BARVENNON.COM
AUSTRALIAN DIARY
MAY 2010.
RUDDERLESS
Kevin Rudd has done an about turn, and suddenly
he
is
looking
like a real prime minister. The nature of the
changes is what impresses me.
The polls are quite negative. But what can you expect? It's
a bit like the worm. The respondents with positive views are self
selecting. The silent majority waits to see.
The Henry Report on Taxes has been released. I have not
considered the total picture as yet, but the tax on minerals is
definitely very Henry George. Even including the shared risk
component. Lower company tax is also very good.
However there is too much
government regulation of commerce. Regulation is always to the
benefit of large business and to the detriment of small
entrepreneurs. The increase of superannuation contributions
is not very good.
Let me try to explain why.
By my reading a superannuation
payment from whatever source looks very much like savings. As I
understand it,
Keynes considered
too much savings (i.e. savings rate above the amount used for
investment in new
plant etc) to be a negative for consumerism & the economy.
Money is a dynamic. Savings will not wait
around till
needed. (well not when a whole generation tries to do
it). Even the purchase of gold will not necessarily help.
Perhaps
gold will be less valuable in the future (when everybody else wants to
cash in their gold for goods and services.) What about buying
bonds or stocks you might suggest? The bond and stock market has
a limited capacity to absorb savings. That is what went wrong in
the USA to Lehman, Freddy, Fanny, AIG... Too much money to
invest, nowhere good to put it. Better to leave that money in the
hands of the punters who will spend it promoting consumer demand.
The way it was done
in times past was best. Age and unemployment pensions were
paid out of treasury cash flow.
As for that mining tax. Of course the big mining companies are
going to object. It has
started already. There are warnings that all that investment
(which has
been keeping the GFC away) will vanish. And given that the
electorate swallowed the union sponsored bullshit about work choices, I
expect the masses will follow that mining company storyline too.
All it needs is enough money to buy the whorish (aka professional) AJA
journalists. (well to be fair, only the whores get into print, or
else they are too dumb to understand the economic engine, which is, I
suppose, a charge that could be leveled at any virtuous woman:) )
The media in Australia is showing (or not showing) the colours of it's
petticoats. I invariably choose to read Rupert
Murdoch's
flagship "Australian" newspaper because it has wider coverage of
issues. For electronic media I choose the ABC news and Allan
Jones, who is Australia's version of Rush Limbaugh.
I mentioned Murdoch's involvement with politics and listed media "beat
ups" a few months ago. Since then,
we have had the $14 billion BER (Building for Education Revolution)
scandal, more questions about the $43 billion NBN and the half baked
multi $billion Hospital takeout. What I find quite
interesting is that (something I have recently noticed that
I had not much noticed) the "Sydney Morning Herald" and the
national broadcast network (The ABC) have been all but ignoring the
Ruddite
failures. \
Of course Murdoch would probably benefit from the 100MB NBN in his
delivery of content to IPads etc. I am not so sure I would.
Divide $43 billion by the number of households (say 8 million) and we
get the per connection cost as about $5,500. Just the interest
payments on $5,500 at 10% and not counting amortization, wages
maintenance etc for my internet connection would be about
$45/month. I can't see it (the 100 MB NBN) costing less than
$100/month.
And I suppose we should just tell all those Telstra stockholders, place not your faith in governments, especially in a two party democracy, where the
incoming government does not "own" previous policies. (unless they bring in buckets of money,
like the GST did.)
MURDOCH & I PADS
The Australian today (20th, P6) had an advertisement for I PAD
application that would download the Australian. Some years past I
recommended that micro payments were the way to charge for
content. Let me add a caveat to that original recommendation: do
not over-micro-charge.
I prefer reading print on paper to a computer screen. However I will
not read a screen in preference to print especially if the prices are
similar. Delivery by internet is virtually free, delivery by
print has a significant cost. If I am to use the inferior media,
I expect to benefit in part from that cost saving.
The world will probably end up with one or two or at most three large
content provision organizations. (Examples are WAL-MART,
Microsoft). Microsoft beat Apple BECAUSE it was cheaper.
VHS beat BETA because it was cheaper. WAL-MART beat it's
numberless competitors because it was cheaper.
Another point. The content aggregator Matt Drudge has probably
arrived at the best format for front page. So reduce the number
of advertisements per page to one or two and use Google
technology of directed advertising.
RUDD
Gamblers know it, when you are hot, you're hot. When you're not,
stay at home.
The mining tax is a good idea, although the quantum might need fine
tuning. Ideally a mining royalty should be calculated on a "per
mine" basis. It should be designed to skim the gravy off each
mine, leaving the operator a margin that makes it a competitive
investment when compared to other mines in Australia and around the
world.
Unfortunately the Greek crisis has hit the world in the week following
the Rudd Budget. In the last three days, the Australian Dollar
has dropped more than 10% to $US0.839, and the DOW has dropped 6%
to 10,400. I am not confident that my fellow Australians will
distinguish that fine point when the election happens.
Some content providers are suggesting that Julia's star is
rising. My bet is that Julia would not bite that poisoned apple
for a million dollars in unmarked bills. At the moment the BER is
being blamed on Kevin. It might have escaped your notice, but
Julia is actually the Federal education minister.
Kevin is keeping a very low profile. Apparently he has not been
able to make peace with Rupert.
ISRAEL
Foreign Affairs minister Steven Smith today castigated the opposition
for revealing information provided during a security briefing. Mr
Smith claimed (I paraphrase) "that although the evidence was not
sufficient to prosecute in a court of law, it was the considered
opinion of the security agencies that the falsification of passports
had been done by the Israelis". Mr Smith, I do not find your test
to be strong enough to take any overt public action against the
Israelis whatsoever. I am forced to the conclusion that there
were concealed motives, and await with interest the progress of Mr.
Rudd's application for employment at the UN. Especially since
opposition member Julie Bishop revealed (and then denied) that
Australia had also
been guilty of similar falsification.
Which brings me to another matter, that Israel is reported as having
offered nukes to South Africa some decades past. During my stint
teaching at University circa late 60's, a colleague reported that he
had been to a conference (NATO?) on nuclear technology. He
confided that when the Brits spoke, everyone yawned. The Yanks spoke
and people paid attention. When the Israelis spoke, nobody could
understand what they were talking about.
Based on that slim data, I infer that the Israelis could be the leading
nuclear weapons technologists in the world. If I was asked in
what direction their technology might have moved, one rather obvious
direction would be miniaturization. Perhaps a megaton device as
small as a cigarette packet?
With such weapons, Israel could wipe Iran off the map.
POLITICS IN THE
PUB
I went along to the meeting and heard Julian Burnside (who is a
barrister) discussing refugees.
My own position is let everybody who wants entry to come.
If they have no papers, then properly identify them. Then give
them a visa and let them stay till they want to go. Most of the
people I meet in the street have much the same opinion. If
refugees want to be admitted as citizens, then let them qualify in the
normal way. For instance, get an education in an essential
industry. They do not get the social security safety
net, but provide minimal hostel accommodation. No
reason why they should not be productive members of our society while
they are waiting, so let them leave the hostel and work if they so
desire. If they commit a crime, then deport them.
The meeting was somewhat more critical of government policy. I
got the feeling that they thought anybody who reached our shores should
be given citizenship. They did not like the new Kevin at all, and
disliked Abbott even more. The recommendation for the coming
election was, vote for the Greens into the Senate. The issue of
some Islamic Sheik being deported on the say so of the security
organization (ASIO? ASIS? who cares) was severely criticized.
I did agree that the advice of our security service should be tested in
a court if it is to result in an extradition. I did not however
raise the issue of the expulsion of an Israeli diplomat (see above) on
the advice of our security organization. I note that our foreign
minister has publicly stated "the evidence would not stand up in a
court".
MAIL
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