Category Archives: Economics

Not making it any more

6
by Economics, Environment • Tags: , , , , , , , , , , , , , , ,

Don’t know if you saw the recent tv program on the geological history of Australia. Some early stuff I didn’t know. For example that enormous mass of iron ore in WA was deposited when the first primitive organisms that could generate oxygen began doing so and all the iron in the seas rusted. The iron and other ores around Broken Hill generated in the deep seas which then ran through this part of the continent. Coal and gas of course laid down when the then lush tropical vegetation died and rotted and was buried far underground by sediments. All flukes really, that the deposits occur in Australia, and flukes dependent on conditions that can never be repeated from millions, even billions, of years ago. No more of that stuff being made on this planet.

On top of the land surface Australia had a rich biodiversity of abundant plant and animal life, also the result of millions of years of evolution and ecosystem development. This biodiversity sustained Aboriginal people in considerable comfort for around 50,000 years, and then provided the basis for English colonists to fell timber, graze sheep and cattle on the extensive grasslands, and grow crops where the soils were deep and organically rich. Not building diversity and rich soils any more.

There’s an old, sorta joke, which says “Want to invest in a sure thing? Buy land, they’re not making it any more”. It’s a message that should have been given to every citizen of Australia to use as a reminder that resources are limited. Instead we have behaved for two and a quarter centuries as Australia Unlimited. Big country, plenty of soil, plenty of trees, plenty of mineral resources. Now the crunch is coming, and there are a couple of urgent responses we need to make. We need to ensure that a good proportion of the staggeringly huge profits being made from digging up those made-once-only mineral resources come back to benefit the 21,999,997 of us who are not mining billionaires. That they are used to create a stronger better Australia as a solid home for us when resources start to dwindle or the demand for them disappears. One of the things we could do with it is sort out infrastructure needs as the climate changes – infrastructure like efficient irrigation, like decent efficient transport, like support for large scale renewable energy projects. And support for individuals in education, health, aged care and so on. The recent budget, trying to balance all those needs, pulling up the blanket to cover the head only to expose the toes, is a classic example of failure to use the mining resources wisely.

And the other response is to stop destroying remaining forests and to start restoring soils to good health. Not least because we need the environment as healthy as it can be to meet the changing climate.

What’s that other saying? Oh yes,”A stitch in time saves nine. Time we started urgent stitching.

A voter who uses his money as votes

7
by Economics, politics • Tags: , ,

Here’s an idea. How about citizens can have multiple votes, the number determined by their wealth? Billionaire mining magnates like Palmer and Rinehart get the minimum one vote each, “ordinary working families” get, say, 100 for each family member; single mothers in housing estates get 1000; refugees get 2,000, and everybody else is somewhere in between. There, that should concentrate the minds of politicians wonderfully eh?

Oh, and poor old Clive and Gina? Well, they would still have the option of buying television networks or full page ads in newspapers. If they could see a message that would get across.

Might need a bit of tinkering and fine tuning, a bit of adjustment of precise numbers of votes per individual, but generally speaking I think it would have to be a considerable improvement on the present arrangement which is effectively the reverse.

Oh and a gentle reminder:
If you would like to see your favourite blog recognised in the big wide world of the Best Blogs 2012, voting for the People’s Choice Award is still open (just)!
You can vote here. Just click on the button on the right (then go alphabetically to find THE Watermelon Blog, ie under T not W). Voting will close Wednesday 9 May at 5.00 pm. All winners will be announced on Thursday 10 May at 10.00 am by the Sydney Writers Centre. Come on now, pretty please?

PS The title, rather cheekily comes from a somewhat different, and reverse, context- Paul Samuelson 1970:

The consumer, so it is said, is the king … each is a voter who uses his money as votes to get the things done that he wants done.

The kindness of strangers

16
by Economics, politics • Tags: , , ,

Rain rain rain and more rain recently. Records set all over the place yet again, but shoosh, don’t mention climate change.

Not what I wanted to talk about here though. Was following bulletins anxiously during the worst of it, checking road closures and the like as family members were travelling. And seeing interviews from SES volunteers about how many call outs they had attended and so on. What would we do without them? I’m OK, up on a hill, but many people weren’t. Trees through roofs, needing tarps; houses and shops needing sandbags; cars off roads; rescues here, rescues there, rescues everywhere. It’s hard, tiring, dirty, often dangerous work, called out at any time of day or night, and, given the nature of the work, called out in atrocious weather. And the people in the yellow uniforms are volunteers, doing it for love of community, the kindness of strangers.

It has thankfully been another quiet Summer for the bush fire brigades around here. But they stay alert, keep the trucks ready, maintain the hoses, practice the drills, raise funds, inform the public. Making sure they are ready for the return of El Nino and a hot dry Summer. Then they will be as busy as the SES in a storm. Volunteers of course, bush fire brigades, on alert day and night through the Summer, and even in winter for road accidents and other fires.

A little while ago our village got a defibrillator (this is a subject close to my own heart), and with it a small group of locals volunteered to have training in its use and be available to use it in an emergency. Many people in our community have done first aid training, some even join St John’s Ambulance to provide more formal first aid services for sporting and community events. On a slightly different but related path are the Meals on Wheels volunteers.

We are used to community volunteers doing all kinds of work around schools, young people, scouts and guides, helping the elderly, Cleaning up Australia, running community festivals and shows and fetes and cake stalls. In fact society couldn’t function very well without our unpaid volunteers, supported as much as possible by government.

Next time you hear a conservative muttering about how human society is red in tooth and claw, no such thing as free lunch, everything must have a profit motive otherwise it won’t work, remember that they have obviously never been caught in fire or flood, had a heart attack miles from hospital, or been involved in community activities.

But be kind to them, as you are to any stranger.

Open for business

2
by Economics, Environment • Tags: , , , , , , , , , ,

NSW govt approving uranium exploration; Qld opposition to dump Wild Rivers legislation; Victoria trying to get cattle into high country; South Australia downgrades renewable energy; Tasmania demanding to continue forest destruction; NT wanting crocodile “hunting”; WA prescribed burning big areas of forest. CSG, seal culling, duck shooting, flying fox culling, wood chipping, land clearing, estuary dredging, salmon “farming”, blocking wind farms.

What do all these things have in common? Activities by state governments, Labor and Liberal, that have, or will, cause enormous damage to their respective states. Nothing much in common, these state premiers, not much similarity between the different states, but time after time, often within days of winning an election, away they go with an announcement welcoming some destructive program. Usually with the identical words “We are open for business”, as if they have just set up a used car yard.

Something else one of the premiers and a soon-to-be-premier have in common is the bright idea of adding the “cost of the carbon tax” to electricity bills. See, this is clever because this will make people hate Labor when they see this extra cost go on the bills. But, hey, guys, you gonna do that, we need a bit of balance. You must also add to the bills the increasing CO2 levels, the rising temperature levels, the cost of lost production as a result of droughts and floods and storms. What’s that, those costs would greatly exceed the few dollars from a carbon price? Good heavens, really, hadn’t thought of that. You know, I understood that the costs of years of infrastructure neglect and privatisation of power companies had added far more to the bills than carbon price, but hadn’t thought about the costs of climate change. Don’t suppose you guys had either, eh?

Same with “open for business”. It’s always billions to be made here, and thousands of jobs over there, and export markets and infrastructure, oh, and did I mention billions of dollars? All put on the plus side of the public ledger, trumpeted by the media. But what they don’t add, to balance the ledger, is the ultimate costs to the state of cleared land, polluted ocean, dried up rivers, lost biodiversity, extinction of species, air pollution. Nor even of more direct costs in poor human health, imbalance of the economy, infrastructure costs, depletion of resources. Pretty nasty business all of it.

So, state premiers, you want to play businessman “running a state like a business”? Good, go for it. But remember real businessmen, and businesswomen, prepare real balance sheets for the balance as a whole. And when costs outweigh profits it’s time to reconsider.

Quite a lot of cost being imposed on states these days. And largely illusory profits.

Back to Methuselah

8
by Economics, politics • Tags: , , , , , , , , ,

Bit of serendipity other day. As I was planning this post I was taken to task by a right wing tweeter unhappy, for some reason, that I had repeated the obvious truism that conservatives are much dumber than progressives. Progressivism, in fact, has an intelligence bias. Anyway, left him to his own world after a while, and sharpened up my intentions for this post.

Morning of 6 June 1968 in Australia, and the news was filtering in, few details, that Robert Kennedy had been shot while campaigning in California for the nomination as Democratic candidate for President (in one of those lovely historical quirks to face off, as it would transpire, against Richard Nixon, just as his brother had done 8 years earlier). So there we were having morning coffee in the tearoom at the university feeling sombre about the news, when in bounced my American academic room mate happily singing the words “Bobby Kennedy’s a vegetable, Bobby Kennedy’s a vegetable”. So demonstrating that (1) even California girls can be conservative (2) that university students can be conservative and (3) that there was a strain of Kennedy family hatred running deep among many Americans in 1968.

I always liked Bobby Kennedy. Saw him, I suppose, as a chance to restart the JFK promise cut short by that bastard in Dallas. And even more so. RFK seemed brighter than his brother and in the 5 years since his loss had come a long way on civil rights and the war. But the right were having none of that, and another bastard shot him, and then it was back to the mediocrity of Humphrey versus Nixon, the old firm back in town.

Said some good things, RFK, in those few brief years. One of the best known was “There are those that look at things the way they are, and ask why? I dream of things that never were, and ask why not?” This was a paraphrased (and improved) quote from GB Shaw Back to Methuselah “You see things; and you say, ‘Why?’ But I dream things that never were; and I say, ‘Why not?’” It’s one of those “two kinds of people in the world” dichotomies, and when I was thinking about the difference between conservatives and progressives it came back to me. Kennedy and Shaw are not quite right for this use for modern times, in fact have almost reversed in meaning.

Progressives look at the world, get the facts on how it is, and ask “Why is that the situation?”, “What do we do about that?”, “How do we solve that?” They live in a fact-based world where problems are identified, analysed, responded to in a real way. Conservatives have no interest in the actual world. One will say “I want to do that” and the other will say “Why not?” and that will settle the issue. Or to put it another way, conservatives have a rigid ideology to which they are determined to make the world conform. With violence if necessary. Or even if not necessary – to hell with it, good money to be made out of wars. They have no interest in looking around and finding out what the world is actually like, they know what it is like, exactly, none of that wishy washy progressive doubt sort of stuff. No need for any of that scientific research and analysis crap either. Just decision-making, that’s all that’s needed. If someone says can we clear this forest for development a conservative says “why not?” Conservatives can have a forest cleared while an ecologist is still putting on his work trousers. A factory owner asks “hey, is it really safe to keep pumping all this CO2 into the air?” A conservative says “why not? who’s ever going to notice?” A businessman says “Hey, why not cut my taxes even more?” A conservative says “why not indeed? Best if you paid no tax really. After all your wealth will trickle down to the undeserving poor eventually”. A billionaire says “Health care? For the poor? Why if you have to ask how much it is you can’t afford it.” A Libertarian says “Why not get rid of all regulation now?” A conservative says “D’Oh!”

And meanwhile the progressives are asking “Why is the planet warming? Why is the wealth gap increasing? Why are poor people still starving? Why are species rapidly going extinct? Why are buildings collapsing? Why are children still dying?” Trying to find out. Trying to do something about it.

Thing is, just between you and me, the answers to the Progressive’s questions are the results of the answers to the Conservative’s questions. Been the case since Methuselah’s time.

You know why.

Factory floored

5
by Economics, Education • Tags: , , , ,

Had a meal in a cafe the other day in a big city not a million miles away. Very poor, almost inedible. These days I’m pleased when I find a good meal. Often the meals seem prepared with little care or attention, using frozen or preserved ingredients, precooked and then reheated in microwave, and so on.

So I prefer eating at home usually, but this is no longer the certainty it once was. Nothing to do with the cooking of course, he adds hastily, avoiding repercussions, but more to do with ingredients.

Don’t know if you have seen a television program called “Jimmy’s Food Factory”. The chap tries to recreate the processes by which food is converted from what occurs naturally on the farm to what you find packaged for sale in shops and supermarkets.

It is one of those programs that tell you far more than you wanted to know for your own peace of mind. He minces things up, steams them, reduces to grey sludge, adds chemicals for colour and taste, reconstitutes in new form, dries, freezes, fires out of cannon, packages, adds a misleading name (a “custard” biscuit for example having no custard of any kind), finished.

The result bears little resemblance to the original but is in a convenient shape and form that can be shipped readily, and will last for a thousand years on a shelf. There are “foods” that you can never look at the same way again after seeing this program – I was floored by a lot of it. If you haven’t seen it I’m afraid it’s not a case of what you don’t know won’t hurt you.

On top of that is the way that there is increasing misleading labelling, of the origin of foods from, say, China or South America, shipped to New Zealand and relabelled, or with labels here that confuse with misdirections involved in various permutations of “Australian made”. Before you know where you are, like watching a magician with hat and rabbit, you have little idea about where the food came from, how old it is, what additives it may have, and so on.

What can we do about it? Not much, probably, we are locked in to factory farming, factory food processing, mass transport over long distances, factory selling in the supermarkets. The people along the chain, after the stuff leaves the farm gate, all make more money the cheaper the food can be processed and the longer it can be sold for. We gain in the convenience of marching into a supermarket, at any time of day, any time of year, and reaching for a packet of something or other which is invariably there.

But having your stomach process factory food probably isn’t the best for you. Increasingly we try to grow some of our own foods, shop at farmer’s markets. Maybe if enough of us do that the stuff we eat won’t turn our stomachs quite so much.

Worth a try.

La même chose

9
by Economics, politics • Tags: , , , , , , , ,

It’s one of those historic events that still, 630 years on, resonate with modern times and make your blood run cold.

In 1381 the so-called “Peasant’s Revolt” led by Wat Tyler massed tens of thousands of poor people protesting the new “Poll Tax” which, like our GST, made poor people pay as much tax as rich people. And against the essentially slavery conditions many of them worked under.

Richard II, then just a teenager, agreed in one meeting to a number of things the protesters wanted. Then in a second meeting the Mayor of London treacherously stabbed Wat Tyler during further negotiations. Tyler rode off, the king led the others into a trap and they were then dispersed. Tyler was dragged out of hospital and beheaded.

Then as Peter Ackroyd* recounts “A few days later Richard revoked the charter of emancipation [freedom of slaves, fair rent for land, punishment of the poll tax gatherers] he had granted to the crowd at Mile End, on the ground that it had been extorted from him by violence. He travelled to Essex in order to observe the aftermath of the now extinguished revolt. A group of villagers there asked him to remain faithful to the pledges he had made them a few days before.

His reply was:

“You wretches are detestable both on land and on sea. You seek equality with the lords, but you are unworthy to live. Give this message to your fellows: rustics you are, and rustics you will always be. You will remain in bondage, not as before, but incomparably harsher. For as long as we live we will strive to suppress you, and your misery will be an example to prosperity.”


A few months later “A parliament was called … where it was proposed that the state of bondage known as villeinage should be abolished.The Lords and Commons, their vital interests as landlords at stake, unanimously voted against any such action.” The leaders of the rebels were rounded up and beheaded (John Ball, as a major leader with Tyler, being hung drawn and quartered).

So a sad story. Just one of many attempts all over the world, through the centuries, to improve the lot of ordinary people, which has been met with brutal repression. And what struck me, reading the king’s words again, was that they could be used, unchanged, by billionaires and corporate leaders around the world today. And by their political front men (and women – not hard to imagine Thatcher making such a speech to the coal miners for example). The power relationships, and attitudes, in spite of centuries of “democratic advance”, remain unchanged in 2012, as seen in the Republican front-runners, the Cameron UK Government, the Australian Opposition.

* Peter Ackroyd 2011 “The History of England vol 1 Foundation” Macmillan, London

Counting out his money

9
by Economics, Media, politics • Tags: , , , , , , , , , , , , ,

What slogan is above the door of the free marketeer’s think tanks? No, it’s not “Abandon hope all ye who enter here”, you naughty people. It’s “Government small enough to drown in a bathtub”.

These people believe that “government” should leave banks and financial institutions alone, get rid of regulation, has no business in business, as it were, should “get out of the way” of private enterprise, and so on. Any suggestion that the “government” should do something about CEO salaries, risky investments, fees, interest rates, is met with the outrage usually reserved for apostates from a religion. And the outrage in turn is largely met with acquiescence by the media, themselves determined not to be regulated in any way. Faced with the unanimity of “think tanks”, media, and of course the financial institutions themselves, politicians from both “sides” have quickly jumped in to say “oh my goodness gracious me heavens to betsy why no of COURSE we wouldn’t want to regulate banks etc. Reckon we are socialists or something?”

So let’s think about this for a moment. Twenty two million Australians elect several hundred people from among their number to represent their interests. Each one has gained the confidence of tens of thousands (in the case of Senators hundreds of thousands) of people. And yet, these people, combining to form a “government”, are told, by a handful of people with a bizarre ideology, that they must not attempt to have any control over the organisations that not only serve the financial needs of the 22 million, but through their activities fundamentally control the economy of the nation.

That is forget the word “government” as used pejoratively by this little band of reverse Sherwood Foresters, instead say to yourself – these financial bodies are supposed to have no oversight by we, the people of Australia? Really? How did that come to be a thing?

Well it came to be a thing because the banks and the think tanks kept saying it, and a lie repeated often enough becomes the truth for all practical purposes these days.

Look, money isn’t a get out of jail free card. Oh, sorry, yes it is of course. Let’s start again.

Just because your major activity, your role in society, involves money, doesn’t mean you can do what you like. I mean, banks aren’t churches, are they?

In almost all other major kinds of activities in our society we, as a people, through our government, decide how we want those things to work. If you are in medicine, teaching, building roads, serving food, police, flying planes, and all the rest, you work within structures, within limits, for the good of society.

Once upon a time only the church was, as they say, a law unto itself. the reason was obvious, they had you over a barrel, in an explicit, and exquisite form of blackmail – try to rein us in and we will damn your soul to eternal hell, no white robes, harps, bunches of grapes or virgins for you. So they were left alone and for centuries did very nicely thank you. Still do pretty nicely actually with tax exemptions, and ability to make their own laws, and avoidance of laws on discrimination, and largely a freedom from discrimination. Nice work if you can get it and they got it.

And then a second group achieved a similar status floating above and beyond ordinary mortals – the media. Achieved in the same way – hey, try to control us, even look sideways at us, and we will hack our phone, have you on the front page of a fish and chip wrapper; or running the perp walk between serried ranks of cameras and blonds with microphones as weapons, outside your own front door every morning. Wouldn’t like that would you mr politician, we know where you live, and we know where your children go to school, oh, and we have a copy of that ill-advised video you and your wife made on holiday in Bali. Any questions? Right then, piss off and leave us alone.

And now the third of this unholy triumvirate. The blackmailing style the same, the weapons slightly different. Not being poked by imps with red hot pokers for eternity, or junior reporters with red hot microphones, but worse, much worse, blackmailed by the guys, and gals, with the keys to the treasure chest. You want us to do what? Cut CEO salary from $20million to $19million, pass on interest rate savings to home buyers, lend more to small business, reduce fees on breathing while in bank, stop playing risky games with dodgy financial brothers? Right, we’re out of here, got a place to go to in Panama, Liberia, Burma, Zimbabwe, no nonsense about regulation there, few dollars to the country’s president and you can do what you like. See ya.

No wonder solidarity from the media, playing similar games. No wonder support from libertarians who mistake a license to print money for a statement about human freedom. No wonder that other industries, seeing the way these groups have got away with murder as effectively as Al Capone, are adopting the same tactics. MIners, clubs, supermarkets, manufacturers have all been at it, when faced with royalty payments, or regulation of problem gamblers, or food labelling.

So time we the people told our representatives we want the bluff called. Want banks behaving responsibly before we count to ten. Nine, ten, knockout. And the blackmail? To hell with it. Do you really think a rich country with 22 million people can’t develop new community banks if the others pick up their notes and coins and go home? Some genuine competition from groups prepared to work with community for a modest return rather than against it for greed would quickly emerge. Competition, you see, remember that quaint concept? Bit old-fashioned, but then I’m just an old fashioned guy with an old-fashioned idea about millionaires.

And with that victory under the belt the government could then tackle the media, and then, gulp, the church. Let’s move from the 14th to the 21st century in one giant leap. And put the fear of god into these other wannabe blackmailers while we are at it.

Oh, and that sound you hear? Tents being folded in the night as the freemarket think-tankers, no longer a job to do blocking regulation here and no money to be earned from doing so, head for Zimbabwe and freedom.

For mine

4
by Economics, Environment • Tags: , , , , , ,

I once nearly bought a small farm in what had been a minor gold-mining area in the nineteenth century. The miners had dug deep but narrow pits, presumably found a grain or two of gold, stopped digging because they were too deep, and then moved to the next spot and dug a new hole. When even the grains of gold ran out they abandoned the field – leaving all their holes. One hundred and fifty years later the holes were still there, hidden by weeds or shrubs, forming natural pit traps. Most had animal bones in the bottom. I didn’t buy, picturing my animals, or visitors, or indeed myself, pitching down a hole one day and breaking necks. The lethal leftovers from a mining operation of which nothing was required except counting the gold nuggets.

Asbestos mines didn’t always leave holes in the ground but did leave spoil heaps of asbestos waste, uncovered, untreated in any way. Children once played on the asbestos piles as they do today in India with little environmental concern as they picked up ticking cellular time bombs. Years later those children and their parents began dying of a horrible lung cancer when those bombs went off.

“Making good” after mining seems to be a thing of the past. Mining for coal, iron ore, and silver lead zinc all leave both dirty big holes on the ground, old spoil heaps, and toxic dust blowing everywhere, including on to schoolchildren’s playgrounds and lunches. Coal mining now pushes under river beds with bad results, and the new coal seam gas drilling and “fracking” pollutes soil and rivers and water tables in rich farm land. In Japan mothers take geiger counters to the shops to try to find vegetables that are not radioactive after the Fukushima nuclear accident, and the mining of uranium back in Australia frequently causes concern about pollution of land and water. Apparently oblivious to such concerns the government has just announced more uranium mining and sales to India in addition to the other export markets.

All mining leaves some sort of toxic time bombs (perhaps even actual ones in the case of uranium) and we need to stop being so blase about it. Does anyone really need to be told twice that CSG drilling in prime farming land is a suicidal process for our future well-being?

And CSG coal mining leave another toxic legacy. Not quite so obvious, being colourless and odourless (though not weightless). Carbon dioxide, as we all now know, is heating this planet up at a frightening rate.

Digging stuff up faster and faster that pollutes farming land and changes the climate for the worse?

Think we are in a hole and digging deeper.

Message in a bottle

13
by Economics • Tags: , , , ,

News the other day of research showing that childhood allergies to foods (for example peanuts) has massively increased in last few years. Worrying not only because can result in death in severe untreated reactions, but because of the debilitating effect on the children themselves and the families (and schools) trying to cope with it. A medical researcher in Perth is trying to establish causes and look at treatments. She very wisely said that there is unlikely to be a simple reason, more likely to be a combination of reasons. But the rapid increase suggests to me two likely culprits.

Once upon a time (he says, revealing his age once more) foods were, well, foods. Lists of ingredients, if even bothered with, would be stuff like tomatoes, cereal, lean meat, and the like. Nowadays it seems every food item not in the fresh food section of a supermarket comes with a list of “ingredients” in their dozens, none of them seem to be actual food, and all of them are carefully disguised by having numbers not names. Oh you can look up the numbers, in secret code books, but the names are no more revealing than the numbers. What we do know is that many such ingredients are either known to be, or thought to be, damaging to health, especially children’s health. We are surely way past time when the known damaging chemicals are removed, and the merely suspect ones are clearly labelled and warned about in big letters on the front of the packets and jars. Manufacturers have been fighting against such labelling for years, but surely they would agree with me that the health of the community is a bit more important than a slight dip in their profits for a year or two?

Once upon a time foods came bottled in glass or wrapped in paper. Now such packaging is the stuff of museum displays where old fogeys like me can point and say “we used to have those”, and everything you buy is contained in some kind of plastic. Some plastics (eg BPA) are already known to cause problems by being leached into drinks. There are certain to be others in which health effects are difficult to recognise or slower to develop. It is one of those areas where we should not do things until they can be demonstrated safe, rather than keep using them until harm can be demonstrated. I am also concerned about the massive increase in chemicals in everyday life as a result of the use of plastics etc in building materials and furnishings and toys, but when it comes to food the threat is direct and obvious.

OK, those are two areas where there has been a massive change in food since I was a child, and I am willing to bet you a plastic bottle of red fizzy drink that both will be implicated in the assault on children’s immune systems that has been happening. What do you think?