The election thread - Two middle-late aged white men trying to be blokey and convincing..., same old shit, FFS.

[wombat]

^^^ Agree with Rider of Fast. If we are talking about GLOBAL warming and a GLOBAL solution, you need GLOBAL action.

So what, we have to wait for some magical 'Earth Government' to be formed, so we can act on a global scale?

 

[scooter]

The only thing I can hope for the future is that the greens don't gain any more power or credibility. If that every happens this country will be truly screwed

And your evidence for this is:
(A) Tony Abbott says so
(B) some rightwing nutbag on the internet who said their policies were to give heroin to schoolkids and force everyone to have gay abortions
(C) Andrew Bolt says so

FYI, India has a carbon tax and China is planning one. But hey, don't let the facts get in the way of that barrow you're trying to push.

 

['Ross]

So what, we have to wait for some magical 'Earth Government' to be formed, so we can act on a global scale?

We already tried, it was called Copenhagen and it failed miserably. If we can act on a global scale I say go for it, but I have not heard one credible plan of how to do so yet...just pipe dreams and wishful thinking.

And your evidence for this is:
(A) Tony Abbott says so
(B) some rightwing nutbag on the internet who said their policies were to give heroin to schoolkids and force everyone to have gay abortions
(C) Andrew Bolt says so
FYI, India has a carbon tax and China is planning one. But hey, don't let the facts get in the way of that barrow you're trying to push.

Nope my evidence is from the Greens themselves, I am not a fan of Abbott or Bolt, in fact I would like the Greens real opinions to get more air time so that people can actually wake up to themselves. The greens are in a very sweet position as the credible alternative, they like to remain hard on ideologies but very vague on details, I think give them a bit of power they probably wouldn't even know what to do with it.

From the horses mouth:
Shut down the entire coal industry (sure sounds nice but our economy kinda relies on it and there are a few people employed by it)
Get rid of all livestock in Australia because they fart too much (and all go vegetarian while we are at it)
Reduce our emissions by 50% (still no word on how, but its nice to dream)
Ban live exports of cattle immediately (Yes this is a good long term goal imo, but current situation you have a lot of livelihoods at stake and its going to take a lot of new infrastructure here and abroad before you can start winding it down)

I would like to mention their immigration policy but once again you get strong ideals mixed with completely convoluted detail. I think one can assumed taxpayer $$$$$ is a big part of it.

The green economy sounds nice, and more jobs for Australians ticks some boxes, but any rational thinking person would realise it aint gonna happen and we probably won't ever see detail on how they plan to achieve these lofty goals.

 

['Ross]

EDIT: It may seem like I forgot to mention India and China, but come on now that's really too easy for me to pick apart.

 

[liamo]

EDIT: It may seem like I forgot to mention India and China, but come on now that's really too easy for me to pick apart.

At least 9 countries and some US/Canadian states/provinces have some form of carbon tax

Two that seem relevant: Finland and Norway both have very strong resource industries and a carbon tax.

We are not 'going it alone' while the rest of the world does nothing.

 

[wombat]

We already tried, it was called Copenhagen and it failed miserably. If we can act on a global scale I say go for it, but I have not heard one credible plan of how to do so yet...just pipe dreams and wishful thinking.

Pfft, Copenhagen was a non-binding show of intention at best.
The whole 'it's a global problem, it needs a global solution' (in this context) is a self defeating argument. We don't have a global governance system capable of tackling a problem like this on a straight-out global basis. The only way you will get a global solution is to have all the parties that make up the global whole move forward.

 

['Ross]

And it absolutely shouldn't be due to some kind of system of governance or imposition. If you do want change or action it has to be proactive not forced, and this is why I laugh at the current government, everything feels so forced and un-natural, Julia and me go wayback and I know when she isn't keen on something, the notion of helping the environment but the everyday Aussie battler comes out better off financially? It aims to do nothing except create positive PR for the government (they hope) I think hypothetically if there was such a system the decision would be to take no action at all until certain economies become more stable (this is not my personal view and kinda links back to my Copenhagen reference)

I agree with what you say, it is just my feeling that the majority of the world does not want to 'move forward' on the issue at present (even though they may claim so, making announcements and setting targets) and regardless a carbon tax will do a very miniscule amount in the quest for forward movement....it only threatens to push up prices and hurt the economy (slightly I feel, it won't ever get out of control)

The notion of 'at least we are doing something...better than nothing' is weak in my opinion, do something worthwile and you will get my support. A lot of people share this view but get labelled as capitalist fat cats or right wing Nazi's, its just a simple principle that I live by in most instances. Its very interesting how this issue seems to be so polarising even though it actually isn't. I don't think many people are calling for an end to electricity neither are there many pretending mankind hasn't impacted on this planet (Barnaby maybe, but he makes me laugh at least)


I will leave this discussion with one further point-hopefully 77 will like it..............taxes, trading schemes, prices on carbon etc they all aim to serve one purpose- By raising prices on the things we have identified as 'bad' progressively we will be forced to create 'better' options, alternatives, technologies because you have made the 'bad' things unsustainable price wise. That's pretty much it right?
I riddle you this: Who is going to come up with the better? I reckon the most likely companies to create the new technologies are those being most heavily taxed (Abbott did touch on this lightly please don't think I'm a fanboy). Even though we label these companies as evil planet rapers, they will be the only ones actually working on a viable alternative because they know it is the future for their business. A small backyard project idea is not going to sweep the world, the companies with the infrastructure, the employees, the money for R&D and the commitment (yes I think its there to a degree) are the only ones capable of creating the 'better'. These pricing schemes stifle the innovation and productivity of the companies trying to create the 'better' solutions and in tern produce a stagnant environment.
If you were to absolutely tax the crap out of them to the point of no return you might be able to kickstart some of these initiatives (the goal of tax supporters) but we all know that won't happen because it has massive implications on the cost of living, economy, and you would want a lot more countries on board to have a good crack at it.

Summary: Small tax-Annoying waste of time. Big Tax- Has hypothetical potential but can't imagine it ever happening to a degree that would make it effective. Solution- Calm down put focus on world poverty/human rights.

 

[seventyseven]

Where is that face-palm emoticons we requested?

Your comparison between humanities degrees and engineering degrees with respect to employment is completely flawed. One course qualifies you for a type of job, the other does not.and what's that got to do with anything? it could qualify you as a professional accredited cactus surgeon, it wouldn't make a lick of difference if there wasn't any demand for cactus surgeons.

Also, your valuation of an industry purely based on GDP or export earnings, does not reflect it's complete value to the Australian taxpayer.actually, it does. it's all about efficiency - if the industry was economical, then it would be profitable and wouldn't need any "assistance". that's all there is to it.

I would expect people with an "econ" education to not look at this data so simplistically.i would expect someone who hasn't a clue what they're talking about to make a statement like that.

and so it begins!

 

[seventyseven]

If this government wants to show any signs of credibility, surely it has to go to the polls?

So far I think a pack of chimps could govern us better.

Can anyone name ONE good thing they have done for us since (the king) Howard was de-throned?

I mean, how stupid does the labor/greens/independents think Australians are? (clearly very...)

AN ELECTION IN 2011 WOULD SEE THE END OF THIS MESS!

howard had some absolutly awful policies (albeit some good ones too). the baby bonus/trying to increase the population (and lower its age) and the first home buyers grant are standouts.

Just a second, you're from Tasmania?

For every taxed dollar on the mainland, Tassie gets $1.60... Tasmania is likened to Australia's version of Europe's Greece (in economic terms).

It's the hippy hoo-haa, tree hugging, union mungering fools that run the Tasmania government who can be to blame. Tas is never going to get ahead with the mainland, the need some free-thinking capitalist minds to dig them out of the ditch. No wonder it's Australia's largest retirement village.

Disclaimer: I have close family living in Launceston, so I have nothing against Tasmanians, just the idiotic labor/greens/independents mob (they're all the same) ---> Let's call them the economic stiflers.

not quite sure what you mean for every taxed dollar on the mainland tassie gets $1.60, that would mean the governments debt went up by 60% each year? do you mean tassie gets back 160% of the tax money it pays? i'd really love your source on that data (no, that's not me challenging you. i'm genuinely interested).

but yes it's a shithole. i was recently talking to a chick who has been a teacher for a few years and i believe that statistically at least, tasmanias education (yr12 rates or whatever it was) is some 50 years behind the rest of the country.

You start out by ranting about how the manufacturing sector is heavily supported and kind of implying that you believe this is because of the presence of unions, but are happy to ignore the extensive support and subsidies for primary producers such as, for instance, the diesel fuel excise... i don't deny that at all. if you look at many other sectors or industries the exact same story as manufacturing is true. i simply singled out manufacturing.

Then you make some generalised rant about humanities students. Even better you effectively claim that engineering would be the best field to get into, unfortunately due to your enlightened economically informed policies, we'd have no manufacturing sector anymore, so with your new engineering degree you'd be shit out of luck.because every engineering grad is employed in manufacturing?

Okay, so if you were running the country we'd have no uni positions in the humanities and no manufacturing sector... What other policy gems come from your economics viewpoint? It's amusing thus far. ah and now for the condescention! my general gist would be raise interest rates, raise bank reserves, privatise stuff.

Rider of Fast, Julia has no less credibility than Abbott. If you want to pony up the dollars (instead of the taxpayer paying for it) to run an extra election then go for it. People got asked to choose, they voted and the result was close. Julia was able to form a government, Abbott couldn't. Suck it up, same as people had to when Howard got in even though he had less than 50% the vote. It's the way our system works and unless you can get a referendum bill up so we change the system, stop bitching!

i'm going to have to split these ones up for sc black:

Nah mate its up to a finance professional to call your cutting and pasting what it is: Your cutting and pasting is drivel.

You are a student. Its nice that you are enthusiastic. Its nice that you have the spare time to find all the "terrific" press releases or "studies" or whatever the hell it is that you continually cut and paste to formulate your supposed "arguments".

cut & paste huh? and if i told you this was all my original stuff? and what studies are you referencing? i'd also like to know why you consider this drivel - please tell us your opinions on the matter.

seventy seven I have the equivalent of three economics degrees, and work at the highest level in the finance/accounting field. Managing to grasp the concepts that your textbooks spout does not give you ANY moral or intellectual advantage over ANYBODY. Just because Milton Keynes has proposed a theory and argued its practicable basis upon some research does not mean it is gospel.

milton keynes?

none of this stuff is from a textbook. i'm a proponent of the austrian theory. so far i haven't posted ANYTHING from an economic textbook. try again.

Economics is a social science, and therefore has no basis on hard fact. It is only INTERPRETATION in the eyes of the researcher. The sooner you learn that fact and that economics is only a set of theories which may be useful to predict human behaviour framed in the format of statistics the sooner you will earn some respect on this site. As it is, you randomly spout some textbook theories supported by various cut and pasting. Your analysis of any topic is ZERO. You really need to start understanding the quote in your sig. From my perspective, you are quoting yourself there.

textbook theories? which ones? and what cut & pasting?

nice of you to rant on about "the sooner you learn blah blah blah" like a sanctimonious tool too, i actually happen to agree with you.

Sorry if I seem to be coming on harshly here. But you must realise, just because you study economics, does not give you ANY intellectual superiority over anyone. And having cut and pasted stuff does not make you "educated". Getting a degree just means you managed to pass a set number of exams. It does not mean you have any understanding of the topic per se.

again with the cut & paste? i also consider an econ degree to be an exercise in bullshit. perhaps you should save your rant for someone that doesn't already agree with you? and who said anything about being a student? and you really don't consider people to be more knowledgable on a subject to have intellectual superiority over those who know nothing about it? i gather you consider yourself to be as much of an authority on physics as einstein then?

and please don't make the (also false) assumption that you know a thing about me either.

Don't try to denigrate people from your dubious position as a "student".

but if i got 3 degrees and worked as a finance professional it would be ok right? and, again with the thinking you know me.

can i make a guess here: your 3 degrees are in keynesian/mainstream drivel, you know they're bullshit, you're of the false assumption that mine is too and therefore have concluded that i'm spouting the same crap you (and i) know to be crap?

i'm of the opinion that with the exception of about half of the micreconomic side of things, mainstream econ is a complete farce. your thoughts on the matter are?

so far you've done nothing but say "i think you are a student of mainstream econ, that thinks he knows everything because he thinks he knows about econ... and doesn't. however i have 3 degrees so i DO know everything about econ, and work doing stuff in finance so must know even further, and you are completely wrong.. but, i'm not going to tell you why or what the right answer is, you just have to accept what i am saying because i claim to know about econ, but you can't expect anyone else to accept what you are saying when the roles are reversed". did that just about sum it up?

seriously. give us your thoughts on the matter(s).

 

[liamo]

cut & paste huh? and if i told you this was all my original stuff? and what studies are you referencing?

I'd call BS. You cut and pasted from the Graduate Careers website without referenece. You quoted from a federal Govt industry report without reference.

You have some original stuff in your posts but it is definitely not all original.

Don't get defensive over the indefensible

 

[seventyseven]

I'd call BS. You cut and pasted from the Graduate Careers website without referenece. You quoted from a federal Govt industry report without reference.

You have some original stuff in your posts but it is definitely not all original.

Don't get defensive over the indefensible

no i didn't. i've missed listing the source for the images from graduate careers, a genuine oversight on my behalf. will go back and fix that now.

as for the manufacturing sector report, that's even listed straight after the data ffs...

 

[liamo]

no i didn't. i've missed listing the source for the images from graduate careers, a genuine oversight on my behalf. will go back and fix that now.

as for the manufacturing sector report, that's even listed straight after the data ffs...

My apologies. A genuine error on my part, I was paying too much attention to the Tour coverage.

It was difficult to decipher what was your commentary and what was cut and pasted. You used different referencing styles in the same posts; sometimes quoted to appear in a quote box, sometimes with "", sometimes no real differentiation between your comments and something that was cut and pasted.

I don't really have an argument to rebut your posts re: 'mainstream' economics being a farce. You've made the statement but I don't understand what makes you believe this. As Scblack says, it's a social science that has a lot of assumptions and generalisations but that means it's not perfect and has certain limitations, not that it's irrelevant or inaccurate in most situations.

And why on earth, if you believe Australia is still in recession would you wish to increase interest rates?

 

[FR Drew]

Seventy Seven,

Maybe scblack just feels like you come across as not terribly coherent and a bit aggressive? He holds pretty conservative views politically re business and finance policy and dislikes Julia/Rudd and co as much as the next person, so if he's got the shits with what you're spouting maybe the problem is you, not him?

re your initial thesis since the reboot of this thread, I'll take your responses to my posting:

The barely coherent manufacturing rant: So you think no industry should be subsidised? Only mining and agriculture? Only ones that have never had any union involvement? What exactly was your point?
There were 3 screens worth of stats and beyond saying that we subsidise manufacturing, I still don't understand exactly what you were trying to say.

If I take it to mean that we should have no manufacturing support, that's an intersting point of view policy wise... Lets take the motor industry, you've just effectively killed off Holdens in Australia, plus Monroe who make shock absorbers... I'm pretty sure that we make windscreens here, and we definitely make mag wheels. Quite a few businesses support the Australian motor industry.
Did you see what happened in Newcastle when 1500 jobs at BHP were lost? It flatlined the city for half a decade at least through flow on losses of jobs to support industries and goods and services suppliers. How many jobs are you proposing to lose by removing industry support to the manufacturing sector? Not just those directly employed, all the flow on related industries as well...

Was this a complaint against Labor Policy, just a misguided dig at unions, or part of your "original stuff"?

On to your university study thesis...

Given that more humanities students go on to further study (like masters and PhD studies) maybe you should compare their salaries to the folks who just got their engineering bachelor degree? How what proportion of engineers go on to a higher level qualification? I'd add to that that many fields are not "one trick pony" and actually require knowledge of more than one topic, hence second degrees.

Analyse the data you supplied further: Humanities students 66% female and median age of 23 years... Not career medicine students who intend to be doctors or pharmacists and probably won't have kids until their late 30's. Guess why a large proportion of your art student sample weren't working in the years directly following the survey? Maybe beginning a family?

By your numbers it'd be pretty simple to claim (rather than "humanities degrees are worthless" which is what you seemed to be trying to claim) that 50% of 23 year old women plan on having kids in the next 5 years and that 20% of humanities students go on to advanced studies in their chosen field.

So again, exactly what you were driving at was rather unclear. I think it was "arts students baaaaad", but if you want to clarify...

Re your economics viewpoint, you've said you support the following:

raise interest rates,
Newsflash: the reserve bank (who I'd postulate have a better handle on economics than you do) don't want us to have high interest rates, and the conservative side of politics have been running a scare campaign for years about interest rates always being higher under a Labor Gov't (as if this was a bad thing). Lets just leave it that unless you can come up with some very coherent and logical arguments, you don't have too many supporters for that proposal.

raise bank reserves,
Yes, more in the reserve would be good. Of course killing manufacturing as you seem to propose to do and the resulting mass unemployment would make this tricky (unless we go the Indian option of big slum areas with people living in cardboard boxes and scouring the trash mountains for recyclable plastic they can sell).

privatise stuff.
Is great in theory, although you may recall a recent NSW backlash led by the Libs against privatising the electricity utilities (so again, the conservative side doesn't seem to agree with your viewpoint). Most folks hate toll roads too... In the past when power has been privatised, upkeep of the infrastructure has been a drain on profits and often let slide, resulting in regular outages (was certainly the case in SA). Having someone else controlling access and operation of an asset or service that you depend upon is not always ideal.

Rider of Fast agrees with you though (probably because you said something negative towards Julia, that seems to push his happy buttons). "Julia is a bitch and I don't like her" is at least his own personal opinion and hard to refute.

From preference I'll take a well argued and coherent thesis from scblack over your "original stuff" any day, even though I may disagree with his conclusions.

By the way, yesterdays policy announcement gets a big FAIL grade from me

 

[FR Drew]

Good reasons for manufacturing support:

Re support for the manufacturing sector:

If you lose your manufacturing sector then you lose almost all your capacity for value adding in an economy. It also roots your balance of trade because, while you may do okay selling your raw materials and mineral assets to overseas buyers, pretty much everything aside from largely unprocessed foodstuffs you have to import from offshore.

If you have no capacity within the system for self support through engineering and processing you're selling at a raw materials price and buying at a finished goods price for everything.

It's a similar story with farming subsidies: If it weren't for farming subsidies in the US and France (to cherry pick 2 examples) the rural sector would have completely died. No-one would farm, as they couldn't compete with low wage countries. This would leave massive parts of the country unpopulated, ghost towns galore, and a big stack of unemployed folks moving to the cities. With no capacity to grow food, come any sort of trade embargo with teeth, both countries would be utterly up the spout.

On the face of it, subsidising any industry is bad, but you need to look at the effects of the changes you propose.

 

[TonyG]

That was probably the worst I've ever seen her, she sure has changed her dialogue, diction, mannerism's, tone in fact her whole personality.

She used to be my local member and lived across the road from my football club, I actually respected her because she had a sharp sense of humor, held a lot of conviction and wouldn't back down when she had something to say. These days she is more of a puppet than Peter Garrett.


This carbon tax fiasco is quite a hilarious insight into human nature really...if we ignore all the puffery and cut to the chase....the whole purpose of this process is to give money to/buy overseas forests or plantations so that we can use them as part of our statistics?

Change of behaviour? No. Rise in price? Probably slightly. Loss of jobs? Likely to some degree? Less emissions, cleaner future, all that garbage we hear about? Well no, but with some clever shuffling of money and warping of statistics we will be able to tell everyone else that we have done all this! In 100 years time I think a lot of people will be looking back and laughing at us pack of fools.

Yep, when you sweep aside all the propaganda from both sides of Politics this is just rubbish policy. And your quite right, this will be one of those policies they use in text books in 10 years, as what happens in a hung parliament.
Unfortunately Abbott would be doing just as horrible a job if he'd formed a gov't with the greens and the independents. Although I think he had the numbers not to need the greens, so it might have been slightly less conflicted.
In theory it's always nice to have buy-in from all parts of Parliament, but you can't form proper policy with this many conflicting partners. All you end up with is an expensive policy that doesn't end up serving any purpose.
The answer? My take on it is to scratch this policy now, reduce the carbon rate to an affordable rate with no subsidies and put all revenue raised into renewable energy.

 

[FR Drew]

Yep, when you sweep aside all the propaganda from both sides of Politics this is just rubbish policy.
The answer? My take on it is to scratch this policy now, reduce the carbon rate to an affordable rate with no subsidies and put all revenue raised into renewable energy.

Yes folks, you saw it here, Tony G and I are 100% in agreement.

That said, I don't think it's down to being in a hung parliament, after all Turnbull wanted to do something too, it's not just Greens policy. I feel it's mainly due to wanting to appear to do something while not getting the coal and iron heavy electorates to despise her more than they do already.

 

[seventyseven]

My apologies. A genuine error on my part, I was paying too much attention to the Tour coverage.

It was difficult to decipher what was your commentary and what was cut and pasted. You used different referencing styles in the same posts; sometimes quoted to appear in a quote box, sometimes with "", sometimes no real differentiation between your comments and something that was cut and pasted.

I don't really have an argument to rebut your posts re: 'mainstream' economics being a farce. You've made the statement but I don't understand what makes you believe this. As Scblack says, it's a social science that has a lot of assumptions and generalisations but that means it's not perfect and has certain limitations, not that it's irrelevant or inaccurate in most situations.

And why on earth, if you believe Australia is still in recession would you wish to increase interest rates?

because i know austrian economics quite intimately.

you would raise interest rates because of the following:

Seventy Seven,

Maybe scblack just feels like you come across as not terribly coherent and a bit aggressive? He holds pretty conservative views politically re business and finance policy and dislikes Julia/Rudd and co as much as the next person, so if he's got the shits with what you're spouting maybe the problem is you, not him?

he flies off the handle & i'm the one with the problem?

re your initial thesis since the reboot of this thread, I'll take your responses to my posting:

The barely coherent manufacturing rant: So you think no industry should be subsidised? Only mining and agriculture? Only ones that have never had any union involvement? What exactly was your point?
There were 3 screens worth of stats and beyond saying that we subsidise manufacturing, I still don't understand exactly what you were trying to say.

that manufacturing is going down the gurgler and probably would have collapsed long ago if it weren't for subsidies. in other words, like tasmania it is a financial black hole.

on your previous points, i wouldn't give subsidies to anything.

If I take it to mean that we should have no manufacturing support, that's an intersting point of view policy wise... Lets take the motor industry, you've just effectively killed off Holdens in Australia, plus Monroe who make shock absorbers... I'm pretty sure that we make windscreens here, and we definitely make mag wheels. Quite a few businesses support the Australian motor industry.
Did you see what happened in Newcastle when 1500 jobs at BHP were lost? It flatlined the city for half a decade at least through flow on losses of jobs to support industries and goods and services suppliers. How many jobs are you proposing to lose by removing industry support to the manufacturing sector? Not just those directly employed, all the flow on related industries as well...

Was this a complaint against Labor Policy, just a misguided dig at unions, or part of your "original stuff"?

but see here's the thing: if something is being propped up by subsidies then it is NOT efficient, and any money being thrown at it is a BAD investment. if manufacturing was profitable, it wouldn't need subsidies, and at very worst would be able to raise money it needed from PRIVATE investors who expect a RETURN on their income. tax subsidies is money taken, by force, and GIVEN to something. it's effectively charity... but the givers have no say in the matter.

the reason there's so much stuff that relies on it is purely a result of all this money being wasted propping it up. if we didn't have the subsidies in the first place, then the market wouldn't have responded the way it did.

On to your university study thesis...

Given that more humanities students go on to further study (like masters and PhD studies) maybe you should compare their salaries to the folks who just got their engineering bachelor degree? How what proportion of engineers go on to a higher level qualification? I'd add to that that many fields are not "one trick pony" and actually require knowledge of more than one topic, hence second degrees.

Analyse the data you supplied further: Humanities students 66% female and median age of 23 years... Not career medicine students who intend to be doctors or pharmacists and probably won't have kids until their late 30's. Guess why a large proportion of your art student sample weren't working in the years directly following the survey? Maybe beginning a family?

By your numbers it'd be pretty simple to claim (rather than "humanities degrees are worthless" which is what you seemed to be trying to claim) that 50% of 23 year old women plan on having kids in the next 5 years and that 20% of humanities students go on to advanced studies in their chosen field.

So again, exactly what you were driving at was rather unclear. I think it was "arts students baaaaad", but if you want to clarify...

actually, there's a real problem in medicine that female doctors are a bad investment because by the time they're actually qualified is exactly when they are having kids.

23 isn't even near to the (i think it's average) age of first motherhood either, that's somewhere near 30. marriage for women is 28 iirc.

but, even supposing your proposition is true: that still doesn't change the fact that it's a BAD investment. it doesn't matter WHY the degrees aren't being utilised, merely that they are.

my point was that not all education is a sound investment.

Re your economics viewpoint, you've said you support the following:

raise interest rates,
Newsflash: the reserve bank (who I'd postulate have a better handle on economics than you do) don't want us to have high interest rates, and the conservative side of politics have been running a scare campaign for years about interest rates always being higher under a Labor Gov't (as if this was a bad thing). Lets just leave it that unless you can come up with some very coherent and logical arguments, you don't have too many supporters for that proposal.

actually the reserve bank hasn't a clue.

firstly, watch this video from about 2 mins on http://www.youtube.com/watch?v=dNyrYwZrZ8I

what you need to think of interest rates as is the time-cost of money. if you accept that, then you can understand how the reserve banks rates are literally, a price fix.

then, if you consider that there are more loans being taken out than savings exist to make them, you can realise that the interest rate is effectively too low. demand is much greater than supply.

if that's the case, what would happen with any physical product (tv's, ipods, gold, whatever) the price would be bid up, or there would be shortages. but with money, it's effectively magiced out of nothing by the banks and that's what gives us inflation - inflation in how much money there is (the money supply). it's effectively printing cash, even if the money only exists electronically.

that money then permeates its way into the markets and people bid up the prices of stuff. stuff gets more & more expensive from that bidding and the best example of this is housing

and this is precisely how a bubble forms.

and now the result is that people are having to go deeper and deeper into debt to purchase (for example) housing:

credit to steve keen for the graphs.

is this making sense?

the reason a recession occurs is because what we've got with interest rates that are too low is increases in debt that are unsustainable. there comes a point where people just can't afford the levels of debt needed to buy a house. at that point, people can no longer bid up the price of the houses (remember that old moniker houses always go up? they don't.) and so all the people that bought purely because they were expecting prices to go up start to sell too (that by the way, is the definition of a ponzi scheme). the result? a crash. just like in the united states.

if you look at the stats, house prices (Both nominal AND real) have just started their decline. we won't have the same scenario as the U.S play out here because we can't just walk away from our debt obligations like the american citizens can.

raise bank reserves,
Yes, more in the reserve would be good. Of course killing manufacturing as you seem to propose to do and the resulting mass unemployment would make this tricky (unless we go the Indian option of big slum areas with people living in cardboard boxes and scouring the trash mountains for recyclable plastic they can sell).

for reference, the sooner we did it the faster we would recover. however a more workable solution is to simply start decreasing the subsidies gradually. 12.5% per year for 8 years or, whatever. the only reason people have invested in/around these industries is because they are of the misguided impression that they are profitable (i.e this is where the money is). if the government would stop interfering with the market, we wouldn't have these messes.

privatise stuff.
Is great in theory, although you may recall a recent NSW backlash led by the Libs against privatising the electricity utilities (so again, the conservative side doesn't seem to agree with your viewpoint). Most folks hate toll roads too... In the past when power has been privatised, upkeep of the infrastructure has been a drain on profits and often let slide, resulting in regular outages (was certainly the case in SA). Having someone else controlling access and operation of an asset or service that you depend upon is not always ideal.

my father also has this mindset. however privatising stuff doesn't result in instant better services. it doesn't work like that. COMPETITION, which takes time, does. the power outages? the tolls? anything else you may be able to think of that people don't like about their service are all things that place a company at a competitive disadvantage.

i can remember way back in my first year of undergrad our head of school making the argument for state owned utilities because they could have a government owned naturaly monopoly that would result in everyone out there benefitting from the huge economies of scale.

here's the thing with that: we actually had private companies trying to open up half a dozen windmills because 6 windmills could produce power cheaper than aurora (the state owned utility) could with the economies of scale it attained by being the sole supplier of electricity for the ENTIRE STATE. the kicker: those private companies were actually blocked/stopped from opening up. why? they used the excuse of birds flying into the mills blades. i'd bet it's because the government won't admit how incompetent it is.

if that's not woeful inefficiency, i just don't know what is.

Rider of Fast agrees with you though (probably because you said something negative towards Julia, that seems to push his happy buttons). "Julia is a bitch and I don't like her" is at least his own personal opinion and hard to refute.

not sure of your point here, you saying the only reason someone would agree with me is because i said i don't like julia gillard (i.e mutual hatred)?

thanks for the personal dig mate. real classy. it totally had a point too.

From preference I'll take a well argued and coherent thesis from scblack over your "original stuff" any day, even though I may disagree with his conclusions.

again failing to see the necessity for that other than to demean or degrade someone. seriously, what did that achieve? i've kept the personal digs out of it, i'd have thought you could do the same.

By the way, yesterdays policy announcement gets a big FAIL grade from me

Re support for the manufacturing sector:

If you lose your manufacturing sector then you lose almost all your capacity for value adding in an economy. It also roots your balance of trade because, while you may do okay selling your raw materials and mineral assets to overseas buyers, pretty much everything aside from largely unprocessed foodstuffs you have to import from offshore.

you say that like this is all a bad thing? we trade our rocks for other companies finished products. that's called trade. what's so bad about that? we don't trade unless we benefit.

and we add value by selling our rocks, plain & simple.

If you have no capacity within the system for self support through engineering and processing you're selling at a raw materials price and buying at a finished goods price for everything.

again failing to see the problem.

It's a similar story with farming subsidies: If it weren't for farming subsidies in the US and France (to cherry pick 2 examples) the rural sector would have completely died. No-one would farm, as they couldn't compete with low wage countries. This would leave massive parts of the country unpopulated, ghost towns galore, and a big stack of unemployed folks moving to the cities. With no capacity to grow food, come any sort of trade embargo with teeth, both countries would be utterly up the spout.

yep it would. now you're seeing the problem with minimum wages, regulations, unions and so forth.

On the face of it, subsidising any industry is bad, but you need to look at the effects of the changes you propose.

no you need to look at why they need subsidising in the first place. work backwards, not forwards.

 

[seventyseven]

now to stir the pot a little bit more about mining.

to quote a conversation i was having with someone that works in mining:

"I was chatting to my GF's boss (he's Chinese) about this, and he had some interesting views on this (my GF works for a Chinese mining company in Malaysia, and previously a Korean steel company). He said there is a massive push by the Chinese to break the back of the current Australian/Brazilian duopoly. He has mines in Malaysia, China and Indonesia, and has looked at Africa and Australia. He said Africa is going to be hard to mine due to instability of governments and general corruption/violence/crime. The thing in favor of the Chinese in Africa is the fact that they haven't fucked with Africa like the western world has. I've worked in Malaysia and have had to "grease" the wheels once or twice myself.

I'd see the biggest issues revolving around bribing the correct people at the correct time. You'd be spending half your life bribing the correct officials/military commanders/tribes

The Chinese will and do use an enemy of my enemy is my friend. It was actually one of the first things I discussed with my GF's boss. He said that only goes so far though. Many people just see the Chinese as the new westerner who was too slow to get in first. It is actually quite fascinating, but scary at the same time There is HUGE amounts of resources, and once tin pot generals find out about the $$$ invloved, then some of these African countries will suffer even more turmoil!"

now when you consider how much of a clusterfuck a lot of africa is (and the chinese are obviously aware of it and the problems it poses), i initially thought this might lead to a lot of PMC presence and so forth which would make up at least some of the savings of cheaper labor in africa. but then i stopped thinking nice legitimate businessman and started thinking asshole. this lead me to coming up with all sorts of "enemy of my enemy is my friend" dealings and many many more dodgy as hell/downright illegal dealings with it. in fact the chinese could even try and use local africans (even if they're rebel groups) as security. such an arrangement would obviously be of mutual benefit.

i'm sure this is something that another guy i know johnny can cover infinitely better than i can (as all my knowledge about china is pretty much purely economic, he seems to be quite intimate with it from an international relations standpoint or similar. all i can say is there does appear to be (albeit circumstantial) evidence of this stuff occurring already.

what we can do is simply google "china africa mines" and see what we come up with.

http://www.chinaafricarealstory.com/...g-deal-in.html

of particular note is this one for how in depth it goes http://www.spiegel.de/international/world/0,1518,484603,00.html

then we've got an exploration permit granted by authorities that just weeks before performed a coup against their government, i mean gee, what do you think went on before that happened? chinese gave them money to buy some guns perhaps? http://www.csmonitor.com/World/Africa/2010/0329/China-mining-company-causes-unrest-in-Niger

and even the ones with governments are doing some seriously dodgy shit http://www.voanews.com/english/news/...111195009.html


it appears to be happening. the guy i've quoted above has done it there's many news articles showing the aftermath when china does.

of particular note is that they're doing this even before the carbon tax is brought in, so the private sector may fuck itself enough (australian & brazilian miners in a cartel, huge prices on iron ore, coal etc) before the government adds its bit. or the carbon tax will result in them just upping the ante in africa. maybe the africans will pay the price with lives instead of us with money.

the conspiracy theorist in me is wondering how long before the mining companies start doing the same thing the chinese (to my mind) appear be doing.


NB: i'm certainly not saying this definitely is occuring, but something smells awfully fishy. and when it smells bad, i'm not eating it.

 

[FR Drew]

Seventy seven,

If you can't see the problem with an economy where your only saleable exports are in unprocessed raw materials and all your imports are in value added manufactured goods, where no females have access to education because it's not cost effective, where you have no agricultural sector (due to the removal of subsidies) and where interest rates are massive, then I'm sorry, I don't think anyone on this site can help you much.

Re rider of fast, yes, I think he's a one trick pony who will praise anyone who dislikes Gillard. This was not intended to be a dig at you, however if he's the only person saying that you "know your stuff" I wouldn't get too cocky.

As far as your interest rates viewpoint: Anyone without the financial means to purchase property straight up would be rooted, unless of course you're proposing some mega inflation on wages to go with your huge interest rates? (I doubt that you'd support that, and if you would, I suggest analysis of Zimbabwe recently, or Germany in the mid 1930's)

News flash: You can't have a big interest rate unless there's a matching return on investment elsewhere in the economy to match it. Otherwise, anyone investing in industry (or mining) would rip the dollars out of where they have it invested and just use it to give people loans or stick it in the bank. People invest rather than saving, only when the return on their investment will keep them in front. Effect: The only industry we had left was mining thanks to your policy viewpoint and now you've ripped all the dollars out of that and killed it too because everyone is saving or giving each other loans.

No manufacturing, no agriculture, no mining/resources. You're making a fabulous banana economy here. Any you're expecting people to trust your economic brains?

Howard was pro low interest rates, Abbott wants low interest rates, so do Rudd and Gillard, so did Hawke and Keating (although at the time, worldwide rates were high, so they didn't have a heck of a lot of choice in the matter), the Reserve Bank wants low interest rates... Sorry 77, looks like you're a bit out on your own on this one.

Regarding the following: "the power outages? the tolls? anything else you may be able to think of that people don't like about their service are all things that place a company at a competitive disadvantage..." this may well be true in a free and open market place, but when the service provider has a monopoly (as water and many electricity suppliers have had) they can be as crap as they want and once the public don't own the asset there's not a hell of a lot that we can do about it. (unless you're proposing more Gov't control over private enterprise, but that doesn't seem a lot like a seventy seven kind of policy platform)

 

[metrics]

I don't usually bother getting involved in these threads, but here it goes anyway.

my father also has this mindset. however privatising stuff doesn't result in instant better services. it doesn't work like that. COMPETITION, which takes time, does. the power outages? the tolls? anything else you may be able to think of that people don't like about their service are all things that place a company at a competitive disadvantage.

Nice concept in theory, that competition would improve services for all, but unfortunately we see the free market fail at competing in some cases, and in other cases it is simply impractical. Most of the time, the cause of this is due to the fact that there is some underlying infrastructure that is required for delivering services which is inefficient to duplicate. For the example of electricity distribution, how exactly would competition work? Would each company run their own power lines to each street? Would they each have their own power-transformers for each network? Hopefully I don't need to point out how inefficient and just plain ridiculous this is?

Perhaps there is a middle ground for privatisation. Privatise the power suppliers so we can compete between electricity generators but keep the infrastructure in government hands. Charge the suppliers for access to customers at a flat per customer rate, so that those in dense housing subsidise those in remote areas, as per the existing system. This is important, otherwise the private suppliers won't bother to supply to remote areas because it costs too much, but sometimes the benefits of having people in remote areas providing our food outweigh the immediate financial gain from turning off the power.

i can remember way back in my first year of undergrad our head of school making the argument for state owned utilities because they could have a government owned naturaly monopoly that would result in everyone out there benefitting from the huge economies of scale.

here's the thing with that: we actually had private companies trying to open up half a dozen windmills because 6 windmills could produce power cheaper than aurora (the state owned utility) could with the economies of scale it attained by being the sole supplier of electricity for the ENTIRE STATE. the kicker: those private companies were actually blocked/stopped from opening up. why? they used the excuse of birds flying into the mills blades. i'd bet it's because the government won't admit how incompetent it is.

if that's not woeful inefficiency, i just don't know what is.

I would love to see a reference source for this. Just out of curiosity as to the exact details. Some things that come to mind are:

• Windmills tend to have a lot of community opposition (for some reason). Was this the cause of them being knocked back?
• Was it worthwhile from an overhead cost perspective for Aurora to install the infrastructure to handle the incoming power?
• Where are the costings that show it was cheaper to generate power that way? From all my points of reference, most obviously my power bill, renewable energy is more costly than coal power in most circumstances.