The neo-liberal execution of democracy


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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A number of commentators made the point after the election that almost a quarter of voters did not vote for the major parties in the House of Representatives. But that is misleading on two counts. It ignores the 5% informal vote and the 10% vote for the Greens who I think are now entitled to be considered a major party — they do contest every seat after all. That leaves about a 10% first preference vote for other than major parties and, given that there were almost 150 smaller parties and independents, that is not a significant vote — an average of about 0.07% for each of them. More…

The standard you walk past...
2353NM, TPS Extra, 13 August 2016

Lieutenant General David Morrison AO gave the speech above in 2013 when it came to light that members of the Australian Army were alleged to be guilty of inappropriate behaviour to those of lesser rank and/or female. There are a couple of clear messages in the speech – firstly, his message to those who believe that his lack of tolerance of inappropriate behaviour is incorrect: if it does not suit you – get out. Secondly he correctly states that the standard of behaviour you walk past is the standard you accept. More…

Why are Abbott’s conservatives destroying our PM?
Ad astra, The Political Sword, 10 August 2016

To those of you who dispute the assertion embedded in the title, let me provide you with supporting evidence.

Some questions for you to answer:

Is Malcolm Turnbull the man you thought he was when he rolled Tony Abbott almost a year ago?
Has he fulfilled your initial expectations?
Is he as secure in his position as PM as he was initially?
Has he been limply acting as a proxy for Abbott and his policies?
More…

The democratisation of opinion
Ken Wolff, The Political Sword, 7 August 2016

With the rise of the internet and social media almost anyone can express their opinion to an audience in the thousands, even hundreds of thousands, no longer just to a circle of people who are physically present to hear the opinion. While that provides the democratisation of opinion, it also has a more sinister side. It has led to a widespread view that in this new democratic world all opinions are equally valid. More…

Make laugh – not war
2353NM, The Political Sword, 3 August 2016

A couple of weeks ago, our esteemed blogmaster Ad Astra published a piece asking Why is there so much anger? It’s a good question. Sociologists will tell us that whatever position a person takes on a particular subject, there will be some who agree, some who disagree and some who don’t have a strong opinion either way; they’re ‘sitting on the fence’. Some of those who disagree would listen to an argument designed to change their mind; for others, successfully changing their viewpoint would be impossible. More…

Johno goes to heaven
2353NM, The Political Sword, 31 July 2016

Johno was 89 when he died the other day. He was (as they religious say) a good and decent man and accordingly soon after his death he arrived at the ‘Pearly Gates’ where as tradition dictates, he was met by Saint Peter. More…




Why is there so much anger?
Ad astra, The Political Sword, 27 July 2016

No matter when we listen to the news, watch TV, or browse social media, the pervading emotion in so many items is anger, unremitting anger. We see it in the wars in the Middle East and among terrorist organizations. We are told it is what motivates individual terrorists. More…

Someone’s gotta pay
2353NM, The Political Sword, 24 July 2016

According to the Coalition government, the ALP’s campaign over the privatisation of Medicare was somewhere between dishonest and outright lies. While it is true that the Coalition has frozen some Medicare rebates and eliminated others, attempted to introduce a $7 co-payment to see a doctor in the 2014 budget and set up a task force to examine the outsourcing of payments to Australians, the Coalition claims that these measures were nothing to do with the privatisation of the Medicare entity. More…

Mr Turnbull, where are your verbs?
Ad astra, The Political Sword, 20 July 2016

It was one of The Political Sword’s regular contributors, Casablanca, who drew my attention to the absence of a verb in the Coalition’s prime slogan ‘Jobs and Growth’. She had been alerted by an article in The Guardian by Van Badham in May: Good slogan, Malcolm Turnbull, but growth in what kind of jobs? The absence of verbs is diagnostic of the malaise that afflicts PM Turnbull, Treasurer Morrison, Finance Minister Cormann and most of the Coalition ministry. More…

The election in numbers
Ken Wolff, TPS Extra, 18 July 2016

We know the Liberals lost 13 seats, or in other words Labor gained 13 seats, with one seat, Herbert, still in the balance at the time of writing. (Labor actually won 14 but gave one back which I will come to later.) The Liberals claimed a win because they did at least manage to hang on to government, thanks to the Nationals, and Labor claimed success because of the number of seats they gained. But can either party really claim success? The numbers suggest not. The numbers also suggest that individual seats varied markedly and there was not anything like a uniform swing to Labor, although swing there was overall. More…

The Liberals are dreaming
Ken Wolff, The Political Sword, 17 July 2016

On Sunday morning 10 July, before Shorten conceded defeat in the election, Arthur Sinodinos appeared on the ABC’s Insiders. He claimed the Coalition had a ‘mandate’ for its 2016 budget and its company tax cuts. Sinodinos’s view takes no account of the reality of the new parliament. More…

Australia; we need to have a conversation
2353NM, TPS Extra, 15 July 2016

There are three types of people in this world, those who make things happen, those who watch things happen and those who wonder what happened.- Mary Kay Ash.
Mary Kay Ash, the founder of Mary Kay Cosmetics, died in 2001, so it is extremely doubtful if she knew of Pauline Hanson. However, Ash’s motivational quotation above could go someway to explaining the election of Pauline Hanson, Jacquie Lambie and Derryn Hinch to the Australian Senate in 2016. More…

Just do your job
2353NM, The Political Sword, 13 July 2016

Fairfax media’s Matthew Knott asked the other day in Election 2016: The uncomfortable truth is the media got it wrong. How did we do it”. It’s a good question. More…




How has it come to this?
Ad astra, The Political Sword, 10 July 2016

The MSM and blog sites abound with critiques of the election and tentative predictions of the political outcomes. So why bother writing yet another to explain how it has all come to this? You will judge whether this analysis adds anything useful. More…

Sausage sizzles and mandates
2353NM, TPS Extra, 8 July 2016

There was a winner to the Federal Election last weekend. A lot of school parents’ organisations and charities made money on sausage sizzles and cake stalls across the country. While you could argue that if funding for education and to those less well-off was at a realistic level there would be no need for the sausage sizzle, it is becoming a tradition and clearly part of the Australian psyche. More…

The Liberal lie continues
Ken Wolff, The Political Sword, 6 July 2016

In his speech on election night, as reported by The Guardian, Malcolm Turnbull: … accused the Labor party of running “some of the most systematic, well-funded lies ever peddled in Australia” in a campaign in which Labor claimed the Coalition was planning to privatise the government funded health insurance system, Medicare. More…

G’day America
2353NM, The Political Sword, 3 July 2016

Hi, howyagoin? We hear that you are having a real problem with who is going to be your next President. If we understand the issues correctly, there is the choice of a property tycoon who seems to be able to lend his name to a lot of developments, star in what are laughingly called reality television series, lampoon women and minorities without fear or favour and also wants to build a fence along your borders. The last one is a bit silly – is it to keep you inside Trump’s America, or to keep others out? More…

Your vote is valuable
2353NM, The Political Sword, 29 June 2016

Over the past couple of months, Turnbull, Shorten, Di Natalie and others have been attempting to convince you that they are worthy of your first preference vote. The usual claim is that your vote is valuable. Guess what – it is. Every first preference vote cast at the election on 2 July is worth $2.62784 More…



The hazards of voting Liberal
Ad astra, TPS Extra, 29 June 2016

It’s clear that around half of all voters for the major parties will vote for the Liberal-National Coalition and half for Labor and the Greens. The result is likely to be close. There are many seats that promise to throw up intriguing results. If the Coalition wins, the Senate may end up being no more helpful to it than the last one. More…

Turnbull’s Medicare backflip – or is it?
Ken Wolff, The Political Sword, 26 June 2016

Turnbull recently announced that his government, if re-elected, will not change any element of Medicare. It came in response to Labor’s campaigning that Medicare was under threat, that it would be privatised, under a Liberal government. The general media response was to take Turnbull at his word and that Labor’s continuing use of the campaign was no more than a ‘scare campaign’ now based on a ‘lie’. But let’s take a closer look, including a careful examination of the words used. More…

Your call is important
2353NM, The Political Sword, 22 June 2016

To paraphrase, hell hath no fury like a politician scorned. Dennis Jensen, MP for the seat of Tangney, was not preselected by the Liberal Party to recontest the seat in Parliament. He is running as an independent. Jensen recently claimed Liberal MPs use database software to profile constituents and decline requests for help from decided voters, even their own supporters. The system is apparently called “Feedback”. More…

The tale of two Daleks
Ad astra, The Political Sword, 19 June 2016

Good Daleks are hard to find. They’re expensive. But for the Treasury and the Department of Finance, no cost is too high. So they spared no expense in their search for reliable Daleks that could repeat their messages tirelessly. They had hoped to find some with a rudimentary knowledge of economics and some understanding of finance, but had to settle for ones that at least could recite mind-numbing messages repeatedly and consistently. More…

National security theatre
2353NM, TPS Extra, 17 June 2016

It’s probably a co-incidence that there has been a lot more advertising around the National Security Hotline since the election was called. You know the ones, the sober colours, formal fonts asking you to report anything suspicious to a free call number. The television and radio advertising (with the foreboding music and deep voice reading the message) give you the impression that all information is valuable and a team of experts will dissect every scrap of information given and act on it. More…

Time for a new economic model
Ken Wolff, The Political Sword, 15 June 2016

Late in the 1970s Keynesian economics was largely abandoned when it failed to explain the stagflation that had occurred during that decade. Recently, in my piece ‘What economic plan?’, I quoted an Australian analyst with the CBA who suggested that recent national data released by the ABS was showing ‘bizarre’ results, an ‘anomaly’. That sounds suspiciously like the criticism of Keynesian economics in the ’70s. It suggests that it is time we reconsidered the current dominant economic models. More…

Feed a man a fish
2353NM, The Political Sword, 12 June 2016

Those who missed the ABC’s Lateline last Wednesday night lost the opportunity to learn about a private (they would prefer the term ‘independent’) school in Sydney that actually seems to want to make a difference. More…



The real Malcolm
2353NM, TPS Extra, 10 June 2016

Since Malcolm Turnbull’s elevation to the role of Prime Minister, there has been consistent reference to his stated ideals and beliefs last time he was the Leader of the Liberal Party plus his public comment on ‘social issues’ such as same sex marriage, internet connectivity, climate change, the republic and so on versus he actions as Prime Minister. For a member of the same party as Abbott and Bernardi, he was really quite ‘small L’ liberal. As times he was more liberal that the ALP. More…

Turnbull is selling us a pup
Ad astra, The Political Sword, 8 June 2016

You all know what that idiomatic expression means – being tricked into buying something that is worthless. It arose from the old swindle of selling a bag that purportedly contained a piglet, but instead there was a puppy inside. PM Turnbull wants you to believe that his bag contains a piglet, but all you will find is a pup. The piglet is called ‘Jobs and Growth’. More…

The economics of debating
2353NM, The Political Sword, 5 June 2016

Economists will tell you that they practise a science in a similar way to chemists, biologists and physicists. If certain inputs are made to solve an economic problem, there will be a certain result. Other scientists also use the same process, a chemist will tell you if you add certain quantities of two chemicals together, it might change colour, smoke or (everyone’s favourite) create an explosion. Others who are less enamoured with economics will suggest that if you put 100 economists in a room and give them a problem, they will come up with a solution. When the solution doesn’t work (because it usually won’t), the same economists will give you 150 reasons why it didn’t. More…

What economic plan?
Ken Wolff, TPS Extra, 3 June 2016

Prime Minister Malcolm Turnbull declared that GDP growth of 3.1%, reported by the ABS on 1 June, showed that his plan for the economy was on track: “You cannot succeed without a clear economic plan. Everything we have is encouraging companies to invest, to employ. So far so good. This confirms the direction we are leading the country in, in terms of our economic plan, but there is much more work to do.” More…

It’s all their fault
2353NM, The Political Sword, 1 June 2016

Have you ever noticed that politicians in general have a great ability to blame others? An example is Labor blaming Prime Minister Turnbull (as he was the former communications minister) for a $15 billion cost blowout in the construction of the NBN. Then in 2013 Turnbull accused Labor of the same thing (only the value was $12 billion in this case) Let’s put this simply — they both can’t be right! More…

*T&Cs apply
2353NM, TPS Extra, 31 May 2016

Charles Dickens wrote a book called Oliver Twist. It is undoubtedly a classic. The book has been the subject of numerous reviews, movies and is frequently a subject for study in English Literature classes. Perhaps the best known section of the book is where young Oliver asks the Master of the Workhouse for ‘more’. More…

How the Liberals are destroying Australia
Ken Wolff, The Political Sword, 29 May 2016

The image above shows rich and poor alongside each other in Mexico. Is this Australia’s future under the Liberals? Australia has a long history of egalitarianism. Between the gold rushes and the 1890s Australia was considered a ‘working man’s paradise’. The depression of the 1890s changed that somewhat but also fostered the growth of unionism and the birth of the Labor party to represent workers’ interests… More…

Turnbull’s Australia tax
2353NM, TPS Extra, 27 May 2016

You may have heard of “the Australia Tax”. The term comes from the apparent difference in the price of a seemingly identical product sold apparently cheaper in another country than the retail price in Australia. Computer software and Apple products are frequently mentioned as being subject to this tax and while it really isn’t that simple, the impression that you pay more because you live in Australia is certainly there. More…

What happened to us?
Ken Wolff, The Political Sword, 26 May 2016

Tony Abbott liked to scare us with tales of violent terrorists coming to attack us and, therefore, requiring more and more security to protect us. Even if we thought he was crazy or going too far, at least he was addressing us. Think about Turnbull’s approach and ask where are the policies, even the broad approaches, that address us, the people and communities of Australia, and our needs. More…

Behind the NBN raids: hypothetically speaking
Ken Wolff, TPS Extra, 25 May 2016

On Thursday 19 May the AFP raided the parliamentary offices of Stephen Conroy in Melbourne and the home of a political staffer as regards leaks from NBNCo. Next morning the AFP Commissioner maintained that there had been no political influence on the investigation, nor the timing of the raids, and that the relevant minister, the leader of the opposition, and even Conroy himself, had only been advised of the ‘investigation’ when the raids were commencing. But consider these hypothetical scenes. More…

Hordes of illiterates
Ad astra, The Political Sword, 24 May 2016

If you had to pick a minister to deliver a nasty message, you would not go past Peter Dutton, master of cruel comments, replete with his trademark po-face and matching body language. Last week, on Sky News, responding to the suggestion by the Greens that we should up our refugee intake to 50,000, his comment was... More…

Dead cats and reset buttons
2353NM, TPS Extra, 23 May 2016

Let’s not give further oxygen to Immigration Minister Peter Dutton’s nonsensical, bigoted and racist comment the other day regarding refugees coming to this country, taking our jobs and adding to our unemployment queues. Apart from the obvious flaw in the argument (if you lower yourself enough to call it that) how can people are take our jobs and add to our unemployment statistics at the same time? Dutton’s outburst is factually wrong on so many levels. More…

The barbie bigot is back: on Turnbull
Ken Wolff, TPS Extra, 22 May 2016

I previously took Brandis’s advice that we have a right to be a bigot an’ had a go at our last PM, pommy Tones, an’ said I was willing to refund his £10 to send him back to pommy-land, especially if we could spare an orange life boat for him. Now I want to have a word or two about the new PM, this Mal bloke. More…

Top hats versus hard hats
Ad astra, The Political Sword, 22 May 2016

Now that the official election campaign has entered its second week, it’s time to assess how each of the major political parties is framing its narratives. More…



Medical ice age: big freeze continues
2353NM, TPS Extra, 20 May 2016

In a previous piece I asked why the freeze on Medicare rebates, that has been in effect since November 2012, was not a major issue. I did not expect that it would be dropped in the 2016 budget but I also did not anticipate that it would actually be extended to 30 June 2020. It adds to the continuing assault on Medicare and our health system generally by the LNP. More...

For earlier items on The Political Sword at a Glance click here. 
The campaign bus
2353NM, The Political Sword, 18 May 2016

So who’s enjoying the current federal election campaign? The television stations certainly are as they are boosting their revenue by the second through showing the election advertising for the various political parties and lobby groups. The newspapers are also getting their share of additional advertising revenue. There are probably some people that are also enjoying rather than enduring the media reporting of the election campaign. At the speed that the election has fallen from top billing on the nightly news, it’s probably fair to suggest that most Australians are, to coin a phrase, gritting their teeth and thinking of the mother country. More…

The mythical $80,000
2353NM, The Political Sword, 15 May 2016

Some reading this would be able to remember the days when the urban dream was the quarter acre block in a ‘nice’ suburb, with a Holden, Falcon or, if you were a real radical, a Valiant parked in the driveway. If you’re younger, you’ve probably seen the concept on any one of a number of Australian history television shows over the years. More…

Jobs and growth, but what jobs?
Ken Wolff, TPS Extra, 11 May 2016

There are two key aspects to the government’s ‘jobs and growth’ mantra: one that it has been successful in creating 300,000 jobs and that its cut to company tax for small businesses will encourage business expansion (growth) and create more. Both assertions, however, are a bit rubbery to say the least. More…

Trickle down thinking breeds inequality
Ad astra, The Political Sword, 11 May 2016

In a piece published on 13 April, I predicted that inequality would be a hot button issue in the upcoming election. Now that we have had both Scott Morrison’s budget speech and Bill Shorten’s speech in reply, we can see how this issue will play out in the election. Although the word ‘inequality’ has not assumed the repetitive status of the ‘jobs and growth’ mantra, it is subtly pervading the political discourse. More…

My innovation is bigger than your innovation
Ken Wolff, The Political Sword, 8 May 2016

Malcolm Turnbull launched his ‘National Innovation and Science Agenda’ on 7 December last, three days after Labor had launched its ‘start ups’ policy, ‘Getting Australia Started’. The launch dates for the policies mean little, as obviously before such a launch there has been considerable background work and consultation – by both parties. So, if they have both done the work beforehand, do they come to the same conclusions and have they found and addressed the real issues facing us in our future ‘innovation economy’? More...

36 Faceless men
2353NM, The Political Sword, 4 May 2016

Let’s face it, the Australian political system is a winner take all arrangement. Either the ALP or the Coalition will win any given state or federal election and then proceed to implement some version of the policy that was voted on by the members of the political party at various conventions. More:

Why isn’t the Medicare rebate freeze a major issue?
Ken Wolff, TPS Extra, 2 May 2016

Although the former Abbott government dropped its $5 co-payment for Medicare it retained and extended a freeze on Medicare rebates that has the potential to introduce a co-payment by stealth. Read more here:



Lords and Ladies: the world changes
Ken Wolff, The Political Sword, 1 May 2016

My Lords and my Ladies, I beseech your indulgence, here before your magnificent court, to present for your amusement and moral edification the fourth iteration of the tale of Tiny Napoleon O’penmouth and his rival Mal C’od-turn-a-bull. Read more here:


Divining the federal budget
Ad astra, TPS Extra, 30 April 2016

Some of you may question the purpose of trying to divine what will be in the May 3 federal budget when the Turnbull Ship of State seems to be all at sea, wallowing towards an uncertain destination, facing strong headwinds, its sails flapping, its hull leaking, with a dithering Captain at the helm, a loquacious and at times incoherent First Mate insisting he knows where he’s going, and a motley crew. Read more here:

Policy from behind the scenes
Ken Wolff, The Political Sword, 27 April 2016

Any good public servant will tell you that policy is determined by government ministers. In Senate Estimates, and other committees, you will often hear public servants say they cannot comment on policy issues, that such questions should be directed to the minister. That is the way our system works in theory but does it actually operate that way in practice? Read more here:

Castles in the air
2353NM, The Political Sword, 24 April 2016

One of the points of difference between the Turnbull Government and the Shorten Opposition is negative gearing. We would all still be here next week if the current regime and the proposals were discussed in full, so how about we attempt to do the ‘helicopter’ version. Just keep in mind that this article is general in nature and doesn’t consider your financial situation. Read more here:

The shifting risk of superannuation
Ken Wolff, The Political Sword, 20 April 2016

Since the 1980s, Australia has changed the way we prepare for our retirement. Rather than depending on an aged pension from the government and some personal savings, greater emphasis has been given to superannuation and building retirement incomes in that way. All three remain in play for retirement but for most employees superannuation has become the major component. Read more here:

So we do have a revenue problem after all – now Moody’s says so
Ad astra, TPS Extra, 20 April 2016

Who could ever forget Scott Morrison’s astonishing statement when he became our nation’s treasurer: Australia doesn’t have a revenue problem; we have a spending problem! Balanced economists were aghast. Read more here:

What can we expect in the coming election
Ken Wolff, The Political Sword, 17 April 2016

Apart from the obvious statements, we can also tell there is an election in the air as, after six months of inactivity, the Turnbull government has engaged in a flurry of policy announcements — or in some cases what should be termed policy ‘thought bubbles’. That is not to mention the concomitant increase in television advertising for existing government programs and policies. Read more here:

Inequality will be a hot button election issue
Ad astra, The Political Sword, 13 April 2016

No matter who writes about inequality, the conclusion is the same: the gap between those at the top and those languishing at the bottom of the pile is widening in many countries, ours among them.

A more familiar way of talking about inequality is to talk about ‘fairness’, a concept every Aussie understands. The ‘fair go’ is valued by most of us. Who would argue against the idea that everyone should have a ‘fair go’?
Read more here:

Perceptions of corruption
2353NM, TPS Extra, 13 April 2016

During March, in what strategists at the time claimed was a masterstroke, Prime Minister Turnbull recalled the Parliament from April 18 primarily to consider the reintroduction of the ABCC legislation by the Senate. Turnbull also advised that if the ABCC legislation was rejected in it’s current form the response would be a double dissolution election. Others questioned why there was a ‘demonstrated’ need for an anti-corruption body responsible for the building industry and not other areas of Federal Government influence.
Read more here:

The calamitous Abbott lies in wait
Ad astra, The Political Sword, 10 April 2016

You may wonder why anyone would waste time writing about this man, erased from the top job by his own party, and discredited in multiple ways by commentator after commentator. For me, the reason is twofold. First, he is still confronting us day after day in the media, and just as importantly his successor is doing so poorly that some want Abbott to return. Read more here:

Continuity and change
2353NM, The Political Sword, 6 April 2016

Malcolm Turnbull’s re-election campaign started well. He tried out ‘continuity and change’ as a slogan when announcing the potential election date of July 2. While it might have been accidental, pinching the ‘meaningless’ election slogan from a US political satire could be seen as an indicator of the standard of the research and advice Turnbull is getting. Read more here:

The small government myth
2353NM, The Political Sword, 3 April 2016

Politicians are a strange breed. They will spend millions at elections time attempting to convince you that their side is better than the other because they will better manage the country. They will also tell you that they have irretrievable differences with their opponents and in essence – it’s their way or the highway. Read more here:





Malcolm’s Magic Pudding
2353NM, TPS Extra, 2 April 2016

Around 100 years ago, Norman Lindsay wrote what certainly has to be one of the classic Australian Children’s books ‘The Magic Pudding’. The story revolves around the owners of a pudding that automatically regenerates after a slice is cut being chased by dastardly ‘puddin thieves’ who in the end get their comeuppance. Read more here:


The irrational voter
Ad astra, The Political Sword, 1 April 2016

Those who think logically, who base their opinions on facts, figures and reason, are astonished at the decisions that some people make, decisions that seem to run contrary to evidence and logic. And it doesn’t matter if they are interested, intelligent, and in possession of the facts. Where the application of rational thought would be expected, out of left field they reach decisions that surprise because they are irrational. How often are voters irrational?
Read more here:




Where are the crooks?
Ad astra, The Political Sword, 30 March 2016

Ask Tony Abbott where the crooks are and he would repeat what he said when he set up the Royal Commission into Union Governance and Corruption: the crooks are clustered in the unions, particularly the construction unions, and most of all in the CFMEU. The last two words of the Commission’s title capture Abbott’s diagnosis. Unions are corrupt; the Commission’s task was to ascertain how corrupt. Read more here:

May your god go with you
2353NM, The Political Sword, 27 March 2016

It seems that the Australian Christian Lobby (ACL) is the keeper of the morals and ethics of a number of conservative politicians in this country. So does the ACL really represent the views of christian Australia, or is it an attempt to enforce the views of a small group of people upon the majority?

To look at the views of the ACL, we need to do a bit of bible study. Those that will tell you that the bible is an accurate historical document have a fundamental problem in that the New Testament (the bit about Christianity) was written sometime after the events occurred.

Read more here:


Politicians and nappies
2353NM, TPS Extra, 24 March 2016

To paraphrase Mark Twain, Politicians and nappies must be changed often and for the same reason. Malcolm Turnbull effectively called the election this week and while a 15 week federal double dissolution election campaign is long. It could be worse – we could live in the USA! Read more here:

The Peter Principle again – has the GOVERNMENT reached its level of incompetence?
Ad astra, The Political Sword, 23 March 2016
It is not often that we see The Peter Principle played out before our very eyes. We saw it recently with ex-PM Tony Abbott and his Chief of Staff, Peta Credlin as they were promoted from opposition where they were deemed to be competent, to government where they were manifestly incompetent. Are we seeing it again with the Turnbull government? Read more here:

An ode to Mal Brough
2353NM, The Political Sword, 20 March 2016

Malcolm Thomas Brough was born in December 1961. He is the current Member of Parliament for the seat of Fisher – based on Queensland’s Sunshine Coast. Between 1996 and 2007, he was the Member for Longman – based on Brisbane’s outer northern suburbs. Brough recently announced his retirement from Parliament would take effect at the next election. Read more here:

On which leg does the Liberal Party stand?
Ken Wolff, The Political Sword, 16 March 2016

The Liberal Party often describes itself as ‘a broad church’, particularly when its parliamentarians are expressing different views. It is to be expected that political parties will contain within them people with different views on some issues but it seems the Liberal Party has a basic philosophical dilemma.

John Howard famously described himself as ‘an economic liberal and a social conservative’ and referred to the philosophic traditions of John Stuart Mill (considered the ‘father’ of liberalism) and Edmund Burke (the ’father’ of conservatism) for those positions: Mill and Burke are interwoven into the history and the practice and the experience of our political party. Read more here:


Malcolm's Bitter Harvest
Ad astra, The Political Sword, 13 March 2016

It would be trite to begin with the platitude: You reap what you sow. To Malcolm Turnbull though, that cliché must have an ominous ring about it as he reflects on his past. To what extent has he brought upon himself the political troubles that afflict him now? Read more here:


Politicide
Graeme Henchel via TPS Team, TPS Extra,
11 March 2016

It was only for two years, that the Thug was in the job
In that short time, he proved to be, a hopeless lying nob
Was not just him, in this crew, the talent is so sparse
It was always going to be one enormous sorry farce
Read more here:

The Peta Principle – how Abbott rose to the level of his incompetence
Ad astra, The Political Sword, 9 March 2016

‘What’s wrong with Tony Abbott?” It’s a question that’s been asked ever since he rose to prominence as party leader, if not before. But then the question had a whimsical ring about it. What was wrong with a leader who was so nasty, so misogynist, so belligerent, so hell bent upon the destruction of his enemies? Read more here:

Let’s talk about tax
2353NM, The Political Sword, 6 March 2016

Taxes are the things that provide services to the community. They provide transport, social security, defence, education, parks, rubbish removal and so on. Read more here:




And the Robbie nominees are. . .
2353NM, TPS Extra, 4 March 2016

Welcome to the 2016 Australian Federal Election Awards. We are here tonight to present the nominations for the tri-annual awards, based on form and practice during the past two years leading up to the scheduled election this year. Read more here:



Safe Schools, Unsafe Politicians
Ad astra, The Political Sword, 2 March 2016

Now we see it, the Christian-Right Liberal reactionaries digging their cruel claws into PM Turnbull over the ‘Safe Schools’ program, one specifically designed to help kids understand that different individuals have different feelings about their sexuality, and that all of us ought to understand, respect, and accept these differences. Read more here:

Karma is a bugger
2353NM, TPS Extra, 28 February 2016

Karma is a Buddhist concept. Very briefly, the concept is that nothing happens to a person that they don’t deserve. The Buddist website explains it a lot better here in case you are interested. Others would be more familiar with the concept of ‘paying it forward’ which effectively is the same thing. The past week in Federal Politics would suggest they can't win a trick. Read more here:

Turnbull and authenticity
2353NM, The Political Sword, 25 February 2016

Question: What do Donald Trump (Republican Presidential hopeful) and Jeremy Corbyn (Leader of the British Labour Party) have in common? Well it can’t be their politics. Read more here:




The year of the union
Ken Wolff, The Political Sword, 24 February 2016
For the Chinese, 2016 is the ‘Year of the Monkey’ but I think in Australia it may well be the year of the union — although not in a positive way. As it is an election year, and in the light of the Trade Union Royal Commission (TURC) report in December, we can expect the Coalition government to have a lot to say about unions during the year. Turnbull, in releasing the TURC report, has already indicated that he will make union ‘corruption’ an election issue if his legislation to implement the TURC recommendations, including the reintroduction of the Australian Building and Construction Commission (ABCC), does not pass parliament. Read more here:

So we do have a revenue problem after all
Ad astra, TPS Extra, 16 February 2016

Who could ever forget Scott Morrison’s astonishing statement when he became our nation’s treasurer: Australia doesn’t have a revenue problem; we have a spending problem! Balanced economists were aghast. Any analysis of our balance sheet left no doubt that we needed more revenue to enable the government to provide the services the people need: Read more here:


Are governments ready for the coming economic and social changes?


In 1930 John Maynard Keynes predicted widespread technological unemployment ‘due to our discovery of means of economising the use of labour outrunning the pace at which we can find new uses for labour’.

In the decades since there has been rapidly increasing technological change but employment has generally been increasing, matching population growth, although not without winners and losers. The creation of new jobs often lags behind the pace of loss of jobs (as Keynes predicted) and those who have lost jobs are not always the ones who take the new jobs — they are often taken by the new generation.

Since the GFC, governments around the world have felt constrained in responding to the changes in the workforce because they lack money — they are in debt — and are being told by mainstream economists that they must return to budget surpluses. People losing their jobs are not being provided the full range of assistance they need to re-enter the workforce nor, in some cases, even the support to sustain themselves and their families whilst unemployed.

That is a direct result of the dominant neoliberal economic approach adopted by so many Western governments. The neoliberal emphasis on debt also has political implications and the following, although written about the US, 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.
While the neoliberal approach remains in place, governments will not be well-placed to respond to current and coming changes in the economy and workforce — selling public assets to reduce ‘debt’ will not help people. Modern Monetary Theory (MMT), on the other hand, offers an approach in which sovereign currency-issuing governments are not so constrained. It is possible for a government to both retain public assets and have the money to provide more programs and assistance to people in these times of economic change. Unless governments embrace a new economic approach like MMT, then the technological unemployment predicted by Keynes is likely to be a real outcome.

The spread of robotics and computerisation throughout the workforce is already happening without us being fully prepared. While there is talk of the need for improved education in things like STEM, computer coding and even innovative approaches, and of the need for a flexible, agile and innovative workforce, these are essentially economic issues and we seem to be ignoring some wider social implications.

A basic question in the rise of robotics is that of ethics. One writer raised an interesting ethical question in the scenario of driverless vehicles: if a driverless vehicle ‘perceives’ that it is about to be involved in an accident and the only pathway to avoid the collision may involve hitting a woman with a pram, which decision will it make? A human would likely make a moral judgment to face the accident and minimise the impact by braking, swerving slightly or whatever action is appropriate but will an automated vehicle see saving itself as the primary response? Whether driverless vehicles can ‘learn’ to place humans first in such situations is debatable. While theoretically driverless trucks seem to be one of the next major targets of computerisation, I think there are still issues to be resolved but I doubt they will be prior to their introduction as the economic imperative will over-rule the ethical.

Computerisation generally will displace many people from their current work, as discussed in more detail in ‘An economy without people’. New forms of work will emerge but how long will that take? Much of the new work will require higher level skills: will we have the capacity to retrain people for the new jobs or do they simply move to the ‘scrap heap’ to be replaced by the next, better educated, generation? As unemployment increases, how will governments respond? If our government is already complaining about welfare costs, it will find it difficult to provide for the new unemployed as computerisation pushes further into the workforce. With an ageing population, there should be a need to keep more people in the workforce but that may no longer be possible.

Some unemployed may voluntarily enter ‘the gig economy’ to help tide them over. But the gig economy may also be on the rise as companies decide it is more ‘efficient’ (cheaper) to hire workers only as they are needed for specific tasks or projects rather than maintain a larger full-time workforce, meaning many more people will be forced into the gig economy. While for people it is ‘the gig economy’, for economists and businesses it is the ‘on-demand’ economy: that difference in terminology also shows how people can be removed from consideration in the coming changes. Whatever it is called, it will have many implications.

Nick Wales at the UNSW Business School has raised one basic concern:
“It polarises people”, says Wales. “Is this creating communities of entrepreneurs who have been marginalised from the traditional economy, such as housewives, students, retirees and immigrants, offering them the flexibility of part-time working? Or is it an underhand way for businesses to get around labour laws and pay these contractors low wages?”
If more and more people are working in the gig economy and on short-term contracts, what rights will workers have? They will not have paid sick days or holidays, or protection from unfair dismissal. Even many occupational health and safety rules may not apply. They will also need to provide for their own superannuation but the extent to which they can may well depend on how much they are able to earn. And will unions find new ways to cover them or is this the final death of unions? (If the role of unions diminishes even further what impact will that have on the future structure of the ALP?) Will these gig workers be treated as, or choose to become, small businesses? We have already seen the problems created by the use of ‘contract workers’ and in the new economy that looks set to expand exponentially.

How do banks respond to people who do not have full-time work/regular income if they are working gigs? At the moment, loans to such people would either be out of the question or, at best, be classified at high risk of default. If, however, this form of work becomes normal for a large proportion of the workforce, banks simply cannot ignore such a significant customer base. There will need to be innovative products that cater to the needs of such customers.

Banks may become more important in another way. There is a possibility that people will become more reliant on debt (loans and credit cards) to carry them through between gigs. It may be in the interest of banks to move into areas of lending currently dominated by the so-called ‘payday lenders’ as there is likely to be a growing market for such short-term products. Banks will have much thinking to do about their role in the new economy.

The gig economy has implications for how government views employment and unemployment as the 37-hour week may no longer be the norm. The OECD is already working on new indicators for employment and unemployment. It is likely, however, that any new definition of ‘employment’ will reduce access to unemployment benefits as it is likely to involve shorter periods of work. Even paying unemployment and other welfare benefits in their current form may no longer be appropriate as they are tied to levels of income. The ‘paperwork’ (data entry) involved in making constant adjustments as people move in and out of short-term jobs (some very short-term) will become onerous as the number of gig workers increases. New forms of payment may be required.

Then there are issues of government regulation and taxation. Already the ATO has ruled that Uber drivers must register for and pay GST as they are providing a ‘taxi travel service’. Current taxi drivers believe Uber is not competing on a level playing field because it does not need to meet the same licence and safety regulations. Victorian cab drivers are protesting a Victorian government announcement that it intends to deregulate the industry. While that may create the level playing field the drivers are seeking, they are not happy that the Victorian government is offering to buy back current taxi licences at a price below what many paid.

On the other hand, if more ‘workers’ are operating as contractors and small businesses, what impact will that have on government revenue, particularly if the push continues to lower company tax rates? Governments may need to reconsider that approach as ‘company tax’ could conceivably become the biggest source of revenue as more people in the gig economy register as small businesses to reduce their taxation.

Deregulation and ‘contract work’ or operating as a small business do not provide the full answer — although it will be attractive to the neoliberal economists and, as such, support for those approaches may be the advice that governments receive. It would mean a large workforce not protected by any provisions for safety, holidays, superannuation nor even hours of work. As Wales suggested, it would allow companies to under-cut existing wage structures and make full-time employment even less attractive for other competing businesses, creating a feed-back mechanism encouraging further use of gig workers.

The Aspen Institute in the US, however, does not believe that governments should regulate but allow companies, workers and consumers to experiment with new models:
… that can begin to give shape to a social contract for a changing economy and new century. We need a better system that ensures workers have the stability and security they need, without stifling innovation or undermining the flexibility the on-demand economy offers.
While suggesting that ‘stability and security’ are required for workers it is basically leaving that to ‘the market’ to determine. Given the history of market solutions, I would have no faith in it reaching a suitable arrangement — because, as explained in the first article in this series, ‘the market’ after all is people manipulating trading for their own advantage and it is to their advantage to have an insecure workforce that is less likely to make demands regarding wages and conditions. Government, even if intending to allow such an approach, must hover at the edges and be prepared to regulate minimum conditions.

While a new economic approach like MMT will help governments understand that they do have the money to deal with problems, it is not the answer to all the issues I have raised (it is, after all, a macroeconomic theory). I am concerned whether its Job Guarantee can be used in the new economy or whether it, too, is based on a model of full-time employment.

At Davros earlier this year, a report to World Economic Forum stated:
During previous industrial revolutions, it often took decades to build the training systems and labour market institutions needed to develop major new skill sets on a large scale. Given the upcoming pace and scale of disruption brought about by the Fourth Industrial Revolution, however, this is simply not an option. Without targeted action today to manage the near-term transition and build a workforce with future proof skills, governments will have to cope with ever growing unemployment and inequality, and businesses with a shrinking consumer base.
So the final issue is that it is not just workers who will suffer. Robotics, computerisation and an increasing number of gig workers will each contribute to ‘a shrinking consumer base’ and that has implications for business survival — in essence, their rush to reduce costs could be creating the conditions for their own demise. That in turn will impact government revenue in lower company and individual tax revenue — but only if they continue to cling to the neoliberal economic approach. If there is a silver lining to this ‘cloud’, it may be that the neoliberal economic approach will be shown to provide an inadequate response to the new situation.

With the possibility of declining consumption and problems redefining employment and unemployment, the concept of a ‘universal basic income’ may gain more traction. Although a proposal to introduce such a payment was recently voted down in Switzerland, it is being considered in Finland and the Labour Party in the UK has begun discussing the concept. In simple terms it is an income payment made to every man, woman and child. It has the potential to replace virtually all welfare payments including pensions, unemployment benefits and family support payments for children: in the case of unemployment, it would remove the need to redefine ‘employment’ to meet the circumstances of the new economy. As it would be paid to everyone, it means those who are working would also receive the payment and it becomes necessary to apply tax to the payment so that those who are in work return a much greater proportion of it in the form of tax. Even the MMT approach would require taxation of such a payment to ensure that it did not create demand beyond the productive capacity of the economy. For businesses it would help maintain the consumer base and so be of benefit to them. With fewer workers, the productivity benefits of robotics and computerisation will not be spread throughout society but further concentrated in the hands of the company owners and shareholders, unless something like a universal basic income is adopted. As robotics and computerisation spread and replace major portions of the workforce, such an approach may become the only viable option.

It appears we have a rocky road ahead. Governments will not be able to respond effectively if they cling to neoliberal economic approaches. Avoiding regulation and spending, and leaving resolution to ‘the market’ will be a recipe for disaster and even businesses will suffer. Without new approaches we will continue to have an economy in which people are placed last and well-being is barely a consideration.

It is time this conversation began because if we leave it until the impact is being felt, it may be too late to avoid a major economic downturn, ironically created by the very process businesses thought would boost their profits.

What do you think?
Are businesses blindly pursuing robotics and computerisation without fully understanding the wider implications?

Can ‘the market’ be trusted to reach new solutions or must governments first find new approaches (including MMT) to protect the people?

Let us know in comments below.


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Who is the culprit?
Ad astra, 25 September 2016
When you reflect on the dilapidated state of federal politics; when you question how on earth we have become encumbered with so many appalling policies, do you ever ask: 'Why is it so?'

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Who is the culprit?

When you reflect on the dilapidated state of federal politics; when you question how on earth we have become encumbered with so many appalling policies, do you ever ask: 'Why is it so?'

I do often. And when I do, one culprit emerges over and again. Who is it?



Who in this motley collection is the culprit? Who is responsible for these policy calamities?

You be the judge. It's not a big challenge for the politically astute, but it might be revealing for the casual political observer.

Let's look at just a handful of policy catastrophes that afflict us still.

Consider global warming
Leaving aside the uninformed utterances of our new One Nation senator Malcolm Roberts and all the other climate deniers, there is strong consensus among thousands of climate scientists that the planet is warming inexorably towards levels dangerous to life on earth, which if not curtailed will become irreversible. A majority of ordinary people believe this to be true, and want something purposeful and effective to be done about it. So what is being done?

All our government is doing is implementing its so-called 'Direct Action Plan'. No environmental scientist or economist worth their salt can demonstrate that it is working, or even can work. It's a dud. Since Labor's 'carbon tax' was repealed and the DAP began, carbon emissions, which had begun to fall, are now rising again. Forget all Greg Hunt's talk about Australia 'meeting and beating' its emission targets, and Josh Frydenberg's reiteration of it. Emissions are increasing. We are not pulling our weight as global citizens. We are frauds in the climate change world.

Why is it so?

Who was it who thwarted the move towards an Emissions Trading Scheme that PM Kevin Rudd and Opposition Leader Malcolm Turnbull had agreed upon? Who used this nascent agreement to upend Turnbull and take his position? You know. Who used the repeal of the 'toxic carbon tax' as a powerful weapon in gaining power. You know.

Have you reflected upon how destructive a move this was, one that left this nation far behind comparable countries, one that made us a pariah? We have never recovered from that, and never will while we have no ETS.

Turnbull lost his leadership over this, and even today clings to it by a thread, obliged as he is by his deal with the conservative clique in his party to make no change to climate change policy. But he was not the culprit. He did not dream up the DAP; he supports it now only to save his skin. It was he who boldly said he would not lead a government that did not take effective action to combat global warming. His support for the DAP is insincere. It puts the lie to his previous pro-ETS utterances. It belittles him. You know who the culprit is in this sorry tale of missed opportunities and ineffective action.

Of all the misdemeanours of our prime culprit, this is the most egregious. It is quite the most dangerous. It is shameful. You know who the culprit is.

Consider the National Broadband Network

It is a strange coincidence that our prime culprit and our current PM were also the players in this sorry saga. Labor proposed a fibre-to-the-premises NBN that experts around the world acknowledge is the ideal model, one that would give the best results and provide this nation with an enduring position in the communications world, and a competitive advantage over those nations with inferior models.

You will have no difficulty recalling who instructed the then Communications Minister, Malcolm Turnbull, to 'demolish the NBN'. Demolition was his modus operandi. Anything Labor did must be demolished irrespective of whether it was in our national interest to keep it. Turnbull must have been horrified. His reaction was to create a hybrid, multi-technology model with a substandard compromise of fibre-to-the-node on the street corner with ageing copper wire to the premises. Turnbull knew this was an inferior model, but at least it was better than demolition. So we are now stuck with a model that will leave this nation well behind in the world of communications and uncompetitive, just when our PM tells us that we must be innovative so that we can be globally competitive.

It is shameful that this has occurred for no other reason than our prime culprit regarded anything Labor created was anathema, and therefore must be destroyed. It is shameful too that tech-head Turnbull now vigorously but unconvincingly defends the Coalition's NBN. He knows it will be inferior, probably will cost the same as Labor's, and might be no faster in rollout. Turnbull has sold us another pup with his FTTN NBN. But there is no gainsaying who is the prime culprit in this lamentable saga. But for him we could have had the best, but now we are stuck with second-best or worse. All the talk about the excessive costs and slow rollout of Labor's model has turned out to be bunk. Now Turnbull is trying to convince us that users don't want the fast speeds Labor's FTTP guaranteed. Has he checked whether businessmen want and need very fast speeds to be competitive?

Our prime culprit has inflicted on our nation yet another destructive decision born of adversarial hatred of anything his opponents proposed to do. You know who he is.

Consider marriage equality

We all know our prime culprit does not support same sex marriage, no matter what he says. So, knowing there was clamour from the community to introduce marriage equality to reverse the Howard government's 2004 insertion of 'between a man and a woman' into the Marriage Act, done so subtly by a simple parliamentary vote, our prime culprit sought to thwart attempts to change the Act by insisting it be put to a plebiscite after the recent election.

He knew a plebiscite would delay a decision; he knew that he could obscure the matter by allowing lots of time for debate and argument 'from both sides'. He is ideologically opposed; same sex marriage is contrary to his religious beliefs. He does not want it, although the community does. He hopes that by fostering debate religious groups can cast doubts in the minds of voters. He knows that doubt is a potent element in any public vote, be it referendum or plebiscite.

He knows that if his allies in opposing marriage equality, prominent among whom is the so-called but unrepresentative Australian Christian Lobby with its persuasive spokesman Lyle Shelton, are given a chance to spread misinformation, fear and doubt, even bigoted views, it might engender a 'No' vote in the plebiscite. He is devious, cunning and ruthless. His conservative supporters have locked PM Turnbull into supporting the plebiscite, although Turnbull himself supports marriage equality.

If the plebiscite fails to reach a majority in favour of marriage equality, just one prime culprit will be responsible.

Now think about income and wealth inequality

You don't hear Liberals talking about inequality - they accept it as the normal state of affairs. There have always been the Lords and the Ladies and the Serfs to bow before them. Driven by their entrenched neoliberal belief in the power and wisdom of markets, they cling tenaciously to the long-discredited theory of supply-side economics, colloquially known as 'trickle down' economics, which posits that tax cuts given to the top end of town trickle down as benefits to the workers in the form of more jobs and better pay. It's bunk, but advocates recite this belief like a catechism mindlessly repeated during worship.

All the evidence is that inequality is increasing in this country. It has been for years. It shows no sign of lessening. The construction of the 2014 Budget made inequality even worse. Neo-liberals don't acknowledge this; neither do they care about it.

Who is the culprit?

Some may identify Joe Hockey, or his successor, Scott Morrison, but think about who put them up to their budgetary strategy. The 2014 Budget was not Hockey's; the punitive attack on the less well off was authorised and endorsed by our prime culprit. He was the one who was prepared to punish the poor. Even his supporters acknowledged that the Budget was unfair, the most unfair in many years, and that those who had the least were targeted for the most punishment. Why is our prime culprit so mean?

To add insult to injury, the Coalition now proposes to give generous tax cuts to businesses. This includes the banks and wealthy international companies, many of whom pay little or no tax anyway.

The budgetary assault on the less well off and the attack on Hockey's 'leaners' are shameful, and equally the handouts to the well off are obscene.

So who is the culprit?

We know that there are a few good politicians, many mediocre ones, several poor ones, and an occasional lamentable one. This piece argues that there is one person, just one, who has inflicted on the Australian public a succession of appalling policies, just four of which I have outlined. His egregious actions have diminished us as a nation.

He has made us a pariah in the world of climate change action. He has thrust upon us an inferior broadband network that will curtail our competitiveness. He has manipulated the debate about marriage equality to diminish its chances of becoming law despite the public's wish that it be so. He has accepted inequality as the norm in our society and has sought to make it worse.

Can you think of a single politician who has inflicted so much destruction, so much damage on our society? Can you identify a meaner person whose adversarial nature has caused so much harm?

Yet he still hovers in the background like a ghost of things past, quietly, subtly eroding confidence in his successor, hoping for another opportunity to wreak havoc once more upon our lucky country.

You know who the culprit is.

If you are still scratching your head, click here!

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

Did you identity the prime culprit?

Do you agree with my assessment of who fits this description?

What is your assessment of this person?
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What is Modern Monetary Theory and will it help?


Modern Monetary Theory (MMT) is a macroeconomic theory for the current age in which governments have abandoned the gold standard and also floated their currencies. It is ‘macroeconomic’ and ‘monetary’ because many of its conclusions relate to the money supply in an economy. Does it offer scope for a new economic approach recognising people? Can it better assist responses to robotics and computerisation than current economic approaches?

Historically, gold was important because coins were minted from it (and silver). Even when coins were no longer minted in gold, the currency issued by governments was convertible to gold and governments needed to hold sufficient gold reserves to satisfy a potential demand from all holders of their currency — that was the gold standard. In that situation governments could not spend without first taking money from the economy (taxation) because the money supply was limited to match the quantity of gold. Following WW2, fixed exchange rates also meant that governments, through their central banks, had to defend the rate they had fixed by buying or selling their own currency in international money markets: that also affected the money supply in their home economy and also placed limitations on government spending. Floating currencies now allow central banks and governments to target domestic economic policy goals knowing that the floating exchange rate will resolve the currency imbalances arising from trade deficits or surpluses.

MMT points out that much economic thinking since the 1980s operates as though the gold standard is still in place — namely, that governments can only fund their spending by taxation and therefore deficits are bad — but some MMT proponents and supporters argue that this has ideological (neoliberal) rather than genuine economic underpinnings.

Since the abandonment of the gold standard, most countries, including Australia, now have a fiat currency — that is, it is created by government fiat (decree) — and it has no intrinsic value. My $50 note is not matched by $50 worth of gold any longer, nor is my plastic note worth $50 itself (in 2012 Australia’s polymer notes cost 34c each on average to produce irrespective of their face value). My note has value only because the government decrees it has and the government is the monopoly provider of currency: therefore it is the currency I need to participate in the economy and to pay taxes.

MMT places this new reality at the centre of its approach. A sovereign government issuing its own currency can never run out of money, never go bankrupt or default on its ‘debt’. That in a sense was Greece’s problem: as part of the Eurozone it was no longer an issuer of its own currency. In that circumstance, as for the states within a sovereign nation, the oft-used analogy of a household budget still applies but it does not apply to the sovereign issuer of a currency.

The ‘sovereign issuer of currency’ argument leads to probably the most well-known and sometimes controversial aspect of MMT, that a government can always ‘create’ money. The critics argue such printing of money — although these days it actually requires only a few keystrokes on a computer to create deposits in the private banking system — will lead to hyperinflation as in Zimbabwe or the Weimar Republic in post-WW1 Germany. MMT accepts that inflation is one factor that imposes a limit on government spending but that limit is not reached until all the ‘real’ resources of the economy are fully utilised — all human resources (full employment) using all available physical resources. If a government continues to spend after that, then dangerous inflation may result but, prior to that point, MMT argues that government spending to assist utilisation of available resources will not lead to uncontrolled inflation. For MMT, the issue is not just money but the real human and physical resources that are available to the economy and not currently being used:
If there are slack resources available to purchase then a fiscal stimulus has the capacity to ensure they are fully employed.
As a means to help control inflation, current mainstream economic thinking accepts the Non-Accelerating Inflation Rate of Unemployment (more commonly known by its acronym, NAIRU). The Australian Treasury uses NAIRU in its modelling as the basic foundation of longer-term stable inflation — currently the NAIRU in Australia is 5% unemployment. Before NAIRU, full employment was taken to mean there would be about 2% unemployment, allowing for people moving between jobs or unemployed short term for various reasons. In practice, NAIRU provides a ‘buffer stock’ of unemployed which basically means that having those extra unemployed, above the previously accepted 2%, provides downward pressure on wages growth because the unemployed are more willing to accept lower wages simply to have a job. The argument goes that if unemployment falls below the NAIRU level the competition for workers will mean employers accept demands for higher wages thus leading to higher inflation. (Despite the whole capitalist free market system being based on competition, whenever workers appear to have a competitive advantage it is decried as a threat to the economy!)

MMT rejects the NAIRU and instead proposes a Job Guarantee for the ‘unemployed’, sometimes referred to as ‘transitional employment’ which probably describes it better. As opposed to the NAIRU ‘buffer stock of unemployed’, MMT offers a ‘buffer stock of employed’ but this is done at a ‘fixed price’ — in Australia this would be the minimum wage, inclusive of standard employment conditions. It means the government supports employment until such time as a person obtains higher paying mainstream work and it will be in productive work using under-utilised resources:
What matters … is whether there are enough real resources available to produce goods and services that are equal in value to the government’s job-guarantee spending. If these resources are available — if they are not already being used to produce something else — then the increased demand that results from the payment of job-guarantee wages will not be inflationary, regardless of what they go to produce.
On broader monetary issues, MMT says that there can only be saving in the private sector, inclusive of banks, businesses and households, if the government spends more than it collects in taxes: that is, only when the government adds money into the economy can there be private sector saving as well as investment.

A good, simplified explanation of this was provided by John Carney at CNBC in 2012:
The MMT people aren’t actually referring to you and I saving. They aren’t even talking about the entire household sector saving financial assets. They are talking about the entire private sector spending less money than it earns.

You can easily see why this would be impossible without the government spending more than it collects. Every dollar someone is paid is a dollar someone else has spent. If we all — every single person and company — spend less than we are paid, very quickly we will find we have to be paid less. The aggregate effect of savings is to reduce the total amount people are being paid for things.

So this is what MMT people are talking about when they refer to a “private sector desire to net save.” They mean that if you add up all the earning, spending and savings of every person and company in the economy outside of the government, sometimes you find that the private sector is trying — nearly impossibly — to earn more than it spends.

The only thing that can make private-sector net savings possible is government spending. If the government spends more than it takes in taxes, the private sector can earn more than it spends. Remember, if everyone pays less than they earn, some outsider must be paying more than he earns.
The MMT equation for this is:

(G – T) = (S – I)

Or in words, government spending (G) minus taxes (T) equals private saving (S) minus gross private investment (I). This is so because in macroeconomic terms the two represent the entire amount of money in the economy. And the other key of this equation is that it shows that money does not come into being in the private sector unless the government has first spent it (over many years now).

MMT points out that when governments run surpluses it leads to an increase in private sector debt because, in that circumstance, if the private sector wishes to save and invest, it has to borrow from the existing pool of money (and the government surpluses are actually reducing the money supply). This is explained by the concept that transactions between banks, businesses and households are ‘horizontal’ transactions and cannot change the amount of money in the economy (liquidity). Only a ‘vertical’ transaction between the government and the private sector can change liquidity (MMT includes both the treasury and central bank when it talks of ‘government’).

In the USA, on all occasions when the government has run surpluses, and reduced debt for a few years, it has been followed by recessions or depressions. Arising from the indebtedness forced on the private sector by the government surpluses, there comes a point when the private sector reduces spending because it cannot afford to take on more debt, thus creating an economic slow-down. In such circumstances, only government spending can relieve the situation. (It is also of interest that since 1776 the US government has been in debt in every year except for the years 1835 to 1837.)

In a globalised world, however, national economies do not operate in isolation so one more aspect needs to be added to the equation: exports (X) and imports (M).

(G – T) = (S – I) ‒ (X – M) or

(G – T) + (X – M) = (S – I)

If a country has a trade surplus that adds to private savings. Many countries, however, as Australia, operate a trade deficit which means that private sector saving is reduced and more reliant on government spending. And at a global level the nett outcome of all countries’ trade must sum to zero, so it is impossible for every country to run a trade surplus — a surplus in one country necessarily requires a deficit in other countries. So a trade deficit or surplus is not bad in itself but does affect private sector saving and creates more need for government to adjust its spending appropriately.

Although even MMT still talks about deficits and surpluses, my reading is that those words are less relevant in MMT. If a government can create money it can never really be in deficit (except perhaps in a point-in-time accounting sense). Even claiming that the deficit represents spending more than collected as taxes is not relevant. MMT says that the government does not need taxes in order to spend — it can always create whatever money it needs. The real purpose of taxes is to take money from the economy or, in economic terms, to reduce liquidity, meaning there is less money to spend and thereby total demand across the economy is also reduced. What taxes can achieve is to create ‘space’ for government spending. If an economy is already running at capacity and the government continues to spend, that is increases liquidity and demand without first making space for that spending, then high levels of inflation may result because there is more money in the economy to buy the same amount of goods and services, meaning people competing for those goods and services are willing and able to pay higher prices to obtain them. So taxes can be important in allowing government spending without dangerous inflation but are not necessary in themselves for that spending.

Similarly MMT argues that the sale of government bonds is not necessary to fund government ‘debt’. So-called ‘debt’ can actually be met at any time because the government can ‘create’ the money to do so. But as always the limiting factor is controlling demand in relation to the capacity of the economy so as not to allow dangerous levels of inflation.

MMT’s explanation is that the sale of government bonds is primarily a means of controlling interest rates: this relates to the overnight commercial bank reserves placed with the central bank but I won’t attempt to explain how that works. (This interview with Bill Mitchell for the Harvard International Review provides an explanation and also a good summary of MMT.) A secondary reason is that banks, financial markets and the private sector generally, desire government bonds as a safe haven to park money. Here in Australia, that became obvious during the Howard/Costello years when the government paid down its debt and saw little need to make new bond issues but the private sector complained and the government had to issue more ‘debt’ even though it had no debt: that fact alone gives credence to the MMT argument.

Although the approach is called Modern Monetary Theory, it places more emphasis on fiscal policy. Bill Mitchell writing on the current economic problems said, ‘until we stop relying on monetary policy and restore fiscal policy to the top of the macroeconomic policy hierarchy, nothing much is going to change’. Mitchell argues that governments have been using the wrong approach to overcome the current economic stagnation affecting many countries:
It is not that they have run out of ammunition. They have been using the wrong ‘ammunition’. For example, trying to drive growth with low or negative interest rates failed to work because the lack of bank lending had nothing to do with the ‘cost’ of loans.

It had all to do with the dearth of borrowers. Households, carrying record levels of debt and facing the daily prospect of losing their jobs, were not going to [start] suddenly bingeing on credit again.

Business firms, facing slack sales and a very uncertain future, could satisfy all the current (low) levels of aggregate spending in their economies with the existing capital stock they had in place and therefore had no reason to risk adding to that capital stock.
In the MMT model, the remedy to many economic problems is fiscal stimulus not austerity which only exacerbates the problems. And as a sovereign issuer of currency the government always has the capacity to provide such a stimulus when there are under-utilised resources in the economy.

Using fiscal policy, and the knowledge that governments can spend as much as they wish, limited only by available real economic resources and inflationary impacts, MMT suggests that the real issues are social policy issues. The debate should not be about ‘debt and deficit’ but what we as a society wish to achieve, wish to become, and, within the limits mentioned, governments do have the capacity to meet those goals. For me that is an important outcome from MMT, not just that it offers a new economic approach but that it offers scope for a new policy and political approach. To that extent, it does allow space for people by creating an economic approach that recognises social policy goals are of critical importance and the ability to achieve them is not so limited or proscribed as it is by existing neoliberal economic theory. For that reason alone MMT deserves more attention.

Next week, in the last of this four-part series, I will consider whether governments are ready for the coming economic and social changes.

What do you think?
Can MMT really change government thinking and overcome current neo-liberal approaches, not just in government but in Treasury?

Will it take a new generation of economists before MMT is accepted? Will that be too late to help the people?

Let us know in comments below.


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2353NM, 11 September 2016
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It’s all about me
2353NM, 18 September 2016
At the risk of earning a Godwin Award in the first sentence, according to those who staffed his office, Hitler was a kind and paternal man. Apparently Goebbels was kind to his family as are no doubt most of the world’s leaders today.

However, the same people who make sure they …
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It’s all about me


At the risk of earning a Godwin Award in the first sentence, according to those who staffed his office, Hitler was a kind and paternal man. Apparently Goebbels was kind to his family as are no doubt most of the world’s leaders today.

However, the same people who make sure they are kind to their staff, helpful for their friends and make sure they have a positive influence in their children’s lives can make the lives of people more distant from their immediate family absolutely horrific. It is history that Hitler and Goebbels were two of the leaders of a regime that murdered millions of people based on racial stereotypes, plunged the world into the second World War and left their country far worse off than when they came to power. It could be argued that there are leaders of a number of countries who are committing similar atrocities today. It is always good, however, to remember that one person’s ‘freedom fighter’ is another person’s ‘terrorist’.

A few months ago, SBS screened a documentary from the UK titled Troll Hunters. The narrator of the documentary is a young woman (Em Ford) who owns an internet beauty blog, giving other young women tips on how to dress according to the current trends and apply makeup. Like a lot of young people, Ford at times suffers from acne and part of the make-up tips she shares on the internet are methods to hide acne. Em Ford’s blog is located here. Unfortunately, and probably unsurprisingly, some of the comments Ford receives on her blog, YouTube videos and so on are less than complementary on her appearance, personality and taste in clothes and fashion. Some of those who comment are persistent, insulting and use copious amounts of foul language. So she sets out in this documentary to find her ‘nemesis’ and call that person to account.

So the search begins. Trolling is basically illegal, as it is using a ‘carriage service’ to harass and cause harm. As you would expect, most ‘professional’ trolls don’t leave much information behind to identify them, however there are people who can sometimes discover the identity of the ‘troller’.

Here’s the spoiler alert as the end of the documentary is the relevant section for the purposes of this article.

While Ford doesn’t find ‘her troll’, with help she locates a troll who was uploading pornography to the social media feeds of a woman who was a former British Conservative Party MP. Ford and the former MP confront the man outside his house and as you would expect the former MP has some interesting observations on the man’s behaviour and can express those views with an interesting variety of language. By arrangement, Ford interviews the ‘troller’ who is not sorry for what he’s done and, despite meeting his victim, doesn’t believe she is real. It appears there is a disconnect with the reality that every ‘cyber person’ with a social media account is somehow related to a real person with a right to be treated with courtesy and respect. He admits he uploads pornography to people’s social media accounts for the fun of it! He also gets a (perverse) victory out of being blocked from someone’s social media accounts.

Let’s put that into perspective. The ‘troller’ enjoys that he can apply increasing pressure to selected victims by use of words, pictures and so on which invokes potentially a police complaint (for which there is little or any evidence available for a conviction) and certainly blocking from the victim’s social media feeds. When this happens, the ‘troller’ believes they are victorious against a ‘cyber-person’ who has no basis in real life and probably moves on to harass someone else.

So how does this relate to Australian politics? Despite what you think of their policies, it is evident that Malcolm Turnbull loves his family (including the often mentioned and photographed grandson, Jack), as Tony Abbott loves his wife and daughters and Bill Shorten loves his ‘blended’ family. It’s probably fair to suggest that Scott Morrison, Peter Dutton, Sam Dastyari and George Brandis love their families as well. In each case, it would be pretty certain that each politician would do whatever it takes to look after their family and have a pretty good stab at teaching children not to steal or cheat, as well as giving them the skills to ‘play nicely with others’.

So why would the same people act so differently when it comes to running the country? Dutton, in response to leaked reports of over 2,000 cases of abuse and humiliation of refugees (supposedly) in our care on Nauru, claimed there was nothing new to see here when it was first reported; and subsequently claimed he was the victim because he was being verballed by the media. This is despite evidence showing that Dutton had been given extensive briefings about the actions of the contractors he employs on our behalf. Dutton was attempting to shift the blame to everyone but himself and the government for the problem caused by his government’s unbending harshness as discussed by The Guardian here a few weeks ago. Maybe it is a coping mechanism. Assuming Dutton’s claim of a ‘fit up’ are true, Dutton claims there are a number of exaggerated and made up claims (by inference not all the leaked claims are incorrect), and there are obviously some incidents that bring discredit to Australia and Australians. According to his website, Dutton has a family. Even one case where a person is treated less than well is one too many and diametrically different to the care and love Dutton probably shows to his family.

The Sam Dastyari donation issue is equally as instructive here. Fairfax media reported:
It is worth noting Dastyari had broken no law, no regulation, nor even a norm in Australian politics. Technically he had not even taken a donation, but a gift. He had even properly declared the gift. He was determined to ride out the scandal.

Last Friday though, the Prime Minister, Malcolm Turnbull, piled on, pointing to quotes in Chinese media suggesting that Dastyari had advocated China's position on the South China Sea dispute, a position contrary not only to Australia's stance, but that of our key ally, the United States.

‘Cash for comment’, said the PM.
The claimed difference between this ‘gift’ and other ‘gifts’ and donations is that Dastyari is supposed to have publicly contradicted the ALP’s policy on the current South China Sea issue where China is apparently attempting to exert more influence than it currently does.

Dastyari fell on his sword early in September and resigned from the position of Manager of Opposition Business in the Senate. Turnbull’s ‘cash for comment’ claim is full of faux outrage. If Turnbull is claiming that Dastyari’s opinion was changed by around $6,500 (in two individual ‘gifts’), it is worth asking why Turnbull and his Liberal Party colleagues’ opinions are not influenced by the 89.56% (or $9,315,505) of ‘non-individual’ donations above the reportable ‘cap’ received during 2014/5 by the Liberal Party. The Nationals seemingly are more resilient to being influenced by ‘non-individual’ donations — 100% of their donations (above the reportable ‘cap’) were not from individuals; the ALP comes in at 90.22% and the Greens rate the least affected, if you can call 89.19% of their donations coming from ‘non-individuals’ as significantly better than 100%, 90.22% or 89.56%! Fairfax reported:
There is still a large portion of donations in the system falling below the $12,800 threshold required for disclosure, many of which would be small contributions from individuals. Labor's figures include all donations above $1000 as they have put in practice their proposal to legislate a lower threshold.

For the purpose of this analysis, Fairfax Media also counted only the AEC "donation" category and not financial benefits reported as "other receipt".
So it is debatable if the million or so dollars in Liberal Party income from Parakeelia, the provider of the customer relationship software mandated for use by Liberal Party politicians, wholly owned by the Liberal Party and funded by parliamentary services electoral office budgets (aka your and my taxes) is included in these figures — it could have been listed as a dividend.

Dastyari has done some good by focussing the national headlines onto the donation issue for close to a week and weathering the storm of faux outrage generated by Turnbull and a few of his ministers. Should donation reform be on the agenda? Almost certainly, yes it should. But the major political parties are so reliant on the donations received from ‘non-individuals’ there is probably no real appetite by the politicians to really do anything as they rely on the funding to the political parties to gain and retain their seats.

It’s not the first time that political donations have undone a political career. Former Premier of New South Wales Barrie O’Farrell’s career fell apart over a bottle of (supposedly quite nice and definitely expensive) wine. O’Farrell did try to limit donations to individuals in New South Wales, but the law was overruled by the High Court.

The interest in political donations here is similar to the interest in refugees on Nauru as well as ‘trollers’ on the internet. There is a disconnect between our reality and theirs.

Em Ford’s interview with the ‘troller’ shocked her — not for what you would assume but for the reason that firstly the male ‘troller’ was an articulate person who seemed to be a normal member of society who just couldn’t understand that behind each website blog (such as this one), YouTube channel or social media account was a person who has probably tried their best, with feelings and an expectation that people should treat each other with respect, recognising that at times people have a right to express different experiences and values politely. The ‘troller’ just didn’t ‘get it’.

If you meet Peter Dutton (or Scott Morrison, the previous Immigration Minister responsible for the indefinite and proven — in PNG at least — illegal detention of refugees who asked Australia for protection and a safe home), you would probably find a person who treats you with respect. They both also have families and you would have to imagine they would do anything to protect their family from hurt and keep them safe. It seems they just don’t ‘get it’. Refugees are people who by circumstance have been forced to leave their homes and livelihood. They are families as well and deserve to be treated as well as the families of Dutton or Morrison.

Turnbull attacks Dastyari over donations of around $6,500, claiming that the cash influenced his opinion, while saying nothing about the almost $10million the Liberal and National Parties received from ‘non-individuals’ in 2014/15 (later figures are not available). It stands to reason that Turnbull just doesn’t ‘get it’. Somewhere around $10million would purchase a lot more influence than $6,500 or thereabouts. Is Turnbull upholding a principle or ‘playing the man’ for political gain?

The real problem here is that there is a disconnect. At what point do people just become numbers, or customers, political enemies or voters? It stands to reason that everyone has people they care about more than the person sitting in the car beside them in the traffic jam, however those who make the decisions in Australia seem to forget that they and their loved ones are a very small proportion of the 24 million plus people who live in Australia or the 7 billion plus people who inhabit the earth. While their job is not to ‘tuck each individual into bed each night’, those who are placed in positions of power need to remember that they are dealing with people’s lives, and act accordingly. Clearly, the Coalition government isn’t. Are they any better than the anonymous ‘troller’ who posts pornography to people’s social media accounts for the fun of it, or those past and present world leaders who carry out genocide for some warped idea of racial purity, without a care in the world about how the victims feel?

What do you think?
Let us know in comments below.
Recent Posts
Modern economics has lost sight of people
Ken Wolff, 7 September 2016
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For those who have followed my pieces on TPS you may recall that I am qualified as a social anthropologist. …
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2353NM, 11 September 2016
Recently on this website, we discussed the nastiness of the conservatives that currently inhabit the halls of power in Canberra. Ad Astra’s article gave a number of examples that demonstrated the point and you can read the article here rather than have me go over the fertile ground yet again. …
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An economy without people
Ken Wolff, 14 September 2016
Last week I suggested that modern economic theory has lost sight of people but the reality is now becoming that many segments of the economy require fewer people to undertake the work and that has serious implications not just for the people losing their jobs …
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An economy without people


Last week I suggested that modern economic theory has lost sight of people but the reality is now becoming that many segments of the economy require fewer people to undertake the work and that has serious implications not just for the people losing their jobs but for the broader economy.

The loss of jobs is not new. In Australia since the 1970s there has been an ongoing loss of un-skilled jobs, particularly for males. In 2006 Sue Richardson, with the National Institute of Labour Studies at Flinders University, wrote in Unemployment in Australia:
By 2001, at every age, at least 20 per cent of men with no post-school qualification were not in the labour force. These men have not withdrawn from the workforce because they have handsome alternatives that mean they do not have to work … Overwhelmingly, the reason they are not in the labour force is because they cannot find work and have given up looking.
And in 2004 Bob Gregory wrote in Between a Rock and a Hard Place: Economic Policy and the Employment Outlook for Indigenous Australians:
An exceptional feature of the Australian labour market over the last three and a half decades has been the loss of unskilled male full-time jobs. This loss has been so substantial that as a proportion of males 15‒64 years of age one full-time job in four has disappeared. Most of this job loss has fallen upon the unskilled …
At the same time there were skills shortages. In September 2004 the Australian Industry Group reported a shortfall of between 18,000 and 21,000 in the manufacturing sector for skilled tradespersons.

And a shift in the make-up of the workforce was already occurring. In 2006, the then Department of Employment and Workplace Relations (DEWR) reported that between 2001 and 2006, 78% of new jobs were created in the four most highly skilled occupational groups: Professionals (17.4% growth), Associate Professionals (18.3% growth), Managers and Administrators (28%) and Tradespersons (10%) but job growth for Labourers had been only 0.6% in that five-year period.

Skills shortages continue. In February this year the Department of Employment published its list of occupations in which there were shortages during 2015. Twenty-five occupations were experiencing national shortages, including higher level occupations like surveyors, optometrists and audiologists. The list included trades such as motor mechanics and automotive electricians, bricklayers, glaziers, roof tilers as well as wall and floor tilers, air conditioning and refrigeration mechanics, chefs, hairdressers and cabinet makers.

The department also released its jobs outlook, Australian Jobs 2016. Overall employment was projected to grow by 8.3% over the next five years which appears to be little more than matching population growth. Six industries were expected to grow by more than ten per cent: Accommodation and Food Services (12.0%); Arts and Recreation Services (10.8%); Education and Training (13.0%); Health Care and Social Assistance (16.4% and it is also the largest industry by employment numbers); Professional, Scientific and Technical Services (14.8%); and Rental, Hiring and Real Estate Services (11.9%). Employment in Mining will decline (‒14.1%) as will Manufacturing (‒5.3%) and Agriculture, Forestry and Fishing (‒3.1%).

When it comes down to occupations ‘Professionals’ provided 41% of new jobs from 2010 to 2015 and employment is expected to grow by 14.5% to the end of 2020. Seventy-four percent of professionals hold a university degree. Professionals are also more likely than other workers to work full-time.

In that period of five years up to 2015 ‘community and personal service workers’ provided the second highest proportion of new jobs, 22% (they also make up about 10% of all employment). Their employment has grown by 16.3% since 2010 and is expected to grow by another 19% in the next five years. Nineteen percent hold a university qualification and 42% a VET Certificate III or higher but 55% are employed part-time. It includes child, aged and disability carers, waiters and bar attendants and baristas.

Technicians and trades work provided 11% of new jobs up to 2015 and employment grew by 5.2% in that time and is projected to grow 5.5% in the next five years. Most of these workers are employed full-time and 62% have a VET Certificate III or higher.

Among the lower-skilled occupations there were, late in 2015, 1.7 million clerical and administrative workers, 1.1 million sales workers, 1.1 million labourers and 740,000 machinery operators and drivers which is still about 40% of the Australian workforce. Their projected growth to the end of 2020 is 1.6%, 9.3%, ‒1.3% and 1.0% respectively. The groups include receptionists and office managers, checkout operators, real estate agents, truck drivers, forklift drivers, delivery drivers, cleaners, kitchenhands and packers, as well as labourers.

The more rapid projected expansion of highly qualified occupations appears consistent with the experience in America identified in 2013. But in America there had also been a loss of middle-ranking jobs, largely due to the automation of routine tasks, not only for manual labour (classified as routine manual work) but by the computerisation of office, sales and administrative work (classified as routine cognitive work). There had been an increase in the number of jobs for non-routine work, both cognitive and manual. The former (non-routine cognitive) requires higher levels of education and generally commands higher wages, but the latter (non-routine manual) involves work such as cleaning, food services, security services, home help, and so on. This is leading to a polarisation of the workforce in America, with more high-paid jobs, more low-paid jobs, and fewer in the middle.

The basic problem with those projections is that they are based on what has already occurred and do not take full account of the increasing pace of technological change nor the areas into which it might move in the coming decades (and the Australian projections are short-term, only for five years).

In January this year CSIRO (and Data 61) released Tomorrow’s Digitally Enabled Workforce in which it found that up to 44% of current Australian jobs were under threat of being replaced by robotics and other computerisation. It found that, as yet, there was no evidence of the ‘hollowing out of the middle’ in Australia but it did find:
… Australian men, particularly single men with less education, are becoming increasingly likely to drop out of the labour force. … Despite strong jobs growth in the service sector, it appears that for a growing number of men the labour market has little to offer unless they re-train.
That reflects the earlier findings of Sue Richardson and Bob Gregory. But it also found that in the future there will be a greater need for individuals to create their own jobs and even a need for higher skill sets to access entry-level positions. So a new flexible education will be required. Similarly, workplaces will need to be more flexible (which can also lead to greater casualisation and use of contract workers). Some changes, however, may lead to greater disparity in regional areas, particularly for older workers: past experience suggests that displaced older workers in regional areas do not relocate to find work but, if forced to, will relocate to cheaper housing in the same location. So new approaches to unemployment and transition to work will be required.

The difficulty with the emphasis on education and higher skills is that has already been happening in America but simply creating an oversupply. It was found that highly educated workers were being pushed down the employment ladder into lesser-skilled positions, pushing the low-skilled further down or out of the workforce altogether.

The CSIRO report did not go into the detail of individual jobs but its estimate of jobs at risk was based on a model used by Oxford University researchers who did a study of the US labour market: The Future of Employment: How susceptible are jobs to computerisation? That report found that 47% of US jobs are at high risk of computerisation. Given the work currently being undertaken on driverless cars, it is foreseen that in the next decade or two driverless trucks will become the standard form for movement of goods and many truck drivers will become redundant. Some have suggested that on major inter-state routes driverless trucks should actually have their own lane. So governments will also need to respond to those changes.

In Australia, Rio Tinto is already automating its Pilbara iron ore mines with driverless trucks and automated charge drilling and setting machines, and is also hoping to have driverless trains to deliver the ore to port (tests have been conducted but recent software glitches have delayed implementation). That is an example of even some skilled work being automated but the huge driverless trucks do require the worksite being ‘landscaped’ to suit.

As more data becomes available and can be stored, office and administrative support positions will be affected and further encroachment into manufacturing will take place. Even aspects of the construction industry could be affected as robotic prefabrication of parts takes place in factories, requiring fewer workers for the actual construction and even circumstances where robots can piece the prefabricated parts together on-site (as has already occurred in Japan).

The availability of ‘big data’ is important in expanding the reach of computerisation. For example, an American oncology centre is using computers to provide chronic care and cancer treatment diagnostics. This could be done because data from 600,000 medical evidence reports, 1.5 million patient records and clinical trials, and 2 million pages from medical journals were able to be stored and used for ‘benchmarking and pattern recognition purposes’. Examining such a vast amount of data would be impossible for a human but not a computer (if it is programmed correctly). As more ‘big data’ becomes available computers will expand their reach.

The report into the US workforce also found that automation will move into non-routine manual work in sales and services. A simple example is the increasing availability of robotic vacuum cleaners capable of replacing at least one task of a hired cleaner: how many other tasks will follow? This follows the historical pattern of technological change, namely breaking down apparently ‘skilled’ jobs into smaller unskilled components — the move from the traditional skilled ‘carriage builders’ approach to early car manufacture to Henry Ford’s production line manned mostly by unskilled workers. If this prediction proves correct, the growth in low-skilled service jobs that has been occurring in the US will actually begin to reverse during the next couple of decades.

This does not mean that all jobs in these areas will be lost but a significant proportion will be.

Jobs least affected will be those requiring creativity and social skills:
… generalist occupations requiring knowledge of human heuristics, and specialist occupations involving the development of novel ideas and artefacts, are the least susceptible to computerisation.
Others have since suggested that even some creative work can be done by computers: already there are computers capable of creating musical scores (no doubt based on ‘big data’). If that continues into the future, and AI becomes a reality, there will be almost no job that is not at risk.

This new world is giving rise to what is known as ‘the gig economy’. This means that, like a band of musicians, people will work ‘gigs’ for which they must search.

A study released in January this year by The Aspen Institute in the US found 45 million Americans (22% of adults) were working in the gig economy providing ride sharing, accommodation, food delivery and other platform-based services. For 14 million it was their main source of income and just over half, 23 million, were young, aged 18‒34.
However, most workers (72 percent) believe companies should be doing more to provide benefits, and more than two-thirds worry that as independent contractors and not employees, they don’t have a financial safety net.
Anecdotal evidence from participants suggests that many, but not all, see such ‘work’ as extra income to meet bills and so on, or as income in periods between mainstream permanent work. Or they are working many jobs to achieve a reasonable income and that can create problems — such as lack of sleep. Some examples:
[young woman in Turin]
I keep busy but I have to constantly juggle different gigs every day … What scares me most is that I have no guarantees, no steady pay, no stability. Everything could end overnight, so I can never make long-term plans.


[Uber driver in Los Angeles]
In the short term, this way of working works, but there is a long-term downside. It’s very difficult to build a future, to save for a downpayment on a house, say, or to save for [a] college fund, on a full-time Uber driver salary or even if you combine multiple freelance services.


[Airbnb host, charity worker and interior designer]
I definitely advocate this way of working, but it’s not for the faint-hearted — if you’re working three or four jobs in a day, you need to be very disciplined and have a keen sense of priority. You have to be a bit of a workaholic: finding the balance and boundaries to fit everything in can be a bit of a juggle. And obviously not having paid time off is a downside.
Some professionals can do better in the gig economy as the internet (and specific sites) allow them access to a much wider range of clients in a much wider range of locations. For some, whose work can be done over the internet, the location of the client no longer matters and, therefore, having access to a larger number of potential clients is an advantage. Conversely, the sites involved also permit potential clients to more closely match the skills of their selected professional to the work required.

Companies will rely less on full-time employees and will hire on a task or project basis. This will apply across many job categories, not just professionals. Companies will be able to hire the specific skills required for a single task, so the work could range from a few hours to a few days. People will be able to specialise and offer their skills to many clients. But this will also spread the problems described by people currently working in the gig economy.

Such an approach is already moving down the employment ladder to very mundane tasks, and to ‘micro-tasks’ such as tagging images, extracting keywords, checking address data, which sometimes may be no more than a few minutes work for each ‘job’. These are termed human intelligence tasks (HIT):
At the time of writing [August 2015] there were about 300,000 HITs on offer on AMT [Amazon Mechanical Turk]. An average Turker (as they are referred to by AMT) can expect to earn US$2 to US$5 per hour on a good day but there’s no guarantee in terms of regular work availability.
Not all of these jobs will remain. Uber, for example, is already investing in and preparing for driverless vehicles. And computers can already undertake some of the minor tasks currently available. Whether people can be prepared in time for the new jobs that may emerge, or there will simply be massive unemployment, will be the big question.

All of the above may prove to be wrong as we do not have a very good record predicting the future — some things change less than we foresee while we seem to completely miss other significant changes. In the 1960s some popular magazines were predicting that by the early 2000s we would have flying cars, or at least hover cars. I also recall a television program from that time, specifically looking at future change, that predicted we would be required to work only ten hours per week in the new millennium to maintain our lifestyle.

Cars have changed, being more luxurious and incorporating many more safety features than in the 1960s but they still have wheels and still require roads. And, in Australia prior to the GFC, individual work hours were increasing, not decreasing. Our lifestyle has changed: the average new house is now twice the size it was (as is the cost); more homes incorporate central heating and/or air conditioning; televisions have grown both larger and smaller and few households are now satisfied with only one. But the biggest change that few, if any, predicted was the explosion in digital technology; the rise of computers, the internet and the information age; and now the portable devices that allow us to access that information at any time and almost any place.

So do we have the rise of robotics and ‘the gig economy’ right? We cannot say with certainty. But to the extent that they are already happening we do need to plan for them and consider their ramifications both for people and the economy as a whole because so much work will no longer require people, or require them for only short durations. We may not get it quite right but we cannot ignore it.

Next week I will consider Modern Monetary Theory (MMT) and what it may offer to meet the challenges of the new economy.

What do you think?
How far can robotics and computerisation go in reducing the need for humans? Is there a limit?

Will unions themselves become redundant if more and more people do not have work or enter (or are forced into) ‘the gig economy’?

Let us know in comments below.


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Toxic talk
Ad astra, 4 September 2016
Are you as offended, as disgusted as I am with the language used by our politicians day after day? Have you noted how mean-spirited, antagonistic and adversarial their words so often are?

They use words like poison arrows aimed at the heart of their political opponents …
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Modern economics has lost sight of people
Ken Wolff, 7 September 2016
This is the first of four articles looking at particular changes, and potential changes, in our economic environment and approach to economics generally.

For those who have followed my pieces on TPS you may recall that I am qualified as a social anthropologist. …
More...
Our Government is morally bankrupt
2353NM, 11 September 2016
Recently on this website, we discussed the nastiness of the conservatives that currently inhabit the halls of power in Canberra. Ad Astra’s article gave a number of examples that demonstrated the point and you can read the article here rather than have me go over the fertile ground yet again. …
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Our Government is morally bankrupt


Recently on this website, we discussed the nastiness of the conservatives that currently inhabit the halls of power in Canberra. Ad Astra’s article gave a number of examples that demonstrated the point and you can read the article here rather than have me go over the fertile ground yet again.

To paraphrase a sacked host of an extremely popular BBC television program loosely based on cars when talking about their ‘tame‘ racing-driver; some say they reached a low with treatment of refugees, others might suggest that the blatant disregard of human rights was worse — all we know is that the government allowing these things to happen is morally bankrupt. How about we look at the claim of moral bankruptcy in the cold light of day. There are a host of examples that could be provided.

Example 1: Offshore detention

We’ll start with offshore detention. During August, The Guardian came into possession of over 2,000 claims of mistreatment and abuse perpetrated on refugees held at a Detention Centre on Nauru funded by the Australian government and staffed by contractors to the Australian government. A significant number of the subjects of the reports were children. The holding company currently contracted to provide management services to the offshore detention centres was recently bought out by Spanish interests and —
… has been warned by professors at Stanford Law School that its directors and employees risk prosecution under international law for supplying services to Australia’s camps on Nauru and Manus Island in Papua New Guinea.
“Based on our examination of the facts, it is possible that individual officers at Ferrovial might be exposed to criminal liability for crimes against humanity under the Rome Statute,” said Diala Shamas, a clinical supervising attorney at the International Human Rights and Conflict Resolution Clinic at Stanford Law School.
They will not be extending their contract arrangements.

Dutton seems to have no problem in continuing to justify the obscenity perpetrated on refugees immorally held on Manus Island in our name. Dutton’s response to the (embarrassing to the government) release of the documents was to downplay the seriousness of the accusations, suggesting ‘Most of this has been reported on before.’

While Dutton may be correct in his assertion that ‘asylum seekers are … setting themselves on fire, deliberately self-harming, or making false allegations of sexual assault in order to come to Australia’, it is beyond comprehension to believe that every one of the 2,000 reports originally authored by Save the Children (who had a contract with the government to provide humanitarian services on Nauru) was false or exaggerated. When challenged, Dutton doubled down on the insults telling 7.30's Leigh Sales : ‘I think the situation is that people have paid people smugglers for a migration outcome.’

Dutton is a proxy for all Australians. We pay him to represent our standards, traditions and moral standards when the Coalition government is dealing with immigration matters. So his (as well as the actions of immigration ministers back to the days of the Keating government) actions are the actions of all of us because we elect the government. The current prime minister and most of the country were disgusted with the reports of abuse that occurred to children at the Don Dale Centre in Darwin. Yet the same government sees no problems with similar claims coming from children that this country put on Nauru on indefinite detention. At least those at Don Dale had a date they would be released.

Example 2: Changes to the Racial Discrimination Act

Senator Bernardi is canvassing support for a private members’ bill that will allow for discrimination to others based on race. While it could be argued that someone else’s opinion could be considered to be risible, their religion, gender, race or ancestry is not a determining factor in why their opinion or statement is what it is. Nevertheless, Bernardi claims every Liberal Party Senator bar one has signed a petition supporting the change.

Clearly we should not ‘offend’ or ‘insult’ anyone. Bernardi wants to legalise it, while not allowing intimidation and humiliation. That would be a fine line.

That the law was felt necessary in the first place is a sad indictment of Australian society as it demonstrates that a number of Australians believed they could insult and offend people based on their religion, race or ancestry. It is even a greater stain on our society that politicians are now actively campaigning to allow it to reoccur.

Example 3: The same sex marriage plebiscite

Since the election of the current parliament, there has been a continual debate about the necessity for a $160million plebiscite to ask Australian voters if the government should legislate to allow same gender marriage.

Let’s get something out of the way first up — there is no need for anyone outside parliament to do anything to make ‘same sex marriage’ legal in Australia. The Howard government inserted the ‘man and woman’ clause into the Marriage Act in 2004. According to Howard at the time:
(It should) not over time be subject to redefinition or change by courts, it is something that ought to be expressed through the elected representatives of the country.
So why can’t the elected representatives of the country change the law now?

According to The Monthly’s political editor Sean Kelly:
For a start, Turnbull accepted the plebiscite as a condition of becoming prime minister. We will never know if this was unavoidable or if, given the choice between losing government under Abbott and accepting a free vote under Turnbull rather than a plebiscite, the Nationals and the conservatives would have backed a strong-willed Turnbull anyway. Certainly Turnbull’s negotiating hand within the Coalition has never been stronger than it was then. But the lure of power can be hard to resist, and at the time the compromise would have seemed like a small thing to give away.
At the end of August, Fairfax’s Matthew Knott suggested that the brutal reality is there will be no free vote on marriage equity, although more recently apparently there have been discussions to make the plebiscite ‘self-executing’ (if the plebiscite is successful, it doesn’t need a vote in Parliament to become law).

The morally bankrupt issue here isn’t who sleeps with whom in the marital bedroom, it is the double standard that allows one conservative prime minister to engineer a change to an act of parliament to ensure that Courts do not have the powers to change or redefine the participants in a marriage, and when it comes time to reassess the action some 12 years later, the same process is determined to be insufficient by another Conservative government to make a change should it be deemed necessary. Instead the country will be forced to the polls in an exercise expected to cost over $160million (while we have a federal budget expenses problem) solely to shore up the credentials of the current and immediate past prime minister in the eyes of his own side of politics. To add insult to our injury here, one of the talking points with the ‘self-executing’ option would be:
… that no taxpayer money be given to either side. That would delight the "yes" camp but anger conservatives, given the Australian Christian Lobby has asked for $15 million in public funds.
Given that some of the same people that want no change to the Marriage Act want to change the Racial Discrimination Act Section 18C to allow offence and insults, opposition leader Shorten’s comment that the plebiscite will be ‘a taxpayer-funded platform for homophobia’ is probably closer to the truth than Turnbull’s claim that ‘Australia is capable of having a respectful debate on same-sex marriage’.

Example 4: Political donations

Senator Sam Dastyari resigned from the ALP ‘front bench’ last Wednesday night over the acceptance of an amount of around $1600 from a Chinese company to repay excess travel claims as well as around $5000 from another Chinese company to settle a legal case. While Dastyari was apparently compliant with federal law as both amounts were declared, he may have been in breach of ALP policy. Either way, why a Senator who receives around $200,000 in salary per annum needs assistance to pay his expenses is a matter for concern.

While the Coalition was claiming that he must go immediately, Deputy Prime Minister Joyce was far less damning regarding his own future last Tuesday night on ABC’s 7.30 current affairs program when asked why he received and kept donations from Mining Magnate Gina Reinhart. Is it splitting hairs to be able to justify some donations while decrying others?

The initial claim here is that our government is morally bankrupt. Surely the government’s treatment of refugees, changing legislation to allow offence to be legal, generating the conditions that will ensure homophobic behaviour is considered fair and reasonable as well as the splitting of hairs around political donations demonstrates the point.

Members of parliament are our employees. It is time for us to tell our politicians that we expect morals, ethics and consideration of the rights of others (regardless of their gender, religion, ancestry or sexual preference) to be more important than political point scoring, looking after mates (who probably donate to re-election campaigns) and the smell of ministerial leather in Canberra.

Jobs and growth as well as 100 positive policies are useless to Australia without the moral and ethical background that is necessary to implement these policies equitably.

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

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Ad astra, 4 September 2016
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Modern economics has lost sight of people
Ken Wolff, 7 September 2016
This is the first of four articles looking at particular changes, and potential changes, in our economic environment and approach to economics generally.

For those who have followed my pieces on TPS you may recall that I am qualified as a social anthropologist. …
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Modern economics has lost sight of people


This is the first of four articles looking at particular changes, and potential changes, in our economic environment and approach to economics generally.

For those who have followed my pieces on TPS you may recall that I am qualified as a social anthropologist. I take the anthropological view that economics is about how a society uses and distributes its resources — that is any society, whether hunter-gatherer or a modern technological society. It is a view that raises some questions about our modern approach to economics.

Basically the ‘use’ of resources includes a social responsibility for sustainable use so that resources can be utilised by others when required and also be available for future generations. And ‘distribution’ of resources includes a social responsibility to ensure that everyone in a community gets a reasonable share to enable them to survive comfortably within the context of their society.

Classical Western economics, however, is based on the tenet of the rational self-interested individual: that people make rational choices in the market that best provide ‘utility’. ‘Utility’ is something that provides the user/purchaser with satisfaction and/or meets their desires in some way. Adam Smith also introduced the concept of the benevolent ‘invisible hand’ whereby decisions made in an individual’s self-interest actually prove beneficial for society.

In classical economics there are also the concepts of ‘perfect knowledge’, by which the individual makes rational decisions based on information about all the prices in the market, and ‘perfect competition’ by which a product reaches an equilibrium (supply matching demand), and its price also reaches an equilibrium for all suppliers of that product, meaning there is then no competition nor need for advertising of the product. Of course these do not exist in the real world. Neither are individuals always rational in making their decisions in the market. So what was classical economics actually describing?

Even the concept of the market needs exploring. Markets of course go back millennia but the concept of the market has changed over time. Early in human history people shared goods, then exchanged surplus goods for other desirable goods and, as villages and towns developed, for services. Money eventually became the medium of exchange for any good or service.

Markets were not always based exclusively on the individual. In medieval Europe if a merchant from town A left debts when he departed town B, the merchants from town B didn’t pursue that individual merchant directly but would detain the next merchant who arrived from town A and hold him until he, the original merchant, or anyone from town A paid the debts. In that sense, the role of the individual in the market wasn’t as important as it later became — at that time it was believed that the community from which the merchant came also had a responsibility for his behaviour (and his debts). Subsequently merchant guilds were formed in which debts could be settled and over time that grew towards individual responsibility for the settlement of debts.

The other concept relevant to the modern market is private property. While the idea of private property now dominates our economic and social thinking it was not always so. Even in medieval England when land was held by dukes, barons and the like, there was common land used by the serfs, so both common and private property co-existed. It is estimated that, although serfs had to provide labour to the rich landholders, by using the common and small plots around their own dwellings they were actually able to keep from 50% to 70% of the product of their own labour. An industrial labouring class was created during the industrial revolution with the enclosure of the commons (in modern parlance, the land was privatised) and poor farmers and rural labourers no longer had access to that land to supplement their incomes and so had little choice but to work in the factories.

In the market, the logic is that to exchange something I must own it in the first place and the other party must also own what they are exchanging. The logic of that seems apparent when one considers what a thief may offer for exchange: we undoubtedly consider that not to be a fair exchange because the thief does not actually own the item of exchange — or does he? The thief clearly has ‘possession’, so is there a logical difference between ‘ownership’ and ‘possession’ in the economic system?

The emphasis on private property as central to a market economy goes back at least to the 1700s in England. C B Macpherson, a political scientist also trained in economics, argued that political freedom came before economic freedom and was first obtained by the property-owning elites who then used their new political power in their own self-interest to entrench private property rights. And it also goes back in history in the sense that much modern ‘ownership’ is based on past dispossession of previous owners and yet the economic system is based on the modern possession not the historic ownership.

Now private property, whether physical or intellectual, is central to thinking in a modern market and in modern economics.

These concepts were put together by the philosophers Hobbes and Locke but Macpherson also argued that they were bound by the values of their time and hence developed their philosophies around the market, contractual obligations and property; and the concept that an individual is the sole proprietor of his or her skills and owes nothing to society for them — what Macpherson called ‘possessive individualism’.

In rejecting a social element to ownership, economists refer to the ‘tragedy of the commons’ to justify that individual ownership, that is private property, is superior to common or social ownership. Although the idea has a longer history, the phrase came from a paper by Garrett Hardin in 1968. It was suggested that, when people grazed their herds on a ‘common’, a self-interested individual could improve his situation by adding one animal to his herd. The individual would gain the benefit. But if each individual added an animal the common would quickly degrade. While the individuals retained the benefit of having an extra animal, the ‘cost’ (the degradation) was shared, leaving them with a self-interested benefit — before the failure of the system. Following this argument, and its corollary that Adam Smith’s benevolent ‘invisible hand’ of individual self-interest does not work for the commons, economists argue that private property, and the individual’s responsibility for that property, remedies the situation and that became central to modern economics.

That approach is based, however, on a misunderstanding of how commons worked. They were not ‘open access’ as the theory implies. Throughout the world where people shared resources there were usually social and cultural rules that controlled that sharing. In Iceland, for example, the common resource of the fisheries was traditionally controlled by kinship rules that allocated spaces on the beach, that were necessary for launching fishing boats, to individual families. In some communities in India the allocation of the common resource of water for farming was determined by community meetings. People accepted these approaches as essential for the well-being of their communities or, in other words, social responsibility was more important than individual self-interest.

The modern market idea of private property and individual self-interest has basically destroyed social responsibility and the concept of the common good and allowed polluters to pour their waste into the ‘commons’ of the rivers, oceans and atmosphere.

We now use GDP to measure the ‘success’ of our economy but the use of GDP to measure economic activity only arose after the Great Depression of the 1930s when the American government was concerned that it did not see the depression coming. The government asked economic experts for a model that would allow it to keep track of the economy and so have a chance of foreseeing such events in the future.

The use of GDP, however, was being questioned as early as the late 1950s. Even its creator, Simon Kuznets, said that ‘the welfare of a nation can scarcely be inferred from a measurement of national income’.

A major problem with GDP is that it measures only productive activity and takes no account of the losses or costs associated with the activity:
… it tends to go up after a natural disaster. Reconstruction and remediation spur intense activity that is registered by GDP, while the destruction, lives lost, suffering and disruption to families and communities in the wake of a flood, cyclone or bushfire are ignored.
Or as Robert Kennedy said in 1968:
… the gross national product does not allow for the health of our children, the quality of their education or the joy of their play. It does not include the beauty of our poetry or the strength of our marriages, the intelligence of our public debate or the integrity of our public officials. It measures neither our wit nor our courage, neither our wisdom nor our learning, neither our compassion nor our devotion to our country, it measures everything in short, except that which makes life worthwhile. [emphasis added]
Yet we still rely on GDP as a measure of a nation’s progress although it has nothing to say about the well-being of the people. Gross GDP per head is sometimes taken as a measure of the economic prosperity of individuals: if that is rising people are said to be better off but it does not tell us whether that prosperity has enhanced ‘happiness’.

There is a long history in which ‘happiness’, or well-being, was removed from economics. A chapter in the World Happiness Report 2013 provided a potted history of the changes in the Western view of happiness: from the Greek philosophers and early Christian church’s view that happiness was achieved by being virtuous, to the economic theory of ‘utility’ in which individualism and consumerism prevailed — the early economic theorists brought material goods into the happiness equation, suggesting that people purchased that which brought them pleasure or happiness (‘utility’). In the twentieth century, however, economics came to be dominated by mathematical formulae and the question of whether market consumption could increase happiness and well-being was no longer a consideration.

Economists claim their field is a science and value free but the economy depends on social values like trust. We cannot even have a ‘market’ unless we trust each other. In a shop, the shopkeeper trusts that I will hand over the money after he hands over the goods or I trust that he will hand me the goods after I give him my money — otherwise we could be there all day arguing over who should make the first move. It could be argued that the behaviour of large multi-national corporations is destroying that trust, as is the use of tax havens to avoid social responsibility. And are we now so distrusting that we require automated payment systems, including even when paying for our goods in supermarkets? — now we have to trust a machine! Human interaction is being removed from the basic market process of exchange.

As Jeffrey D Sachs wrote in the World Happiness Report:
A prosperous market economy depends on moral ballast for several fundamental reasons. There must be enough social cooperation to provide public goods. There must be enough honesty to underpin a stable financial system. There must be enough attention paid to future generations to attend responsibly to the natural resource base. There must be enough regard for the poor to meet basic needs and protect social and political stability.
After all the economy does not exist in its own right. The market and the economy is people, as producers and consumers, as it has always been. It is the approach to it that has changed.

In an article in The Monthly, Richard Denniss argued that we are being led to believe that governments, in making their decisions, have to be conscious of the reactions of ‘the markets’. He wrote that we should remember that ‘markets’ per se do not have feelings, do not have needs or demands. What we refer to as ‘markets’ is actually people buying and selling and attempting to manipulate trading for their own advantage.

So historically we have moved from social co-operation in economic activity to twentieth century economic theories that have reduced people almost to invisibility. We discuss economics in terms of markets, GDP and monetary and fiscal policy as though these are entities in their own right. There is no economy without people, no markets, no goods and services without people as producers and consumers but this now gets less attention. The economy is deemed to have its own ‘scientific’ rules that operate irrespective of people and, as mentioned earlier, can now be analysed simply in terms of mathematical formulae.

Until people are re-introduced into the equation (both metaphorically and literally), the economists will not be describing the real economy nor will those utilising economic theory, such as governments (and their advisers), pay enough attention to the needs of their people. When ‘markets’ and GDP come first, people come last.

We need to measure the well-being of the people rather than only production; we need to pay more attention to the sustainability of our use of resources, not only for future generations but to ensure that current generations have reasonable and continued access; we need to ensure a fair distribution of resources, not only within our own society, but for all people globally; and only then will we have an economic approach that is realistic rather than the narrow view of current economic theory.

Next time, continuing the economic theme, I will discuss ‘an economy without people’ as robotics and other changes reduce the size of the workforce.

What do you think?
Who benefits from economic theory if it does not pay enough attention to people?

Why have we accepted the propaganda that even social progress hinges on the economy?

Let us know in comments below.


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Toxic talk
Ad astra, 4 September 2016
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Toxic talk



Are you as offended, as disgusted as I am with the language used by our politicians day after day? Have you noted how mean-spirited, antagonistic and adversarial their words so often are?

They use words like poison arrows aimed at the heart of their political opponents and those in our society whom they despise.

They have no concern for the damage their arrows might inflict, or how injured or offended their targets might feel. Wounding, disabling, hurting, demeaning is their purpose. The more damage they can inflict, the more satisfied they are.

It’s akin to schoolyard bullying, but much worse. Can you recall language as ranting, as poisonous, as hurtful, as damaging, during your school days? I can’t.

Listen to them – try to pick their targets, and watch their reaction.

There is a group that conservatives loathe passionately – those at the bottom of the social scale who rely on welfare support: the unemployed, the job seekers, the homeless, the disabled, and the mentally ill. They are Joe Hockey’s ‘leaners’.

This derogatory language goes back a long while. Do you remember when Tony Abbott, as a minister in the Howard government coined the tag ‘job snobs’ to denote those who were too lazy to look for a job, or too fussy about what work they would do and where, or too demanding about terms and conditions? Those who eventually did get a job might then oversleep, or not turn up because the travel was too arduous or inconvenient or they had no transport, or they would leave work early or slack on the job – thus the tag ‘job snobs’. When job seekers moved onto Newstart, the term morphed into a peculiarly Aussie term: ‘dole bludgers’.

Joe Hockey upped the ante when he pushed his ‘end of entitlement’ message, first at a conference in Britain. Far from trying to conceal his theme, he proudly shouted it from an international pulpit. His point was that there were some, indeed too many, who felt entitled to welfare, entitled to support from the government, and of course the taxpayer, if they had no job. Not long after we heard his now-infamous descriptor – ‘leaners’ – to designate this despicable mob, who depended on Hockey’s ‘lifters’, the good guys who had a job or a business, who pay their taxes and support the idle leaners.

Hockey’s message did not go down well, especially when those castigatory tags were given effect in his punitive 2014 budget, in which he punished the leaners and the less well off. Even his own supporters recognized that his budget was unfair. Rudiments of it still languish in the Senate wistfully awaiting endorsement.

Then along came Scott Morrison, keen to transmit the same message but unwilling to use Hockey’s tags. So he coined some of his own, not as elegant as Joe’s, but replete with the same pejorative meaning. So now we have the ‘taxed’ and the ‘taxed-nots’. As keen as Hockey, and Abbott before him, to divide our nation into ‘them and us’, into ‘the deserving and the undeserving’, Morrison launched his unique tags at the Bloomberg Summit on the economy last week.



Here’s what he said:
“A generation has grown up not ever having known a recession, of seeing unemployment rates at more than 10% … On current settings, more Australians today are likely to go through their entire lives without ever paying tax than for generations. More Australians are also likely today to be net beneficiaries of the government than contributors – never paying more tax than they receive in government payments. There is a new divide – the taxed and the taxed-nots.”
Remember though that in his mind the ‘taxed-not’ cohort are the dole bludgers, the leaners, those who suck the welfare system dry because they don’t, won’t, or can’t work and therefore pay no taxes. Somehow, the almost 600 companies, major ones such as Qantas, Virgin Australia, General Motors, Vodafone, ExxonMobil, Warner Bros Entertainment, Lend Lease and Ten Network Holdings, who paid no tax last financial year, were not mentioned. Nor were international giants Apple, Microsoft and Google, who paid very little tax here on the large profits they earned in this country. Presumably Morrison does not categorize them as ‘taxed-not’. Why?

The reason behind Morrison’s apparent inconsistency is ingrained conservative ideology. Conservatives believe that we get what we deserve. Those who work hard, or are entrepreneurial enough to own a business, deserve the monetary reward they get, and what’s more deserve to keep that reward and not have governments take it away as taxes and give it to others, to those who do not work and earn. Thus we hear endlessly that Liberals want to reduce tax, and have seen them propose to do that, even for the wealthiest. The promised $48 billion tax cut to businesses awaits the verdict of the Senate.

Moreover, conservatives believe that those who have little deserve their impecunious state. They have not worked, or have not worked hard enough, or have not saved enough, and therefore deserve to be poor. These people ought not expect to get handouts from others, or from their government. They deserve their poverty-stricken situation, and should not expect the milk of human kindness to be offered to them. This view is consistent with George Lakoff’s model of politics. Using the metaphor of nation as family and government as parent, he argues that conservative politics corresponds to the strict father model that posits that people should not look to the government for assistance lest they become dependent. Conservatives regard the inequality that is a sequel to such an ideology as part of the natural order. There have always been lords and ladies, and serfs to bow to them and serve them. They see no need for egalitarianism in what they see as an inherently unequal world.

We ought therefore to not be surprised when we hear Scott Morrison or Mathias Cormann or Kelly O’Dwyer perpetuate ’the workers versus the bludgers’ way of thinking. Remember the fury Eric Abetz generated while he was Minister for Employment when he sought to introduce a rule that the unemployed must complete forty job applications a month. As far as he was concerned, they had nothing better to do. The impracticability of this soon mugged him, particularly when it became apparent that it was unlikely that forty jobs would be available in Tasmania close to where the job seeker lived. His object was not really to find a job for these people; it was to punish them with ‘homework’ for being unemployed.

Abetz reasoned:
"We undertook what we believed would be a fair consideration of an application of a job every morning and every afternoon should not be too onerous."

"There doesn't seem to be a community complaint with the cut-off of 20 job applications per month, so one assumes one might be able to increase that without too much extra community concern.”
Eventually, the idea was scrapped out of concern that employers would be ‘swamped with fake job applications’, rather than the imposition on job seekers of forty applications a month was unreasonable and stupid.

So long as conservatives are in power, we can expect this toxic talk to continue, directed as it is at what they see as a lesser grade of citizens, a poorer class of people. It is a reflection of their entrenched ideology, which they will not, indeed cannot change. It is in their DNA.

There is another variety of toxic talk, one that we witness, in fact suffer every day, many times a day. We see it whenever politicians are confronted with uncomfortable facts. Rarely prepared to say: ‘We messed up’, ‘We made a mistake’, or more benignly ‘We could have tried a different approach’, they barrage us with a deluge of disingenuous words to justify their actions, and just as deceitfully, to blame others for the situation.

All politicians are adept at this stratagem. Blame shifting, and aiming their poison arrows at their opponents, comes easy. But few do it as spitefully as our odious Minister for Immigration, the Honourable Peter Dutton.

Confronted recently with the shocking report by Save the Children about the impact prolonged detention was having on children held on Nauru, he quickly dismissed reports of sexual assault and abuse as ‘hype’ and ‘false allegations’. He went on to roundly condemn The Guardian and the ABC for promulgating the report and the ugly accusations it contained.

He accused those seeking to expose the awful occurrences on Nauru as maliciously denigrating the government’s effort. Never was there a concession that things were bad on Nauru, and needed urgent attention. To Dutton, this report was a storm in a teacup, exaggerated out of proportion. He maintained that protective systems were in place and operating effectively. He accused asylum seekers of setting themselves on fire, deliberately self-harming, or making false allegations of sexual assault in order to come to Australia. He airily dismissed the reports of sexual assault, child abuse and self-harm written by detention centre staff, insisting: “Most of that’s been reported on before.”

To Dutton, whistleblowers are simply troublemakers hell bent on embarrassing him and the government.

He was quick to add that the genesis of this situation was Labor’s relaxation of ‘border control’, and the resultant arrival of thousands of boat people, with hundreds drowning on the way (he has always got his figures off pat). His argument is that if only Labor had continued the Howard border protection policies, this situation would not have arisen. Now poor Peter has to cope with Labor’s legacy of neglect and incompetence!

So he delivered the double whammy: nothing much was wrong on Nauru, and what was wrong was Labor’s fault anyway.

Perhaps more than most, it is those ministers who are tasked with managing the nation’s finances who most regularly engage in toxic talk. Never prepared to concede that they haven’t got all the answers, or that they might have achieved a better result with another approach, they continue to blame the previous Labor government for their fiscal woes. We are regularly reminded about Labor’s legacy of profligate spending, ‘debt and deficit’, and Labor’s determination always to raise taxes, and never to cut spending. It matters not that under the Coalition spending has increased, taxes have risen, and the deficit has ballooned; it is still all Labor’s fault. Labor continues to be condemned with this toxic talk, this disingenuous language, extravagantly embellished with straight-out lies.

I could go on for pages recounting this type of toxic talk that so infuriates us all day, every day. I wrote about it extensively on The Political Sword almost eight years ago in The curse of adversarial politics. It is still worth reading. The penultimate paragraph reads:
“Those who despise adversarial politics find it to be contemptible, a damaging affliction on our political system. They resent the stifling impediments it places on governing, on governments carrying out what they promised the electorate they would do. They see it as focused on ‘winning’, on gaining a political advantage, rather than telling or establishing the truth, or contributing usefully to the discourse.

“It sets the teeth of the electorate on edge, which ‘turns off’ in despair. Voters would prefer politicians to be open and upfront, more focussed on the good of the nation, less willing to corrupt the usually-worthy principles that brought them into politics in the first place. Adversarial politics may be an important reason the public has turned away from politics and has become cynical about the motivation and behaviour of politicians. The more adversarial politics becomes, the greater the erosion of voter engagement and threat to the democratic process.”
That was written eight years ago. What’s changed? Nothing!

The public loathes toxic talk as much as ever. Will politicians ever learn?




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

How do you feel about the way politicians use pejorative words to describe citizens they despise?

How do you feel about the adversarial language our politicians use against each other?

What do you feel about the way they use toxic talk to attack and berate each other?

How would you prefer them to behave?



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A once and future Senate
Ken Wolff, 21 August 2016
We now know that the Senate elected at the July election comprises 30 Coalition members, 26 from the ALP, 9 Greens, 4 from One Nation, 3 from the Nick Xenophon Team (NXT) and one each from Family First, the Liberal Democrats, Derryn Hinch’s Justice Party and the Jacqui Lambie Network. Thirty-nine votes are required in the Senate to pass legislation, so the government will require either ALP or Green support, or otherwise support …
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The meaning of life
Ad astra, 24 August 2016
As you sit on your comfortable chair after a satisfying meal with a glass of your favourite drink in hand and view current affairs programmes on TV, do you reflect on the plethora of distressing images that assail viewers day after day? Do you ponder how you might feel if you were part of those images?

How did you feel when you saw the stunned, blackened, bloodied face of …
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Bring out your debt


After a year of saying that he could get the Federal Budget back into surplus, seemingly by just cutting support to the less well off in our society, Treasurer Scott Morrison finally realised something any school child who has started business studies classes would be well aware of — a balance sheet comprises debits and credits.

Morrison was speaking to the Bloomberg Economic Summit in Sydney last week. Apart from the usual claims of deliberate obstruction from the Opposition, there was an acknowledgement that ‘Deficits have proven difficult to shift in recent years, despite applying significant expenditure controls’. Taxing more, which is apparently different from ‘protect[ing] the revenue base from structural weakness’, has been ruled out. That still allows measures such as enforcing GST payments on low value imports (such as the shopping you and I do over the internet), attempting (apparently again) to ensure that multi-nationals pay tax before shipping profits overseas and looking at ‘the way generous tax concessions are provided in the superannuation system’.

We even got a new (sort of) three-word slogan to illustrate how serious Morrison is: the ‘taxed and the taxed-nots’. Morrison correctly makes the claim that a lot of Australians have not experienced a recession in their adult lives or unemployment rates of over 10%. The jury is still out on the effectiveness of the ‘taxed and taxed-nots’. Probably the gold standard here is now Ambassador Joe Hockey’s ‘lifters and leaners’: while it was an effective slogan as people remember it, Hockey’s period as treasurer was noted only for an increase in the government’s debt and the infamous 2014 budget which still hasn’t passed parliament in its entirety.

Hockey and Morrison point the finger at the ALP for holding up savings measures in the Parliament. Most of the measures held up in the Parliament are spending measures because as Peter Martin reported:
As he [Morrison] puts it, "you don't encourage growth by taxing it more". Of course, withdrawing spending doesn't help much either, but to him it's a lesser evil.

Of the $40 billion in budget measures yet to be passed, more than 60 per cent constrain spending. Only a third, $15 billion, boost revenue.
The two big claims are that more Australians receive more in government benefits than they pay in tax and Australia (the government) will owe $1trillion to others in the near term should action not be taken immediately. Let’s look at the claims.

It’s probably a fair statement to suggest that about half of the population pay no nett tax. At least it was a couple of years ago. The architect of the current taxation and welfare systems, Howard era treasurer Peter Costello wrote an opinion piece in the Daily Telegraph a year or so ago which to an extent justifies his reasons:
Sometimes tax reforms involved lower income earners paying more — like the introduction of the GST — but we were always clear that the welfare system could be used to compensate for that. The welfare system is the way to redistribute income. That is not the role of the tax system. The tax system is there to raise revenue at the lowest cost in the most efficient way doing the least damage to the economy.

If you try to use both the tax and the welfare system to redistribute income you get punishing rates of income withdrawal as a person’s income rises. This is called the effective marginal tax rate (EMTR). As people lose benefits and pay higher taxes they can lose 60, 70 per cent, sometimes 100 per cent of every extra dollar they earn. This creates a huge disincentive to work. It creates poverty traps. And, it heightens the incentive to “hide” additional income.
And Costello has a point — the tax system is there to raise revenue at the lowest cost and do the least damage to the economy. If there is a need to return funds to a section of the community due to adverse circumstances, it is far easier to do so using targeted welfare, rather than arranging for exemptions and conditions in the taxation system. We could discuss the inequity in Costello’s targeting until next week if we wanted to but the professionals, such as The Australia Institute might have a better understanding.

According to The Australia Institute, Peter Costello’s actions during the ‘once in a lifetime’ mining boom was to:
… cut taxes so far and so fast that they forced the Reserve Bank of Australia to rapidly increase interest rates.

While countries like Norway took the benefits of resource price booms and banked them in their sovereign wealth fund, Peter Costello chose to cut taxes for the wealthy instead. He knew at the time that his populist generosity to the highest income earners would force future treasurers to choose between budget deficits or cutting spending on the sick, the poor and elderly. No prizes for guessing which our former treasurer prefers.

The only thing Peter Costello hates more than budget deficits is collecting the revenue needed to fix them. Just as his government did nothing about the long term challenge of climate change, his government did nothing to set up Australia's long term public finances.
If you want to, you can wade through the IMF’s report of government waste and profligacy released in January 2013 here or you can just take The Saturday Paper’s word for it that generally Australia was judged well except for four periods — the two largest under the stewardship of Howard as prime minister and Costello as treasurer (partial paywall). Howard and Costello were buying votes. It’s an easy sell to suggest that if you support my re-election campaign, I’ll give you money back in additional benefits or reduced taxes. As The Australia Institute suggests:
For the record, here are 5 of Treasurer Peter Costello’s most ‘profligate’ and inequitable decisions, which created the structural deficit inherited by his successors;

1. Income tax cuts, primarily for the rich, during the boom. Worth $37.6 billion or $26.4 billion if you exclude bracket creep in 2011-12

2. Capital gains tax discount. Worth $5.8 billion in 2014-15

3. Got rid of fuel excise indexation. Worth $5.5 billion in 2013-14

4. Superannuation tax cuts. Worth $2.5 billion in 2009-10

5. The decision to convert 'franking credits' into cash refunds for shareholders
They have given an explanation why each of the cuts has been incredibly bad value to the economy — go to the article to see them.

In some ways it is a delightful irony that the Coalition treasurers of the ‘twenty teens’ are having difficulty in politically justifying the spending cuts they believe are necessary to achieve their economic aim. Which leads us on to ‘message two’ as recently promoted by Morrison — Australia’s debt will hit a $1 trillion if nothing is done.

news.com.au breathlessly reported last week that Morrison’s statement to the Bloomberg Economic Summit would blow out to $1 trillion within the next 10 years if the government doesn’t get its budget savings through the parliament. Of course, according to Morrison anyway, this is the ALP’s fault and, while it is admitted that the figure is the ‘worst case scenario’, the implication is that Keating’s ‘Banana Republic’ would have nothing on the resulting recession.

Apparently, a trillion looks like this; 1,000,000,000,000. Australia’s annual GDP (our income before expenses) is currently around $893billion (or $893,000,000,000) according to the Parliament of Australia’s website. While all debt does have to be repaid at some point there is bad debt and good debt — a nuance that seems to be lacking in the current political debate.

Bad debt in the case of the government is where they are borrowing money to pay for recurrent items such as wages, the cost of stationery or similar items. To bring it back to a domestic level, if you were to go to the supermarket and petrol station each week and get your groceries and fuel on the credit card while only repaying the minimum amount due, two things would eventually happen: the first is that you would hit the credit limit of the card and the retailers would not accept any further charges; and two, the cost of the groceries and fuel you had already consumed would rise exorbitantly as the usually high interest on the purchases made on a credit card would continue until the debt was repaid in full (together with the interest).

Good debt is something else again. Governments borrow money for capital works and long term investments. Again bringing it down to a domestic level, if you borrow money to purchase a home to live in, depending where you live in Australia you are entering a contract with a financial institution for them to loan you considerably more than you can possibly earn in a year. Here’s an example using Westpac’s ‘How much can I borrow’ calculator for a couple with two dependent children.

Borrower 1 earns around $60,000 per annum and Borrower 2 earns around $45,000 per annum and they have some expenses. If you assume that they have a 20% deposit they would probably be in the market for a property priced around $800,000 to $900,000. To save time, we’ll leave the discussion on what they can/should buy and where to the property websites and TV shows. The point here is that between our two borrowers, their joint income is around $100,000 per annum. The Westpac borrowing calculation is really saying that to purchase a home, they can borrow about seven times their annual income and in parts of Australia, they will need every cent of it.

If our mythical borrowers were contemplating borrowing up to seven times their annual income no one would blink an eyelid, as buying a home is ‘good debt’ and the ratio of around 7 to 1 hasn’t changed for decades.

What we have yet to establish is if the potential government $1 trillion debt is good debt or bad debt. Last Sunday on our website we observed that of the $37 billion in additional debt Australia had placed in the 2016 budget, $36 billion of it was for capital works. Generally capital works are an improvement to a particular site that generates income in some way — either directly (say the construction of a new factory to house a production process) or indirectly (improving people’s quality of life by putting a roof over their head for the long term). Just like buying a home, capital works is generally good debt for government, provided we can meet the repayments, as it improves the amenity of our society through more efficient transport connections, better communications or increased services to the community.

Morrison’s recent speeches on debt and disaster therefore are duplicitous on two levels: while the ALP certainly didn’t clean up the overly generous welfare system, neither did they create it (if anything the ALP and the Greens are trying to inject some fairness into the changes blocked in the 2014 and subsequent budgets so the better off ‘feel the pain’ as well); and if a bank will lend our hypothetical ‘borrower 1’ and ‘borrower 2’ nearly seven times their annual income to purchase a capital item (a home to live in), why is there so much concern about Australia’s borrowings potentially getting to a value slightly over one year’s income or GDP (prior to deductions) in around 10 years’ time?

The problem with all this is that Morrison is claiming a debt of $1 trillion will send this country into a recession like we have never seen before. Who knows, it may — but the chances are pretty remote. The more probable alternative is that our society shares the output from the borrowing by our government and the resultant economic benefits. The economic benefits of the better road, rail line or telecommunications infrastructure makes money for the businesses and individuals who use it, who then earn more and pay more tax giving the government the resources to repay the original debt.

Morrison is half way on his ‘road to Damascus’ in that it recently seems to have ‘clicked’ that alterations to the revenue side of the Australian budget are just as necessary as his and his immediate predecessor’s fixation with the expense side of the ledger to the detriment to those on lower incomes. Now he just needs to understand that there are different types of debt; and some of them are actually good for our society.

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

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Rethinking our priorities
2353NM, 28 August 2016
Some believe that those who purchase Lotto entries, play pokies or Keno or participate in other forms of gambling are effectively paying an idiot tax. On a purely rational level, they may be right as there is a significant chance that the few dollars you give to the Lotto machine operator or similar is wasted money — albeit a small proportion goes to the government in some form of wagering tax.

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Rethinking our priorities


Some believe that those who purchase Lotto entries, play pokies or Keno or participate in other forms of gambling are effectively paying an idiot tax. On a purely rational level, they may be right as there is a significant chance that the few dollars you give to the Lotto machine operator or similar is wasted money — albeit a small proportion goes to the government in some form of wagering tax.

There are of course, many that disagree and happily put their money down to have a chance of winning considerably more than they started with. It doesn’t matter if it is pure luck or there is some skill involved in the wagering process; each time the money is gambled there is a small hope that the gamblers world will get much better financially very soon. Gambling companies have to publicise the chances of ‘winning big’ these days, and it’s on their website (albeit right down the bottom of a menu).

Despite the miniscule chances of winning a life changing amount, we all at some point have wondered what it would be like to be able to afford anything we wanted to do. Well, Steve Colquhoun probably couldn’t afford it but he hasn’t had to wonder either. You see Colquhoun up until recently was a writer for Executive Style on the Fairfax Media websites and the list of what he has done to file his stories is awesome. Despite seemingly having it all (with the added bonus of not having to pay for it), he’s giving it up to spend valuable time with his ‘long suffering’ family. Maybe you can’t have it all.

Sadly, most of us will never win a substantial amount of money gambling or have a job reviewing ‘experiences’ for Executive Style. That’s why financial institutions were invented — to lend money.

Provided you meet some criteria, there are any number of financial institutions that will lend you money for all sorts of things. Running a bit short until next payday — there are organisations that will lend to ‘tide you over’. Is your TV too small? — there is a lender for that as well. It’s the same if you want to buy furniture, cars, holidays, houses or pretty well anything else that takes your fancy; ‘come in and talk to our friendly and helpful staff and you can walk out with the item of your dreams’. Lenders are there to sell money. Interest on the money they sell is the cost to the purchaser of buying the money now rather than waiting until the consumer can walk in and ‘write the cheque’ (which these days is usually ‘do a bank transfer’ — which is a completely separate can of worms to talk about another day). The lenders take a risk in lending for periods of up to 30 years (for a house) based on the financial affordability that you can demonstrate today and they price the risk in, making the loan according to the facts they have at their disposal. Financial institutions like to get their money back. If the loan is secured (you pledge that they can get something of equal or higher value if you choose not to pay the lender’s money back), the lender will price the money accordingly.

So, for example if you are looking for a few hundred to tide you over until payday, the facts a lender would consider include why you only need money for such a short term and the chances of you not being able to be found when it’s time to repay the debt; and charge you a high cost (interest rate) for the use of their money. Traditionally, people borrow money for a home, assets that appreciate in value or a tool of trade (a machine of some sort that generates more income than it consumes). Without trying to be flippant, it is the bread and butter business of the financial industry. Assuming you have the income and can demonstrate you fit the criteria for security and repayment capability, there are hundreds of lenders around Australia that will lend you the money now to fund your purchase if you promise to repay the debt over a specified period. Generally, houses increase in value, which means that while you are paying a fee to use someone’s money, the increase in value of the house will over time probably exceed the interest you pay. Tools of trade generate more income than they cost — a plumber would find it difficult to get to their next job with all their tools if they relied on public transport and a machine that can double the output of a product will generate cash for the business that buys it. You could say everyone’s a winner.

Some loans don’t make as much sense. If you borrow money to purchase a personal use car or consumer goods, you are paying a higher interest rate and generally the item you are purchasing doesn’t appreciate in value as a house does. A ten-year-old car is worth far less than a new one, while a house that you have lived in for ten years will probably be worth more than what you paid a decade ago. The car or other consumer item you are purchasing is also transportable, you can drive a car across the country; you can hide an expensive watch in your pocket and so on. Accordingly, the lender will charge you a higher fee for the privilege of using their money.

Borrowing to purchase a home, an asset that should appreciate in value or a tool used to produce income is an accepted part of Australian lifestyle, so much so that when the Commonwealth Bank recently announced a $9.45 billion profit claiming the bank's flagship retail business underpinned the profit growth, the media reports suggested:
Investors were underwhelmed by the result from a bank that trades at a premium to peers, with CBA shares falling 1.3 per cent to $77.40.
In fact, one of the points of difference between the two major political parties at the last federal election was the future treatment of ‘income losses’ produced by taxpayers negatively gearing investment borrowings. Neither party was suggesting that borrowing money to fund the purchase of income producing assets was a bad idea: the ALP claimed they were attempting to reduce the heat in the property market in some of Australia’s large cities (and gain revenue) while the Coalition wanted to keep the status quo.

Yet at the same time as the Coalition is suggesting to you and I that if we can demonstrate to a financial institution that we can afford the repayments we should be able to purchase all the houses we like (and the subsequent increase in prices pushing first home buyers out to areas where services such as shopping, transport and so on are either not provided or far more expensive), we have former Treasurer Peter Costello on ABC’s Four Corners claiming:
PETER COSTELLO: Superannuation changes aren't going to balance the budget; that's obvious. The only way you'll balance this budget is if you get spending below 25 percent of GDP, right? We're at about 25.8 percent now. Um you cannot balance a budget on that. Until such time as you get your expenditures below 25, and preferably well below 25, you won't balance a budget. Super won't do it.
Yes, this is the same Peter Costello who introduced a number of expenditure measures (tax relief to companies and subsidies to average and higher income earners) while Treasurer during the period that Australia was in the fortunate position of higher than traditional revenue due to the mining boom. His ‘profligacy’ has been a problem for all the governments that followed him. As The Saturday Paper observed in December 2014:
Profligate is not our word. It was the word used by the International Monetary Fund in a major report it released early last year, that examined 200 years of government financial records across 55 major economies, identifying periods of government prudence and profligacy in spending.

Overall, Australia was judged very favourably. For most of the country’s history, governments of both persuasions had been prudent economic managers. The IMF identified only four periods of profligacy. The two biggest were during the Howard–Costello years. They were in 2003 and then between 2005 and 2007, and they accompanied the mining boom.

On its face, the IMF assessment might seem harsh. After all, before they were voted out in 2007, Howard and Costello had delivered six budget surpluses in a row.

But they also seriously undermined the structural integrity of the budget by making big spending commitments and giving huge tax cuts, on the basis of a flood of revenue that would inevitably dry up.

“You can sum it up in four words,” says Chris Richardson of Deloitte Access Economics. “Temporary boom, permanent promises.”
Whether Costello or Treasury were responsible for the permanent spending caused by a temporary boom is not the issue. The issue is the consistent bashing over the head we receive with the claim that the budget must balance and government debt is bad. At the same time, the government of the day and Treasury are encouraging the Australian population to assume debt in the form of home loans, through processes such as the ‘First Home Owners Grants’, the ability to claim losses from investment properties as a deduction on tax returns, as well as the capital gain being halved prior to the tax calculation if the appreciating asset is held for a period in excess of one year, they are telling us that all government debt is bad. On a logical basis, it just doesn’t make sense.

While most Australians would prefer not to incur debt on recurrent expenditure, such as fuel for their vehicle or the weekly trip to the supermarket of their choice, it is probably fair to assume that governments would prefer not to pay for wages and subsidies from debt funding as the costs are recurrent in both cases. But, just as it makes sense for Australians to incur debt to purchase appreciating assets or tools of trade it is probably just as valid for the governments around Australia to incur debt for infrastructure that will either appreciate in value or produce income in excess of the costs of the debts (especially when interest costs are so low at the moment). After all, if there is benefit in a concept that benefit should accrue regardless of the corporate status (individual, company or government) of the ‘person’ that will benefit. When someone spends money, the whole economy benefits, through people receiving wages and then creating demand in the economy. Governments are the financial industry’s ultimate safe borrower — there is almost no chance that the government will renege on the agreement and they almost invariably repay their debts to the cent at the required time. Ross Gittens recently wrote in Fairfax media:
Treasury wants little old ladies to feel as guilty about borrowing to improve the Pacific Highway as they do about borrowing for "routine government expenses".

So, let's worry about getting the recurrent budget back to surplus (as most state governments did long ago), but not about borrowing for infrastructure. Agreed?

Except that when you read the budget papers carefully enough to find the info Treasury has hidden on page 6-17, you discover that the expected underlying cash deficit for this financial year of $37 billion includes capital spending of $36 billion.

Get it? We're already back to a balanced recurrent budget. So why so much hand-wringing? And why aren't we getting on with planning the infrastructure pipeline we could expedite "in the event that we were to need a big demand stimulus"?
So much for the debt and deficit disaster that Australia will inevitably face. It seems most of the debt that Australia is going to incur this year is for capital expenditure such as upgrading the Pacific Highway. Whatever happened to the country that completed the Snowy Mountains Scheme, the water pipeline from Perth to Kalgoorlie and the building of thousands of kilometres of railway lines, then roads, all paid for at least in part with borrowings?

Australia as a nation can’t wait until we get ‘lucky 7’ on the roulette wheel, the winner in the third at Moonie Valley or win the lotto to justify spending on improvements to our infrastructure that will improve our way of life well into the future.

And to prove you can’t have it all, it seems that winning the lotto is not all it is cracked up to be.

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

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As you sit on your comfortable chair after a satisfying meal with a glass of your favourite drink in hand and view current affairs programmes on TV, do you reflect on the plethora of distressing images that assail viewers day after day? Do you ponder how you might feel if you were part of those images?

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The meaning of life

As you sit on your comfortable chair after a satisfying meal with a glass of your favourite drink in hand and view current affairs programmes on TV, do you reflect on the plethora of distressing images that assail viewers day after day? Do you ponder how you might feel if you were part of those images?



How did you feel when you saw the stunned, blackened, bloodied face of five-year-old Omran Daqneesh, sitting in an ambulance after being dragged from the rubble after another air attack on Aleppo? Did it bring back memories of Alan Kurdi, a three-year-old Syrian boy of Kurdish background drowned on a beach near the Turkish resort of Bodrum in September last year during his parents’ attempt to escape Syria for the Greek island of Kos. This image shocked the world, yet here we are a year later shocked again by the same conflict and the same awful outcomes for children. Now we hear that Omran’s ten-year-old brother Ali died in the same attack.



These images reminded us of a photo of a small, naked nine-year-old Vietnamese girl, Phan Thị Kim Phúc, also known as 'Napalm Girl' running away from a napalm raid on her village. The photograph is one of the most memorable of the 20th century. It may have changed attitudes to the Vietnam conflict, highlighting as it did the tragic legacy of war, but here we are again reliving the tragedies all over again, tragedies that afflict little children, innocents who suffer because of where they live, whose lives are forever scarred. These children have known nothing but war.


When you wake in the morning, do you ever ask: ‘What am I going to do today?” For older folk, now in retirement, this may be a regular question. Can you imagine what the answer might be if you were living in the rubble of Aleppo or any of hundreds of places ravished by war day after day? Can you picture what your answer might be if you were living in an overcrowded refugee camp in Turkey just over the border from Syria. The most likely answer might be simply ‘survival’, survival for another day – finding enough food, water and shelter for yourself and your family to keep body and soul together. What might your answer be if you were confined to Manus Island or Nauru, with virtually no prospect of ever settling where normal family life might be resumed?

As we enjoy our comfortable lives, how can we imagine what it must be like to suffer the torment, the danger, the uncertainty, the boredom and the endless weariness of living in limbo?

We struggle to contemplate these never-ending agonies, and feel helpless as we reflect on whether we can ever make a difference for those who live with this daily suffering. It is distressing even to think about it.

For these unfortunate people, what is the meaning of life?

When survival is their prime endeavour, how can they anticipate a secure life, a rewarding existence, and a healthy future?


Most who read this piece will have had a satisfying life. Not perfect, not lavish, not entirely free of stress, worry and ill health, but agreeable enough in this land of ours so gifted with natural resources and opportunity. Most will feel fulfilled, will feel that they have made a contribution to our multicultural society. Not all – there are always the disadvantaged, the sick, the disabled, the poor, the homeless, those who have been dealt a poor hand in the game of life. Our society recognizes these inequities and makes provision for some of them.

Most who live in this richly endowed country are likely to feel that they have been able to make a contribution to society and, to use a hackneyed phrase, will ‘leave it in better shape’. For some this has been relatively easy. Teachers, doctors, health care workers, neighbourhood workers, firefighters and police officers go to work each day feeling that what they do is valuable, indeed essential for the wellbeing of the community. Likewise, mothers know that giving life to children is crucial to the vitality of our community. Raising and nurturing a family gives meaning to life for parents around the world. Some find meaning in life by adherence to religion, or through support for charitable organizations. Some join movements protesting against injustice.

There are of course many other ways that we contribute, whether through manufacturing, commerce, industry, public service, the armed forces, or the myriad of services the community wants and needs. Some may feel that their occupation is humdrum and their contribution insignificant, but most can enjoy the satisfaction of doing something for others. For most in this lucky country, although sadly not all, there is meaning to life, and satisfaction with a life well lived.

But this does not relieve us from being concerned about those less well off, about the inequality that afflicts our Australian society, about those whom we as a nation treat poorly, or inhospitably, or cruelly, or indifferently.

How can we watch the images of war: destruction, displacement, despair and death, even of precious children, and not want to do something? All except those who have built a wall of indifference around them feel the anguish of conflict, dislocation, poverty, injustice, unfairness and inequality. Yet we so often feel powerless to effect any change. Too often, we lack the means. While life might be meaningful for us, we know it is not for so many others. How can we make a difference in the lives of the less fortunate? How can we help them to find meaning where there is so little?

The answer seems to rest largely with those whom we elect to represent us. Individually, we are unable to stop conflict, eliminate war, remedy the displacement of many millions around the world, and relieve the poverty, the injustice and the inequalities that afflict so many. But we do have our politicians and the public service that supports them.

Of all our citizens, politicians have more power than any of us to effect change. Politicians are able to assess the state of our world and our nation, to identify our problems, to evaluate our advantages, to take stock of our resources, to arrive at equitable solutions, and to put them into place. We elect them to do this. We want them to enact laws that give meaning to people’s lives, laws that give a helping hand to those who need it, that smooth out social inequities, that increase the prosperity of our nation and all who live in it, that enable all of us to make the most of our lives, to enjoy meaningful lives that enrich not just ourselves, but all those with whom we have contact.

Moreover, we want our politicians to reach out to those outside our country, to use their influence to lessen tensions, conflict and war. We want them to bring peace to our troubled world. And while they are doing so, we want them to give succour to the displaced, to the families and the children ravaged by conflict, destruction and death, to give them the opportunity of a meaningful life.

I know it reads like an impossible dream. Sadly we not only seem to be far from realizing the dream; we seem to be making the nightmare worse.

I could write reams about the inadequacies, the indifference and sheer incompetence of our federal government, but I need go no further than ask why our offshore detention arrangements continue to persecute the innocent – the men, women and children that languish without hope on Nauru and Manus Island. How in earth has it come to this?

We know the history pretty well. Look behind it though and we see the real reasons. John Howard saw a political advantage in opposing asylum seekers coming by boat. The ‘Tampa affair’, the ‘children overboard’ saga, and his words, indelibly written into our history; “We will decide who comes to this country and the circumstances in which they come”, all reinforced a view that these people were unwelcome intruders. Tony Abbott, never to miss a chance to wedge his opponents, ramped up the anti-asylum seeker rhetoric, demonized boat people, stirred up enmity, even hatred among some in marginal electorates, and used the slogan ‘Stop the Boats’ to successfully wedge his opponents. His hyper-partisan approach to boat arrivals set a pattern that exists to this day.

Labor became caught up in an unseemly race to the bottom; inhumanity, cruelty and hopelessness became the norm for boat people. It persists still. Scott Morrison and Peter Dutton became loyal foot soldiers for Abbott and his conservative admirers, and now for Turnbull, who despite his own feelings, has been dragooned into taking the same punitive, unyielding, unsympathetic, mean approach of his predecessor, all in pursuit of the spurious objective of ‘protecting our borders’ from what is represented as some sort of invasion. The truth is that he is protecting his back from the knives of Abbott’s conservatives.

Our federal government seems hell-bent on depriving those on Manus and Nauru of any real meaning in their lives. Every morning, as they ask what they are going to do today, the answer is the same – survive another day. They dare not hope for any improvement in their situation. And in addition to their overwhelming feelings of hopelessness and despair, they now suffer assaults, sexual abuse, rape, child abuse, and discrimination, about which reports Dutton is skeptical and indifferent.

What has our country come to? Our reputation as a decent people is tarnished daily. We are held up to the world community as cruel, indifferent to the norms of international behaviour towards asylum seekers, and thoroughly mean spirited. Is that the image we want?

So what is the answer? What can we do to change the state of the world, or closer to home the plight of asylum seekers in indefinite detention? How can we make life more meaningful for these almost-forgotten people? How can we enhance the meaning of life for ourselves?

The ballot box is one answer. But with both major parties using asylum seeker issues as a wedge, would a change of government make any difference, so entrenched in the electorate is the anti-asylum seeker feeling, now accentuated by Pauline Hanson’s One Nation Party?

There are protest movements: GetUp and 350.org are just two, but they are having little effect on the Turnbull government and its hardnosed Immigration Minister, the odious Dutton.

Blog sites and social media have a role to play; even writing something like this piece, and commenting on it, give a feeling of doing something, no matter how small.

We all seek meaning in our lives, but sadly many have few avenues of enriching it. Maybe contributing our small voices in this way is the best we can do to encourage, indeed pressure those whom we depend upon to speak out and act for us in this troubled world, to challenge, repudiate and defeat the alien forces we see operating around us everywhere, every day. But that would take fortitude and selflessness, rare attributes in today’s politicians, for whom self-interest prevails.

Oh for politicians of the calibre of William Wilberforce and Emmeline Pankhurst, whose courage, tenacity and unyielding persistence gave meaning to the lives of so many of the oppressed, so many of the disadvantaged!

Where have they gone?


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

What do you feel about the ongoing conflicts in the Middle East?

What do you feel about the way the government is managing offshore processing at Manus Island and Narau?

How would you prefer them to be managed?

Should those detained there be brought to Australia for assimilation?



Recent Posts
The election in numbers 2: minor parties and independents
Ken Wolff, 14 August 2016
A number of commentators made the point after the election that almost a quarter of voters did not vote for the major parties in the House of Representatives. But that is misleading on two counts. It ignores the 5% informal vote and the 10% vote for the Greens who I think are now entitled to be considered a major party — they do contest every seat after all. That leaves about a 10% …
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Rudd and Abbott: saviour of their parties
2353NM, 17 August 2016
Two of the three ex-prime ministers who were deposed by their own political party have been in the news in recent weeks. Kevin Rudd requested backing from the Coalition government to bid for the Secretary-General position at the United Nations and Tony Abbott claimed there are factional divisions in the NSW Liberal Party. On face value, both men are using the media to further their own ends. …
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A once and future Senate
Ken Wolff, 21 August 2016
We now know that the Senate elected at the July election comprises 30 Coalition members, 26 from the ALP, 9 Greens, 4 from One Nation, 3 from the Nick Xenophon Team (NXT) and one each from Family First, the Liberal Democrats, Derryn Hinch’s Justice Party and the Jacqui Lambie Network. Thirty-nine votes are required in the Senate to pass legislation, so the government will require either ALP or Green support, or otherwise support from nine of the eleven minor party members.
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A once and future Senate


We now know that the Senate elected at the July election comprises 30 Coalition members, 26 from the ALP, 9 Greens, 4 from One Nation, 3 from the Nick Xenophon Team (NXT) and one each from Family First, the Liberal Democrats, Derryn Hinch’s Justice Party and the Jacqui Lambie Network. Thirty-nine votes are required in the Senate to pass legislation, so the government will require either ALP or Green support, or otherwise support from nine of the eleven minor party members. Given that NXT has three Senators and One Nation has four, their support for every Bill opposed by the ALP and the Greens becomes essential. It will be a difficult situation for the government but there is another issue I wish to discuss.

Before the election, the Coalition and the Greens combined to introduce a new voting system for the Senate, the aim being to reduce the number of minor parties or people being elected despite starting with only a handful of first preference votes. It did not work this time, largely due to the election being a double dissolution, but will it achieve its aim in the future when we resume the cycle of half-Senate elections?

Senators are elected for six years but on a rotational basis so that half the Senate faces the electorate every three years. After a double dissolution a decision has to be made as to which of the newly elected Senators will serve a full six-year term and which will serve only three before facing an election. There are two ways of doing this.

The common approach has been to use the order in which Senators from each state are elected and give the first six the six-year term, with those elected from seventh to twelfth to serve three years. In a Senate election those with smaller votes are progressively ‘excluded’ and their preferences distributed and preferences from those who have an ‘excess’ quota are also distributed on a proportional basis: as that process unfolds a clear order of election emerges.

The other way, put in legislation by the Hawke government in 1984, allows the Australian Electoral Commission (AEC) to do a recount of the election as if it was a half-Senate election and those ‘elected’ under that count would be given the six-year term. The underlying idea supporting that approach was that using the ‘first six elected’ may have been fair when we had ‘first past the post’ voting but not when we have a proportional representation system: despite that, even after the 1987 double dissolution this method was not used.

Although those two methods are available, the Constitution states only that the Senate itself can decide who will serve six years and who three.

Derryn Hinch had suggested that if he did not get a six-year term he would challenge the decision in the High Court. I am not a lawyer but I don’t like his chances if he carries out that threat. When the Constitution states the Senate can decide, it would seem that it is not even bound to use either of the methods I have described.

It was reported on 12 August that the Coalition and Labor had agreed they would use the ‘traditional’ method of the ‘first six elected’ to determine the six-year Senators. That means the Coalition will have 16 six-year Senators, the ALP 13, the Greens 3 (Di Natale, Ludlam and Whish-Wilson), NXT 2 (Xenophon and Griff) and One Nation (Pauline Hanson) and Jacqui Lambie Network (Jacqui Lambie) one each. So that will be the starting point for a new Senate from 1 July 2019.

At a state level that translates as 3 each from the Coalition and the ALP in NSW; in Queensland, 3 Coalition, 2 ALP and Pauline Hanson; in SA, 2 each from the Coalition, ALP and NXT; in Tasmania, 2 each from the Coalition and ALP, and 1 Green and Jacqui Lambie; and in both Victoria and WA, 3 Coalition, 2 ALP and 1 Green.

I will basically ignore the Senators from the NT and ACT, except in discussing total numbers, because they face election every three years and the territories invariably return one Coalition and one ALP Senator, meaning that we just add two to each major party.

What becomes more important is who will face re-election in three years: 12 Coalition Senators, 11 from the ALP, 6 Greens, 3 One Nation, 1 NXT and Derryn Hinch (Derryn Hinch’s Justice Party), Bob Day (Family First) and David Leyonhjelm (Liberal Democrats). From that list you can see why the Coalition and the ALP agreed to the ‘first six elected’ method: their numbers for re-election are close and 13 of the 20 cross-benchers have to face re-election. In that regard, the government may be relatively content with the outcome from the new voting procedure and see the next half-Senate election as an opportunity to reduce the size of the cross-bench.

To be elected a Senator has to achieve a ‘quota’ which is determined by dividing the total number of votes in a state by the number of Senators facing election plus one. In the recent double dissolution that meant the vote was divided by 13, or in percentage terms a quota was about 7.69% of the vote. In a half-Senate election, the number is divided by 7 and so a quota becomes 14.29% of the vote. While preferences are important in determining who is elected, the quota achieved after first preference votes gives a reasonable indication of who will be elected, with those achieving at least 0.4 of a quota having a higher probability of achieving a full quota after preferences.

Given the results in the 2016 election who is likely to win re-election at a half-Senate election and what will that mean for the Senate from 2019?

Firstly, neither David Leyonhjelm, NSW, (Liberal Democrats) nor Bob Day, SA, (Family First), appear likely to be re-elected: their 2016 vote becomes only 0.2 of a quota at a half-Senate election. They would each require something close to a doubling of their vote and that is highly unlikely.

In Victoria, Derryn Hinch may be in with a chance of being re-elected if he can maintain his vote: his half-Senate quota would start at 0.42 rather than the 0.79 at the 2016 election. My guess is that at a half-Senate election Hinch, if he runs again, may even achieve a slightly higher vote, but even with a starting point of 0.4 of a quota I expect that he could be returned.

Jacqui Lambie was elected in Tasmania at the recent election but will not face re-election at the half-Senate election. The 2016 vote translates to 0.58 of a quota at a half-Senate election but because that vote was for Jacqui Lambie herself, it is unlikely to be repeated when she is not running. So even if she runs a Jacqui Lambie Network candidate, I would expect a very reduced vote and it is unlikely a second Network member would join her in the Senate.

Three One Nation Senators will face re-election with the NSW and WA Senators appearing unlikely to win as their starting quota would drop below 0.3. A Queensland win is possible based on the 2016 vote as it would become 0.64 of a quota at the half-Senate election. Hanson herself will not be running so that could reduce the One Nation vote but it may still be enough to secure a second One Nation member in the new Senate (unless there is a large drop in the vote, which is possible based on the past history of One Nation).

Based on the 2016 vote, NXT could pick up two more Senators in SA at a half-Senate election as it would have 1.52 quotas. As with Lambie and Hanson, however, Xenophon himself won’t be running and that may reduce NXT’s vote. Even so, it seems likely that at least one NXT member will be returned and two can’t be entirely ruled out. So NXT will maintain at least three Senators, and possibly increase that to four, in the new Senate from 2019.

One Green Senator from every state will face re-election. They are likely to have at least four and probably five returned. SA is most problematic for them largely because of the magnitude of the NXT vote. If the NXT vote drops, it may become a battle between the Greens and a second NXT candidate for the final Senate position. So that will not change the number on the cross-bench, just the composition.

So, on my estimation, it is possible that 9 of the 13 cross-benchers facing a half-Senate election could be returned, meaning there would still be 16 rather than the current 20. Counting the six-year Senators, the new cross-bench could comprise 8 (possibly 9) Greens, 4 (possibly 3) NXT, 2 One Nation, Jacqui Lambie and Derryn Hinch.

How the Coalition and the ALP fare at a half-Senate election depends very much on who wins government in the HoR because, obviously, the winning party would probably see an increased vote compared to the 2016 election. An increased vote for either party may also have some influence on the results for the minor parties, with Hinch in Victoria, the One Nation candidate in Queensland and possibly the second NXT candidate in SA being most at risk.

At best, the Coalition could win three seats in each state, although if NXT continues its success in SA it may only be two there. Even with an increased vote, and irrespective of the NXT vote, I suggest that 17 Senators is its very best outcome, for a total of 35 Senators (including the two Territory Senators) in the Senate from 2019, still four short of a majority.

The ALP’s best result, with an increased vote, appears to be 16 Senators for a new total of 31 (also including its two Territory Senators) so, as in the past, it would be reliant on the support of the Greens to pass legislation.

Those ‘best’ results for the Coalition and the ALP include the scenario that Hinch, One Nation and NXT do not win the extra seats I mentioned. If they do win, then the Coalition could expect to win 14 seats and the ALP 13, in which case the 2019 Senate would be 32 Coalition Senators, 28 from the ALP, 8 Greens, 4 NXT, 2 One Nation and Derryn Hinch and Jacqui Lambie.

In that scenario the Coalition would require ALP or Green support, or all but one of the minor party Senators to pass legislation, and the ALP would require the Greens and at least three of the other Senators, which most likely would mean gaining the support of NXT.

There are of course many permutations. Will there be a stronger vote for the Coalition or the ALP in 2019 and, if so, will it be strong enough to reduce the vote for minor parties? Will there be a resurgence in the Greens’ vote? Will the One Nation vote collapse as it has done in the past? Can NXT maintain the very high vote it achieved in SA in 2016? The answer to those questions can change what happens at the next half-Senate election and perhaps re-write my scenarios.

But unless the answer to those questions is ‘yes’, ‘no’, ‘yes’ and ‘no’, then it appears likely that the government’s Senate voting changes will not achieve its intention of significantly reducing the size of the Senate cross bench. It may have to wait until 2022, even 2025, and try, try again.

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


Recent Posts
The standard you walk past . . .
2353NM, 13 August 2016
Lieutenant General David Morrison AO gave the speech above in 2013 when it came to light that members of the Australian Army were alleged to be guilty of inappropriate behaviour to those of lesser rank and/or female. There are a couple of clear messages in the speech – firstly, his message to those that believe that his lack of tolerance of inappropriate behaviour is wrong; if it does not suit you - get out. …
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The election in numbers 2: minor parties and independents
Ken Wolff, 14 August 2016
A number of commentators made the point after the election that almost a quarter of voters did not vote for the major parties in the House of Representatives. But that is misleading on two counts. It ignores the 5% informal vote and the 10% vote for the Greens who I think are now entitled to be considered a major party — they do contest every seat after all. That leaves about a 10% …
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Rudd and Abbott: saviour of their parties
2353NM, 17 August 2016
Two of the three ex-prime ministers who were deposed by their own political party have been in the news in recent weeks. Kevin Rudd requested backing from the Coalition government to bid for the Secretary-General position at the United Nations and Tony Abbott claimed there are factional divisions in the NSW Liberal Party. On face value, both men are using the media to further their own ends. …
More...

Rudd and Abbott: saviour of their parties


Two of the three ex-prime ministers who were deposed by their own political party have been in the news in recent weeks. Kevin Rudd requested backing from the Coalition government to bid for the Secretary-General position at the United Nations and Tony Abbott claimed there are factional divisions in the NSW Liberal Party. On face value, both men are using the media to further their own ends. To observers of Australian politics, this really shouldn’t be a surprise.

While Rudd’s campaign was probably always going to be unsuccessful according to others, on the face of it he does offer the UN some demonstrated leadership ability in trying circumstances — such as the GFC when Australia was the only developed economy that continued to expand during the late 2000’s. Certainly he also has some less redeeming character traits as well — some of which were aired in public when the ALP deposed him as prime minister.

Abbott made a number of claims about factions and backroom lobbying in the NSW Liberal Party, despite Prime Minister Turnbull’s claim to the contrary.


In spite of Abbott probably airing the ‘dirty linen’ in public for his own perceived advantage, he is correct. In any organisation there is usually a difference of opinions on a host of issues, with some being convinced that policy and practice should change to reflect current society/meet differing expectations and so on, while others will suggest that if it ain’t broke, don’t fix it. Sometimes the discussion on a combined position is amicable; mostly it isn’t. It also stands to reason that if you can influence parliamentarians — a benefit of being a member of a political party — you could have a better chance of ensuring a particular law of the land reflects some advantage to your business or personal position — so the stakes can be pretty high. Abbott, to his credit, did ban lobbyists from holding organisational positions in the Liberal Party (suggesting there could be a conflict of interest) early in his prime ministership:
One of Mr Abbott's first acts as prime minister was to rule that party officials could not lobby his government, a move mirrored by then-NSW premier Barry O'Farrell.
Rudd too changed the rules of the ALP after he was brought back to the prime ministership in 2013. Effectively he ensured that there was only a small number of opportunities to change the leadership; the Daily Telegraph claimed at the time that it was an attempt to shore up Rudd’s leadership; probably a pretty good assumption.

In a similar way, Fairfax Media claims Abbott’s statement:
… comes as Mr Abbott's conservative-right faction struggles with increasing irrelevance in NSW, where the moderate faction has become dominant, led by key figures such as party president Trent Zimmerman and lobbyist Michael Photios.
So the rule changes orchestrated by both men could also be construed as attempts to maintain or increase their personal longevity and power within their respective political parties. On the face of it, there is nothing new to see here. However, lets dig a little deeper, there are almost certainly unintended consequences in play here. Rudd and Abbott really are pretty similar. Both men were ruthless as opposition leaders. Rudd was seen as being in touch with the majority of the population and an example of generational change from the days of John Howard and his long term government. ‘I’m Kevin from Queensland and I’m here to help’ went down in folklore and contrasted sharply with Prime Minister Howard’s last term where his ideological position on workplace rights lost him a lot of support.

Abbott became opposition leader during the initial debate around a mechanism for the pricing of carbon emissions. While later demonstrated to be completely false, visions of $100 lamb roasts and entire cities being shut down due to the impacts of the ‘carbon tax’ that Abbott would rescind on day one certainly grabbed the mind of the public.

On top of that, both men were ‘stop gap’ leaders. Rudd was ‘unaligned’ according to the ALP’s system of factions and took over from Kim Beasley who is often cited as the best prime minister Australia never had. Beasley accepted the position of ambassador to the United States when offered the positon by Rudd and survived the transition to an Abbott government seemingly unscathed. As he was ‘unaligned’, Rudd really didn’t have the support of any of the established factions of the ALP, having arrived in federal parliament via the Diplomatic Corps and some time as Queensland ALP premier Wayne Goss’ Chief of Staff. (Goss was the person who led the ALP to victory after a number of decades of predominately National Party rule by Bjelke-Petersen and others). Rudd’s time as prime minister commenced late in 2007; his popularity ratings sank to a position where the ALP decided to remove him from power in June 2010. Some of the reasons for his drop in popularity were supposed to be because of his management style, the actions he took during the Global Financial Crisis, refugee processing and the lack of progress on emissions trading legislation. The ALP reinstated Rudd into the prime ministerial role in 2013 and he lost the subsequent election to Abbott.

Abbott won a party room leadership showdown in 2009 by one vote over his predecessor Malcolm Turnbull. The leadership contest was opened due to differences over climate change policy — Turnbull was prepared to support the Rudd government’s Emissions Trading Scheme; Abbott wasn’t.

The Coalition under Abbott and the ALP under Gillard obtained 72 seats each in the 2010 election. According to contemporary media reports, Abbott begged the three independent cross-benchers to allow him to become prime minister – even his opposition to emissions trading was negotiable according to Tony Windsor, one of the independent MP’s involved in the discussions:
"But ... Tony Abbott on a number of occasions said that he would do absolutely anything to gain government - anything," Mr Windsor told Sky News.

"One could draw a conclusion from that that if we pulled a tight rein and said 'Well, you've got government if you put a carbon price on' he would agree with it - that was the inference from his statements."

Mr Windsor said he had made a "character judgment" about Mr Abbott after the discussions.

"He actually begged for the job ... (he said) 'I will do anything to get this job'," Mr Windsor said.
It seems both Rudd and Abbott are the personalities who will do anything to reach a goal or shore up a position. Now let’s look at why this is relevant in August 2016. When Rudd achieved victory over Howard and Abbott achieved victory over Rudd, they were in the pantheon of glory within their respective political parties. As the opinion polls went south (and the other side was suddenly looking like a winner), there was a reassessment of their capabilities; the respective party rooms came to the conclusion that their leadership was untenable in the long term.

Potentially a believer in the axiom to keep your friends close and your enemies closer, Rudd was kept in the Cabinet by his successor Julia Gillard. History suggests that Gillard didn’t keep Rudd close enough, leading to a challenge in 2013 where Rudd was re-installed as prime minister. One of the things Rudd did to the ALP rules subsequent to his re-installation was to institute a requirement that the parliamentary leader of the ALP be elected by polls of not only those in parliament, but the broader ALP membership. Rudd claimed he decided to: ‘
“. . .democratise the party for the future.

''Each of our members now gets to have a say, a real say in the future leadership of our party. Decisions can no longer simply be made by a factional few," he told reporters in Balmain.
While the statement is true enough — all ALP members now have a vote on the leadership of the Federal Parliamentary Party — subsequent to the 2013 election Anthony Albanese won the ‘ALP members’ vote and Bill Shorten won the ‘parliament’ vote which was held due to an election defeat. Obviously, while all ALP members are equal, Caucus has more say.

As we all know, Abbott was rolled by his party room in 2015 (it couldn’t be because it seemed to work so well when the ALP did it, could it?) and for a while Malcolm Turnbull and the Coalition’s approval figures, according to the opinion polls, were stratospheric. Accordingly, Shorten and the ALP’s polling figures went down by a similar level.

The benefit Shorten inherited from Rudd was that it would have taken his resignation, an election loss or a 75% vote of no confidence by the ALP Caucus to topple Shorten. If there were any ALP ‘bedwetters’ (to coin a phrase) in late 2015, they probably realised the hurdles required to change the opposition leader were almost insurmountable and decided (publicly anyway) to grin and bear it. It’s now also history that Shorten went on to lead the ALP to the 2016 election, suffering a narrow loss which was a better than expected result.

Abbott’s recent disclosure regarding factions in the Liberal Party probably didn’t surprise anyone. Turnbull’s claim last October that the Liberal Party in NSW was one big happy family was treated with the ridicule it probably deserved by those that should have some idea of the reality (the video above was published widely when it occurred). In the words of The Guardian:
“Tony Abbott has warned that lobbyists holding positions as power brokers in the Liberal party creates the potential for corruption.”
and
“Some of these factional warlords have a commercial interest in dealing with politicians whose preselections they can influence,” Abbott said.

He said this created a “potentially corrupt position”. “The best way to see off the factionalists is to open up the party — the more members we’ve got, the harder it is for the factional warlords to control.

“There are people not on the state executive who caucus regularly on the phone and face-to-face with people who are on the executive to try and get pre-cooked outcomes.”

Abbott said he wanted to empower the membership by letting them choose Liberal candidates for parliament. The call for more democratic preselection is likely to re-open a debate between moderates and conservatives over how candidates are chosen.
Abbott’s opinion seems to be that if the process of preselection within the Liberal Party is opened up, and dare we say made more ‘democratic’, the party will preselect those whose opinions are shared by the majority of the Liberal Party members in the electorate. He may believe that more ‘conservative’ people would be elected but there is no guarantee that outcome would occur, just as Rudd’s changes to the ALP rules didn’t save his leadership.

Rudd was probably trying to cement himself as the parliamentary leader of the ALP in 2013. Abbott is probably trying to ensure that more ‘conservative’ Liberal Party members are given a chance to enter parliament ensuring that he has a greater number of like-minded people around him, improving the chances of a second ‘Abbott era’.

Both interventions, however, have the effect of opening up both major political parties in areas where they have been accused of pandering to sectional interests. While Abbott obviously thinks he can influence ‘conservative’ Liberals to a greater extent than the more numerous ‘moderate’ faction, it is not a fait accompli that the ‘moderate’ majority would send more ‘conservatives’ to Canberra.

Rudd’s ‘reforms’ to the ALP leadership have made it more democratic (all members have some say) and made it easier for a new leader to develop and implement a strategy designed to improve the position of the ALP at the next election. As the leader is not judged on instant results (because the bar for changing leaders is set at a high level of discontent), a new leader and the party organisation have a reasonable expectation that the strategy will, if somewhere in the ballpark, be implemented in full. Shorten and the ALP’s opinion poll popularity certainly played a part in the demise of Abbott, who went from hero to zero in about two years. The election results also demonstrate the success of the ALP sticking to one leader and strategy for a considerable period of time.

Wouldn’t it be a delicious irony if Rudd and Abbott’s seemingly self-serving interventions into the operation of their respective political parties make the two major parties more democratic and ensure rank and file party members have a genuine say in their respective party’s destiny?

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

Recent Posts
Why are Abbott’s conservatives destroying our PM?
Ad astra, 10 August 2016
To those of you who dispute the assertion embedded in the title, let me provide you with supporting evidence.

First some questions for you to answer:

Is Malcolm Turnbull the man you thought he was when he rolled Tony Abbott almost a year ago?

Has he fulfilled your …
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The standard you walk past . . .
2353NM, 13 August 2016
Lieutenant General David Morrison AO gave the speech above in 2013 when it came to light that members of the Australian Army were alleged to be guilty of inappropriate behaviour to those of lesser rank and/or female. There are a couple of clear messages in the speech – firstly, his message to those that believe that his lack of tolerance of inappropriate behaviour is wrong; if it does not suit you - get out. …
More...
The election in numbers 2: minor parties and independents
Ken Wolff, 14 August 2016
A number of commentators made the point after the election that almost a quarter of voters did not vote for the major parties in the House of Representatives. But that is misleading on two counts. It ignores the 5% informal vote and the 10% vote for the Greens who I think are now entitled to be considered a major party — they do contest every seat after all. That leaves about a 10% …
More...

The election in numbers 2: minor parties and independents


A number of commentators made the point after the election that almost a quarter of voters did not vote for the major parties in the House of Representatives. But that is misleading on two counts. It ignores the 5% informal vote and the 10% vote for the Greens who I think are now entitled to be considered a major party — they do contest every seat after all. That leaves about a 10% first preference vote for other than major parties and, given that there were almost 150 smaller parties and independents, that is not a significant vote — an average of about 0.07% for each of them. Many of them garner only a few hundred votes: it is the sheer number of smaller parties and independents that contributes to the overall magnitude of their vote and that was not unique to this election.

We have heard most about the success of the Nick Xenophon Team (NXT) and One Nation but they contested only a limited number of seats. Two parties that contested more seats were Family First and Fred Nile’s Christian Democratic Party, which contested 65 and 55 seats respectively. Family First gained 1.5% of the vote nationally (just over 201,000 votes) and Fred Nile’s group 1.3% of the vote (about 178,000 votes). If we consider their vote against the number of seats they contested, then Family First averaged about 3,100 votes per seat and the Christian Democratic Party about 3,240. By way of comparison, the ALP averaged 31,350 votes per seat and the Liberal Party 36,300 in the 107 seats it contested (that is the Liberal Party only, not the full range of Coalition parties). And there are about 100,000 voters per seat, give or take 10%, except in Tasmania.

Nationally, NXT achieved 1.85% of the vote, or 250,400 votes, but it contested only 18 seats (11 in SA) giving it an average vote of 13,900 per seat. But NXT was not as successful outside of SA: for example, in Queensland in Moreton, it achieved 4.8% of the vote (4,072 first preference votes) and 7.6% in Groom (6,960 votes). While those Queensland results are reasonably good for an independent or minor party, they are not extraordinary. In the 11 SA seats, however, NXT averaged 21.3% of the vote or 20,120 votes. Xenophon has been an independent Senator for SA since 2007 and his high profile and popularity translated into votes for his Team but that did not extend to success beyond SA.

One Nation contested only 15 seats, of which 12 were in Queensland, to obtain 1.3% of the vote or 175,000 votes nationally, slightly less than Fred Nile’s Christian Democratic Party and significantly fewer than NXT, at an average of about 11,700 per seat. One Nation did marginally better in Queensland, averaging about 12,300 votes (13.9%) but this varied from 6,775 (7.6%) in Leichhardt (Warren Entsch’s seat) to 18,461 (20.9%) in Wright (a conservative seat that stretches west from the edge of the Gold Coast). Ironically one of the seats in which One Nation fell below its Queensland average was Pauline Hanson’s old seat of Oxley: it obtained just over 7,000 votes or 8.4% (admittedly the boundaries have changed since Hanson first won it).

So for NXT and One Nation, their ‘success’ largely came from targeting only a small number of seats, of which the majority were in their leader’s home state. At a seat level, they actually averaged more than the Greens who, in contesting all 150 seats, averaged 9,200 votes per seat.

There was also Bob Katter, who has his own party (Katter’s Australia Party) but is perhaps more like an independent. His party contested 12 seats in Queensland but obtained only 72,900 first preference votes of which Katter himself, in the seat of Kennedy, obtained 34,300. Katter is a sitting member with a high profile but his party did not fare so well averaging only 3,500 votes (a similar average to other minor parties) in the other 11 seats.

Also at a national level, over 100 independents, not linked to any party, achieved a total of 2.8% of the vote (about 381,000 votes), more than both NXT and One Nation but at an average of about 3,400 votes per independent candidate. Even that figure is inflated by high profile and successful independents like Andrew Wilkie and Cathy McGowan, and even the unsuccessful like Tony Windsor and Rob Oakeshott. Those four alone accounted for about 116,000 (or 30%) of the votes that went to independents: if they are removed, the vote for other independents was about 2,500 per candidate which does not suggest a major shift to independent candidates.

They are still independents I hear you say and that is true. But the more successful ones had a high profile in the seats they were contesting and two, of course, were sitting members (or three if we count Katter as an independent). A vote for Wilkie or McGowan was not a genuine shift away from major parties to independents but simply support for a sitting member (a rejection of the major parties could be said to have occurred in the year they first won their seat). And Windsor and Oakeshott, although not sitting members, were previous independent members in the regions they contested. The key to successful independents seems to be their public profile and/or a grass roots movement within an electorate, such as when McGowan won Indi from Sophie Mirabella in 2013 — she was drafted to run against Mirabella by a community organisation that felt Mirabella was not paying sufficient attention to the electorate. Once they do win a seat, as a sitting member they retain that advantage in subsequent elections. Another successful independent ploy is to move from a major party as Windsor, Oakeshott, Katter and Pauline Hanson the first time around, have done, often after having first been elected as a party candidate, so their profile has already been enhanced by party support (noting, however, that Hanson was selected as a candidate but lost party endorsement prior to the election).

In the Senate there are now 20 Senators (26%) not from ALP or L/NP: 9 Greens and 11 others from minor parties — and they are each minor parties although a few of them, like Katter in the HoR, are more like independents. That number would superficially seem to justify the argument that a quarter of voters did support non-major parties but, as I said in relation to the HoR vote, whether the Greens can still be considered a minor party is debatable. In the Senate the Greens secured 8.7% of the national first preference vote (almost 1.2 million votes) behind only the L/NP and ALP and double the vote of the next highest of the other parties — One Nation with 4.3% or 593,000 votes. The Senate, however, is determined at a state level and by a complicated preference distribution process, not by national first preference votes but the national figures give an indication of the actual support across the nation for the minor parties. In that regard, at the national level, NXT secured 456,000 first preference votes (3.3%), the Liberal Democrats (Leyonhjelm’s party) 299,000 votes (2.2%), and Family First and the Shooters, Fishers and Farmers Party each secured just over 190,000 votes (1.4%). I would describe most, but not all, of the minor parties as ‘niche’ parties because they focus on only one or two key issues and so can attract a small percentage of voters who feel strongly about those particular issues — they are often issues not picked up in the broader agenda of the major parties.

But we do need to consider how the minor parties fared at the state level and achieved the outcomes they did.

NXT won three Senate seats all in SA. A first preference vote in SA of 21.7% matched its SA vote in the HoR and gave it 2.8 quotas, so it did not require a high level of preferences to achieve its three seats. NXT did contest every other state but did no better than 2.2% of the first preference vote (0.28 of a quota) in WA. So despite the high profile of NXT, it is a profile and success limited to Nick Xenophon’s home state.

Similarly, Derryn Hinch’s Justice Party contested all states but had no success outside Hinch’s home state of Victoria — 6.1% of the vote and a starting quota of 0.79. Otherwise his party did no better than 0.7% of the vote in WA and was as low as 0.2% in SA.

The Jacqui Lambie Network ran candidates in four states but like Xenophon and Hinch had no success outside her home state of Tasmania, securing a highest vote of only 0.4% in Victoria.

So it is clear that some successful ‘independents’ and their associated parties do not have national appeal but rely solely on the profile and local popularity of their principal candidate in their home state. It would appear that they formed ‘parties’ only to secure the option of an ‘above the line’ vote.

Family First won one Senate seat in SA, for its sitting Senator Bob Day, but from a 2.9% first preference vote (0.37 of a quota). Its results in other states were significantly lower, ranging from 0.64% of first preference votes (0.08 of a quota) in WA to 1.97% (0.25 of a quota) in Tasmania.

One Nation is the party that is a little different to the other minor parties because it appears, on the surface, to have had success across the country, with two Senators from Queensland, one from NSW and one from WA. Because One Nation contested all states it was able to increase its national vote to 4.3% from the 1.3% it achieved in the HoR (where it contested only a small number of seats) but again it did best in Hanson’s home state of Queensland, securing 9.2% of votes (250,000 votes) and a quota on first preference votes alone. It gained a second Queensland seat although its provisional quota (from first preference votes) was only 1.2 — so somehow it managed to make up 0.8 of a quota from preferences. By comparison the ALP went from 3.4 quotas to four elected Senators and the Greens from 0.9 to achieve only one Senator. Beginning with 0.4 of a quota is often considered the lower base from which a full quota can be gained, so a second One Nation Senator from Queensland is not really an indication of the strength of the One Nation vote but arises from the lengthy and complicated preference distribution process. Similarly, its successful candidates in NSW and WA both came from an initial position of 0.5 of a quota to win their seats (4.1% and 4.0% of the vote respectively) — although they were the highest starting quotas among the non-major parties. In NSW, however, the ALP had almost eight times One Nation’s first preference vote and in WA was seven times higher but the seat ratio became only four to one. In the other states, One Nation received only 1.8% of the vote in Victoria, only marginally more than the Animal Justice Party; in SA it achieved 3.0% of the vote, only 0.1% more than Family First; and in Tasmania 2.6% — so, for whatever reason, it performed little or no better than other minor parties in those states.

David Leyonhjelm (of the Liberal Democrats) was also re-elected to the Senate from NSW and he came from a lower starting position than the One Nation candidate in that state, with only 0.4 of a quota (139,000 votes or 3.1%) after first preference votes.

The number of Senators from the minor parties is largely a result of Turnbull calling a double dissolution election. For example, if it had been a half-Senate election, the votes received by the parties in Victoria suggest that the outcome would have been 3 L/NP, 2 ALP and 1 Green — no Derryn Hinch. And in NSW, there would also likely have been 3 L/NP, 2 ALP and 1 Green (although there could have been a battle for two spots between the third L/NP candidate, the Greens and One Nation) — so no Leyonhjelm and possibly no One Nation. For the mess the Senate seems to have become Turnbull has no-one to blame but himself. Some of the new Senators appear as if they will be more difficult to negotiate with than the likes of Glen Lazarus and Ricky Muir as they have stronger personal agendas.

In the HoR, I expect that independents like Wilkie, McGowan and Katter will continue to have success as sitting members. Whether more independents are elected in future appears to depend very much on the quality of the candidates of the major parties: the example of the reaction against Mirabella when voters perceived she was not paying sufficient attention to her electorate is instructive in that regard, as is the fact that when she recontested at this election she suffered the biggest swing against the L/NP of any seat in the country. So major parties cannot ignore independents but neither can they ignore the response of the electorate to their own candidates or they will see more independents elected.

The ALP almost shot itself in the foot in Tasmania when it moved sitting Senator Lisa Singh to the almost ‘unwinnable’ sixth position on the ballot paper but Tasmanian voters chose to vote ‘below the line’ and gave her 20,741 first preference votes in her own right: she became the fourth ALP Senator to be elected with the candidate in the fifth position being earlier excluded and the other candidate above her, in fourth position on the ballot, winning the fifth Senate place for the ALP. Although not an independent, I give that as another example of the electorate’s response to individual candidates. If she had run as an independent, after being moved down the ballot the way she was by the ALP power brokers, there is a strong possibility that she would still have won a place. That is often how successful independents are ‘born’ and if the major parties wish to keep the number of independents and minor parties as low as possible they need to heed such examples of electoral responses to their candidates.

Although minor parties and independents had some success, in both the HoR and the Senate, the overall ‘best’ average seems to remain around a 3‒4% vote for minor parties except in the home states of the key principal candidates (Xenophon, Hanson, Hinch, Lambie) and for sitting members. So it seems to come down to the local public profiles of individuals and can also be influenced by the quality of individual candidates put forward by the major parties, not simply a reaction against the major parties.

What do you think?
Is Ken right in suggesting that it is the public profile of ‘independents’ that has most influence?

Is the Senate system ‘fair’, if people can win a seat starting with only 3‒4% of the vote?

Let us know in comments below.


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Why are Abbott’s conservatives destroying our PM?



To those of you who dispute the assertion embedded in the title, let me provide you with supporting evidence.

First some questions for you to answer:

Is Malcolm Turnbull the man you thought he was when he rolled Tony Abbott almost a year ago?

Has he fulfilled your initial expectations?

Is he as secure in his position as PM as he was initially?

Has he been limply acting as a proxy for Abbott and his policies?

Has he disappointed you?

Has he disappointed many voters, even LNP supporters?

Has he disappointed many in his party?

Has he disappointed/angered politicians in other parties?

If you answered ‘No’ for the first three and ‘Yes’ for the others, you will be in tune with the thinking in this piece.

But the crucial question is a Julius Sumner Miller favourite: ‘Why is it so?’

This piece addresses this central question.

It is apparent to all that elements within the LNP distrust, dislike and even despise our PM. This dates back to when he was Leader of the Opposition at the time Kevin Rudd was PM. Many in his party, particularly the conservative clique, believe he is more suited to be in a progressive party – several have suggested he would be more comfortable with Labor.

For some, it was the last straw when he sided with Rudd in proposing an Emissions Trading Scheme to ameliorate global warming, a move that led to a party revolt and his removal, by just one vote, in favour of Tony Abbott. That a majority of the party regarded Abbott as preferable to him shows how deeply the antipathy towards him ran within the Liberal Party!

Initially, after he returned the compliment by toppling Abbott in 2015, Turnbull’s personal popularity soared, and the awful two-party preferred polling under Abbott that had persisted month after agonizing month (the LNP had lost 30 Newspolls in a row) reversed into positive territory. The LNP was then able temporarily to put aside its doubts and outright antagonism to Turnbull. If Turnbull could win the upcoming election that Abbott looked certain to lose, the conservatives would be able to swallow their enmity. There was nothing sweeter than the anticipation of victory to make the bitter Turnbull pill go down. The doubts persisted, but were pushed underground – an uneasy rapprochement was achieved. But it was not long though before the doubts resurfaced.

Everyone realized that Turnbull had sacrificed several of his strongly held principles to obtain the endorsement of the conservative clique that gave him the leadership.

The man who said he would not lead a government that did not take climate change seriously, folded when the conservatives insisted he stick to the highly suspect Abbott/Hunt ‘Direct Action Plan’, which he then defended as if it was Holy Writ. During the election campaign there was no mention of the Coalition’s cut of $1.3 billion from the Australian Renewable Energy Agency or the disgraceful censorship of the UNESCO report on climate impacts on the Great Barrier Reef, even as recent reports highlighted the frightening damage already caused to the reef.

Turnbull said he had paid a ‘high price’ for his previous stand on climate change; clearly he was unprepared to pay it again!

The man who insisted that the marriage equality matter ought to be settled by a parliamentary vote gave in to the conservatives’ demand that it be settled via Abbott’s plebiscite, despite the government's $66 million price tag (and Price Waterhouse Coopers calculated ultimate cost of $525 million), and the risk of community discord arising from the toxic debate that the ACL and their ilk would initiate.

The man who promoted the concept of a republic so vigorously in his earlier years, quietly put it on the back burner.

The tech-savvy man who was prominent in initiating one of the early email services – OzEmail – was dragooned by Abbott into scrapping Labor’s superior fibre-to-the-premises model, and inserting the inferior, slower, multi-technology, fibre-to-the-node model with boxes on the street corner and ageing copper wire connections to the premises. Despite all his talk about innovation and competitiveness he was prepared to give us a lesser service so as to meet the demands of the conservatives. Innovation, competitiveness, nimbleness and agility took a back seat.

With every passing week, we see a diminished Turnbull pandering to the conservatives, looking weaker by the day.

Just when he wanted to look decisive and show leadership after the Four Corners exposé on youth justice in the NT, he jumped quickly, but with little consultation with indigenous leaders, and appointed a ‘law and order’ judge to be the Royal Commissioner into juvenile justice in the Northern Territory. Having been involved in judgments as Chief Justice there, it was not surprising that a protest eventuated that saw the Royal Commissioner as potentially biased. Judge Brian Martin, showing better judgement than Turnbull and Attorney General Brandis, decided to step down on the grounds of ‘apprehended bias’, which ought to have been obvious from the outset.

This, and the pressure from indigenous groups who wanted a co-commissioner with an indigenous background, caused Turnbull and Brandis to turn turtle and appoint high-profile Indigenous figure Mick Gooda, Aboriginal and Torres Strait Islander Social Justice Commissioner, and former Queensland Supreme Court judge Margaret White as co-commissioners.

How much pressure came from his cabinet we will likely never know.

On the issue of supporting Kevin Rudd’s bid to be Secretary General of the United Nations, how much influence the conservatives had in the cabinet discussion is a matter of conjecture. We do know that Julie Bishop supported Rudd and that more spoke for Rudd than against. But conservatives Scott Morrison and Peter Dutton were strongly opposed to nominating Rudd, and the meeting ended with Turnbull and Joyce being left to make a decision.

Clearly, Turnbull, more concerned with propping up his leadership among the conservatives than doing what many, even from a Liberal background, thought was correct protocol – supporting a previous prime minister on the international stage – squibbed making this decision, told Rudd he was unsuitable, leaving him fuming, and in the process attracted strong criticism from many quarters for not supporting an Australian for this post.

And most recently we see Turnbull ‘slapping the banks on the wrist with a feather’ with his threat to force their CEOs before the Coalition-dominated House Economics Committee to explain their reasons for not passing on RBA interest rate cuts. It is his way of avoiding a Royal Commission into Banking, which his conservative colleagues are intent on avoiding.

There are enough examples of Turnbull making decisions that bewilder, enough to ask: ‘Why is it so?’ Enough to evoke the suggestion that it is to placate Abbott’s conservative forces in the LNP that threaten to upend him if he does not comply. We see ‘the three As’: Abbott, Abetz and Andrews poking their heads above the parapet in their own subtle way expressing their dissatisfaction with Turnbull, as we witnessed in this week's episode of Four Corners. And we have seen George Christensen threatening to cross the floor unless the superannuation legislation is altered to his satisfaction!

With the balance of power so delicately balanced with a majority of just one in the House, and a polyglot and quite unpredictable Senate, one might have expected tight unity within the LNP to hold onto its tenuous grip on power. Instead we see actions that threaten that unity. Why is it so?

I can’t explain why some LNP members feel as they do, but it looks as if some would sooner see the leader turfed out if he does not support the party line on climate change, on marriage equality, on the NBN, and on proposed Royal Commissions. They seem hell-bent on tightly controlling their leader, and if they can’t, destroying him. They are well on the way already.

It seems more logical to do what’s necessary to retain power, even if at times uncomfortable, than to destroy the leader and the party with it. Have they got another more acceptable leader lined up? Do they want Abbott back as leader? Do they think that is possible? Insider Gerard Henderson doesn’t think so.

I can’t explain such aberrant behaviour except to offer the suggestion that sometimes, entrenched ideology, the desire for personal power, and feelings of hurt and rejection, are more powerful than the desire for self-preservation and political power. John Howard was easily able to decide which principles ‘he would die for in a ditch’, and for which he wouldn’t. Abbott’s conservatives seem to not have that gift.

Expect therefore that some will continue to say and do things that threaten their leader, and that in the end they may unexpectedly upend him.

Can you offer any other explanation for the Abbott conservatives’ anti-Turnbull behaviour? Has Turnbull the strength to counter them? What will happen when parliament resumes?


What do you think?
Can any of you give a plausible explanation of the behaviour of Abbott's conservatives, especially with just a one seat majority in the House and a likely hostile Senate?

Please comment below.


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The democratisation of opinion


With the rise of the internet and social media almost anyone can express their opinion to an audience in the thousands, even hundreds of thousands, no longer just to a circle of people who are physically present to hear the opinion. While that provides the democratisation of opinion, it also has a more sinister side. It has led to a widespread view that in this new democratic world all opinions are equally valid.

There is no doubt that all opinions are valid but only as personal opinions. It does not make an opinion true (that is, matching the evidence) nor does it mean that the opinion has any validity beyond its expression as a personal point of view. And yet in this democratisation of opinion, we see people maintaining that not only do they have a right to their opinion but they have a right for their opinion to be considered valid in all circumstances, even when a range of evidence refutes it. It is much like saying my opinion that 2 + 2 = 3 is as valid as the alternative that 2 + 2 = 4. No-one would argue that proposition would they? — these days the answer to that question is not so clear.

What is the opposite of opinion? — probably truth or facts. Without getting into a philosophical argument about what is ‘truth’, it is possible to employ scientific method to arrive at conclusions that are true, or most likely true. That is because scientific method is based on observations and drawing conclusions that explain the observations and that has been done for hundreds of years. It is possible to say that science still forms opinions, or what are called theories or hypotheses, based on those observations but science will change its theories when observed facts do not match the current theory.

For a long time people thought that the sun went around the earth — and why not? After all, even though we are spinning at 1670km/h (at the equator), travelling around the sun at 107,000km/h and spiralling with the sun around the Milky Way at 792,000km/h, we feel nothing but we do see the sun rise in the east every day and set in the west. Based on that latter observation alone, it is logical to assume that it is the sun that is moving not the earth. But astronomers watching the stars and planets saw something which that model could not explain: at certain times the other planets appeared to go backwards in the heavens. Eventually that, and other observations, made it clear that it was the earth moving about the sun that explained what the astronomers were observing. And so we have advanced our knowledge using that model. It is not as though science plucks its theories out of the air. They explain what has already been observed until a new observation suggests it is time for a new explanation.

And it is not just scientists who use this method. There are many anecdotal stories of farmers knowing more than scientists in particular situations and proving scientists wrong. But that is not based on some random opinion of the farmers but their own observations over many years of local weather, soil, and crop and livestock results in varying situations. Their opinion is often proved right because their set of observations is over a much longer period than those of experts who arrive for a field trip that may last no longer than a few weeks. Even though the experts are trained in their discipline they do not have the range of observations that the farmers have that are relevant to the local circumstances. The farmers’ observations may not be recorded but retained in memory, or even family tradition for observations over longer periods, but their opinions are based on long term observations. Scientists are acknowledging that history of observation and drawing it into the scientific process, just as they are now recognising Aboriginal knowledge in the management of fire, flora and fauna is based on thousands of years of observation, even if that knowledge is expressed in a different way. These days the scientists are trained so that they can apply their knowledge over a range of circumstances, whereas the farmers and Aboriginal and Torres Strait Islander people have more detailed knowledge and opinions based on decades or millennia of observation but it has most relevance only to their local conditions.

Opinions have some commonality with the scientific use of observation. Almost all opinions are based on some level of observation but the real difference between the quality of opinions is probably the extent of observations drawn upon to form the opinion. In the recent Brexit campaign in the UK, some experts were warning of the economic consequences of the UK leaving the European Union but Michael Gove, campaigning for the ‘leave’ side, suggested that people were tired of experts and, by implication, would ignore such advice. The observation that led many people to that conclusion concerned the rules coming from the EU technocrats in Brussels which many Britains saw as undermining their traditions and control of their own country. Based on that observation alone, they could validly form an opinion that questioned the experts but it should only have been the experts issuing those rules. Instead, one observation can become a wider dismissal of expert opinion.

Thus we have the questioning of the science underpinning anthropogenic climate change or even questioning climate change itself. People are perfectly entitled to have an opinion rejecting climate change but that does not make their opinion true. For their opinion to be true it would also have to be based on a set of factual observations and some of the observations used by the deniers have been shown to be false or, at best, built on a foundation of quick-sand. When by far the majority of observations support the occurrence of climate change and the probability of it being ‘man-made’ is 90% or more, then some very strong alternative observations would be required to change the current scientific consensus. The deniers have not presented such observations but still insist their opinions are not only valid but true.

I worked in Aboriginal and Torres Strait Islander affairs for many years and so I often came across people who held negative stereotypes of Aboriginal and Torres Strait Islander people. I would be asked why should they have houses when they only break them down for firewood. I knew there had been such instances, although rare, so I would not deny their opinion based on that observation but answer with a broader and more positive range of observations: all of the people who did not burn their houses but lived normal lives in them; the range of Aboriginal and Torres Strait Islander businesses; or even that many problems in housing arose not from Aboriginal and Torres Strait Islander misuse of the dwelling but from shoddy workmanship by the original construction contractors. I don’t know how many opinions I managed to change but at least I had presented a new range of observations for them to consider.

Politicians hoping to run the country shouldn’t operate from a limited range of observations but many do. They play up to their audience or constituency by presenting views based on a limited range of observations and ignoring those observations that run counter to that opinion — just as the church rejected Copernicus’s observations that the earth went around the sun. The Trumps and Hansons of the world are masters of this approach. While it may have some electoral appeal, it is not a basis on which to run a country. A government, almost by definition, must take account of a wide range of opinions (and the observations on which they are based) and either determine which are true or balance the conflicting views to come to a policy decision in the best interest of the country.

Governments often express an intention to follow ‘evidence-based’ policy, but we also have lobbying which is an attempt to convince policy makers to pay more heed to one set of opinions or observations rather than another. The big and unanswered question is whether members of government are well-placed to assess the varying observations supporting different opinions or whether they are also personally influenced by a limited range of observations. It is perhaps a belief that the latter is true that leads to public opinion that politicians are ’out of touch’ or, in other words, are not considering a broad range of observations but are overly influenced by lobbyists, a small number of interest groups, or personal opinions — each of which is focused on a limited range of observations.

Yes, we all have personal opinions that are valid as personal opinions no matter how few the number of observations on which they are based. If, however, I am willing to listen to, consider and perhaps accept a wider range of observations, then we can have a rational discussion, debate the observations (evidence) and perhaps reach a conclusion that changes my opinion or that of my interlocutor. Or we may mutually agree a different opinion that is new for both of us. If that was the way of the world, then opinions would be in their rightful place and open to change based on a wider range of observations.

Of course, there are some whose opinion will not change, who see all other observations through the prism of their own opinion or believe that the observations supporting their opinion are ‘true’ and therefore all other observations must be ‘false’. That has always been the case but with this so-called democratisation of opinion many more people now feel that their opinion must be valued as it stands. When all opinions are considered valued and valid, people defend them with vehemence as we see on blog sites and social media and do not open their minds to a broader range of observations. Instead of taking the new observations as something to be considered, they take them as a personal attack on their ‘valued’ opinion and attack in return. If this is democratic, it is a negative form of democracy — to use an old cliché it is ‘playing the man, not the ball’ and that is not truly democratic for it fails to recognise the democratic rights of your fellow citizen. Yes, all opinions are valid but only if our minds are open to consider a broader range of possibilities that may change our opinion.

And yes, this entire piece is my opinion. So now over to you for your opinion and revelation of broader observations for my consideration.

What do you think?
Do people form opinions based on only one or two observations because that is easier than considering the implications of a broader range of observations?

Or do we have different opinions because people draw different conclusions from the same set of observations?

And if so, how can all opinions be valid?

Let us know in comments below.


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A couple of weeks ago, our esteemed blogmaster Ad Astra published a piece asking ‘Why is there so much anger?’ It’s a good question.

Sociologists will tell us that whatever position a person takes on a particular subject, there will be some who agree, some who disagree and some who don’t have a strong opinion either way; they’re ‘sitting on the fence’. Some of those who disagree would listen to an argument designed to change their mind; for others, successfully changing their viewpoint would be impossible.

This played out for all to see in the recent federal election. Out of the 150 House of Representative seats, by the end of the election night there were only a dozen or so that were still in play. The (never-ending) election campaign wasn’t to convince the voters in the 130 odd seats that were almost certain to fall to the red or blue teams, the millions of electrons and litres of advertising ink were all expended to convince a handful of voters to change their votes. Out of the 90,000 people in these marginal (or swinging) electorates, the advertising was designed to convince a small number of voters to support the red, blue, green, orange or other party on 2 July rather than their previous allegiance.

How about we look at this another way. Uncle Toby’s Oats products are available all year round on the shelves of most supermarkets so there is clearly a year round demand. As it is winter in Australia, the sales of this and similar products would currently be higher as people choose to have something warm for breakfast instead of their normal cereal with cold milk. Some people will always purchase Uncle Toby’s Oats regardless of the price or difficulty in sourcing them because of some perceived benefit of the product over other similar products. Others would purchase oats in winter based on the cost or some other criteria without caring about the brand. There are also some who would never buy oats in general or Uncle Toby’s Oats in particular due to any number of reasons from they just don’t like oats through to some perceived shortfall in the Uncle Toby’s product.

In a similar way, some people will always purchase a Ford vehicle, some will buy a vehicle regardless of the brand due to the perceived needs of the consumer being matched as closely as possible by the vehicle they are considering and others would never buy a Ford due to past poor experience, they have a tribal loyalty to another brand or some other reason.

Advertising is designed to move people from the ‘undecided’ column to the ‘always purchase’ column. The belief is that if you convince someone to consider your product, the obvious benefits of your product once they have tried it will convert the consumer to an ‘always’ purchaser of that brand. There are a lot of ways to do this: Uncle Toby’s may hand out free samples at little athletics carnivals or major transport interchanges; Ford might display a car at or sponsor a pop culture festival or perhaps loan vehicles from their range of light commercials to the Gympie Music Muster in South East Queensland; a luxury consumer goods supplier might choose to associate themselves with the Australian Ballet or a series of performances at the Sydney Opera House.

At the same time, other manufacturers of similar products such as Kelloggs and Toyota are attempting to convince the undecided consumer that their products are better for each individual consumer than Uncle Toby’s or Ford. You need something to make your advertising memorable. Comedy seems to be frequently used, such as in this Specsavers advertisement.

PJ O’Rourke is an American political satirist and journalist. He is, by his own account, a conservative Republican who is in Australia for the next month or so on a speaking tour that includes the Byron Bay Writers Festival and a number of ‘think tank’ events in the southern capitals. O’Rourke’s writing skills can be demonstrated by his ‘fawning’ endorsement of Hillary Clinton in the 2016 US Presidential Race - ‘She is the second-worst thing that could happen to America’. O’Rourke was interviewed by Matt Wordsworth on ABCTV’s Lateline. (Slightly off topic, the interview is worth reading solely for O’Rourke’s opinion of Trump.) O’Rourke and Wordsworth discussed the crossover between comedy and commentating:
MATT WORDSWORTH: You and your colleagues at Lampoon — you're editor of Lampoon, obviously — now, comedians are the go-to commentators.
P.J. O'ROURKE: Isn't that stupid?
MATT WORDSWORTH: Did you see that coming?
P.J. O'ROURKE: No, no. Who could possibly have seen that coming? I mean, it's absolutely ridiculous. The role in — if humour has any positive role in covering politics, it's simply to keep people's attention for long enough that they will actually look at the serious issues that are ...
MATT WORDSWORTH: But they're increasingly becoming the primary source of news for some people — your Colberts and your John Stewarts and whatnot.
P.J. O'ROURKE: (Laughs) Yes, yes. And I object. That's not where one is supposed to be getting one's news. We are and should remain a sideshow. If we can get some more people to go to the big top, great.
The reality is that comedy has been used as a ‘cover’ for making pointed comments since the middle ages. Former Liberal Party Senator Chris Puplick was talking about court jesters in an ’Ockham’s Razor’ interview on ABC’s RN radio network in 2003:
Their job was to give what used to be called 'frank and fearless' advice to the monarch. They were the reality check to the absolute rulers of their day. They were the utter reverse of today's spin doctors. They told the governors what the people needed them to hear, they took the views of the masses to the masters rather than being employed to tell the masses the lies the rulers think they ought to be fed.
It wasn’t just a mediaeval thing, the UK has a long and proud history of comedic comment on ‘sacred cows” such as this Dave Allen clip on his first experience of religion.



Australia also has a rich history of using comedy to comment on the news, from The Mavis Bramston Show, through The Gillies Report in the 1980’s (worth watching the whole 9 minutes for the very young John Clarke at the start and the ‘cover’ of the song ‘Shout’ at the end)



to today where Waleed Aly who presents The Project on Network 10



and Charlie Pickering who presents ABC’s The Weekly



both offer razor sharp commentary on current events.

So why are some people always angry? Some people are always going to find something to be angry about. Regardless of what argument you present on a particular issue, some people are going to absolutely disagree with you. In today’s winner take all society, some of those who will never be convinced to change their mind on their ideas will actively attack you (in an attempt to either change your opinion or challenge your right to have a different opinion) rather than just agree to disagree.

Others will be open to having their opinions changed by discussion. Currently the discussion on a number of issues around the world is being led by those who preach anger, hate and isolation, such as Trump, Christensen, Bernardi, Hanson and so on. While they claim that their argument is sound and consistent, don’t forget that Hanson’s initial speeches referred to the Chinese who were going to take over Australia 20 years ago, showing similar consistency to those who were around in the 60’s and 70’s suggesting that the Greeks and Italians were going to take all our jobs while claiming unemployment benefits (and other farcical stretches of logic). The problem is that if there is no other argument that sticks in people’s minds to reinforce positive attitudes over the carefully calculated scare campaign, the hate preachers gain more converts.

Mark Twain is alleged to have said “A lie can travel half way around the world while the truth is putting on its shoes”. Advertisers use comedy to attract attention and ensure that the sponsored product is kept top of mind. Perhaps the Colbert’s, John Stewart’s, Waleed Aly’s and Charlie Pickering’s have worked out how to produce discussion in respect to sensitive issues, keeping them top of people’s minds (hopefully turning a number of ‘undecideds’ into people with positive opinions on the way), by appealing to those who are looking for relevant information and using comedy as a tool to deliver the message.

Fairfax recently ran an article in The Brisbane Times that demonstrated how the Islamic Council of Queensland is managing trolls who contact them by social media. Instead of getting upset, they use humour to disarm the situation. It’s an example we could all follow.

A little way up the screen is a Dave Allen clip relating to religion. While he was probably best known for his religious jokes, he also frequently told stories about other issues — such as how he lost the top of one of his fingers. If only we could all tell stories like this the ‘hate’ preachers would have nowhere to go.



Dave Allen, Waleed Aly, Max Gillies, PJ O’Rourke and Charlie Pickering are all good story tellers and frequently discuss subjects where others are too afraid to go. While there is the need for decorum and consideration of others feelings, those who wish to provide positive arguments to people who are undecided about a whole range of subjects including religion, drug use, responsible behaviour and so on need to use tools that those looking for information will relate to. Unfortunately, the argument for positive behaviour is usually more nuanced than the alternative, so the message can’t be communicated in a 10 second soundbite that you watch while scrolling through your Facebook feed. Rather than using ‘fire and brimstone’, perhaps a little humour during the explanation of the positive view will delay scrolling long enough to discuss some facts, helping to disarm the hate and anger. It’s fine to disagree — anger and hate is another matter entirely.

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

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