the people who want action on climate change urgently.

And it’s not just ordinary people who want action. Major business organizations and energy users have urged federal and state governments to work cooperatively to map out a “strategic response to Australia’s energy transition and challenges”… warning that investment is at risk. The Australian Energy Council, the Australian Industry Group, the Business Council of Australia, the Energy Users Association of Australia, Energy Consumers Australia, the Energy Efficiency Council, the Energy Networks Association and the Clean Energy Council are jointly calling for leadership from and between the jurisdictions, and bipartisanship on “the tightly connected issues of energy and climate change”, warning that in the absence of bipartisanship, “uncertainty will cause essential energy investments to be deferred or distorted, to the ultimate cost of us all.” But will Turnbull listen to them?
On 11 April [2009], a piece Why is Malcolm Turnbull so unpopular? began “There’s not much need to emphasize Turnbull’s contemporary unpopularity – it’s all over the air waves and the papers. It takes only a few metrics to quantify it...He leads a Coalition that currently shows has an average TPP of 60/40 in Labor's favour across several polls, which show a steady trend away from the Coalition.
His polling situation is not quite as bad now, but compared with the stellar polls he enjoyed just a little over a year ago, his personal popularity is in a steady downward spiral, and recently the Coalition’s TPP was as bad as it was when Abbott was PM!

This piece is already long enough. Let’s finish with the conclusion of the 2009 piece; The Turnbull endgame?
To draw this long piece to an end, should we be surprised at the position in which Turnbull now finds himself? Looking back over a year or more a pattern of behaviour has become clearly apparent: impetuosity, poor political judgement, ruthlessness and self-confidence not matched by political ability, that goes to his character, his integrity and his political wisdom, all of which are now highly questionable.

Is Turnbull’s endgame upon him? ‘Endgame’ describes the last part of a chess game, when there are very few pieces left. That looks like the right word.

It seems that only lack of a plausible alternative can now save him.
Here we are again! Nothing has changed since 2009 except the dates. Turnbull is still the Turnbull he always was, and always will be. The electorate, initially buoyed with high expectations, has that sinking feeling again as disappointment and disillusionment overwhelms.

And his right wing would have him gone in a flash if they could mount a plausible case, provided they could find an acceptable alternative, as was the case in 2009.


As 2353NM put it in Turnbull – Abbott from a better postcode?: “When Turnbull became prime minister, there was a hope that he would bring the claimed decency and ability to appeal to the middle ground that was so lacking with Abbott. After 13 months, it hasn’t happened. There are two possibilities: Turnbull is just as bad as Abbott (except for better clothing choices and living in a ‘more expensive’ postcode); or, to coin a phrase, Turnbull ’doesn’t have the ticker’ to promote and implement policy and legislation that isn’t approved by his conservative rump thereby ensuring his longevity as prime minister. Either way, the rest of us as Australian citizens will continue to suffer as a result."

Marx said: History repeats itself, first as tragedy, second as farce.

We’ve had the tragedy; now we have the farce.

Is this the Turnbull endgame – again?




What do you think?
Let us know in comments below.

Is Turnbull reaching his endgame again?

What evidence do you have?
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Assuming the Opposition agrees, there will be a plebiscite on the proposition to allow same sex marriage in Australia in February 2017. The independents in the parliament have (mostly) stated their positions on the matter and the Greens are against the plebiscite but in favour of same sex marriage.

The history here is that the Marriage Act was legislated in the 1961 saying (basically) marriage is a union of two people and that union is recognised across Australia. It also recognised marriages legally made under the laws of another country. As Rodney Croome wrote in the ‘Winter 2011’ issue of Overland magazine, the reason the law was made was to eliminate blatant discrimination in Australia whereby Aboriginal people were not allowed to marry who they wanted to in some states and Territories. Until 2004, there was nothing in the legislation to suggest that marriage had to be between a man and a woman, leading some same sex couples to have their marriage legally recognised in jurisdictions such as Ontario, Canada which, they claimed, automatically made their marriage ‘legal’ in Australia. The Howard Government didn’t agree and stripped the marital rights of same sex couples as soon as they landed back in Australia.

According to Croome, in early 2004:
… two such couples sought a ruling from the Federal Court on whether Australia’s relatively liberal laws on foreign marriages extended to the recognition of their Canadian unions.

The court was never allowed to decide. Liberal senator Guy Barnett petitioned the prime minister to ‘protect marriage’ from being ‘demeaned and degraded’. The petition was successful, not least because 2004 was an election year in both Australia and the United States, and the politicisation of ‘gay marriage’ welded wealthy and highly disciplined evangelical churches in marginal electorates to the conservative cause.
In August 2004, the Senate passed the ‘man and woman’ amendment to the Australian Marriage Act. Again Croome suggests:
The government’s marriage amendment — declaring matrimony to be exclusively hetero-sexual, and limiting the powers of the courts to recognise overseas same-sex unions — was raced through parliament, prioritised over government anti-terror legislation. For good measure, the prime minister addressed a rowdy meeting in the Great Hall of Parliament House in defence of ‘traditional marriage’, during which homosexuals were condemned as ‘moral terrorists’.
Not that the ALP was any better:
In her address to that anti-gay audience, shadow attorney-general Nicola Roxon declared Labor’s support for entrenching discrimination against gay relationships. She was given a standing ovation.
So why waste somewhere between $160 and $200 million on a plebiscite to change the legislation back to the way it was in the 45 or so years until 2004? Clearly, the reason is not due to some specific wording in the legislation, as Howard had no problem in changing the law in the first place.

In 2015, Time Magazine listed 21 Countries (apart from the USA) where same sex marriage is legal. The USA legalised same sex marriage in June 2015, New Zealand did in 2013. It is plainly obvious that life as we know it has not ended in either the USA or ‘over the ditch’ in New Zealand.

We’ve done the history — now for the politics. Turnbull, like most prime ministers before him, claim that they govern for the benefit of all Australians, regardless of whether or not you voted for him. While it is true that the ALP governments between 2007 and 2013 could have legalised same sex marriage, to be fair around half of the countries on the Time magazine list have only acted since 2013. It makes sense that while the issue had been building for a while, it was the Abbott Coalition government that felt the effects of the debate from 2013. Abbott ‘bought some time’ by promising a plebiscite in the next term of government (he also didn’t know that he wouldn’t be the prime minister at the 2016 election — and that story has been done to death so let’s move on).

Details of the Coalition Agreement between the Liberal and National Parties are re-negotiated every time the leader changes and subsequent to each election, so when Abbott was ousted in favour of Turnbull in 2015 there was a re-negotiation. Both parties confirmed there was an agreement for a plebiscite on same sex marriage in the next term of parliament (the parliament subsequent to the one elected in 2013). Subsequent to the 2016 election there was another renegotiation, as is customary. The 2016 agreement is secret but believed to include an understanding that a plebiscite on same sex marriage is required before the legislation is considered. (A small but worthwhile digression is to ponder why a secret agreement governing an arrangement between two political parties is perfectly acceptable in the case of the Liberals and Nationals, but any co-operative arrangement between the ALP and the Greens is frowned upon by both the ALP and the Liberals.)

Turnbull, rightly or wrongly, has continued to support a number of Abbott government measures, including a plebiscite on same sex marriage, claiming it should be non-binding but compulsory. The logic here is interesting as Howard rammed through changes to the Marriage Act in double quick time (with ALP support) in 2004 to insert the ‘man and woman’ concept into the Act. So according to Turnbull it is completely logical to change legislation to address the concerns of conservative members of his political party in 2004, but we have to waste $200 million in a vote to change it back to the way it was. To ensure tracing the logic is the equal to the triple pike with twist, the plebiscite is non-binding, so if your conservative member of parliament doesn’t want to change the legislation, they can still vote no in parliament — in spite of the results of the plebiscite (however the individual politicians choose to ‘spin’ the response and their eventual vote).

To make it even worse, the federal government has decided in its wisdom to fund both sides of the argument to the tune of $7.5 million each. Turnbull claims this will allow for a respectable debate which will allow the public to make an informed decision. Before the funding was even allocated, the ‘no’ case was linking the same sex marriage discussion to educational matters as well as using (apparently without permission) the image and words of Nelson Mandela.

Managing Director of the Australian Christian Lobby, Lyle Shelton, claims that:
“The baby who is taken from the breast of her mother doesn’t have a voice in this debate, the child who doesn’t get to know their father doesn’t have a voice,”
And
“Research clearly shows the quickest pathway to poverty for a child is for their biological mum and dad to break up, that's just a fact.”
While Shelton didn’t offer any evidence to support his claim, he is claiming that those who are brought up in a family that doesn’t replicate his idealistic view of the world are somehow fatally flawed, something that both Shorten and Turnbull (who were both raised by single parents) should demonstrably be arguing against. Instead Turnbull proposes to give the ‘no’ case $7.5 million to further denigrate those who don’t live in Shelton’s ‘nuclear’ family. While you could suggest that Shelton has ‘jumped the shark’ (again), Turnbull as the nation’s leader has a responsibility to ensure that all are treated equally. He clearly hasn’t to those children in Australia who for a variety of reasons (including same sex partnerships, death, divorce or numerous other reasons) have only have one parent. Clearly keeping the conservative rump of his political party ‘on side’ is far more important than correcting the false testament of people like Shelton who is belittling Turnbull’s own upbringing.

Another example of Turnbull’s behaviour concerns his ‘new’ approach to climate change. It has been widely reported that the Great Barrier Reef is undergoing significant bleaching of the coral. The government’s own Great Barrier Reef Marine Park Authority (better known by its slightly easier to say GBRMPA acronym) reported in June 2016 that this was caused by a seemingly small rise in sea surface temperature. The overwhelming consensus of scientists with experience in the area of study suggests that sea surface warming is an indicator of human induced climate change. One proven way to reduce human induced climate change is to move away from burning fossil fuel to generate electricity. South Australia has probably moved quicker towards renewable energy power than other states connected to the ‘National Grid’, but recently suffered a statewide power failure. Turnbull is publically implying that ‘extremely unrealistic’ renewable energy targets are the problem.

In reality, the South Australian blackout in late September had nothing to do with renewable energy. Twenty-two high voltage power pylons blew over due to excessive wind during a severe storm. As the article points out:
If the recently closed Port Augusta coal power station was still operating, it would have been cut off by the downed distribution lines too. And that would have likely made the disruption worse, since it would have created an even bigger sudden change to the network.
Lenore Taylor argued recently in The Guardian:
… state targets are exactly what Australia needs to meet the promises the prime minister made in Paris last year about reducing greenhouse gases.

Of course it would be preferable to have a consistent national policy to reach those goals, but it’s not exactly the states’ fault that we haven’t got one.

That vacuum was Tony Abbott’s proud achievement, with the abolition of the carbon price and the winding back of the federal renewable energy target, after a lengthy debate about whether it should be abolished altogether, which of course dried up almost all investment in renewable energy.

And consistent, credible national policy hasn’t been any more evident in the year since Turnbull took over either.

His own officials admitted in a Senate inquiry this week they had undertaken no modelling at all about how to meet the target Turnbull pledged in Paris for reducing Australia’s emissions out to 2030. That’s the target he is about to ratify, the target that will be Australia’s legal obligation.

But plenty of others have done modelling and analysis for him, and they all conclude that he won’t meet it, not with the Coalition’s current policies.
Clearly Turnbull is keeping the conservative rump of his political party ‘on side’ and apparently arguing the false testament of notable ‘thinkers’ and conservatives such as Deputy Prime Minister Barnaby Joyce, Queensland Senator (with 77 direct votes) Malcolm Roberts and Brett Hogan, the Research Director of the Institute of Public Affairs.


(Roberts actually linked to a news item stating the real reason for the power failure and still gets it wrong!).



In an environment where Turnbull publically called for the resignation of ALP Senator Sam Dastyari for accepting around $6,500 from people who have ‘connections’ with the Chinese government, he is doing nothing about the claims of a former minister in his government, Stuart Robert, who apparently sees nothing wrong with attempting to stack the Gold Coast City Council with people sympathetic to development proposals. Robert was sacked from his ministerial position in February after (separate) claims of inappropriate use of political donations. Fairfax’s The Age called for his resignation from parliament in an editorial on September 29. At the time of preparation, however, it appears that Turnbull is again keeping the conservatives in his own party ‘on side’ rather than calling out Robert’s behaviour for what it is.

When Turnbull became prime minister, there was a hope that he would bring the claimed decency and ability to appeal to the middle ground that was so lacking with Abbott. After 13 months, it hasn’t happened. There are two possibilities: Turnbull is just as bad as Abbott (except for better clothing choices and living in a ‘more expensive’ postcode); or, to coin a phrase, Turnbull ’doesn’t have the ticker’ to promote and implement policy and legislation that isn’t approved by his conservative rump thereby ensuring his longevity as prime minister.

Either way, the rest of us as Australian citizens will continue to suffer as a result.

What do you think?
Let us know in comments below.
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In my inbox each day I get an e-mail from The Washington Post called The Daily 202. This year it has been, as is to be expected, mostly about the American Presidential primaries and forthcoming election but, in reporting Bernie Sanders’ primary win in West Virginia back on 10 May, it stated the win was not really about ideology but disaffection:
Americans, collectively, are not as angry as watching cable TV would lead you to believe. But many poorer, less-educated folks who have been left behind in the 21st century — the ones who have seen their wages stagnate, their opportunities for upward mobility disappear and their life expectancies shorten — are looking to disrupt a status quo that has not worked for them.

That’s what Sanders and Trump are both promising to do.

So how did the septuagenarian socialist do it? The bottom line is most people are not voting for Bernie because he is liberal. They are voting for him because they perceive his promised “political revolution” as a challenge to the system that has failed them.

“West Virginia is a working-class state, and like many other states in this country, including Oregon, working people are hurting,” Sanders said last night at a rally in Salem, Oregon. “And what the people of West Virginia said tonight, and I believe the people of Oregon will say next week, is that we need an economy that works for all of us, not just the 1 percent.”
We are seeing the same phenomenon around the world: the election of Jeremy Corbin to the Labour leadership in the UK; the rise of anti-establishment parties in Spain and Greece; and, unfortunately, it has also meant the rise of extreme right (and sometimes neo-fascist) parties that tap into that disaffection with the political system.

How has it come to this?

Basically, as Sanders alluded to, it is the economic approach followed by governments that, since the Thatcher and Reagan years, has been based on a neoliberal economic philosophy which appears to be benefitting the wealthy rather than society as a whole. We know the shortcomings of that approach, based as it is on supply-side or ‘trickle down’ economics, but we have seen little discussion (at least here in Australia) on the broader impact it is having on democracy.

We live in a system where a democratic form of governance is coupled with a capitalist competitive free-market economic system.

In a democratic political system all people are meant to be equal — one person, one vote, and all votes of equal value.

The neoliberals also base their political approach on the individual but tend towards the libertarian view that governments should have no role in an individual’s life choices. Thus, in Australia, we have a libertarian, Leyonhjelm, arguing against anti-smoking regulations and the mandatory wearing of bicycle helmets. While that may support individual freedom, it ignores the wider social benefits of those approaches and the cost to the community, through our taxes, of hospitalisation and associated services for smokers or cyclists suffering head injuries. If the wider community bears the cost of such ‘freedom’, then surely it has a right to say that in the community interest some individual freedoms can and should be curtailed.

The neoliberals, however, would argue that the community concern is overcome by privatising health services: then the individuals who suffer health problems from smoking or cycling accidents have to meet their own costs — but so does everyone else, including the less well-off and those cast out of their jobs by the neoliberal economic approach.

This emphasis on the individual, as applied to economics, creates even more problems. A philosopher in the 1970s, Robert Nozick, basically set out a philosophical underpinning for neoliberalism.

There is no such thing as the ‘common good’ in Nozick’s (and the neoliberals’) approach, only individuals:
While it is true that some individuals might make sacrifices of some of their interests in order to gain benefits for some other of their interests, society can never be justified in sacrificing the interests of some individuals for the sake of others. [emphasis added]
Nozick considered that the state’s single proper duty is the protection of persons and property and that it requires taxation only for that purpose. Taking tax for redistributive purposes is on a par with forced labour, he wrote. So government should play little or no role in regulating the economy: the state then can be seen as an institution that serves to protect private property rights and the economic transactions that follow from them regardless of whether we think some people deserve more or less than they have.

The neoliberal economic approach also emphasises debt. I used this quotation in my previous article but it is also relevant here. Although written about the US, it could readily apply in Australia:
Indebting government gives creditors a lever to pry away land, public infrastructure and other property in the public domain. Indebting companies enables creditors to seize employee pension savings. And indebting labor means that it no longer is necessary to hire strikebreakers to attack union organizers and strikers. Workers have become so deeply indebted on their home mortgages, credit card and other bank debt that they fear to strike or even to complain about working conditions.
The sale of public assets to relieve debt and the emphasis on the individual means the areas in which government can exercise control in the interests of the wider society are diminishing.

George Monbiot, writing in The Guardian (UK) in April said:
Perhaps the most dangerous impact of neoliberalism is not the economic crises it has caused, but the political crisis. As the domain of the state is reduced, our ability to change the course of our lives through voting also contracts. Instead, neoliberal theory asserts, people can exercise choice through spending. But some have more to spend than others: in the great consumer or shareholder democracy, votes are not equally distributed. The result is a disempowerment of the poor and middle. As parties of the right and former left adopt similar neoliberal policies, disempowerment turns to disenfranchisement. Large numbers of people have been shed from politics.

Chris Hedges remarks that “fascist movements build their base not from the politically active but the politically inactive, the “losers” who feel, often correctly, they have no voice or role to play in the political establishment.” When political debate no longer speaks to us, people become responsive instead to slogans, symbols and sensation. To the admirers of Donald Trump, for example, facts and arguments appear irrelevant.
The remarks by Chris Hedges explain the rise of the far-right and capture the same disillusion referred to in The Washington Post article. Consider also the initial success of Tony Abbott: ‘slogans, symbols and sensation’ and ‘to [his] admirers, … facts and arguments appear irrelevant’. It certainly fits!

We can also go back to Naom Chomsky in 1999 when he wrote:
… to be effective, democracy requires that people feel a connection to their fellow citizens, and that this connection manifests itself though a variety of nonmarket organizations and institutions. A vibrant political culture needs community groups, libraries, public schools, neighbourhood organizations, cooperatives, public meeting places, voluntary associations, and trade unions to provide ways for citizens to meet, communicate, and interact with their fellow citizens. Neoliberal democracy, with its notion of the market uber alles, takes dead aim at this sector. Instead of citizens, it produces consumers. Instead of communities, it produces shopping malls. The net result is an atomized society of disengaged individuals who feel demoralized and socially powerless.
Basically, democracy is being undermined, leaving people disaffected, unable to foresee how they can influence the political process for their benefit. As Monbiot pointed out, the range of politically influenced decisions is contracting. Privatisation of former public assets mean governments are controlling less and less, their decisions also cover less and less. If all our services are privatised and the individual is placed above society, what role is left for government? And in that circumstance, what is the point or the value of voting?

I wrote about this previously in relation to the situation in Greece and noted this comment from eminent economist Joseph Stiglitz:
Seldom do democratic elections give as clear a message as that in Greece. If Europe says no to Greek voters’ demand for a change of course, it is saying that democracy is of no importance, at least when it comes to economics.
We know that the bankers and financiers did say no to the democratic wish of the Greek people.

People are also further and further removed from influence over the economy, and yet the economy relies on people. The neoliberal economy has seen the rise of inequality in most countries around the world. The neoliberals see no inconsistency in inequality.

To return to Robert Nozick’s philosophy: as each individual owns the products of his or her own endeavours and talents, it is possible for an individual to acquire property rights (as long as they are not gained by theft, force or fraud) over a disproportionate amount of the world; once private property has been appropriated in that way, it is ‘morally’ necessary for a free market to exist so as to allow further exchange of the property. And the individual then has complete control as to how that property is passed on. So it is logically okay for someone to inherit a fortune having contributed nothing to gain that wealth: reward for effort or just desert do not come into it for Nozick — it is only property rights and market mechanisms that count. That, of course, is the neoliberal approach.

Piketty made this clear in his work Capitalism in the twenty-first century in which he explained the rise of rentiers (those who gain their income from rents, dividends and interest) and that the growth of such wealth is outstripping the rise of earned income.

Monbiot also quoted another author who was making a similar point:
“Investment”, as Andrew Sayer notes, means two quite different things. One is the funding of productive and socially useful activities, the other is the purchase of existing assets to milk them for rent, interest, dividends and capital gains. Using the same word for different activities “camouflages the sources of wealth”, leading us to confuse wealth extraction with wealth creation. [emphasis added]
Too much economic activity now seems to be based on ‘wealth extraction’ rather than genuinely productive activity. In Australia, the increase in the number of investment houses is a symptom of this, particularly when it is an existing house and provides no new productive activity (construction) and relies on rent and/or capital gains for a return on investment. The negative gearing tax incentive and capital gains tax concessions have distorted the market and made it more profitable to put money into ‘wealth extraction’ rather than ‘wealth creation’. And our government intends to do nothing about it because it may curtail the rights of some individuals — what it falsely called the ‘mum and dad’ investors.

The rise of the global economy has transferred jobs. Chinese manufacturing has replaced significant portions of manufacturing in the US and the UK, as well as in Australia. Even work in call centres has been ‘off-shored’. There is some evidence that the Brexit vote in the UK was influenced by the loss of traditional employment in particular areas, not just by immigration: some of the strongest ‘leave’ vote occurred in areas where major industrial plants had closed in the preceding decade and jobs had not been replaced. Some predict that ‘jobs’ will be the major political battleground in coming years arising not just from a globalised economy but from the increasing spread of robotics.

When people feel economically threatened they look to their government to relieve the situation but governments will not intervene, or intervene minimally, while they continue to pursue neoliberal economic approaches. As Monbiot pointed out, one’s capacity to participate in this new world is determined by spending power but as more people lose jobs they have little or no capacity to participate.

The next step in the process, which has already begun, is that people also then feel that the political system is failing them and will turn to those offering either radical or more despotic (even fascist) solutions. They will be attracted to solutions harking back to a ‘golden age’ — whether it is myth or reality. But in the neoliberal world the government will have almost no capacity to respond: it will be in debt; it will not have control over major economic areas that have been privatised (sold off to meet ‘debt’); it will believe it should not intervene in ‘the market’; it will continue to believe that people improve their situation only by their own individual effort; it will have no answer to those offering alternative solutions that may be attractive to the masses.

If governments across the Western world continue to follow neoliberalism in both their social and economic policies we will also see the continuing slow death of democracy, including in Australia, with more people disaffected and disillusioned with the economic and political systems and that may well lead to a willingness to embrace non-democratic solutions.

So governments beware! Your support of neoliberalism is planting the seeds for your own downfall.

What do you think?
Is One Nation and the rise of right-wing parties around the world simply a reaction against neoliberalism?

How long can democracy survive if governments continue pursuing neoliberalism?

Let us know in comments below.


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Do politicians make you sick?



I expect most of you would answer with a resounding YES. They make us sick when they lie, break promises, assail us with mendacious rhetoric, engage in adversarial behaviour, fail to recognise this nation's problems, seek to blame their opponents for any ills we have, and exhibit incompetence in doing what they are well paid to do.

They make us sick, though, in other ways - through their legislative actions. This piece will describe how policies can and do result in illness in individuals and groups in our society. It draws on the work of celebrated epidemiologist Professor Sir Michael Marmot, president of the World Medical Association, who is currently visiting this country. His book: The Health Gap: The Challenge of an Unequal World is rich with information garnered over many years of studying inequities in health and their causes. He is a medical doctor who moved from clinical medicine to public health because he saw that it was necessary to look for the 'causes of the causes' of ill health, the causes behind the traditional medical causes. He saw that social factors were central in the genesis of ill health. He has made a life-long study of the 'social determinants of health' and headed a World Health Organization commission that published Social Determinants of Health, Closing the Gap in a Generation in 2008.

Before looking at social factors in depth, let's examine some basic principles of cause and effect. The tubercle bacillus is a necessary factor in the genesis of tuberculosis, which usually affects the lungs, but sometimes other organs. But it is not the only factor. Some people exposed to the bacillus contract tuberculosis; others do not. A homely analogy is the 'seed and the soil' concept. No matter how potent the seed, it will germinate only in fertile soil, and wither on barren soil. Likewise, the tubercle bacillus needs a 'fertile' human environment to survive and cause disease. In the era of rampant tuberculosis in earlier centuries, there were the underprivileged who lived in cold, damp dwellings, who worked in dusty, demanding and dangerous occupations and who suffered malnutrition, whose bodies were thereby susceptible to the bacillus. The tubercle bacillus was therefore a necessary but insufficient factor in contracting tuberculosis. The susceptible host was the other necessary factor, and that factor derived from poor work and living conditions and poverty - all social factors.

Michael Marmot takes a holistic view of health. While acknowledging the importance of medical science in health and illness, he insists that there is so much more to it. In the introduction to his book he writes:
Knowledge of medicine and public health is not so much wrong, as too limited. Health is too important to be left solely to doctors. Health is related not only to access to technical solutions but to the nature of society. We are being foolish in ignoring a broader array of evidence, which shows that the conditions in which people are born, grow, live, work and age have profound influence on health and inequalities in health in childhood, working age and older age.
He illustrates his assertions with evidence. One of his most important is that the gradient of health parallels the social gradient. He contrasted life expectancy in two suburbs of Glasgow, Calton and Lenzie. He reported:
If a man dies in his prime in Calton, a down-at-heel part of Glasgow, it may be a tragedy, but it’s not a surprise. Actually, the question of what constitutes his ‘prime’ in Calton is moot. Life expectancy for men, when I first looked at figures from 1998–2002, was fifty-four. In Lenzie, a much more upmarket place a few kilometres away, ‘in his prime’ has an altogether different meaning: life expectancy for men was eighty-two. That converts to a twenty-eight-year gap in life expectancy in one Scottish city.
He carried out similar studies in several countries, with the same conclusion.
The social gradient in life expectancy runs all the way from top to bottom. It doesn’t just feel better at the top. It is better. At the top, not only do you live longer but the quality of life is better – you spend more years free from disability... The social gradient in disability-free life expectancy is even steeper than it is for life expectancy. ‘Disability’ here is quite broadly defined: any limiting long-standing illness. Talk about adding insult to injury: the more deprived people spend more of their shorter lives with ‘disability’. On average people at the top live twelve years of their lives with disability, people at the bottom twenty years.
I could go on quoting his many other studies, but will satisfy myself with his famous 'Whitehall' study of British public servants. The details are fascinating. Here's an abbreviated account of how Marmot described that experience:
The British Civil Service changed my life. Not very romantic, a bit like being inspired by a chartered accountant. The measured pace and careful rhythms of Her Majesty’s loyal servants had a profound effect on everything I did subsequently. Well, not quite the conservatism of the actual practices of the civil service, but the drama of the patterns of health that we found there. Inequality is central. The civil service seems the very antithesis of dramatic.

Please bear with me. You have been, let’s say, invited to a meeting with a top-grade civil servant. It is a trial by hierarchy. You arrive at the building and someone is watching the door – he is part of the office support grades, as is the person who checks your bag and lets you through the security gate. A clerical assistant checks your name and calls up to the office on the fifth floor. A higher-grade clerical person comes to escort you upstairs, where a low-grade executive officer greets you. Two technical people, a doctor and a statistician, who will be joining the meeting, are already waiting. Then the great man’s, or woman’s, high-flying junior administrator says that Richard, or Fiona, will be ready shortly. Finally you are ushered in to the real deal where studied informality is now the rule. In the last ten minutes you have completed a journey up the civil service ranking ladder – takes some people a lifetime: office support grades, through clerical assistants, clerical officers, executive grades, professionals, junior administrators to, at the pinnacle, senior administrators. So far so boring: little different from a private insurance company.

The striking thing about this procession up the bureaucratic ladder is that health maps on to it, remarkably closely. Those at the bottom, the men at the door, have the worst health, on average. And so it goes. Each person we meet has worse health, and shorter life expectancy, than the next one a little higher up the ladder, but better health than the one lower down. Health is correlated with seniority. In our first study, 1978–1984, of mortality of civil servants (the Whitehall Study), who were all men unfortunately, men at the bottom had a mortality rate four times higher than the men at the top – they were four times more likely to die in a specific period of time. In between top and bottom, health improved steadily with rank. This linking of social position with health – higher rank, better health – I call the social gradient in health. Investigating the causes of the gradient, teasing out the policy implications of such health inequalities, and advocating for change, have been at the centre of my activities since.
The difference between top and bottom was attributed to work stress. While initially it was postulated that those at the top had higher demand and more stress and therefore should have poorer health, that was shown to be wrong. There was another factor. Marmot puts it this way:
It was not high demand that was stressful, but a combination of high demand and low control. To describe it as a Eureka moment goes too far, but it did provide a potential explanation of the Whitehall findings. Whoever spread the rumour that it is more stressful at the top? People up there have more psychological demands, but they also have more control.
Having control over one's life, one's destiny, is a necessary factor for having a more healthy life.

Let's now look at how some policy decisions and legislative moves that the federal government has made, are likely to influence health. There are many; I shall select just a representative few.

Contemplate how those on welfare must have felt when Joe Hockey declared 'the end of the age of entitlement', when he tagged welfare recipients as 'leaners', supported by the good guys, the 'lifters', who worked and paid taxes to support them in their indolence, and when he brought in his punitive 2014 Budget designed to punish them. His behaviour increased their stress, reinforced any feelings of inadequacy they may have been harbouring, and deprived them of control over their destiny. They were in his careless hands. Hockey's policies and actions, supported by his leader and his party, created conditions conductive to anxiety, depression, feelings of inferiority and inadequacy, all manifestations of ill health. And the longer his rhetoric lasted, the more vulnerable they became.

This ideologically-driven politician made them sick.

Reflect on Eric Abetz' declaration that those on welfare must complete forty job applications a month - twice the number previously - for the very limited number of jobs in his home state of Tasmania. How did they feel about this demanding yet pointless imposition? Did that affect their mental health?

Liberals just can't give up on 'welfare dependency'. Minister Christian Porter was at it again last week. Although he clothed his policy recommendations in words of support for those in that predicament, the prime purpose was clear - to reduce the burden of welfare on the federal Budget. He exaggerated his case by using 'lifetime' projections of cost that soared into the trillions, neglecting though to point out that this figure was but a tiny proportion of the multi-trillion revenue budget over the same 'lifetime' period. Ideology dominated his thinking. But the effect on the targeted was as always - demeaning, demanding, destructive to their wellbeing and mental health. Porter's move would make them sick despite his stated intention to make their life better, sincere though it purported to be.

Remember the attempts to increase the required waiting period to receive the dole from one week to six months, a measure designed to save the Budget $1.8 billion over five years. Imagine how potential recipients felt about being without income for a long six months! The threat of this Coalition move must have made them sick with worry and apprehension. This is what Peter Martin had to say on this subject.

Attacks on welfare create anxiety, increase uncertainty, demean the recipients, and make them sick.

Reflect on the plebiscite on marriage equality, which PM Turnbull insists he is bound to implement. Already we are hearing of the distress the LGBTI community is feeling at the prospect of a bitter, biased, and likely bigoted public debate about whether they should be afforded the right to declare and publicly confirm their love and commitment as do heterosexual couples. Their right to do so is to be subject to the whims of the ACL and other opposing bodies. Will the LGBTI community feel they have been placed like insects under the public microscope? Will their mental health, already fragile from past experiences in 'coming out', deteriorate? Will suicide, that some contemplated when 'coming out', become more inviting? It seems hard to avoid the conclusion that some will take this course.

The policy of subjecting this matter to a plebiscite will make some of our community sick. Politicians do make us sick!

I could go on, but these examples, taken against the profusion of evidence that Michael Marmot has documented in his book, ought to caution us not to inflict any more distress and misery on those amongst us who are vulnerable. We have no right; politicians have no right to make us sick through making decisions, by legislating policies that can have no other health outcome among our most distressed, underprivileged and marginalised than to make them sick, even sicker than they are already.

If you wish to learn more about Michael Marmot's work on health inequality, watch Jane Hutcheon interviewing him on One Plus One on ABC TV.

For even more information, listen to Professor Marmot's Boyer Lectures.

Politicians do make us sick. They need not; they ought not; but they do.

What do you think?
Do politicians make you sick?

Please give us some examples.

Let us have your views in comments below.


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