Club Troppo

Here’s my article from last week’s Fin which it placed below the headline “ALP sold itself short instead of selling its strengths”. I’ve also done an interview with Michael Duffy on Counterpoint which was recorded last Thursday, but went to air last night.

How did it come to this? That’s what the last two Governments asked themselves as they fought for their lives in the last two elections. Howard had presided over a decade’s surging prosperity; the ALP Government had protected that prosperity with a fiscal stimulus that Economics Nobel laureate Joe Stiglitz described as world’s best practice: as good as it got – anywhere.

Part of the answer is to be found in this paradox: In seeking political advantage – in playing politics ahead of truth-telling and governing well – they ended up with a travesty of the very political objectives they were so desperate to achieve.

Take John Howard’s Workchoices. It was obvious that workplace deregulation would hurt Australia’s lower paid workers though Howard was right that it would help generate jobs for those even further down the pecking order. A frank acknowledgement of that could have saved Howard by creating the space around which he could have built a political and economic strategy to deal with the downside.

When Workchoices was cooked up, every time the Government of the Lucky Country looked, there was another few billion dollars in the kitty from surging company taxes on Australia’s miners. Usually playing political catch up, the Government shovelled it out the door as fast as it could – much of it to those battlers who were in the firing line of Workchoices.

So Howard could have focused those giveaways around the political economy of Workchoices and sold it as a wage/tax trade-off of precisely the kind that the Hawke Keating Government made a staple of their thirteen year reign. Instead he went out to sell the spin doctors’ message – that Workchoices would unchain our heart. Oh wait . . . that was the GST. Anyway you get my meaning.

The ALP Government managed to spin doctor its way to plenty of similar own goals including several right at the heart of its political viability. Some of us with some experience of government were stupefied to hear of the Government’s ‘root and branch’ review of taxation to report in an election year. I wondered what Rudd was thinking then. I wonder if even he knows now. But the announcement sure sounded visionary in the euphoria of the 2020 Summit.

Another trick from the political playbook is to divide your opponents. John Howard became so preoccupied with it that he tied himself into all sorts of contortions – like firing an environment minister for meeting quite properly with lobbyist, Brian Burke. Why? Because it seemed like a good idea in the 24 hours that Howard was going after Rudd for meeting with Bourke. Such frivolous invoking of the grave principle of ministerial responsibility only managed to highlight how much it was being traduced elsewhere. And it created an atmosphere of chaos. As in the dying days of the Whitlam Government, people wondered “What next?”.

Likewise the ALP Government focused as much on dividing its opponents over its emissions trading scheme as it did on the increasingly labyrinthine content of its own scheme. And then, famously walked away only to discover that its popularity had been built on the Australian people’s hopes for something better. We see political principle and political pragmatism as somehow in competition, but for a skilful politician – I’m thinking of Bob Hawke above others – they inextricably complement one another. As it learned in hindsight, in its passing pursuit of political opportunity it subjected itself to mortal political danger. (Continued)

I have often worried about whether promoting ‘efficiency” – in the economic sense – ensures maximum well being where it makes some people better off but others worse off – even if the Kaldor-Hicks criterion is fully met e.g. by ensuring those who gain from the policy could potentially bribe those who lose from it.

I discussed at length the issues involved in “The Distribution Effects of Labour Deregulation” (see article in AGENDA, Volume 14, No 2, 2007). I reached an inconclusive answer: it depends on what mix of social values appeals most (distributive justice and equality of opportunity versus choice and self-reliance).

Now Uwe Reinhardt and Steven Landsburg debate this issue in a piece highlighted in Greg Mankiw’s blog, August 27, 2010. It is most interesting discussion which I strongly recommend.

We’ve just had an election in Australia which was basically very clean, at least as far as one can tell. It was negative. It was empty but there was nothing illegitimate about what either party did or said about the other. Over the pond it isn’t so.  The Republicans are revolutionaries. That is they don’t accept the legitimacy of their opponents. But they’re the worst kind of revolutionaries, which is to say that they are not appealing to any elites who might be able to take over and run the place. They’re appealing to psychoses of various kinds. Mobs used to be left wing, or at least that was the mythology of the French and Russian Revolutions. Not any more.  Over to you Paul.

It’s Witch-Hunt SeasonThe last time a Democrat sat in the White House, he faced a nonstop witch hunt by his political opponents. Prominent figures on the right accused Bill and Hillary Clinton of everything from drug smuggling to murder. And once Republicans took control of Congress, they subjected the Clinton administration to unrelenting harassment — at one point taking 140 hours of sworn testimony over accusations that the White House had misused its Christmas card list.

Now it’s happening again — except that this time it’s even worse. Let’s turn the floor over to Rush Limbaugh: “Imam Hussein Obama,” he recently declared, is “probably the best anti-American president we’ve ever had” …, bear in mind that he’s an utterly mainstream figure within the Republican Party; bear in mind, too, that unless something changes the political dynamics, Republicans will soon control at least one house of Congress. This is going to be very, very ugly. …

What we learned from the Clinton years is that a significant number of Americans just don’t consider government by liberals — even very moderate liberals — legitimate. Mr. Obama’s election would have enraged those people even if he were white. Of course, the fact that he isn’t, and has an alien-sounding name, adds to the rage.

By the way, I’m not talking about the rage of the excluded and the dispossessed: Tea Partiers are relatively affluent, and nobody is angrier these days than the very, very rich. Wall Street has turned on Mr. Obama with a vengeance:… And powerful forces are promoting … this rage…, the superrich Koch brothers and their war against Mr. Obama has generated much-justified attention, but … only the scale of their effort is new: billionaires like Richard Mellon Scaife waged a similar war against Bill Clinton.

Meanwhile, the right-wing media are replaying their greatest hits. …Mr. Limbaugh used innuendo to feed anti-Clinton mythology, notably the insinuation that Hillary Clinton was complicit in the death of Vince Foster. Now … he’s doing his best to insinuate that Mr. Obama is a Muslim. … [And] Mr. Limbaugh is … tame compared with Glenn Beck. (Continued)

One of the more extraordinary things in life is the amount you can be charged by your mobile carrier on ‘international roaming’. It’s completely extraordinary with amazing stories of people downloading serious amounts of data – eg for a movie and getting back to find bills for $60,000. I travelled to the UK and Paris a couple of years ago and used my phone sparingly. Probably spent about ten or fifteen minutes a day on it – making various calls back home and or organising things.  About 8-9 days useage cost $400.

Anyway, you’d think that this would be easy enough to bypass. You’d think you could buy SIM cards here for overseas. When the VirginMobile Australian site tells you that

Another option worth considering..

Is using a local Pre-Paid SIM card that they have purchased overseas, you’d think they might offer to sell you one – after all, that’s just more money to be made. But alas no.

So Oh Troppodillians, I’m heading to Washington DC next week and my son Alexander is going to Paris the next week (this is pretty normal for us – we’re very cool people – very very cool).

Now you can say ‘just head to your country of choice and buy a SIM card there.  Well yes, you can, but it’s surprisingly difficult.  In the US, the land of the free and the home of the brave, there’s a special committee which arose in the wake of the House Unamerican Activities Committee called the House SIM Card (Protection against easy access) Committee.  Since it is implausible that no newsagent in any American airport would have heard of it, I presume this committee has prohibited SIM cards being sold in airports (after all it would just fuel terrorism, and making the terrorists go down to the local AT&T store has pretty much fixed (domestic) terrorism and if it ain’t broke, don’t fix it.

In fact when I was last in Washington, I did go to a local AT&T shop and bought a SIM card, but it was a poxy SIM card with I think US$25 or perhaps US$50 on it which charged about 30-40 cents a minute including incoming calls, which was a bit – well Unamerican.

So, oh Tropposphere, I’m all ears for your suggestions.

It’s time libertarians ditched their alliance with conservatives and Republicans, writes Brink Lindsey. In a piece for Reason magazine, Lindsey argues that libertarians should stake their claim at the centre of American politics and imagines a new swing constituency animated by libertarian ideas — a constituency courted by politicians on both the left and right.

Lindsey is appalled by the conservative movement’s anti-intellectualism, its intolerance, sense of victimhood and delusional ideas. But worst of all is the movement’s disregard for freedom:

… the right today is a fundamentally illiberal and authoritarian movement. It endorses the systematic use of torture. It defends unchecked presidential power over matters of national security. It excuses massive violations of Americans’ civil liberties committed in the name of fighting terrorism. It supports bloated military budgets, preventive war, and open-ended, nation-building occupations. It calls for repressive immigration policies. Far from being anti-statist, it glorifies and romanticizes the agencies of government coercion: the police and the military. It opposes abortion rights. It opposes marriage equality. It panders to creationism. It routinely questions the patriotism of its opponents. It traffics in outlandish conspiracy theories. If you’re serious about individual freedom and limited government, you cannot stand with this movement.

The right’s illiberalism is not a new development. "Modern conservatism has always had an illiberal dark side", writes Lindsey. "Recall the first great populist spasms of the postwar right — McCarthyism and opposition to desegregation — and recall as well that National Review founder William F. Buckley stoutly defended both."

What’s different today, says Lindsey, is that the populist ranters and conspiracy theorists are running the movement. Conservatives used to rely on intellectual champions like Milton Friedman and George Will to represent conservative ideas in the media. But today there’s no need to win over liberal gatekeepers in the mass media. Now conservatives have Fox News, talk back radio and the internet. The result is that intellectuals no longer set the agenda:

What counts today isn’t engaging the other side with reasoned arguments; it’s building a rabid fan base by demonizing the other side and stoking the audience’s collective sense of outrage and victimization. And that’s a job best performed not by serious thinkers but by hacks and hucksters. Rush Limbaugh, Glenn Beck, Sean Hannity, Mark Levin, Joseph Farah, Ann Coulter, Michelle Malkin: they adorn the cathedral of conservatism like so many gargoyles.

Yes, there are still many bright and inquisitive minds on the right, but they are not the movement’s stars and they don’t call the shots. On the contrary, if they stray too far in challenging the conservative id, they find themselves cast out and castigated as heretics and RINOs (Republicans In Name Only). Bruce Bartlett and David Frum (who are friends of mine) are only two of the more prominent victims of that intolerant groupthink; both were sacked by conservative think tanks shortly after loudly expressing heterodox opinions.

And last week Lindsey joined the diaspora. He is leaving his job as vice president for research at the Cato Institute to take up a position at the Kauffman Foundation. Fellow ‘liberaltarian’ Will Wilkinson is also leaving Cato.

Lindsey and Wilkinson aren’t talking about their reasons for leaving Cato, but that hasn’t stopped speculation. At Slate David Weigel wonders whether it’s a purge. And there are similar questions from the New Republic’s Jonathan Chait and Salon’s Alex Pareene.

(Continued)

It’s easier to declare a film a work of genius than to figure out its secret. But I think in the case of Boy, it’s balance. This film tempts you at the start to expect a feel-good movie, but ends up steering clear of sentimentality. There’s menace and heartbreak, but it doesn’t go over the top into numbing social realism. It’s about the clash between fantasy and reality that kids experience, some more brutally than others, but which most of us somehow survive. It highlights what is probably a near-universal experience on the road to maturity — a boy’s disillusionment with his father and the process of re-establishing the relationship on a new footing. Boy’s ride past that particular milestone is hliarious, but it’s credibile enough to be thoroughly jolting as well.

The story is about two brothers who live with their grandmother and miscellaneous young cousins on a ramshackle farm in the Bay of Plenty. Their mother is dead and their father is mostly in jail. Boy is the oldest, and already self-reliant enough to look after the other kids when the grandmother leaves them on their own for a few days. Shortly after she departs their father, like the Cat in the Hat — charming, even elegant in his best moments, and completely irresponsible. He’s destined from the outset to wreak havoc in his sons’ lives, although you sense that he’s fundamentally harmless. (Continued)

“Oil and coal? Of course, it’s a fungible commodity and they don’t flag, you know, the molecules, where it’s going and where it’s not . . . So, I believe that what congress is going to do, also, is not to allow export bans to such a degree that it’s Americans that get stuck to holding the bag without the energy source that is produced here, pumped here.”

Sarah Palin

Here’s the breakdown of a Canb-Melb flight I just booked on the to be avoided at (almost) any cost Tiger Airlines.

Now ‘airport charges’ are not all airport charges. Some of it is presumably tax. The ‘service fees’ are for a Mastercard payment (which the Tiger website told me would cost nothing – but the incompetence of Tiger is only an aside here, not my point).   But it’s quite a table nevertheless. The service provider gets 23%, the government gets 10% (allowing for tax on the service fees) and at least on the face of it the rest goes to the monopolies running our airport and financial services (though Tiger takes a juicy cut of the financial services cost).

I’ve thought for a while that the News Ltd stable of papers in Australia were stuck between two seperate models in the News Ltd empire when it came to political reporting. The old Murdoch model of cultivating the image of influence by backing winners, frequently supporting unprofitable mastheads to do so, and the newer Roger Ailes Fox News model which runs wholeheartedly partisan coverage to capture both a party and a tribal following that makes the model very profitable.

The Australian papers are stuck betwixt these worlds. They are entrenched in one camp like Ailes is, which reduces your status as a player to be courted since one party will write you off and the other will take you for granted. But they also have to be cross subsidised by profitable parts of the empire, such as right wing populism in Foxnews or left wing populism in Avatar.

With the Labor apparatchiks who believe most heavily in “the narrative” seemingly on the way out the illusion may swiftly disappear just as Alan Jones’ influence in NSW evaporated when Bob Carr’s departure meant no-one in power was treating him as if he had it.

But this election has produced something even crueler. A bunch of independents who care not a whit for what the headline of the day is, how things are playing, the flow of “the narrative” or winning the horse race. it’s no wonder that the News Ltd papers are strikingly unanimous in calling for a new election. A new election gives them a chance to look like players. The independents make them look impotent.

I don’t think the image of potency can easily be regained, nor a reputation for quality journalism that would make the paywall pay. Perhaps they’ll simply continue the Maoist fervour against elites who claim they have expertise (climatologists, economists etc.) that is superior to the gut knowledge of right thinking folk. I don’t think they can be entertaining enough to make it pay though.

Here are all the sponsors for the Australian Conference of Economists this year.  All public sector agencies. Now economics is a discipline fundamentally about policy – or I think it is – so it’s no scandal, but it’s still pretty striking that there’s not a private sector sponsor among them – or perhaps there are and they’ve fallen below the ‘bronze medal’ radar. Anyway, it’s a bit of a pity.

The Economic Society of Australia (NSW Branch) acknowledges the support of our ACE10 sponsors:

· The Treasury (Gold Sponsor)

· Australian Securities and Investments Commission (Silver Sponsor)

· Department of Families, Housing, Community Services and Indigenous Affairs (Silver Sponsor)

· NSW Treasury (Silver Sponsor)

· Productivity Commission (Silver Sponsor)

· Department of Education, Employment and Workplace Relations (Bronze Sponsor)

· Reserve Bank of Australia (Bronze Sponsor)

· Australian Bureau of Statistics (Satchel Sponsor)

· Independent Pricing and Regulatory Tribunal (Name Badge Sponsor)