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May 31, 2010
public education: looking backwards
Australia's underfunded and neglected public education system seems to be stuck in the industrial manufacturing past, rather than becoming part of the knowledge economy of the future. Australia is lagging behind our international peers in educational outcomes, our educational system is becoming ever more unequal, and the policy approach of the Rudd Government is one of tough love.
Linda Darling-Hammond's judgement of American schools in Restoring Our Schools in The Nation applies to Australia:
we have failed to invest in the critical components of a high-quality education system. While we have been busy setting goals and targets for public schools and punishing the schools that fail to meet them, we have not invested in a highly trained, well-supported teaching force for all communities, as other nations have; we have not scaled up successful school designs so that they are sustained and widely available; and we have not pointed our schools at the critical higher-order thinking and performance skills needed in the twenty-first century.
Her argument is that though some states in the US are notable exceptions, America has not, as a nation, undertaken the systemic reforms needed to maintain the standing the US held forty years ago as the world's unquestioned educational leader.The Conservatives introduced a new theory of reform focused on outcomes rather than inputs—that is, high-stakes testing without investing.
National educational reform in Australia under Rudd Labor --and the Labor governments in the states---appears to be more about setting goals and targets for public schools and punishing the schools that fail to meet them, rather than investing in a highly trained, well-supported teaching force or ensuring that our schools teach the critical higher-order thinking and performance skills needed in the knowledge economy twenty-first century.
It is more about apprenticeships and trades rather than ensuring that students have the more complex knowledge and skills needed in the twenty-first century.
Posted by Gary Sauer-Thompson at 12:22 PM | Comments (7) | TrackBack
May 30, 2010
the corporate backlash
Paul Krugman has an interesting article in the New York Times entitled The Old Enemies that has some relevance to Australia, where the miners are digging into their deep pockets in order to beat up the Rudd Government over its proposed resource super-profits tax.
Krugman says:
They’re as mad as hell, and they’re not going to take this anymore. Am I talking about the Tea Partiers? No, I’m talking about the corporations...corporate interests are balking at even modest changes from the permissiveness of the Bush era...what President Obama and his party now face isn’t just, or even mainly, an opposition grounded in right-wing populism. For grass-roots anger is being channeled and exploited by corporate interests, which will be the big winners if the G.O.P. does well in November.
Isn't this happening in Australia with the mining corporations? They are as mad as hell over an emissions trading scheme to address global warming and the proposed new resources tax. They have the Murdoch media onside and the Coalition in their pocket.
No doubt the mining industry's money is flowing into the Liberal Party's coffers.
Will the grass roots ---the battlers --rebel? Unlikely. They'll be fobbed off with identity politics says Krugman:
If this sounds familiar, it should: it’s the same formula the right has been using for a generation. Use identity politics to whip up the base; then, when the election is over, give priority to the concerns of your corporate donors. Run as the candidate of “real Americans,” not those soft-on-terror East coast liberals; then, once you’ve won, declare that you have a mandate to privatize Social Security.
The Australian Right's embrace of populism under Abbott is a populism that is sympathetic to big corporations such as the multinational miners who are so full of sound and fury.
What Krugman doesn't say is that the strategy is to polarize the electorate and so shrink the middle ground. As Paul Kelly says in The Australian:
The middle ground that is the bedrock for successful Labor governance and policy reform is being pulled apart. This is a new phenomenon and a negation of the politics of the past generation...The centre is weakening; votes are moving to the polarities; populists on both the Right and Left carry sway.This undermines the basis for middle-ground Labor reformism. If this phenomenon became the new trend, the policy consequences would be far-reaching.
Is it becoming the new trend? Kelly is persuaded. I'm yet to be convinced.
Posted by Gary Sauer-Thompson at 7:06 PM | Comments (6) | TrackBack
May 29, 2010
food politics
In The Food Movement, Rising in the New York Review of Books Michael Pollen, an ethical food guru, says that, if the advent of fast food (and the culture of cheap processed food in general) has become an indispensable pillar of the modern economy, then it has given rise to criticism that industrial food production (agri-business) is in need of reform because its social/environmental/public health/animal welfare/gastronomic costs are too high.
Public health is central given the current concern about the health of the population:
perhaps the food movement’s strongest claim on public attention today is the fact that the American diet of highly processed food laced with added fats and sugars is responsible for the epidemic of chronic diseases that threatens to bankrupt the health care system. The Centers for Disease Control estimates that fully three quarters of US health care spending goes to treat chronic diseases, most of which are preventable and linked to diet: heart disease, stroke, type 2 diabetes, and at least a third of all cancers. The health care crisis probably cannot be addressed without addressing the catastrophe of the American diet, and that diet is the direct (even if unintended) result of the way that our agriculture and food industries have been organized.
The food industry's claims, that it merely giving people the sugary, fatty, and salty foods consumers want, ignores that it actually helps to shape these desires through the ways it creates products and markets them. Don't expect the Rudd Government to take on agribusiness in Australia, corporate food or the subsidies to these industries in consumer capitalism.
However, the food movement is broader than this, as evidenced in the slow food movement and farmers markets. Janet Flammang in The Taste for Civilization: Food, Politics, and Civil Society indicates a wider conception of the politics of food:
Significant social and political costs have resulted from fast food and convenience foods, grazing and snacking instead of sitting down for leisurely meals, watching television during mealtimes instead of conversing”—40 percent of Americans watch television during meals—”viewing food as fuel rather than sustenance, discarding family recipes and foodways, and denying that eating has social and political dimensions.
The cultural contradictions of capitalism—its tendency to undermine the stabilizing social forms it depends on—are on vivid display at the modern American dinner table.
Posted by Gary Sauer-Thompson at 12:43 PM | Comments (5) | TrackBack
May 28, 2010
BP: oil spill in Gulf of Mexico
BP's busted Deepwater Horizon oil well is spewing crude into the Gulf of Mexico four times faster than BP claimed, eclipsing the 1989 Exxon-Valdez spill of 257,000 barrels of oil in Alaska. It is now the worst spill in US history. It's at least 75 million gallons threatening an environmental and economic catastrophe across hundreds of kilometres of the US Gulf Coast.
As the Gulf of Mexico becomes a sludge pit it is becoming a political problem for the Obama administration. And so it should. Obama has ordered a six-month freeze on the opening up of the waters of the Arctic to oil exploration and on the drilling of 33 deepwater wells in the Gulf of Mexico.
BP is pumping heavy mud into the leaking Gulf of Mexico well, hoping that this Top Kill tactic –will result in the mud overpowering the steady stream of oil. The company wants to eventually inject cement into the well to seal it. Before Top Kill” there was the “top hat” which failed, the “junk shot” which failed.
Fishermen, hotel and restaurant owners, politicians and residents along the coast are fed up with BP’s so far ineffective attempts to stop the leak that sprang after an offshore drilling rig exploded on April 20. Eleven workers were killed, and millions of gallons of crude have spilled into the Gulf, fouling Louisiana’s marshes, coating birds and other wildlife and curtailing fishing. It is proving difficult for reporters to visit the affected areas cos its BP oil. Corporate stonewalling.
The regulatory assumption has been that companies would regulate themselves and be competently monitored for the public good in a vigorous free-market economy. This is a long way from the true state of affairs. John Vidal in The real cost of cheap oil says that the Gulf disaster is only unusual for being so near the US. Elsewhere, Big Oil rarely cleans up its mess:
There are more than 2,000 major spillage sites in the Niger delta that have never been cleaned up; there are vast areas of the Colombian, Ecuadorian and Peruvian Amazon that have been devastated by spillages, the dumping of toxic materials and blowouts. Rivers and wells in Venezuela, Angola, Chad, Gabon, Equatorial Guinea, Uganda and Sudan have been badly polluted. Occidental, BP, Chevron, Shell and most other oil companies together face hundreds of outstanding lawsuits. Ecuador alone is seeking $30bn from Texaco.
The pursuit of maximum profit rules. BP and the rest of them continue to dominate our politics and despoil our planet. They will make billions, leave devastation in their wake, and get away with it cos their power is complete.
The oil giants can say good bye to a world in which self-regulation, green spin, and light public oversight is the order of the day. What comes next?
Update
Top kill has failed to stem the flow of oil. There is a vast expanse of crude oil half an inch thick in the marshes off Louisiana with no visible sign of the BP or government clean-up efforts. BP continues to lowball the flow rate of the oil leak (they say it is 5,000 barrels a day, when it is more like 40,000 to 100,000 barrels a day) in an effort to reduce the amount of money it could be fined by the government.
The hard line small government conservatives, such as Gov. Bobby Jindal of the red state of Louisiana (its dependent on fishing and oil) is calling for help from the Federal government to act big. That cuts the ground under the Republican culture war attempt to defend free enterprise against European style statism.
Jindal stands for American exceptionalism and the virtues of economic laissez-faire. Well, BP stands for free enterprise. Will Jindal break ranks with the Republicans to put forth strong legislation that will make other oil companies be a hell of a lot more cautious about offshore drilling? Will he go against Big Oil and offshore drilling?
Update2
The Greenpeace Fickr stream plus their set for the Gulf oil spill --finally some decent photographs from behind the corporate blockade. They have a blog on the issue and they have boat in the area.
BP plans to put in place a second version of a containment dome, a strategy that failed earlier this month. Even if the cap works, it might not fit snugly enough to capture all the leaking oil. They need to drill relief wells. Obama is still relying on BP to do the right thing: clean up its mess, pay whatever it costs, and avoid the same mistakes in the future.
Posted by Gary Sauer-Thompson at 5:42 PM | Comments (19) | TrackBack
May 27, 2010
Liberal Party: papering the contradictions
The basic problem faced by the Liberal Party is to reconcile the differences between being electorally viable by appealing to the middle ground and the Liberals standing for something that appeals to their conservative base.
Some say that it is a contradiction that it is increasingly coming out into the open, and that it this ducking and weaving that undercuts their credibility.
Unlike the Republicans in the US the Liberal Party finds itself unable to openly articulate its right wing agenda. They allude and gesture to it (eg., climate change) whilst posing as conservative populists deeply concerned with their small business and the Howard battlers constituency.
They have to swing this way and that way as their electoral politics is a balancing act between two starkly different constituencies (big business and Howard battlers). To retain credibility they have to spin the balancing act so that the presence of contradictions do not become too open.
The trouble is that the current front bench are not that good at it working the contradiction between the middle ground and party base. The standard attack on Labor on everything, for instance, appeals to the conservative base, but it then pushes them away from the middle ground.
Another example is that their usual kind of covering over of the cracks was thrown to one side with their open support for the big multinational miners over the proposed super profits tax. The attempts to link this support to their other traditional constituencies ---rising cost of living etc---fell flat as the stretch was too great for the fabric.
So they openly spoke for big business--- they looked naked as their conservative populist clothing fell away and they came out defending the power of the big miners over that of an elected government. Governments in a liberal democracy, it seems, should further the interests of big business.
Posted by Gary Sauer-Thompson at 12:09 PM | Comments (13) | TrackBack
May 26, 2010
the ongoing digital media revolution
The standard account of the effect of the shift to digital media is that newspapers are having a hard time adjusting to declining revenues and circulation, reduced profits, shrinking resources and people moving from the printed page to networked screen. The iPad will not to save the newspapers by offseting the revenue decline of their print businesses.
Yet this is only part of the media story. The next turbulence is not switching off of all the old analogue broadcast signals; nor the existence of a catch up facility along side a broadcast service. It is the emergence of IPTV or Internet Protocol Television. IPTV enables programming to be delivered over a fast Internet connection (courtesy of the national broadband network) to a set-top box plugged into a digital television screen in the living room.
Broadband providers (eg., Internode, Telstra and iiNet) are beginning to move with increasing speed toward installing the IPTV equipment to ensure they are the comprehensive communications provider for each home they serve. Their aim is to provide video, audio, Internet and telephone service to every home with a single fat pipe – and for a single fat monthly bill.
This is disruptive technology because it offers an alternative to Pay-TV of Foxtel and it furthers the segmentation of the mass market into niches. Even though niche content appeals only to a limited subset of an audience (the long tail content), market fragmentation deprives national broadcasters of the mass market that enabled the high ad rates and the fat profits. This undermines traditional broadcast model of the commercial free-to-air media as it depends on assembling large audiences to view regularly scheduled programs.
The scenario is similar to the one newspapers have faced: as revenues recede and profit margins decline so most local broadcasters will reduce the resources they devote to covering local news. There will be a contraction in local news and the content of local TV news will become even thinner than it is today.
The Australian TV landscape is going to change. Sure IPTV today is not viewed as a successful model, the content is not there, and the market is still waiting for it to develop its business model. At the moment we have video content on the personal computer not the television whilst the internet connectivity behind the TV is rare. The big probem for IPTV providers is to create a critical mass of content which challenges that available on the open internet because ‘I don’t pay for it on my PC so why should I pay on my TV?
I suspect that there will the emergence of IPTV Freeview from the ABC with its main stream content; initially in the form of an Electronic Program Guide (EPG) that displays broadcast content schedule two weeks ahead and catch-up content one week behind for all the ABC channels.
Movie content then becomes available with film aggregators like Quickflix, and as our viewing habits change from broadcast to on-demand, we consumers demand the open browser tools (one that handles all video formats and display technologies) to discover the choice of internet-based video content themselves without gate keeping or a walled garden.
The upshot is that the broadcast ‘viewer’ model no longer cuts it in this time-poor, choice-rich world that we live in.
Posted by Gary Sauer-Thompson at 9:07 AM | Comments (9) | TrackBack
May 25, 2010
the Dubai passports affair
An investigation by the Australian Federal Police and spy agencies has found that Israel has equipped a Mossad team of assassins with forged passports of Australians and other nationalities (those of Britain, France, Germany and Ireland), for a hit on Mahmoud Al-Mabhouh. He was a senior figure in the militant Palestinian organisation Hamas, who was found murdered in a hotel room in Dubai in the United Arab Emirates on January 20.
In response to the identity theft by Israel the Rudd Government has expelled an Israeli diplomat, just as the former Brown Government did in the UK.
The voices of the local Israel lobby said that the government's action was an overreaction; a response that functions to defend Israel, now a full blown national security state.
The position of the local Israeli lobby is a refusal to admit that Israel has erred.
They see their job as defending every action by the Israeli government. Israel is our ally, (both countries belong to the same camp), Israel's actions can be excused because it was fighting terrorism. What the Australian government should have done was to condemn Hamas, the extremist Islamic terrorist movement that controls the Gaza Strip, and to denounce Iran's nuclear ambitions.
Both Hamas and Iran want to destroy Israel, which has to fight for its survival. Israel, which is the only democracy in the Middle East, is the only Middle Eastern country that can be relied on to act resolutely against international terrorism.
The arrogant and smug Left defend Hamas despite the threat that violent Islamism poses within Western societies. Islamism is a form of totalitarian ideology that is profoundly reactionary and deeply antisemitic and, racist.
Julie Bishop, the Shadow Foreign Minister, claimed that there was insufficient hard evidence to support the government's decision and that it was an attempt by Mr Rudd to seize control of the media cycle. Then she went much further:
The government is facing an election,The government is also seeking to pursue a seat on the (UN) Security Council; the government is keen to curry favour within the Arab community.The Arab community have made it quite clear to Mr Rudd in writing that unless the Australian government showed a more negative attitude towards Israel, they would not be able to count on their vote for Mr Rudd's quest for a seat on the Security Council.
The implication is that Australian Government cowtows to the demands of Arab governments in the Middle East. Is this the dog whistle of Islamophobia?
There are strong currents in the 'fear or hatred of Islam' discourses and criticisms that have distinct sources, motivations and goals in Australia, and these often surfacs in the modern-day demonization of Arabs and Muslims by politicians in the media.
Posted by Gary Sauer-Thompson at 2:47 PM | Comments (11) | TrackBack
May 24, 2010
an unfolding economic crisis
The economic crisis that has emerged from the global financial crisis continues to deepen.
It is evident in Europe where governments such as Greece, Ireland Spain, and the UK struggle to tackle the massive debts (public spending and fiscal deficits) absorbed by governments in the recession wake of the banking crisis and the collapse in asset price bubbles.
Martin Rowson
The real problem in Europe is that by creating the euro, Europe’s leaders imposed a single currency on economies that weren’t ready for such a move.The €750 billion plan is only a temporary fix designed to protect weak links in the euro zone for the next three years, buying them the breathing space to shore up public finances, clean up banks and retool uncompetitive economies so they can grow again and pay off their debts.
In the US, which has undergone a massive transfer of wealth since the 1970s, the economic crisis is evident in both the rise of long-term unemployment, and the ruins of Detroit, once the heart of America's auto-industrial economy. Joseph Stiglitz has written:
Because of the [neo-liberal] choices that have already been made, not only will the downturn be far longer and deeper than necessary but also we will emerge from the crisis with a much larger legacy of debt, with a financial system that is less competitive, less efficient, and more vulnerable to another crisis.
America, says Paul Krugman, appears to be heading for a Japan-style lost decade, trapped in a prolonged era of high unemployment and slow growth. Sharply reducing demand in an economy that is recovering only weakly from recession may cause much unnecessary pain.
The promise of durable prosperity based on the assumption that the good times would roll on forever now seems another economic myth along with the efficient workings of self-correcting markets, and that governments should be minimal: they should do nothing beyond providing for law, order, and national security, along with some manipulation of the monetary system.
Posted by Gary Sauer-Thompson at 10:18 AM | Comments (8) | TrackBack
May 23, 2010
media wars
The Murdochs and News Ltd don't like, or are hostile to, public broadcasters such as the BBC and the ABC doing their job of providing information to citizens. They see public broadcasters and their free content as a big threat to their media business, and they would like to see public broadcasters kneecapped so that we consumers are forced to buy more of the Murdoch media product. Nothing should be free in their world of paid-for content, with access to information being based on paying for that access.
Hence the Murdoch's big shift to putting their digital content behind pay walls --eg., News Corp.'s Times Online For them there's only one way forward for the future marked by by ongoing structural change compounded by flatter advertising growth, and its their paid-for content model, even though it is deliberately downsizing their audience. Journalism for the Murdochs is a commodity, not a democratic necessity.
Recently the Murdoch's attack on public institutions providing free information to citizens was broadened with James Murdoch's attack on the British Library's plan to digitise up to 40m newspaper pages and then make them available online. They will include papers - local, regional and national - dating back to the early 1700s and will make accessing them by the public academics and working journalists.
For the Murdoch's this is yet another example of unfair competition by subsidised public institutions increasing their audience so they capture more users and gained more funding. In his speech James Murdoch said:
Take the current controversy over the library's intention to provide unrestricted access to digital material. Material that publishers originally produced – and continue to make available – for commercial reasons. Like the search business, but motivated by different concerns, the public sector interest is to distribute content for near-zero cost – harming the market in so doing, and then justifying increased subsidies to make up for the damage it has inflicted.
The case of the British Library goes even further. Just yesterday, the library announced the digitisation of their newspaper archive – originally given to them by publishers as a matter of legal obligation.This is not simply being done for posterity, nor to make free access for library users easier, but also for commercial gain via a paid for website. The move is strongly opposed by major publishers. If it goes ahead, free content would not only be a justification for more funding, but actually become a source of funds for a public body.
The Murdoch's want a slice of the action--a cut--because the British Library's move would undermine News Corps paid-for content model. Their approach is making money rather than good journalism or public information to help democratic citizens empowering themselve.
Posted by Gary Sauer-Thompson at 10:17 AM | TrackBack
May 22, 2010
Leunig: lies + truth
Tony Abbott confessed on The 7.30 Report that he sometimes said things in the heat of battle that he had reason later to regret and to amend. Or that what he said contradicted his previous positions. Abbott was stating the obvious about politicians like himself: they often lie to get themselves out of sticky situations.
Hence the honesty defence argued for by Terry Barnes in The Age:--Abbott was actually an honest voice in a political sea of spin, deception and broken promises.
However, the issue goes deeper to the relationship of trust between politicians and the electorate in a liberal democracy. The base position is that all politicians lie just like advertisers. Hence they are distrusted, just like used car salesmen.
Barnes recognizes that this is a bad situation for liberal democracy to be in and adds:
If we tolerate a political culture in which it's normal to say and do whatever it takes to win and hold power, we need to not just criticise and condemn those politicians falling short of perfection, but take a very hard look at ourselves and ask if we're encouraging them by our own indifference.
Our indifference? With used car salesmen we employ a mechanic to check the car before we buy it. Who do we have to check up on the deliberate deceptions of the motley crew of politicians?
The media has traditionally said that it was the watchdog for democracy that would ensure citizens would have the information they needed to make their judgments. Trust us. These days if journalists have not succumbed to infotainment, then they are recycling media releases as their own copy to further the corporate media's political agenda. So we are left to our own devices to cope as best we can:--all politicians lie. It goes with the territory, as do grumpy, cynical electorates. The system is broke.
Barnes' solution is dysfunctionality is to suggest self-regulation by the politicians, then to reject it as impractical. He says:
In 1996 Peter Costello introduced the Charter of Budget Honesty to ensure that the financial state of our nation is always presented consistently, honestly and prudently. It's tempting to suggest that political statements should be subject to similar rules, but this would be impossible to implement. Instead, in a democracy like ours voters have a responsibility to deploy their own political lie detectors, and mark down those caught out....In future, when all who aspire to govern ask us, "Can I be trusted?", our answer should not be a cynical shrug and a "yeah, whatever". Otherwise, we will get the politics we deserve.
Barnes' doesn't go far enough with self-regulation. One option is to strengthen the checks and balances that have built into the political system of liberal democracy.
Checks and balances on executive dominance would be a good start by giving greater power to the committee system in both houses of Parliament. Proportional representation for the House of Representatives, along the lines of the Hare-Clarke system, would be another place to start. This would ensure that we citizens have a choice about who to vote for and against within all political parties.
Posted by Gary Sauer-Thompson at 2:28 PM | Comments (7) | TrackBack
May 21, 2010
trashing our digital future
The Liberal/National party dominated Senate select committee on the National Broadband Network (NBN) has recommended scrapping the project in its Fourth Interim Report.
Now it is true that this project has been rushed ahead in the absence of adequate planning is well made. Examples of the Government's hasty approach are commencing construction of the network before receiving the implementation study and finalising the broad range of important issues the Implementation Study raises.
The justification for the majority taking this position of scrapping the NBN is simple one:
In the absence of a cost-benefit analysis proving to the contrary, the committee believes the NBN is not justifiable policy. Too much public money is at stake to be thrown away without transparent, accountable, independent assessment of the merit of starting, let alone progressing, the project.... All in all the committee does not accept that the Implementation Study, nor other evidence given to the committee, supports the NBN in its current form.
How then do they square this with those Australians who are crying out for a better telecommunications than the low grade, expensive one that we have now?
The majority report says:
The committee believes that there are better ways to provide fast broadband of a capacity and speed required by most Australians at a cost considerably less than the $26–43 billion suggested by the Implementation Study. The committee believes that by working cooperatively with the industry, a better arrangement could be implemented providing affordable fast broadband at an earlier time than is proposed by the NBN in its current form.
That means working co-operatively with Telstra? Whose kidding who?
How this market based approach will work to build a comprehensive fibre based national broadband network is not spelt out at all. We know enough about markets and telecommunications to understand that the model of fibre networks being rolled out by vertically integrated incumbents results in these incumbents cherry pick the most valuable customers leaving much of the rest of these countries with non-fibre solutions. So we have a digital divide.
What the Coalition's working co-operatively with Telstra refers to is the Telstra story--the future is wireless. So watch out NBN, whose shaky business case is based on rather heroic/wildly optimistic assumptions about penetration rates. Watch out because the iPhone is a game changer with respect to mobile broadband. There is going to an explosion in the amount of digitized data and applications, faster and more affordable mobile data prices, and more powerful devices. Smart phones are the future rather than wireless being only a small and complementary part of the broadband future.
Posted by Gary Sauer-Thompson at 9:38 AM | Comments (3) | TrackBack
May 20, 2010
Hockey + neo-liberalism
I couldn't bring myself to watch Shadow Treasurer Joe Hockey's budget reply speech at the National Press Club in Canberra to see how the Coalition would deliver on its promise to reduce the deficit.
I knew that deficit reduction was the primary focus of the Liberal's economic policy (through raising taxes and cutting spending), given their classic debt hawk position, all their clichés about fiscal responsibility, and their concern to push policies that keep the financial industry happy.
So I worked on some photos instead of listening to Hockey stuck repeating himself.
I guess that I should have watched Hockey to see whether he would have addressed how government needs to govern in the context of the global financial crisis. This crisis has resulted in the ending of the neo-liberal mode of governance that came into being in the 1970s.
Instead I've scanned the text of Hockey's Press Club address, and it is about about values, policy and an alternate Budget strategy. It is an affirmation of small government, competitive markets, and self-regulating markets with no recognition that the financial crash has brought the era of neo-liberalism to an end. It is as if nothing has changed despite the paranoia and suspicion about the present.
The Coalition's combination of economic liberalism with social conservatism is a return to Thatcherism in the form of the grip of John Howard's wider political culture over Australian politics: a one nation conservatism; backing globalization and finance capital; a belligerence about going to war, xenophobia, racism and class warfare. Though this zealous right-wing mentality, which sees threats and enemies everywhere, from immigration to Islam and China, is a toxic brew, there has been little to no attempt to "detoxify" the Liberal Party.
What is astonishing is not the cuts to recurrent expenditure, as that was expected, given that efficiency and competitiveness is the only game in town. It is the way the Liberals, for all their talk about higher productivity, will slash public investment in infrastructure designed to facilitate the ongoing modernization of the Australian economy. What Hockey offered was substantial disinvestment. The assumptions are that economic expansion will come from the mining and that private capital will build the necessary infrastructure.
For example, there is no need for a national broadband network NBN). It's a white elephant. This ignores that the increased role for government in infrastructure building has been because of the sluggishness of investment in productive activity. We are taking about Telstra here. They got us into the situation of poor broadband (slow speeds, low quotas high costs) in the first place. They want to return to a situation where Telstra is free to hold back the market and build at its own pace, for its own profits.
The Liberals are not only going to take the axe to the NBN. The party will also
Posted by Gary Sauer-Thompson at 7:09 PM | Comments (8) | TrackBack
May 19, 2010
political abstraction + practical politics
In Is That It For Neoliberalism? in New Matilda Jason Wilson, in the course of reviewing Robert Manne and David McKnight’s edited volume, Goodbye To All That?: On the Failure of Neoliberalism and the Urgency of Change, accepts an old dichotomy or duality. This is one between political abstraction (eg., the concept 'neo-liberalism') of the intellectuals and the practical or pragmatic politics based on reconciling the diverse interests of the governed of the politicians.
Wilson adds that one of the important:
truths about social democracy, especially in its Australian form [is] that it is more concerned with programs and principles than political theory; that, where intellectuals are concerned, it has most use for those engaged in specialised technical pursuits — economists, say, or lawyers — and that the boring activity of reconciling interests that is the central concern of social democratic governments is most likely to alienate intellectuals first.
He adds that what this actually means is that social democracy in practice often has an uncomfortable relationship to the intellectuals who seek to support it where powerful interests have to be contended with, although you may be guided by high principles, you might not get what you want, and you might not get it on time.
Isn't social democracy as much a political abstraction, or political theory, as neo-liberalism? An abstraction that refers to the middle way between socialism and capitalism in the form of the welfare state? Isn't neo-liberalism more concerned with programs and principles than political theory?
Didn't the economic crisis of the 1970s represented the expiry and collapse of the post-war welfare settlement, through pressure of its own contradictions? That resulted in the emergence of Thatcher in 1979, and Reagan in 1980, and the subsequent attack on working class institutions and the deregulation of the financial sector in 1980's-- ie., setting free the financial sector to operate on a global basis, and to establish itself as the dominant growth sector of the British economy.
Wouldn't it be more useful to shift to 'modes of governance' and see neoliberalism and social democracy as different modes of governing the country? This shift to governmentality allows us to think in terms of the organized practices (mentalities, rationalities, and techniques) through which subjects are governed and the ways that the conduct of subjects is shaped.
This enables us to look at the assemblage of governmentality: the process through which a form of government with specific ends (a happy and stable society),the means to these ends (“apparatuses of security” and a particular type of knowledge (“political economy”) to achieve these ends. It is a political rationality that involves thinking about the government and the practices of the government. So neo-liberalism and social democracy are different ways of thinking about government and its practices of governing.
We can then begin to explore this in terms of the economic crisis of 2009 caused by the instabilities of unregulated markets; a crisis that develops through the dysfunctions of unregulated markets (eg., climate change). Maybe we can think in terms of the breakdown of the neo-liberal regime or mode of governance. So we have the opposition by the Right (economic and political) in Australia to any reforms whatever and to a more active/interventionist role by governments in the regulation of capital flows and markets.
Posted by Gary Sauer-Thompson at 10:52 AM | Comments (4) | TrackBack
May 18, 2010
when I lie to you I'm honest and real
So "straight talking" Abbott comes clean--he lies to us consistently but we shouldn't take it seriously! This is the game of politics.
Abbott's admission on the 7.30 Report that not everything he says in the heat of debate should be seen as gospel truth is now being spun by the Liberal Party as more evidence their guy is "real" and "honest" and a "straight talker".
The implications is that in politics words have no basic meaning--they just mean whatever the politicians want them to mean in different situations----and this exhibits a total disregard for us in a critical dialogue in a liberal democracy. In doing so they understand effective persuasion in public forums and institutions to be disconnected from truth. They stand for sophistry and spin, just like the advertisers and marketeers of Madison Avenue.
True, Abbott's qualification was that he was not necessarily speaking the truth unless it was in the form of an official statement, such as a speech or a policy document. So that means, as Kerry O'Brien observed, every time Abbott makes a major statement we have to ask him whether it's carefully prepared and scripted or something on the fly?
A further implication is: 'How do we know that what Abbott said on the 7.30 Report is true?' After all Abbott's admission was said during the heat of discussion with Kerry O'Brien. He could be lying all the time. Whatever it takes etc etc. Just like a used car salesman or real estate agent
What we can infer is that rhetoric, for Abbott, has more to do with lies than truth or argument. It has more to do with deception than persuasion. In doing so he is trashing the rhetorical tradition, which he as a Burkean Conservative, should be defending.
Posted by Gary Sauer-Thompson at 1:15 PM | Comments (9) | TrackBack
May 17, 2010
The Daily Show on BP + oil spill
BP's attitude to the Deepwater Horizons offshore drilling disaster in the Gulf of Mexico seems still to be one of unconcern. They still seem to be saying it's no big deal--its only a small leak. Even if it is a big deal, it's not our fault.
The Daily Show’s segment on the Deepwater Horizons disaster is titled, “There Will Be Blame”:
| The Daily Show With Jon Stewart | Mon - Thurs 11p / 10c | |||
| There Will Be Blame | ||||
| ||||
A relief well, considered the permanent solution the leak, is still being drilled and is months away from completion. Until then, BP is also considering a smaller containment dome or trying to clog the leak with golf balls and rubber. Whatever happens BP's reputation nosedives and greater restrictions are placed on off shore drilling.
The entire gulf is beginning to look like an oil slick, as we learn that oil companies like BP, rig owners like TransOcean, and contractors like Halliburton (the cement plug provider in the Gulf spill) never bothered much abouit preparing for potential disasters--especially not spending money to research solutions to potential catastrophes. Anyone surprised?
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Thai Democracy
In the last 60 or so years Thailand has witnessed more than 15 coups, 16 constitutions and 27 changes of prime minister. So though the current conflict and bloodshed is the worst in two decades, it is not unprecedented. Areas of Bangkok have been turned into “live firing zones”.
The street violence would indicate that Thailand has lost faith in electoral democracy and many poor and working-class Thai citizens are seeking a transformation in the underlying social and political relations of rule.
My crude understanding is that the rural poor (red shirts, or anti-government protesters) are protesting for the right to have a greater say in the government of their country. The move is being resisted by the Bangkok elite – the wealthiest families, the military, the bureaucrats – who have controlled Thailand's affairs for generations, and who do not like an electoral democracy that brings the rural poor to power.Hence their antagonism to the red shirt protesters, pushing for the devolution of economic and political power to average Thais.
says that:
The events of recent years have in some ways exceeded traditional Thai upheavals of the past. Instead of a single brutal and decisive crackdown that reset the political clock at the first peak of political agitation, we have a drawn out and decidedly indecisive series of provocations that have included attacks on the monarchy and privy council (and this was perhaps only made possible by the coincidental existence of a new medium of expression—the internet)......Dozens of political lines have been crossed in recent years in the conduct of politics and protest. That means we are presently drawing out and testing new lines.
Tyrell Haberkorn in Thailand's political transformation at Open Democracy says that the familiar rendering of Thailand’s political drama - a popular insurgency by Thailand’s rural poor against its urban rich---fails to convey the political heterogeneity that has been emerging under these misleadingly unified banners. He says:
The red-shirt movement in Thailand is redefining the terrain of politics, in a way reminiscent of the autonomist struggles in Italy in the late 1970s and the Zapatistas in Mexico in the late 1990s. For like these earlier movements, the UDD is seeking both to contest an ancien regime (and in Thai terms, the amatya and jao who populate it) and to change the terms of engagement through which politics is conducted.The red-shirts are, after all, seeking far more than merely a seat at the decision-making table for the marginalised majority. In their refusals, demonstrations and demands to reshape politics, they are agents of a deeper transformation in Thailand.
For Haberkon the counter-revolutionary violence being exercised by Thailand's elite is seeking to keep the new at bay, even whilst the old order is dying. Will the army allow fresh parliamentary elections? Do they call the shots rather than the elected government of Abhisit Vejjajiva?
update
A journalist called Igor Prahin has been updating his Flickr stream, and he has several images of Bangkok on fire. The Thai government cannot shoot its way back to political order and then pretend to hold elections as if nothing had happened. The country's political order will not be the same, even if there are more shopping malls built.
Posted by Gary Sauer-Thompson at 11:09 AM | Comments (6) | TrackBack
May 16, 2010
before and after
In the The Message from the Glaciers at the New York Review of Books Orville Schell addresses the Fourth Assessment Report of the UN’s Intergovernmental Panel on Climate Change (IPCC) erroneous claim that there was a “likelihood” that Himalayan glaciers would disappear by 2035, “and perhaps sooner”.
This has fuelled the climate change deniers--the anti-science crowd---who claim that the evidence that the climate is warming just isn't there; that the seas are not rising; the ice is not shrinking; the polar bears are not vanishing; and there has been no significant climate warming since 1995.
Schell says though the IPCC's error embarrassed the report’s author it has not altered the reality that many glaciers in the Mt Everest/Himalayan region are, in fact, rapidly receding.
George H. L. Mallory/Royal Geographical Society, Mount Everest and the Main Rongbuk Glacier in 1921
Nor does the error scientifically invalidate the panel’s overall conclusion that because “more than one-sixth of the world’s population live in glacier- or snowmelt-fed river basins and will be affected by the seasonal shifts in stream flow,” a serious downstream problem is unfolding.
David Breashears, Mount Everest and the Main Rongbuk Glacier, Tibet Autonomous Region, China, 2007
It is in the region of Asia’s ten major rivers—the Yellow, Yangtze, Mekong, Salween, Irrawaddy, Brahmaputra, Ganges, Indus, Amu Darya, and Tarim—among huge modern-day populations of Asia, that the melting of the Greater Himalayas’ glaciers will have the most significant impact during the coming decades and centuries.
The political reality is that the anti-science crowd, who deny that global warming is real and is principally caused by human fossil fuel use, don’t really want any meaningful action in the form of aggressively deploying clean energy technologies. They are happy with increased temperatures because these conservatives cannot abide the solution to global warming-strong government regulations and a government-led effort to accelerate clean energy technologies into the market.
They have a deep dislike for mandatory restrictions on greenhouse gases and are engaged in winning a battle in an ideological war.
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May 15, 2010
The Australian's upside down world
The Australian's op-eds just get worse---to the point of looniness. If the strategy is to develop a conservative perspective on, and an interpretation of, the events of the day, then the stridency becomes ever more shrill and the claims ever more extreme--to the point where its columnists live in an inverted world.
The latest example from its stable of Conservative hacks and ideologues is an op-ed by Melanie Philips, who has a column in the Daily Mail and runs a blogs for the UK The Spectator in which she teases out the left's secrets and sinister patterns.
In her Londonistan (2006) book Philips claimed that radical Islamism has established London as a base of operations, blaming what she sees as the broader failures of multiculturalism, cultural relativism and appeasement in Britain. Britain is "sleepwalking towards cultural suicide" and "has capitulated to Islamic terror" etc.
In her Blind ideology is dancing on the grave of reason op-ed in The Australian Philips takes aim at the progressive intelligentsia's style of thinking.
She says:
Across a broad range of issues, the progressive intelligentsia appears to have junked the rules of evidence, objectivity and rationality in favour of fantasy, irrationality and upside-down thinking.Take man-made global warming, for example.The belief that the planet is on course for carbon Armageddon is now embedded in Western politics. Yet the evidence that the climate is warming to an unprecedented and catastrophic degree just isn't there. The seas are not rising, the ice is not shrinking, the polar bears are not vanishing, and there has been no significant climate warming since 1995.
In Philips' inverted world science is ideology and an irrationality, whilst her opinions and fundamental religion are reason, which is the reverse of the actual situation in our world.
However, this is what conservatism actually means today. This kind of inversion is what those who gather around the Australian actually believe, and the subterranean racial and class resentments leads to the idea of the Left's conspiracy machine.
Philips' perspective in her upside down world is that:
Such irrationality, intolerance and, indeed, bigotry run counter to the cardinal tenets of a free society based on reason and the toleration of dissent.This is because these dominant ideas are all rooted in ideologies: environmentalism, anti-racism, anti-Americanism, anti-imperialism, anti-Zionism, egalitarianism or scientism, the belief that scientific materialism alone explains everything.
She has written a book on science as a form of irrationality that engages in a witch hunt, whilst environmentalists are fascistic. So science stands for the anti-enlightenment. The claim is that science is ideology because it wrenches the evidence to fit a prior idea and sacrifices truth to power.
Philips claims that, in attacking science and the progressive intelligentsia, she is defending a free liberal society. However, the very extremity of her claims and the demonisation of her opponents indicates that she has dumped the whole idea of a liberal public reason based on argument and debate. Criticism can, and should be made of natural science, environmentalism and scientific materialism in a liberal society but this is done though argument not blanket condemnation.
Update
The Australian's political strategy is one of forcing political change through orchestrated crisis that makes an enemy of those who work for the Rudd Government. News Limited, with its ruthless and nasty culture has has been conducting a war on the government primarily via The Australian. Surprisingly, the ABC takes its political compass from the ugly Australian.
Maybe this inverted world is an expression of an emerging conservative populism? If so, will it led to genuine grass-roots organizing: voter registration, letter-writing campaigns, building mailing lists and staffing phone banks, canvassing neighborhoods at election time, and, above all, getting elected and mounting direct challenges to incumbents, regardless of party?
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May 13, 2010
Coalition: in the spotlight
Now it is the Coalition's turn to establish their economic narrative about Australia's future, given the emergence of economic recovery. What kind of Australia does it envision. What kind of reforms does it propose to facilitate this? Will Abbot spell this out in his budget reply speech? They've promised to give voters a "clear direction" of their economic strategy. What would that be, now that their debt’n’deficits rhetoric has been effectively neutralized by Swan?
Judging from the comments this morning in the media can we expect anything more than the standard lines about "tackling with conviction", the budget deficit, government waste and mismanagement, the new resources tax, and returning the budget to surplus quicker than Labor?
Will there be any "real action" on health? Education? Or climate change? Or tax reform? Or will Fortress Australia make a comeback? Along with we love miners. They are hurting badly.They need to be defended etc. etc:
How about something substantive on workforce participation, which is strongly influenced by incentives in the tax and transfer system, and by the affordability of child care.
Will they address the strong disincentives of the high effective marginal tax rates around the withdrawal of benefits plus payment of tax? They could address this by lifting the tax-free threshold to $25,000. It's very expensive, sure, but a mining boom is underway. Super profits will be made. So why not use the proceeds to pay for such a tax reform.
This is not likely though. Abbott is about politics not policy reform. So the Budget reply will probably be about looking after the poor miners who are carrying an ungrateful Australia on their backs.
Update
Abbott's budget reply speech was all about we love the miners and we''ll fight for them cos we need their money. Okay, he didn't say the last bit. But he made sure that the super-profits-based tax of the mining sector was the core of his election strategy.
The Coalition will oppose the mining tax in the Senate and rescind it in government. Simple. Abbott finishes thus:
In the end, it’s a judgment about who can be trusted with the fate of the country that decides elections. This budget rests on the government’s new mining tax and the election should turn on this too.
Australia’s future depends on the bulk carriers travelling to Asia just as surely as it once rode on the sheep’s back. This election, like the budget, will pit a party that thinks it’s reasonable to make Australian miners the world’s highest taxed against one that doesn’t.The die is cast. Neither side will retreat. The only way to stop this great big new tax on the people who saved us from the recession is to change the government.
There was lots of negativity and attack at the beginning of the speech with little policy substance in the rest apart from slashing the public service and recycling WorkChoices. They can kiss Eden-Monario goodbye.
Posted by Gary Sauer-Thompson at 12:54 PM | Comments (10) | TrackBack
May 12, 2010
hot rocks indeed
The economic narrative of the Rudd Government's 2010 pre-election budget is that Labor are responsible economic managers. They steered Australia through the global financial crisis and economic recession with generous stimulus spending that meant low unemployment. They imposed fiscal discipline with a 2 per cent real spending cap; they have charted a course back to budget surplus and enabled the economy to recover.
This kind of economic prudence is such a contrast to the huge cuts to public spending that will need to be implemented by the new coalition Conservative/Liberal Democrat government in the UK under David Cameron. In contrast to the turbulence in the economies of Europe that are burdened with debt for many years to come, Wayne Swan, Australia's Treasurer, is talking about a return to surplus in three years from a flow of tax revenue from strong economic growth due to the mining boom in iron ore, coal and natural gas.
Australia is the lucky country. We ride the mining boom to prosperity thanks to the continuing industrialization of China, and forget all about the effects of climate change on Australia. It's a political amnesia that flows out of winning the next election. And after the election? The China-fuelled growth means infrastructure bottlenecks, labour shortages, stubborn inflation pressures, rising housing prices and rising interest rates.
Climate change is over the horizon, beyond the rainbow of the never ending mining boom. There is no need to restructure the economy to take into account climate change by making a substantive start on baseload electricity generation by renewables. There is no commitment to a substantive investment in research and development in green energy technologies; investments so that we can have cheap solar panels rather than expensive ones as we have now.
Maybe, even though the reality of global warming is accepted by the Rudd Government, they are thinking that dramatically cutting carbon emissions is simply not warranted.
Posted by Gary Sauer-Thompson at 8:53 AM | Comments (4) | TrackBack
May 11, 2010
Budget 2010: no frills
The budget spin from Canberra is "no frills", judging from yesterday's news grabs on the TV news. The "no frills" will need to help restore the fortunes of a "progressive" Rudd Labor Government, since its political credibility is looking rather tattered due to its shift to the right. Kevin Rudd's popularity is in free fall. The aura is well and truly gone--the honeymoon is over. Rudd Labor are on the nose.
One explanation for the fall from grace is that Rudd Labor have adopted the NSW Labor Right's death grip script of all electoral tactics, little long-term strategy, and no substantive policies. Everything is geared to the tactical victory and the favourable headline in the 24 hour news cycle. Rudd Labor is repelling voters, who are shifting to the Greens. Nor are Rudd + Co increasing their support amongst those working families returning to being Howard's battlers.
The result of the oh too clever politics is that Abbot's Coalition is now in a "competitive" electoral position---Labor and the Coalition are suddenly neck and neck, and the recent trend is running against the Government and in favour of Tony Abbott and the Opposition. It looks increasingly as if the name of the game for Rudd Labor is to retain power for its own sake--just like the NSW Government--and that it will do what it takes to retain power.
No doubt, we will hear much rhetoric from Wayne Swan about how Rudd Labor's great success in dealing with a global recession--defying global economic gravity-- can be turned into growing prosperity --the China boom---for all Australians under the sound management and steady hands of a fiscally conservative Labor Government.
There will be few grand or big ticket expenditures---what the mainstream media call pre-election sweeteners or giving voters a raft of goodies in an election year. There will be more talk about deficit reduction and returning the budget to surplus quicker than forecast in the context of an international economy in crisis (the cold wind blowing from Athens).
That's my guess.
How will that be achieved? Will this austerity help them win an election? Presumably it will take some of the wind out of the tax and spend government out of control sails of the Abbott Coalition who claim that the Rudd Government is "Whitlamesque'' in its reckless spending. This is an opposition whose rhetoric of real action is increasingly retreating into the right corner.
Update
I didn't watch Swan's budget address. I listened to the blues whilst taking photos of dead flowers instead. A return to a $1 billion surplus by 2012-13 from a budget deficit of $40.8 billion this year. This will be primarily from faster economic recovery and higher commodity prices (the resources boom) rather than from big budget cuts.There was little slash and burn and no tax cuts as the recovery in revenues flows to the treasury and not to voters.
Gee, there is even a little new renewable energy fund to try to prove the government is still committed to climate change, even without the emissions trading scheme it still admits is essential. No money for an emissions trading scheme. How about that? I note that they've taken the axe to to several environmental programs, worth millions just to show that they are "balanced". This is not a green government.
I note that more money has been pumped into primary health care -- $2.2 billion all up, in addition to the funding deal thrashed out with the states and territories at COAG. There are cheaper prescription medicines, more GP super clinics; more money for clinics and nurses to staff them; a nationwide network of primary health care organisations; and electronic health record by mid-2012.
The biggest health reforms "since the introduction of Medicare"? Health under Nicola Roxon represents the strong reformist side of the Rudd Government. But there is no new mental health funding and nothing on a universal dental scheme. However, the government has not lifted the proportion of the health budget spent on prevention much above the level of the previous government, partly because of the huge increases in spending on hospitals and doctors.
There will be more analysis tomorrow. Too much red wine has been drunk whilst listening to Dark Star.
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May 10, 2010
The eurozone's debt crisis
In the Introduction to their 13 Bankers: the Wall Street Takeover and the Next Financial Meltdown Simon Johnson and James Kwak say:
If the basic conditions of the financial system are the same, then the outcome will be the same, even if the details differ. The conditions that created the financial crisis and global recession of 2007–2009 will bring about another crisis, sooner or later. Like the last crisis, the next one will cause millions of people to lose their jobs, houses, or educational opportunities; it will require a large transfer of wealth from taxpayers to the financial sector; and it will increase government debt, requiring higher taxes in the future. The effects of the next meltdown could be milder than the last one; but with a banking system that is even more highly concentrated and that has a rock-solid government guarantee in place, they could also be worse.
This does appear to be a description of what is likely to happen in the UK:
There is a economic crisis happening now in Europe.
Greece's debt crisis threatens to spread to other European nations (such as Portugal, Spain and Italy ) and threatens the euro. Greece has run out of options. It has to be bailed out. Germany dragged its feet.
Because Greece, as a member of the EU, cannot devalue its currency without leaving the eurozone, the only remedy available to Greece is loans whose conditions require prolonged and savage deflation, pay and pension freezes, the tax increases and the public spending cuts.
Meanwhile as the markets test and probe the credit-worthiness of each member, the euro itself is at risk because there has been no way of passing around the hat to protect the eurozone's weakest links. Now they are talking in terms of €500 billion emergency support mechanisms: a troubled country will have to explain its plight to the European Central Bank and the European Commission, then ministers of the 16 eurozone countries will have to approve the help unanimously.
Fiscal tightening reduces domestic demand---- Spain is tightening at the same time as Greece, Ireland and Portugal, with Germany following suit (plans for a tax cut have been abandoned after Sunday's regional elections). So the EU will be looking to gain global market share, an incentive to let the euro slide further to make exports cheaper.
Will this stablize markets? Will some of the Eurozone banks go down? Are we seeing the politics of a nasty recession across Europe, including Britain, in which ordinary taxpayers and workers have been asked to foot the bill for bank bailouts, austerity plans and the like: ie, to pay the price for the proceeding economic bubble in so many parts of the west.
Posted by Gary Sauer-Thompson at 4:02 PM | Comments (2) | TrackBack
May 9, 2010
UK: a logjam
Neither David Cameron, Gordon Brown, nor Nick Clegg had a good election. The key question post the UK election and its hung parliament is whether the Lib Dems will hold firm on insisting on electoral reform (proportional representation) as a condition for supporting either of the two major parties? Will they play hard ball? And who with?
The grossly disproportionate mismatch between votes and seats needs to be addressed given this kind of breakdown:
Tories 36% of vote, 49% of the seats.
Labour 29%of vote, 42 % of the seats.
Lib Dem; 23% of vote, 9% of the seats
It is increasingly clear that a deal with the Conservatives to ensure a minority Tory Government will not deliver proportional representation---the Conservative's offer so very little on this. They would also use a coalition deal to ensure a Conservative victory in the next election in six months or so.
Martin Rowson
While there is no Conservative majority, there is only the most tenuous of anti-Conservative majorities - a prospective 'rainbow coalition' of Labour, Liberal Democrats, Plaid Cymru, the SNP, the Alliance Party, the SDLP and the Greens. The money/bond market will not react kindly to a 'rainbow coalition'. The momentum is that the Lib Dems were edging ever closer to the Tories--- that's what the headlines have been saying.
Update
Jonathan Freedland in The Guardian observes that:
The Tories have the edge on the two criteria that mattered, promising both stability and legitimacy. Any Con-Lib coalition would not only have solid numbers in the Commons but could claim a moral right to govern, led by a Tory party which had passed Clegg's "most seats and votes" test..... Lib Dems believed Labour could not match the Tories on either count. .... Labour might feel like natural bedfellows to most Lib Dem supporters, but any progressive coalition they might cobble together would be perilously frail – reliant on assorted Irish and Welsh nationalists and a sole Green MP to march in lockstep with every last member of the Labour and Lib Dem parliamentary parties. What's more, feared Clegg, any coalition with Brown at its head would lack legitimacy, led by a prime minister rejected by the voters
With Brown gone Clegg will now have to decide which is the best offer, which partner is most likely to deliver it and prove most acceptable to the electorate.
So far Clegg failed to win enough concessions on electoral reform from the Conservatives to satisfy his 57 MPs, who called for formal talks with Labour to begin after informal soundings over the weekend. However, some Liberal Democrats still see a deal with the Tories as a more realistic prospect, not least because of the parliamentary arithmetic. These are the Orange Lib Dems --named after the David Laws, Vince Cable and Chris Huhne's Orange Book: Reclaiming Liberalism (2004), which advocated market solutions to a range of issues which Labour regards as the prerogative of the state.
A formal Lib-Con coalition, with Liberal Democrats sitting in a Cameron Cabinet, is now seen as the most likely method of co-operating if there is such a deal, rather than a commitment by Clegg's party to support a Tory minority government in key Commons votes.
In The Independent Sean O'Grady says that getting into bed with the Conservatives would mean:
A violent Liberal Democrat split – inevitable with a Lib-Con deal – suits the Tories fine. After that, they might be able to recruit the "Orange Book", market-oriented Liberal Democrats they've been wooing for years. The result would be to reduce the party to a rump. The last time the Liberal party joined the Tories in a coalition, in the 1930s, the party split three ways. It could easily happen again...For them [the Conservatives] the Liberal Democrats are not partners in power, but enemies to be destroyed – by stealth if necessary, as outright electoral assault has not worked. The last thing they will give the Liberal Democrats is a permanent lock on power.
So the Conservatives cannot be trusted on introducing substantive electoral reform--proportional representation for the House of Commons. Their best offer is committing the Conservative party to a referendum on a new, alternative vote (AV), system of electing MPs.
So the Lib Dems started talking to Labour, formally after Brown says he will go. Is Labour serious?
Update 2
The logjam has been cleared. The new government is a coalition of Cameron's modernizing Conservatives and the radical centre Liberal Democrats after the Lib Dem talks with a divided Labour foundered.
Posted by Gary Sauer-Thompson at 8:18 AM | Comments (8) | TrackBack
'enuf said
The Leak cartoon says it all really. The WA miners and the Coalition are beside themselves with rage in defending their self-interest. The miners want all the loot from digging up rocks for themselves. The Coalition cannot see beyond digging up rocks and selling them for a top dollar (spot price) to the Chinese steel mills.
What is missing from the cartoon is the role of the Murdoch Press, which is acting as the publicity arm of the miners and the Coalition in their attacks on the Rudd Government. This is a rightwing power nexus that has no time at all for a world of climate change, finite natural resources and protecting the environment. The miners should rule.
Progress for them is digging more rocks out of the ground, making lots of money and ensuring that governments toe the line by ensuing that the economy is flexible, is internationally competitive and has the right light regulatory framework.
Not for them an ecological enlightenment. They represent the old order that resists this kind of change and are prepared to engage in mass deception to do it.
BHP is putting pressure on the Rann Government in SA. Though the $20 billion expansion of Olympic Dam copper, uranium and gold mine in South Australia has not been shelved--- it would be "very difficult" to approve the new mine if the tax was introduced in its current form. The hacks in the Murdoch papers then write t it up. The strategy is get Rann to pressure Rudd to lay off the miners. And to get Anna Bligh in Queensland to do the same.
This is another example of how large companies use the media cycle and their political power as a deliberate part of their government lobbying strategies.
Update
It comes as no surprise that Kevin Foley, the SA Treasurer, will lobby Canberra for changes to ensure the expansion of Olympic Dam in the state's outback. The Rann Government shared the concerns of BHP, which is leading the mining industry attack on the tax, and its position is that the tax should be instituted in a manner that did not threaten current or planned investment.
Posted by Gary Sauer-Thompson at 12:36 AM | Comments (4) | TrackBack
May 7, 2010
UK election: conservatives surge
The momentum in the last couple of days in the UK election has been with the Conservatives. The Liberal Democrats have gone backwards--they may even lose seats! They've been squeezed by the two party system. Unsurprisingly, Labour looks as if it has lost. Their flicker of hope has been strangled. The centre-left has gone backwards.
The national swing the Tories require to win an overall majority is 6.9%; the exit poll suggested 5.5% swing, but the swing is not uniform across the nation. Will the Conservative's blue surge be enough to get them the majority of seats they desire--326? That looks more realistic than a late Labour surge that would make a minority Lib Dem/Labour coalition possible. Will Labour and Lib Dems win enough seats to form a coalition?
Martin Rowson
The turnout is high and Britain has moved on from New Labour. Despite all the late Labor talk about them being is in the business of trying to form a coalition with the Lib Dems, Labor have worn out their welcome. Gordon Brown is toast. The electorate wants change. A minority conservative government?
The traders in the bond market traders are banking on a Tory victory in the context of a crisis about sovereign debt across Europe. At this stage, the Tories inisist that Labour has lost its authority to govern. Labour says the Tories haven't won and Britain needs stability. On the other hand, bringing in electoral reform via Labour remains the Lib Dems only hope of ever making a breakthrough.
Update
A hung parliament---with a Conservative minority government---looks likely. Can they get to 314 seats so that the pressure on Brown to give up power will be intense. The Constitutional convention and the British political system says that the first call in a hung parliament situation is the government of the day: can the PM form a strong stable and principled government?
It's 1974 (Ted Heath, Jeremy Thorpe and Harold Wilson) revisited for the British, who don't seem to thing much of coalition governments especially during a European debt/economic crisis (Athens is burning etc etc ) and twitchy money market. The pound is taking a battering etc etc. They--the media and talking heads---want a strong government to take decisive action.
Labour has made clear it would try to hang on to power by forging a partnership deal with the Liberal Democrats to get a majority on the floor of the Commons. Labor still don't have enough votes to do this. So will they try to put together be an anti-Tory coalition with a multitude of parties (eg., the Lib Dems +Scottish and Welsh Nationalists)
The Lib Dems appear to have two choices. They can support the Tories either in a formal coalition (unlikely, because the party ranks would be agianst) or through informal deals not to block Tory legislation. They may get much of what they want in such a deal, but they will not get electoral reform.
Alternatively they may decide this is their one real chance for voting reform, and so do a deal to keep Labour in power as the only way to achieve that, although almost certainly with a new leader. In deciding which way to go it may come down to what they think the public regards as more important - electoral reform or an end to the Labour government? They are in a hard place as the markets rattle at sterling with Greece and New York sending out shockwaves.
Update2
Nick Clegg will give David Cameron and the Conservatives the first shot at attempting to form a government. All that Cameron is offering the Lib Dems is an "all-party committee of inquiry" into political and electoral reform and to work with him on implementing the Tory agenda
Will there be a Clegg-backed Tory administration? Only if there is a chance of electoral reform surely. This is the Lib Dems chance in a lifetime to introduce proportional representation. There's little chance for electoral reform--proportional representation--from the Conservatives judging from their past statements.
The markets are insisting on the immediate deep cuts the Conservatives have been promising to bring down the deficit. But the Tories will also be desperate to avoid the kind of harsh early measures that might deny them the clear majority they'll be looking for in a second election latter in the year.
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hysterical miners
In The Australian Arthur Sinodinos says that the resources tax on super profits means that it is now the turn of the big bad mining companies to play the national villains for the Rudd Government. He says:
They are lambasted as multinationals with substantial foreign shareholdings that are sucking the life out of Australia's non-renewable energy sources. Never mind the jobs generated locally or the royalties, taxes and charges paid at all levels of government.
The self-serving miners, who were successful in blocking an emissions trading scheme, are now making daily threats about stopping resource investment, cancelling projects and even nationalisation.
Now Sinodinos does make a reference to the national interest:
Australians will go along with taxing the mining sector more only if they can be confident it will not harm the national interest. And, broadly speaking, they support maximising resource development.
But he makes little mention of sharing the wealth from a booming industry that has grown and prospered to the Australian population.
Isn't the well-being of the Australian population the core of the national interest? Treasury thinks so.
Posted by Gary Sauer-Thompson at 8:42 AM | Comments (3) | TrackBack
May 6, 2010
National Broadband Network looks good
I've always been very sceptical of the right wing media's attack on the National Broadband Network. I've suspected that the case has been long on hostility, short on logical argument, and extreme in its claims about the expense to consumers and viability in relation to wireless broadband.
One example is Colless's big claim in The Australian that:
it is clear the federal government must reshape its strategy for a national broadband superhighway if it wants to prevent this policy dream turning into a financial and logistical nightmare.
Clear? How so? Why? There has been a marked failure---and a notable lack of interest---from the anti-NBN crowd in the Murdoch press to assess how the NBN as an long-term infrastructure investment would transform business, government and everyday life. What seems to matter is that the NBN has to be attacked in principle --there is not even a mention of the need to address the backhaul problems for the regions. Wireless, apparently, will solve everything.
The NBN Implementation Study, written by McKinsey-KPMG, states that entry-level broadband prices would be set at $20-$30 per month of a basic broadband service of 20Mbps, $30-$35 per month for broadband and voice, around $50 per month for a higher speed broadband service. It also stated that fibre-to-the-premise was the "optimal future-proof technology", with wireless only considered to hold a complementary role in providing broadband.
That kind of access to a fast fibre broadband network looks pretty good news in relation to what we have now.
Another finding was that the $43 billion was a conservative estimate for how much the network could cost to build. The peak investment required by the government was considered to be $26 billion by the end of the seventh year of the roll-out, with $18.3 billion to be found over the next four years, which the government will make "appropriate provision" in the 2010/2011 budget.
Thirdly, the government could build the NBN without the involvement of Telstra and would reap a modest return on its investment within 15 years of 6 to 7 percent.
So what is the right wing media --eg., The Australian--- up to in its attacks on the NBN? Ignorance? Defending the Coalition's rejection of a national broadband network? Attacking it because it is being built by the government and not private enterprise? The Coalition stands alone in waging war on the NBN as the carriers came out to praise the NBN Implementation Study findings. Spinning for Telstra? For what purpose? Telstra will be structurally split and they don't care about the public good. Or is it just another plank in the the Murdoch Press's general attack on the Rudd Government?
What has changed is that the government initially said that private telecommunications companies would be keen to take an equity share in NBN Co. The implementation study has recommended there will be no private-sector involvement in the ownership of NBN Co for at least 15 years.
Update
Some say---eg. Jennifer Hewett in The Australian--- that Telstra has a plan B ready to go that would see it upgrade its cable network and immediately slash its prices on broadband for high-value, high-user customers in a price war. Alan Kohler says that Telstra's goose is cooked--- it cannot compete:
The only reason to stick with a copper access network with a limited life would be to milk it for cash; the purpose of a price war is exactly the opposite – to build market share at a loss for future returns. But there is no future for copper in a nation that has 93 per cent fibre to the home.
Telstra’s only viable option is to take whatever it can get for renting its underground ducts and backhaul fibre to the NBN, and get on with a new corporate strategy based on using a third party fibre access network and gradually shutting down its copper.
Posted by Gary Sauer-Thompson at 7:20 AM | Comments (3) | TrackBack
May 5, 2010
a question
As a result of the global financial crisis, the corruption of the international rating agencies, the subsequent global economic recession and the euro crisis in Europe---high unemployment and high government deficits--- people have criticized the government for withdrawing from the economic and particularly financial sphere and allowing private sector actors to do whatever they wanted.
One of the issues raised is the lax regulation of the finance industry. Hence the calls for reform of the financial system to arrest the dominance of a financial sector that looms too large on our economic landscape.
Wall Street fights back regulatory reform to ensure its political power, and even though the ideology of deregulation has been exposed as a failure, Wall Street and its political allies are still invoking the bogeyman of big government to fight off financial reform. They appeal to the U.S. values of free markets and minimal regulation:---the broad imperatives of globalization are marshaled by well-connected and "untouchable" business interests to defeat regulatory oversight of the financial system and elsewhere.
The lesson learned is that what is good for Wall Street is not necessarily what is good for America as this is an industry that makes toxic products with huge negative externalities. This raises a key question:
Do we think the government should simply act so as to correct the imperfections in free markets? Or do we see a positive role for government in determining what kind of an economy we should have?
It is true that some free market economists deny that the market has any failings or flaws (externalities) because of their "efficient markets" and rational market assumptions. However, most economists do favour a more active role for government; but they usually limit the government to correcting known problems with the free market so as to allow the economic machine to keep on ticking over.
Climate change highlights the issue of what kind of economy we should have, since addressing climate change requires shifting to a low carbon economy.
Posted by Gary Sauer-Thompson at 9:34 AM | Comments (3) | TrackBack
May 4, 2010
UK: a minority Conservative government?
A few days out from the general election and Britain is locked in a tight three-way race. All three parties are within five points of each other. Cameron's Conservatives look as if they won't get an overall majority even though they are "measuring up the curtains for no 10'; the Liberal Democrats may come second, though that looks unlikely; whilst Labour continues to trail, clinging on to the hope that something might turn up.
None are leveling about what is needed to address Britain's huge fiscal deficit, its bloated state and soaring public debt. This election is not about the parties' plans to tackle Britain’s deficit:
Dave Brown
What has changed is that there are now three parties in electoral contention, and an overall majority of the sort first-past-the-post used to yield may become more difficult for any party to achieve. A hung parliament may knock some sense into the corrupt political system.
Labour deserves its come uppance says George Monbiot because Labor under Blair and Brown has:
abandon[ed] everything it once stood for, and hand[ed]us, trussed and oven-ready, to big business and the Daily Mail. We'll be trapped like this for ever, in New Labour's Bermuda triangulation, unless we vote for what we believe in rather than just against what we don't.
The New Labour era is limping to a close. The unfair electoral arithmetic of first-past-the-post still massively disfavours the Liberal Democrats, and will limit its seat-gains to a few dozen even in the best circumstances. At this stage it looks to be a Tory minority government dependent on Lib Dem cooperation.
More realistically Cameron's Conservatives would seek pacts with Unionists in Northern Ireland, Plaid Cymru and the Scottish Nationalist Party in order to avoid having to accommodate Lib Dem demands for electoral reform. The momentum does seem to lie with the Conservatives. They may even win a majority of seats if the momentum continues in the last days.
Posted by Gary Sauer-Thompson at 10:28 AM | Comments (5) | TrackBack
May 2, 2010
Rudd/Swan squib on tax reform
The Henry Review runs to over a thousand pages of detailed analysis and 140-odd recommendations on achieving a more efficient and fairer tax system. The objective was to lay out a blueprint for long-term tax reform. The Rudd Government's response. There is little relation between the two.
Rudd + Swan have squibbed on tax reform to make it fairer and more efficient in the context of the aging of the population, a growing shortage of workers, and increasing globalization. No surprise there, as this lack of courage and risk-taking is what we have come to expect on reform from the Rudd Government. Politics rules.
The "tax reform" package announced today by Treasurer Wayne Swan is really just a new resource rent tax that squeezes the miners plus the long-term increase of compulsory super contributions based on a 12% compulsory levy and accelerated depreciation for small business. Some of the super tax is going into the new infrastructure fund, which is about getting better road, rail and port facilities to help dig up our minerals and ship them out to booming Asian economies. There is zilch for the environment or climate change here. No surprises there either.
Of course, the politics is that Rudd 's main game is getting re-elected--political survival. Then in their second term the "we don't do brave" Rudd Government will address the next phrase of tax reform---that's the promise. It's a 10-year reform agenda. There is good coverage at TaxWatch.
The radical change to income tax, including a $25,000 threshold and a two-step tax scale, has gone into limbo, its fate left to much later. So have proposals for family-payments reform, because it's all inter-related.
Most of Henry's reform plans are either shelved or ruled out. Moreover, the 12 per cent target won't be achieved for nine years--the first increase is just 0.25 of a percentage point from July 1, 2013. Another 0.25 of a point will come from July 1, 2014. That is slow.
The core fairness issue is how to ensure that people living on low incomes, including those on income support, get a better deal out of the tax system; remove anomalies and poverty traps for people moving from welfare to work; and address the sustainability of social services, including how best to ensure adequacy and certainty of funding.
Posted by Gary Sauer-Thompson at 11:30 PM | Comments (8) | TrackBack
May 1, 2010
taxing times
Tax review time dawns as our two speed economy heats up and interest rates rise in an election year.
The Henry Review of the taxation system was given a mandate to make recommendations across the broad sweep of tax policy. Will the implementation of its proposals be limited to efficiency considerations: ie., a tidying up of anomalies (plugging tax holes, simplifying the tax system, broadening the tax base)? Or will there be fundamental reform?
If the latter, then how politically palatable are the proposals in an election year? The tax take is going to have to rise to pay for increasing budget costs driven by an ageing population and increased demand for health care. Is the Rudd Government genuinely interested in substantial tax reform? If so, what would it be since they have ruled out raising the GST rate and have shown little interest in a carbon tax (polluter pays). Will the Rudd government being more interested in the extra billions that will flow to Canberra rather than the task of reshaping the country’s tax system?
We know that the Henry Review covers a broad suite of taxation proposals that cover resources superannuation, savings and property and roads. Already the miners, who are opposed to an ETS to address climate change, are outraged at the suggestion of a resources rent tax on the cash flows of new resource projects once their capital costs have been paid off.
Amidst a resources boom and super profits the miners cry from Perth ("killing the golden goose") is that jobs and investment will be placed at risk. They are not interested in sharing the wealth, despite the resource industry requiring public investment in skills and transport infrastructure or those in the economic slow lane who are are expected to bear the brunt of the recovery with interest rates rising to "above normal" levels as the economy picks up pace.
Will the Rudd Government finally reduce the high effective marginal tax rate that still applies to to low-income people seeking to increase their earnings? Isn't that one way to address the skills shortage and reform the tax system ?
What will happen to the superannuation industry? Currently, the superannuation system is funded largely by employers and effectively offers major tax breaks to wealthy Australians able to divert their income into retirement accounts. Will there be a rise in tax on contributions? What will they do for lower income earners?
Update
The Australian has its own ideas. In an editorial it says:
Australia desperately needs a tax system that allows individuals, families and businesses to retain more of their earnings backed by a smaller, efficient government sector. In a global economy, Australia's long-term prosperity demands an attractive investment climate to encourage effort, investment and savings through competitive company taxes and a low personal tax regime.It's all about incentive.
They say that Australia's top tax rate of 45 per cent on income above $180,000 must be cut. So must company tax---it is also ripe for reform---by which they mean reducing the burden on companies.
Posted by Gary Sauer-Thompson at 7:35 AM | Comments (12) | TrackBack