Club Troppo

Not a show I watch I admit, but as Troppo’s reality TV correspondent I read this piece from New Matilda “Reality TV Sh!ts In Its Nest”

It’s an expose of Ladette to Lady.  I though it would explain how the girls were exploited in the sense of being deliberately set up to be typecast.  It does a bit of that and on that I’m very sympathetic and very unsympathetic to the producers for whom, we are all just so much feedstock.  

But the article’s major concern is a union complaint.  

It’s an issue with a lot of differing viewpoints, but a simple core. While opinions differ on whether reality TV participants should share in the profits of a show they help to make, most people would agree the simple principles of fairness dictate that the mostly young, inexperienced participants should not finish these shows with less money in the bank than they started with.

Less money – more fame (which can often in its turn lead to more money – though that’s largely beside the point).  It’s a tradeoff people have made since Roy Emerson stayed amateur to win Grand Slams while Rod Laver was safely on the pro tour and indeed it’s the tradeoff that so many creative people make. As a matter of fact I’m making it now. 

What’s the big deal?

I was once on a tram in Melbourne and got talking to the woman next to me.  She asked what I was doing and I told her that I was down from Canberra for the day.  I told her that I was advocating a particular policy.  Being the son of an academic I was brought up to believe that the most influential ideas were those that were best argued and which were advocated by people who did not have a direct interest in the stake of the argument, because then their advocacy was tainted.  I told her that I had discovered that this was wrong.  No-one took you seriously at all unless you had some position and even that was less important than representing someone great and powerful or at least large and wealthy.

I had discovered that this was true, not just with governments in general but even of organisations that, it seemed to me, ought to have the same values my father taught me – like the Industries Assistance Commission.  In any event, it was not so. So I was in Melbourne visiting a large company who stood to gain significantly from the policy I was advocating.  I was trying to persuade them to pay me to advocated the policy either on their behalf.  She was rather taken with this.  Anyway our conversation went on in various other directions.  As I got off the tram she said to me that she thought what I was doing was a good thing and that she had little doubt that with perseverence I would be successful.  

It was one of those rare moments in which I responded appropriately rather than suffer from l’esprit de l’escalier.  I yelled back down the tram as the doors were opening.  ”Yes, I’ll persevere, and I expect I’ll be successful at persuading people at about the time that it becomes the wrong thing to do”. In any event, I thought of this reading Robert Gottleibsen’s column today.  It’s a good thing to bring down the extent to which people borrow to buy their first home – zero deposit home loans are unlikely to be a good part of the landscape, at least if they’re a major part. Now banks are reducing the extent to which they’ll offer them.  

Trouble is, it would have been a great thing to do a few years ago to moderate the boom.  I doubt it’s a smart thing to do right now. Yet the new credit regime may help do it (though I’m not sure it’s a big problem) and the banks are now reducing the loan to valuation ratios they’ll offer people, not really because they’ve found the risk unacceptable (in which case they would have done it roughly from September on as the GFC hotted up) but because, government guarantee in hand enabling them to raise lots of money, some are going off on acquisitive foreign adventures.  Is this sensible?  Possibly, but not using an Australian Government guarantee.  Still, it helps keep the senior executives’ bonuses up which is obviously something we’d all be keen to do to make sure we’re ‘competitive’ in the international labour market for top banking talent.

From the US General Accountability Office.  HT – an email from David Lian.

The federal governments financial condition and fiscal outlook are worse than many may understand. Despite an increase in revenues in fiscal year 2006 of about $255 billion, the federal government reported that its costs exceeded its revenues by $450 billion (i.e., net operating cost) and that its cash outlays exceeded its cash receipts by $248 billion (i.e., unified budget deficit). Further, as of September 30, 2006, the U.S. government reported that it owed (i.e., liabilities) more than it owned (i.e., assets) by almost $9 trillion. In addition, the present value1 of the federal governments major reported long-term fiscal exposuresliabilities (e.g., debt), contingencies (e.g., insurance), and social insurance and other commitments and promises (e.g., Social Security, Medicare)rose from $20 trillion to about $50 trillion in the last 6 years.

I’m re-reading the Theory of Moral Sentiments.  Some of it’s great.  Some of it, not so much. Anyway a well known phsychological phenomenon is they way that our happiness reverts to our mean level of happiness which tends to be determined more by our temperament than our circumstances. Here’s Adam on the same phenomenon. And a warning – our Adam didn’t care too much about breaking things into paragraphs to give his readers a bit of a break.  

The great source of both the misery and disorders of human life, seems to arise from overrating the difference between one permanent situation and another. Avarice overrates the difference between poverty and riches: ambition, that between a private and a public station: vainglory, that between obscurity and extensive reputation. The person under the influence of any of those extravagant passions, is not only miserable in his actual situation, but is often disposed to disturb the peace of society, in order to arrive at that which he so foolishly admires. The slightest observation, however, might satisfy him, that, in all the ordinary situations of human life, a welldisposed mind may be equally calm, equally cheerful, and equally contented. Some of those situations may, no doubt, deserve to be preferred to others: but none of them can deserve to be pursued with that passionate ardour which drives us to violate the rules either of prudence or of justice; or to corrupt the future tranquillity of our minds, either by shame from the remembrance of our own folly, or by remorse from the horror of our own injustice. Wherever prudence does not direct, wherever justice does not permit, the attempt to change our situation, the man who does attempt it, plays at the most unequal of all games of hazard, and stakes every thing against scarce any thing. What the favourite of the king of Epirus said to his master, may be applied to men in all the ordinary situations of human life. When the King had recounted to him, in their proper order, all the conquests which he proposed to make, and had come to the last of them; And what does your Majesty propose to do then? said the Favourite.I propose then, said the King, to enjoy myself with my friends, and endeavour to be good company over a bottle.And what hinders your Majesty from doing so now? replied the Favourite.18 In the most glittering and exalted situation that our idle fancy can hold out to us, the pleasures from which we propose to derive our real happiness, are almost always the same with those which, in our actual, though humble station, we have at all times at hand, and in our power. Except the frivolous pleasures of vanity and superiority, we may find, in the most humble station, where there is only personal liberty, every other which the most exalted can afford; and the pleasures of vanity and superiority are seldom consistent with perfect ^ztranquillity,^z the principle and foundation of all real and satisfactory enjoyment. Neither is it always certain that, in the splendid situation which we aim at, those real and satisfactory pleasures can be enjoyed with the same security as in the humble one which we are so very eager to abandon. Examine the records of history, recollect what has happened within the circle of your own experience, consider with attention what has been the conduct of almost all the greatly unfortunate, either in private or public life, whom you may have either read of, or heard of, or remember; and you will find that the misfortunes of by far the greater part of them have arisen from their not knowing when they were well, when it was proper for them to sit still and to be contented. The inscription upon the tombstone of the man who had endeavoured to mend a tolerable constitution by taking physic; I was well, I wished to be better; here I am;19 may generally be applied with great justness to the distress of disappointed avarice and ambition.

Full of relevance for our own brand of muddling through. Here’s the column. 

 

Labours affair with bankers is to blame for this sorry state

In Wednesdays Budget statement, Alistair Darling acknowledged that even on his optimistic assumptions a decade was needed to repair Britains public finances. The UK governments reputation for economic competence was already in tatters; the chancellor of the exchequer has now laid it definitively to rest. How did the New Labour project end in such disaster?

The answers lie not in unpredictable global events but closer to home. The government failed to deal effectively with the reform of public services and conducted an indecent love affair with the financial services industry. These two apparently unrelated errors, allied with hubris, proved to be a fatal combination.

When Labour came to power in 1997, dissatisfaction with public services such as health, education and transport was widespread, and justified. For two decades not enough money had been spent, particularly on capital projects. This underspending had contributed to weak and demoralised management, reservations about which led to a fear that simply allocating more cash would provide poor value for money.

There were two possible directions of reform. One it might be described as Blairite decentralised management authority and financial responsibility. The other it might be described as Brownian tightened centralised control and imposed performance targets on managers, with associated sticks and carrots. Both approaches were pursued, inconsistently, but overall with more Brown than Blair. When, by 2000, there was little to show in the way of beneficial results, the decision was made to spend lots more anyway. There were some service improvements, but the concern that the extra money would not be well spent proved largely justified. (Continued)

From Dani Rodrik’s blog.

Macroeconomics doesn’t get much plaudits around now, but here is a real-life story that should hearten those who think the field is really broken.  It concerns Andres Velasco, a distinguished macroeconomist who is currently the minister of finance in Chile, and who also happens to be a good friend, colleague and co-author. 

Until the current crisis hit, Chile’s economy was booming, fueled in part by high world prices for copper, its leading export.  The government’s coffers were flush with cash.  (Chile’s main copper company is state-owned, which may be a surprise to those who think Chile runs on a free-market model!)  Students demanded more money for education, civil servants higher salaries, and politicians clamored for more spending on all kinds of social programs. 

Being fully aware of Latin America’s commodity boom-and-bust-cycles and recognizing that high copper prices were temporary, Velasco stood his ground and decided to do what any good macroeconomist would do:  smooth intertemporal consumption by saving most of the copper surplus.  He ran up the largest fiscal surpluses Chile has seen in modern times. 

This didn’t make Velasco very popular.  Last November, public sector workers marched in downtown Santiago, burning an effigy of Velasco.

But by the time the financial crisis hit Chile, Velasco (and the Central Bank governor Jose de Gregorio, another fine macroeconomist) had accumulated a war chest equal to a stupendous 30% of GDP.

The price of copper plummeted 52 percent from Sept. 30 to year-end, and Velasco dusted off his checkbook. In the first week of January, he and Bachelet unveiled a $4 billion package of tax cuts and subsidies…  Velascos stimulus spending, includ[ed] 40,000-peso ($68.41) handouts to 1.7 million poor families…

The surpluses accumulated during the good years has given the Chilean government unusual latitude in responding to the crisis.  As a result, the economy is doing much better than its peers.  As Bloomberg reports, “the countrys economy is expected to grow 0.1 percent in 2009, as the region contracts 1.5 percent, according to the International Monetary Fund.”

And does good economics pay off politically?  Eventually, yes.  Five months after being burned in effigy, Velasco is currently President Bachelet’s most popular minister.

Reclaiming Americas Soul, by Paul Krugman, Commentary, NY Times: Nothing will be gained by spending our time and energy laying blame for the past. So declared President Obama, after his commendable decision to release the legal memos that his predecessor used to justify torture. Some people in the political and media establishments have echoed his position. We need to look forward, not backward, they say. No prosecutions, please; no investigations; were just too busy.

And there are indeed immense challenges out there: an economic crisis, a health care crisis, an environmental crisis. Isnt revisiting the abuses of the last eight years, no matter how bad they were, a luxury we cant afford?

No, it isnt, because … never before have our leaders so utterly betrayed everything our nation stands for. This government does not torture people, declared former President Bush, but it did, and all the world knows it.

And the only way we can regain our moral compass … is to investigate how that happened, and, if necessary, to prosecute those responsible.

What about the argument that investigating the Bush administrations abuses will impede efforts to deal with the crises of today? Even if that were true even if truth and justice came at a high price …laws arent supposed to be enforced only when convenient. But is there any real reason to believe that the nation would pay a high price for accountability? …

Tim Geithner … wouldnt be called away… Peter Orszag, the budget director, wouldnt be called away… Even the president neednt, and indeed shouldnt, be involved. All he would have to do is let the Justice Department do its job… America is capable of uncovering the truth and enforcing the law even while it goes about its other business.

Still, you might argue and many do that revisiting the abuses of the Bush years would undermine the political consensus the president needs to pursue his agenda.

But the answer to that is, what political consensus? There are still, alas, a significant number of people in our political life who stand on the side of the torturers. But these are the same people who have been relentless in their efforts to block President Obama… The president cannot lose their good will, because they never offered any.

That said, there are a lot of people in Washington who … probably just dont want an ugly scene… But the ugliness is already there, and pretending it isnt wont make it go away.

Others, I suspect, would rather not revisit those years because they dont want to be reminded of their own sins of omission.

For the fact is that officials in the Bush administration instituted torture as a policy, misled the nation into a war they wanted to fight and, probably, tortured people in the attempt to extract confessions that would justify that war. And during the march to war, most of the political and media establishment looked the other way.

Its hard, then, not to be cynical when some of the people who should have spoken out against what was happening, but didnt, now declare that we should forget the whole era for the sake of the country, of course.

Sorry, but what we really should do for the sake of the country is have investigations both of torture and of the march to war. These investigations should, where appropriate, be followed by prosecutions not out of vindictiveness, but because this is a nation of laws.

We need to do this for the sake of our future. For this isnt about looking backward, its about looking forward because its about reclaiming Americas soul.

I’ve had a few requests for more of these – so I’ll pop them up when they’re especially classy.  Click on the link to the game Breyer vs J Esser to see the answer. And of course any day you want a fix, just go to Chessgames.com

White to play

Breyer vs J Esser 17. ? See game for solution.

It’s quite tricky to teach undergraduate law students about the Whitlam Dismissal.  You have to cover it because it’s the only example of exercise of vice-regal reserve powers of dismissal of an elected government since federation (at least at federal level; there’s also Sir Phillip Game’s dismissal of the Lang government in NSW).

The problem is that few students today have any knowledge or memory of the events, and it seems it isn’t taught to most of them in school (which no doubt says something about the teaching of history).  Law textbooks tend only to cover the actual events in very basic outline, and we don’t have time in class to recount them either.  The focus is necessarily on the constitutional and legal issues arising from the events.

Given that 85% of CDU’s students are studying law externally and online (attending lectures and tutorials in voice/video-enabled online Live Classrooms), it makes sense to deliver necessary historical and cultural context using a range of publicly available online sources.  In addition to a couple of scholarly articles in subscription journals, I give students a link to historian Geoffrey Blainey’s article ’The ghost of crisis past‘ from The Age newspaper of 5 November 2005.

Slightly more idiosyncratically, I also embed various videos in the Learnline website, including footage of Whitlam’s famous “nothing will save the Governor-General” speech on the steps of Parliament House and a fairly wacky Barry Humphries sketch about the 1970s from Edna and Les’s viewpoint, in which Gough and Margaret feature prominently. It aims at giving them the flavour of the times.

I also embed a video of a Max Gillies sketch about the events, albeit with some cautionary notes. I thought Troppo readers might find both the video and the caveats worth a look:
(Continued)

Australia’s economy may be officially in recession, but Lateral Economics at least is doing its bit to reduce the effects. In addition to the research assistant Nicholas advertised for earlier this week, we also need someone with some web design and Wordpress backend experience for a particular urgent project.

It involves using Wordpress for collaborative work with functions having some characteristics of a wiki and some of a blog. It also needs to be easy to use/”intuitive” for non-nerds. It probably doesn’t need any programming work but does require some “tweaking” of Wordpress “look and feel” and some use of plugins.

Just as importantly, the timeframe is tight. The project has been long delayed and we really need a functioning, respectable “beta” site within a couple of weeks. You would be working closely with both Nicholas Gruen and Ken Parish on developing and finalising the project.

Remuneration by discussion/negotiation with Nicholas, and applications to Nicholas via the Troppo contact facility (see sidebar).