Pearls and Irritations

A regular collection of links to writings and broadcasts in other media

ABC’s Saturday Extra with Geraldine Doogue (from 0730 to 0900 or on their website  in case you miss it).

The new Arab spring? The resignation of PM Saad Hariri has not stopped the protests in Lebanon – and similar mass protests are breaking out across the region.

Working for Big Brother: Over the years numerous reality TV contestants have complained about poor treatment, bullying and harassment. Now the courts have taken their side, arguing that contestants are employees, and as such they qualify for workplace protection.

Taxing Netflix: Multinational digital giants like Netflix and Facebook operate according to their own logic – and that extends to the way they pay tax – or don’t – in various countries. Will the OECD’s new global tax plan succeed in clawing back revenue where other legislation has failed?

In the latest of our series on Africa we turn to Nigeria – the economic and cultural powerhouse of the continent. Is it the success story it seems?

The Pick – our monthly look at what people are reading and watching. Guests: Stephen Loosely and Dara Conduit.

Other commentary

Polls

Young Americans aren’t all that enthusiastic about capitalism

A  YouGov Poll  commissioned by America’s Victims of Communism Memorial found that 70 per cent of US “millennials” – those presently aged between 23 and 38 – would support a socialist for president. Only among older Americans is there strong support for capitalism and reluctance to support a socialist candidate. Julia Conley writing in Common Dreams, points out that while American ageing “baby boomers” (like the baby boomers across the Pacific) are disinclined to vote for socialism, they are the biggest beneficiaries of government services and transfers.

Australians’ contradictory views on Labor and the economy

The chart below is drawn from data in the latest Essential Poll, which asked its regular question about which party should be trusted to handle important issues.

On every economic issue affecting people’s lives – fair wages, ensuring housing is affordable, providing essential government services, ensuring the tax system is fair – people are much more inclined to trust Labor rather than the Coalition. That’s a realistic assessment in view of the economic damage wrought by six years of Coalition neglect of structural policy. Yet when it comes to the abstract idea of “management of the economy” the Coalition is ahead. As John Menadue points out “the Coalition’s claim to economic competence has become part of the public’s mindset”, regardless of the evidence.

The same poll asks about people’s preference between a budget surplus and spending to stimulate the economy. Economic stimulation wins by a long shot, with predictable partisan differences and a surprising gender difference – men seem to prefer a neat set of fiscal books while women go for a Keynesian stimulus.

Writing in The Guardian  Essential’s Peter Lewis reports on these findings. The Coalition ran an election campaign with its puerile presentation of Shorten as the Bill Australia cannot afford, while promising fiscal rectitude. They now have to live with this reckless promise, even as the prospects for balanced budgets recede and as the public come to understand the consequences of fiscal austerity.

The Essential Poll also asks about awareness of and support for the “extinction rebellion”. A majority of those aware of the movement support it, with predictable partisan differences. Queenslanders, however, stand out for their opposition to the movement.

Women are more concerned than men about the state of Australian society

Reporting on the ABC’s  Australia Talks National Survey  Annabel Crabb presents a graphic on the extent to which Australians see particular issues as problematic. On almost every issue women are more concerned than men. Issues about which 90 per cent or more women are concerned include “poverty”, “environment”, “water”, “household debt”, “cost of living”, “drug and alcohol abuse” and “public transport infrastructure”. The only issue which bothers men more than women is “loss of traditional values”.

But are women more likely to vote for the Coalition?

Writing in The Conversation  Australian academics Leah Ruppanner, and Gosia Mikolajczak and American academics Christopher Stout and Kelsy Kretschmer have an article Why white married women are more likely to vote for conservative parties.

Their article needs to be read with caution, particularly with regard to any possible extensions to the Australian situation. Research on US elections shows that since at least 1980, and probably earlier, there has been a significant gender gap – most recently 11 percent – manifest as women showing stronger support for Democrat candidates than men. In times long past in Australia there was a bias in the other direction, but more recent surveys, such as that reported by Peter Lewis  in The Guardian last year, suggest that women are far less supportive of the Coalition than men.

Navigating the South China Sea

Former Australian diplomat Paul Barratt, now of the University of New England, has written  an extensive review of the book  Building a normative order in the South China Sea: evolving disputes, expanding options, written by a panel of East Asian experts. He stresses that the issues around the South China Sea go way beyond naming rights. He points out that “this vast body of water is transited by approximately half of the world’s commerce” and is rich in natural marine resources.

At first sight the problems appear to be intractable and Barratt agrees that bilateral negotiations between the main parties are unlikely to make progress, but he suggests that it should be possible for “middle powers of the region such as Australia to take both pragmatic and principled approaches”, dealing with problems issue-by-issue, and working towards solutions that are consistent with the norms of the international order.

Indonesia – undoing Habibie’s legacy

Writing in The Conversation  Tim Lindsay of the University of Melbourne describes Indonesia’s unravelling of the anti-corruption reforms introduced by former President BJ Habibie – A requiem for Reformasi as Joko Widodo unravels Indonesia’s democratic legacy.

Indonesia’s movement to authoritarianism is manifest in a proposed new criminal code, which would wind back press freedoms, expand blasphemy laws, ban pre-marital sex and censor the Internet. There is a protest movement, but in comparison with the movements that pushed for democratisation in earlier times it is weak.

The real Kurdish threat

In recent days most media have understandably focussed on Trump’s betrayal of the Kurds who had done so much in the battle against ISIS, and the brutality of the ensuing Turkish occupation of the Kurdish strongholds. Writing for Project Syndicate, President of the Council on Foreign Relations Richard Haass outlines the diplomatic and security implications of this abrupt manifestation of US isolationism, and how it plays into the US domestic political agenda – The high price of Trump’s great betrayal.

There is more to the Kurdish betrayal than the politics of US alliances. In the New York Times International Edition, Jenna Krajeski refers to  the long-term Kurdish project, which has been to develop democracy in a region dominated by authoritarian governments. “That plan included equal representation of women and minorities; fair distribution of land and wealth; a balanced judiciary; and even ecological preservation of northern Syria’s rural landscape.” Realisation of such a model would indeed be a threat to the right-wing theocracies offered by ISIS and Turkey’s Erdoğan. No wonder the Kurds feel betrayed.

Familiar and lesser-known Democrat presidential candidates

Joe Biden, Bernie Sanders and Elizabeth Warren

Commenting on Joe Biden’s campaign, Robert Reich writes that “Democrats cannot defeat Trump’s authoritarian populism with an establishment candidate who fronts for the oligarchy. His article in The Guardian – No wonder Wall Street fears Warren and Sanders – they speak for the people – points out that the present-day divide isn’t between “left” and “right”, but between democracy and oligarchy. He believes a large majority of Americans would become politically engaged if they understood that they could move toward “a real democracy and economy that worked for the many”.  The oligarchy may be comfortable with Biden, but they see the real threat as Warren, whom they are watching with “increasing panic”.

On a similar theme Joseph Zeballos-Roig, writing in Business Insider, notes that the campaign messages of Sanders and Warren echo those of Franklin D Roosevelt  when he took on the oligarchy in 1936. They are “harnessing lingering anger among the public towards financial institutions and the wealthy a decade after the 2008 financial crisis”. This message is gaining support, even among Republicans.

Tulsi Gabbard

Tulsi Gabbard is a Member of Congress with a strong interest in America’s foreign policy. She has been a member of Congressional armed services and foreign affairs committees and has done military service in Iraq. She continues to serve as a major in the Hawaii National Guard.

She is standing against what she provocatively calls the Clinton-Trump policy “of acting as the world’s police, using the tools of war to overthrow governments we don’t like, wasting taxpayer dollars, costing American lives, causing suffering and destruction abroad, and undermining America’s security”, to quote her article in the Wall Street Journal  I can defeat Trump and the Clinton Doctrine.

In spite of her  low (but rising) support  in polling (not very meaningful in a Melbourne Cup field of candidates), she is causing a stir among Democrats. Hilary Clinton has levelled accusations against her, suggesting she may become a third-party “spoiler” in the ultimate contest – a suggestion dismissed in  an article  in The Economist  (which has some general insights about the influence of third-party candidates).

(The WSJ has a paywall but there is a door open for the infrequent reader. You can soon wear out your welcome, however.)

In China Xi Jinping remains firmly in power

Writing for the Center for Strategic and International Studies, Jude Blanchette explains the governance mechanisms of China’s political processes, including the currently running four-day Fourth Plenum of the Nineteenth Party Congress. Every indication is that the outcome of the session will be a re-assertion – indeed a strengthening – of the hold Xi Jinping and the Communist Party have over the country. The ruling elites will not be shaken by growing hostility from the US, unrest in Hong Kong or slowing economic growth. Rather they will consolidate their grip on power, he writes.

What’s going on in Chile?

As with the unrest in Hong Kong, there is no shortage of news on Chile’s riots and demonstrations, but there is little reporting on the underlying causes. We do know that although in 2017 they elected a right-of-centre government, the overwhelming majority of Chileans  support the demonstrators’ goals (but not necessarily their methods).

Writing in  Project Syndicate  Andrés Valesco considers a  number of possible drivers of the unrest. Although income inequality has not been getting worse, expectations for democratic reform are not being realised.  “Chile has joined the OECD club of rich countries, but in many ways it remains a traditional society riven with class privilege.”

Writing in Bloomberg Tyler Cohen of George Mason University offers  several possible explanations  based on Chile’s political, social and economic conditions. One, which may also be relevant to Australia, is that inequality is more in your face when a geographic concentration of economic activity ensures that people of different economic classes regularly encounter one another, as is the case in Santiago, a city of 6 million in a country of 18 million. He points out that in the US, by comparison, the rich and poor are separated geographically.

Albo on Jobs and the Future of Work

On Tuesday Albanese gave a speech – Jobs and the future of work – which perhaps should have been delivered by a Labor leader nine months ago before the disaster of the May federal election. It focuses on how adaptation to climate change can lift our struggling economy out of its doldrums and counter the Coalition’s deliberate policy of suppressing wages.

The popular press has tended to focus on his mention of support for traditional jobs, “including coal mining”. But it is clear from his speech that he is referring to high-grade metallurgical coal for steel-making, not coal for generating electricity (thermal coal). Whatever Angus Taylor and Matt Canavan may believe, thermal coal is on the way out. But until the world economy becomes less steel-intensive, and can improve its use of recycled metals, there will be demand for metallurgical coal. As pointed out in a recent Reserve Bank paper  The changing global market for Australian coal, even metallurgical coal faces an uncertain future. Those who spruik for the coal industry are cruelly misleading investors and miners.

As Albanese stresses, a world adapting to climate change will generate plenty of demand for mineral products for batteries and conductors, particularly lithium, silver and copper.  (perhaps even coal to make large storage batteries rather than making CO₂).

On the other side of the fence the tribal elders of the Coalition are warning Morrison about the risk of hubris (Michelle Grattan in The Conversation) and his  attitude towards the National Party  (Andrew Probyn on the ABC website).

Farmers doing it tough in a policy vacuum

Linda Botterill of the University of Canberra, writing in  The Conversation, calls for a national drought policy. A national drought policy should be an easy, bipartisan fix. So why has it taken so long to enact a new one? Since 2008 the Commonwealth has had a report from the Productivity Commission recommending a set of policies to deal with drought, but it has ignored that advice. She points out that the 2008 report “was pretty clear in its conclusions about the impact of climate change on drought in Australia”, but the Morrison Government still cannot bring itself to see the link between climate change and the plight of farmers.

Writing in  Pearls and Irritations, former Agriculture Minister John Kerin  says that “the current Coalition response to just another drought is pathetic, short-term, divisive and dishonest. All it is doing is managing the drought politically”.

The Commonwealth does not have a monopoly on irresponsible rural policy. Guardian journalists Adam Morton and Anne Davis describe how the Queensland and Western Australia governments, under previous LNP and Liberal administrations, have encouraged land clearing: they are now joined by the NSW Government which has weakened laws protecting native vegetation protection laws: protection laws: Australia spends billions planting trees – then wipes out carbon gains by bulldozing them.

We’re becoming wealthier – or is it simply an illusion of misunderstood figures?

Roy Morgan has released a few “key findings” of its  Wealth Report 2019.  (If you want to read the full report it will set you back $10 725, in this brave new age of privatised social data). It should properly be called a report on “financial wealth”, because it excludes some of the most important aspects of wealth such as social capital, human capital, institutional capital and shared common wealth.

It claims that Australians’ per-capita gross wealth (i.e. financial wealth before debt is debited) increased in real terms between 2007 and 2019 from $306 100 to $370 200 (their source of four-digit precision is not revealed). But it seems that it has simply applied CPI inflation to the market value of housing to come to this figure, when by any reasonable consideration the value of one’s house – that is the real value of providing shelter and comfort – has little to do with its market value, a value that fluctuates with the whims of so-called “investors” and government taxation policies.

Even within these assumptions Roy Morgan concludes that inequality has increased over this period. Charis Chang of news.com.au, who apparently has access to the full report, has produced some  revealing tables and graphs  on the distribution of changes in wealth. Among her findings she points out that while  average personal wealth may have increased, the wealth of the  median  Australian (the person in the middle) has actually decreased by 2 per cent.  (It would almost certainly have decreased even more if the value of housing were deflated by a more relevant indicator than the CPI.)

Wage theft – pick your explanation

Woolworths has done the nation a service by bringing wage theft back to the front pages.  Some, such as Paul Gregoire, writing in The Big Smoke, see it as  a manifestation of a deliberate anti-union push  by the Morrison Government. William Olson, writing in Independent Australia, points out that it is widespread and is certainly  not confined  to any one industry – even the ABC has been underpaying staff. On the ABC’s  PM  program David Taylor hosts  a short debate  (4 minutes) between Sally McManus (ACTU Secretary), Peter Strong (Council of Small Business Organisations CEO), and John Buchanan (Head, Business Analytics at the University of Sydney Business School). McManus argues that wage theft is deliberate and systematic in some industries;  Strong suggests that it results from the complexity of labour laws; and Buchanan points to structural factors such as underemployment in our weak economy as setting conditions for wage theft.

The ACTU  submission to the inquiry into wage theft in Queensland  reads like a who’s who of Australian business. Besides the common practice of paying under-award wages, it lists 20 other practices, including failing to pay superannuation, clawing back wages through high charges for staff accommodation, and phoenixing to avoid paying accumulated entitlements. Although the Morrison Government is framing wage theft as a big-business phenomenon (take for example its attacks on Woolworths), data finds wage theft in most sectors, including small business.

How we let so-called “conservatives” behave as wreckers

Referring to political populists including Trump, Johnson and Morrison, Laura Tingle writes that “the trashing of institutions, and the existing order, are seen as almost accidental fallout when in fact they lie at the heart of what these political outsiders pursue”. They even disregard the traditions of the parties they claim to represent. (Yet we call them “conservatives”.)

Her article on the ABC website – Politicians keep shifting the goal posts as though the public isn’t watching – is in the particular context of Angus Taylor’s contempt for accountability in relationship to his absurd claims about Sydney Council’s travel expenses, and Bridget McKenzie’s open admission that her office keeps no records on how sports grants are allocated. Just in the last ten years (remember how Turnbull lost his party leadership over the ”Utegate” incident?) the goalposts of accountability have shifted, Tingle writes.

Annabel Crabb has published more results from the ABC’s Australia Talks National Survey: What makes an Australian? Probably not what you think.  Crabb’s article is mainly about what we expect from immigrants, but it’s notable that highest ranking goes to “respecting Australia’s institutions and laws”. If we expect such respect from immigrants, surely we should expect it from Coalition politicians. (The heartening news from Crabb’s article is that “being born in Australia” and “being white” have very low scores.)

For a short discussion on the (shifting) meaning of conservatism, see a short article in The Harvard Gazette – The conservative quandary – in which American politicians and political scientists offer their definitions.

Reserve Bank Governor Lowe on history and the state of capitalism

Philip Lowe’s  Sir Leslie Melville Lecture  is an important piece of work. Its economic and policy rigour is in stark contrast to the economic drivel emanating from the Morrison Government.

The first part is a description of the Bank’s mandate and how it developed. That mandate is not just about inflation targeting; rather it has a broad three-part mandate to do with the economic prosperity and welfare of the people of Australia. “We need to remember that [inflation control] is a means to an end, and that end is welfare maximisation”.  It’s a reminder that the Bank’s mandate dates from a time when economic policy was about shared prosperity rather than fiscal impression management.

The second part is on a global issue – the ineffectiveness of low interest rates to stimulate borrowing and investment. He starts with factors enticing individuals and firms to save – demography, the economic rise of Asia, and the legacy of previous borrowing binges which have left households with high debt: when we already have high debt low interest rates do not entice us to borrow more. He then looks at the demand side: why are firms so reluctant to invest when there is the enticement of low interest rates? Demography plays a part – the growth of national and global populations is slowing (a major challenge for the present growth-dependent model of capitalism). The main immediate issues are to do with uncertainty and pessimism, including the uncertainties of major economies being run by economic idiots. (His actual words are a little more guarded.)

He holds back from criticising governments’ fiscal policies, but a clear conclusion one may draw from his speech is that this would be an excellent time for our government to use the funds sloshing around in the market to invest in nation-building works and industrial transformation.

A shocking tale of neglect

That’s the title of the first chapter of the  Interim Report of the Royal Commission into Aged Care Quality and Safety, released on Thursday. It is summarised in the Commission’s  media release – “A shocking tale of neglect” – neglect that diminishes Australia as a nation.

There has been a great deal of media coverage of horror stories from nursing homes but not so much about public policies and attitudes that have led to such outcomes. One clue lies in the Commission’s description of “a system that is designed around transactions, not relationships or care”.  Some insights of how aged care is perceived as a commodity rather than as a human service can be gleaned from the Commission’s summary of its hearings in Adelaide, in the first two chapters of its second volume.

Mental health – another tale of neglect

Another report released last week is the Productivity Commission’s  Draft Report on Mental Health. Its specific remit is about mental health, and it presents striking figures on the incidence and economic cost of mental illness. Its suggestions for reform include many measures that could apply to health care more generally: there should be more early intervention; gaps in services should be closed; there should be investment in services beyond health, particularly housing; there needs to be coordination of services and funding; and there should be more pathways for people with mental illness to get into work.

Defending science in a post-fact era

That’s the title of a record of an  interview with Naomi Oreskes  published in the  Harvard Gazette, discussing her book  Why trust science?. She is trying to turn the arguments on climate change and other issues such as public health from “why trust scientists?” to “why trust science?”. In advice that could be apt for Australia she urges scientists to get out to the “red states” – America’s Republican-dominated inland – to deliver the message on climate change.

Restoring the Imperial knot

Anglophiles such as Tony Abbott cannot wait for Britain to separate itself from those ghastly French and Germans and get back to the days of empire and preferential tariffs for goods from the motherland. So here are a few questions, the answers to which can be found on  an infographic provided by Alex Joiner of IFM Investors:

• In what year did the UK first slip out of first place among Australia’s trading partners?
• In what year did Japan first occupy first place? What was the UK’s place in that year?
• In what place was the UK in 2009 when China first occupied first place?
• In 2018, was the UK still among Australia’s top ten trading partners?

Always look on the bright side

Something endearing about the British is their capacity to make  light of a ghastly situation.

Saturday’s Good Reading and Listening  is compiled by Ian McAuley

Watch out tomorrow, Sunday, for Peter Sainsbury’s Sunday environment round up.

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