I don’t like Tony Abbott

I just figured I should start with that, so that my prejudices are known. As are, to be fair, his. His reaction to the government’s response to the national emergency of Indigenous communities?

“We need to get the police in and the booze out.”

“You aren’t going to stamp out the child abuse and violence without a strong police presence in these communities.”

“That’s how it starts, and that’s why the most significant aspect of the prime minister’s announcement is getting the police into these communities on the ground as soon as possible.”

Yes, police. Because when Indigenous people are 11 times more likely to be imprisoned, in the Northern Territory with its mandatory sentencing, after we’ve stepped in and started telling grown adults what they can and cannot consume, with the welfare upon which we’ve made them dependent, and of substances upon which we’ve made them dependent (we can debate this another time), more police are going to really smooth those tensions over.

Unless what the Minister for Health meant to say was that the police ought to be boosted there to enforce this daft idea – preventing the sale of alcohol to Indigenous people all over the Territory, and following everyone else home to make sure they drink it themselves. Surveilling indigenous communities to make sure they aren’t getting it or making it some other way and drinking it on the sly, or drinking anything else they think will blow their brains out for an evening. Will his police be able to do something about mere neglect, or only substantiated child abuse? And why does he suspect more police will help a problem whose existence is not due to under-policing in the first place?

Every time one of the government opens their mouth, policy moves ever farther away from the Inquiry’s very intelligent recommendations concerning community empowerment – let alone community enrichment or development.

Meanwhile, Indigenous life expectancy is still 17 years less than White Australia, Indigenous mortality rates are still around triple that of White Australia. Perhaps our Minister for Health could concern himself with those statistics.

Attending to stereotypes

According to this morning’s SMH, 125 former members of parliament (Australia’s) have accrued AUD1.2m over the last financial year in air travel – air travel for which they don’t pay. Up to 25 domestic return air-fares per year are given to former MPs as part of their golden election, or whatever it should be called.

Politically, electorally, this ought to be good. John Howard is not responsible for former MPs – although a look at former Liberals vs. former Labor MPs would be bloody entertaining. According to the article, the top 2 were Labor MPs, in fact. But this news comes hard upon the heels of the news that current MPs are giving themselves a pay-rise, so it all rolls into one: politicians are greedy. Public good, common treasury, etc. are not their watch-words: Jerry McGuire’s are. Parliament the operation gets the bad name, and John Howard has been in charge of it for the last 11 years, making it his fault.

It’s about the easiest maths in the world to do. It isn’t right, and we could well argue whether or not it is fair. In our simple two-party system, with our simple two-party stereotypes, Bad Characteristics must be apportioned, and I reckon the Libs will get this one.

Interestingly, though, Rudd won’t have much room to profit from the news, given the Top 2 exploiters are from his party (the Prime Minister thanks the breaks he can catch). With suitable naivete I’d say this means it is barely news, and will go away?

This links with another odd story – the RAAF making six flights, in all, to get the Prime Minister to the cricket. Couldn’t he just put on his weird sports-outfit and sit on the couch?

Why I find these interesting is that there is a cost-to-taxpayers element to all of this, but to me there’s an environmental element. We’re Australia: at the end of the day, AUD1.2m for rewarding former politicians for the job they did or didn’t do is eminently affordable. It isn’t as though we’d planned on spending it on Indigenous health interventions, or anything. There have been enough budget surpluses that I defy anyone to pretend this was money the country needed. Even the total bill for all MPs (AUD8m) hardly registers, for me – though I’d certainly rather have that money myself, if offered.

Making the RAAF fly a bloody Challenger business jet empty, twice, however is the obnoxious part. As are all the other flights made for one cricket match, etc. Could we not give our retired politicians free tickets on the Indian-Pacific, instead?

Therefore: I’d like to see the costs of this sort of thing in Terms Environmental – carbon emissions, barrels of oil, things that most certainly could be happily done without, or diverted to other purposes. Just a thought. Everyone else is supposed to be concerned, while the Prime Minister is comfortable causing unnecessary CO₂ emissions (NSW, remember those storms you only just had?), noise pollution, etc. That’s selfishness.

Congress May Challenge Private Equity’s Big Tax Break

This is only poorly-comparable, as yet, to the actual fun the UK’s parliament is having with their private equity bosses.

From the New York Times:

…leaders of the tax-writing committees in Congress are considering a new proposal to end a tax break that has allowed wealthy financiers who run private equity firms and hedge funds to cut their total income tax bills by billions of dollars.

The proposal to raise tax on “carried interest,” which may be attached to a tax bill expected as early as July, would have a far broader effect than more modest-legislation introduced last week by Senate tax writers to increase taxes on private equity firms that go public.
…
At the heart of the newest proposal is an attempt to bar private equity and hedge fund operators from a longstanding, but little understood, practice that has allowed them to pay a lower capital gains rate of 15 percent instead of the ordinary top income tax rate of 35 percent on their performance fees, which typically represent most of their annual income.

The industry argues that the portion of profits they receive from investments should receive preferential treatment because of the risk involved. But critics contend that the fees are effectively bonuses because private equity firms have little, if any, of their own money at stake.

More on that latter part in a moment. This ‘carried interest‘ issue isn’t unique to the US – it’s equivalent to the taper laws being exploited in the UK (apparently not for long, though). Germany, recently, stopped the tax-exemption of carried interest, only to weaken that stoppage.

Carried interest is a proportion of capital gains a venture fund makes that is given to the fund manager as incentive. Hence the question – is it income for services rendered, subject to income tax rates (yes), or is it s standard capital gain (no)? So far it’s come in as a capital gain. Which it isn’t.

That industry argument at the end of the quote is frankly hilarious, when it isn’t insulting. Carried interest refers to money earned on venture capital, given to fund managers. Ergo, it isn’t money earned on risks taken with the fund manager’s money. In any event, the rate of return on venture capitalism and private equity are supposed to be the reward for the risks – that’s why they make so much bloody money. The idea that the government should pay venture capitalists to make endless potentially destabilising gambles on weirdly-constructed companies and/or financial instruments is sheer idiocy.

If managed, there’s a big loophole in taxation that can be filled. If managed:

Already, an army of lobbyists is lining up to stop such proposals, including the U.S. Chamber of Commerce and the Private Equity Council, a recently organized group to represent the industry.

“This is the No. 1 issue all offices are getting lobbied on right now,” a senior aide in the Senate told The Times. “Carried interest is billions; publicly traded partnerships is millions.”

Fees discourage state pupils from applying to university

I had to no idea my post about student debt would prove to be so topical. According to a survey by the group Pure Potential (about whom more momentarily),

…75% of bright Year 12 state school students feel they do not understand university tuition fees. This is 12% more than last year.

The survey shows that this year’s school leavers are just as anxious and uninformed about the higher education choices available to them as pupils were 12 months ago.

Most know little or nothing at all about the financial support available to them at university (93% compared with 95% in 2006) and 29% are less likely to go to university because of tuition fees – a 2% increase on last year’s figures.

Some 30% do not feel at all confident about the university process, up slightly from 28% last year.

God! What dribbly statistics. ‘Bright’ Year 12 students? Did they actually measure that in their survey? Actually they did, but I’m still not impressed. I expect so much better of an institution like the Guardian. So 30% do not feel confident about the University process – a 2% increase? Is there a benchmark? Do we worry when that is 35%? Should we have begun worrying when it was 20%? Personally I’d like to know where the other 70% come off being so bloody cocky. I was terrified about the University process – I barely knew which train station to get off from for my campus.

Pure Potential’s bag is access to higher education – meaning that, yes, they have something to sell. Still with the Guardian,

Marc Zao-Sanders, the co-founder of Pure Potential, which was previously called Target 10,000, said: “The figures speak for themselves. Students from the state sector – especially those with no history of higher education in their families – are now even less informed about key aspects of HE.”
…
“We are able to help 10,000 bright students a year but no bright students should be put off going to university in today’s society. Existing schemes and initiatives are clearly not working,” Mr Zao-Sanders said.

I support whole-heartedly the idea that background should not impede willingness to attend higher education – or success in doing so. I’m the first in my family to attain a bachelor’s degree, let alone my PhD. But I do disagree, a little, with the contention that every bright person must attend university. There isn’t enough University for every bright person, particularly in an age of grade-inflation in A-levels. Pushing it, as the Blair government has done, is what has led to exactly the cost-increases that Pure Potential is targeting with this survey.

Are costs uncertain? Yes – fees can go up (as they did while I was a student, and these were non-course fees), costs of living, as well as circumstances, are variable. There’s no reason why this shouldn’t be the case. I will sound heartless, but there is something wrong with your information, in the UK, if you worry that University is something for wealthy people. It isn’t the United States. There are a bundle of very good institutions all over the country, and despite its cock-ups the government is near enough to the Australian, Dutch, et al model for loan-and-tax processes that paying your fees should be sorted.

Stay away from overdrafts and student Barclaycards and there’s little reason to worry. You will probably live in near penury and on terrible food for a few years, graduate, and earn more during your lifetime than you would have without that degree, and far more than the degree cost.

Finally, I found this section of the article very telling.

According to the survey findings, siblings (33%) and newspapers (22%) are the main sources of information about university, with school career services (12%) and other initiatives (7%) having less influence.

The study also shows how student life is changing following the introduction of tuition fees and rising student debt levels.

Long gone are the days of students spending hours in bed or the student union. Almost two-thirds (64%) say they will get a part-time job while at university and 26% say they will live with their parents or guardians while studying.

Siblings and newspapers definitely should not be your main source of information. My school counsellor was bloody awful, so I can’t comment there. The introduction of tuition fees, student debt, etc. I’ve covered in the other post – I will point out that other countries have all been through this, and we still have universities. But “Long gone are the days of students spending hours in bed or the student union.”? If Pure Potential thinks it has a constituency that still thinks of the old days of grants, the best advice it can give them is to stop watching the Goodies and the Young Ones.

If you’re going to attend University, you’re going to pay and you’re going to have to work. It’s not high school plus, it’s an investment in human capital. I doubt this is particularly merited – I’m more sure than not that this article is just free advertising for the company.

This is the Night Mail crossing the border/Bringing the cheque and the postal order

Britain’s Royal Mail, which can date itself back to 1516 and Henry VIII, has had a rough time, just lately.

Famous for losing one’s post (around 14.4m letters each year), some of which can be recovered using other methods such as re-purchasing them on eBay (no, but I wish I was joking), Royal Mail lost part of Amazon’s business, yesterday (the announcement, anyway). Amazon has decided to retain Royal Mail’s services for first-class post, but no longer use it for second-class post.

New kid on the block UK Mail has picked up the GBP8m worth of business – just as it did earlier this year when it found the favour of

• The Department of Work and Pensions
• BT
• British Gas
• HSBC
• LLoyds
• The Royal Bank of Scotland
• The BBC

This also doesn’t include the likes of Centrica, and the remainder of the Lloyd’s gig, which went to a Dutch company (TNT). This comes after Royal Mail lost its 350 year-old monopoly only last year. Unfortunately for Royal Mail it’s been losing contracts due to a ‘failure to modernise’ – which it might have had the time and money to get done had postal regulator Postcomm left the monopoly in place the extra 15 months – I doubt Royal Mail was exactly prepared for that.

Royal Mail is in the news again only today after the long-heralded postal strike – the first in a decade – is on for June 29. With another strike within a fortnight if nothing satisfactory comes of the first. The Communications Workers Union went for the strike after getting nowhere with Royal Mail’s 2.5% pay offer, and without satisfactory assurance over fears that restructuring will shed some 40,000 jobs.

Given Royal Mail lost its monopoly and seems to have done little since but lose contracts and esteem, I’d say either job losses are unavoidable, or Royal Mail’s bankruptcy is. The effect that the strike(s) will have on confidence in the surety of Royal Mail’s services won’t help in the least, either. I don’t know how the workforces of UK Mail or TNT are fixed for salaries, unionisation, etc. It certainly doesn’t look like Royal Mail’s troubles are over just yet, though.

The World Without Us

Slow news day. I am going to spend time looking further into multilevel modelling for some work I’m beginning, as well as return to reading Alan Weisman’s excellent book The World Without Us (I rather like the cover image). This was the analysis that gave us this memorable graphic:

Meanwhile, The Big Picture is recapping various contributions thus far to the lexicon of inflation.

The Oil Drum, when you’re done with that, is discussing oil supply. Specifically the ongoing bluffing game between OPEC and Everyone Else. In this case, The International Energy Agency, and the Energy Information Administration have both decided that OPEC needs to increase supply (so that we don’t face a crunch driven by prices). OPEC says the balance is fine. The difference is about a million barrels a day. The question is, can OPEC even do it?

Back in 2006, the Oil Drum listed the status of the the Ghawar oil field’s peak/decline as unknown. Today, I’d say it’s knowable. The Saudis have been using the intrusion of gas and water to get to the remaining oil for a while now, and production has every appearance of having peaked. I posted these a while ago, I think (or did I just show them to students?). The Oil Drum’s figures (based upon EIA, IEA and Baker Hughes data) show a decline in Saudi Oil

Even as rigs are rapidly increasing

If that doesn’t indicate the problem, nothing does. I also heard probably the best argument in yesterday’s posted documentary. At least one interviewee commented that, if the Saudis had the production capacity, why wouldn’t they use it in an increasing market?

Over at the Association for the Study of Peak Oil & Gas, I found a different view put forth by ex-Saudi-Oil-guy Sadad Al-Husseini (he’s still Saudi Arabian, just not in oil exploration and production).

There has been a paradigm shift in the energy world whereby oil producers are no longer inclined to rapidly exhaust their resource for the sake of accelerating the misuse of a precious and finite commodity. This sentiment prevails inside and outside of OPEC countries but has yet to be appreciated among the major energy consuming countries of the world.

Which, to be fair, is a fair point. There’s no reason why the provider’s of oil need to be as gluttinous, avaricious and near-sighted as the countries demanding it. I still say Ghawar’s production will continue downwards. There are other views. There are also still a few fields in Iraq that have …yet to be properly stabilised..

Well, it turned my farm into a pile of sand/Yes, it turned my farm into a pile of sand

Dam levels hit 50%.

And to think, all it took was two devastating storms and one very near miss. They laid a bunch of waste, and they’re going to cost (insurers) a tonne of money, but having rain actually fall on a catchment area was nice. So, saved? Not even close – 50%?

Non-Australians may wonder why the celebration of our tanks being only half-full. Well…

That was from NSW Water Information. Compared to those numbers, 50% is a flood. It hardly means we’re saved, however: farmer’s dependent upon irrigation are still mostly screwed. So-called ‘moisture deficits’ have not been affected greatly (Soil Moisture Deficits are, as the name suggests, moisture the earth needs and doesn’t have. In Australia, this means the rainfall is sucked up by drought-stricken ground long before crops or animals can benefit). Dams in the ACT only went to the low 30 percentages. Water allocations for farmers dependent upon the Murray-Darling Basin are still going to be cut practically to zero, and the federal government is still going to take it over.

Water restrictions are still in force in NSW, and the desalination plant (that one that was too important to be publicly debated) is still going ahead. This was/is quite unpopular – NSW undertakes very little recycling or waste reduction, has the appearance of unfettered high-density exapansion in housing, and went straight for desalination. Along the way the state government declared something call critical infrastructure:

The proposed plant has been declared “critical infrastructure”, allowing it to bypass the normal approval process, so that the Government can fast-track its construction.

“By designating the project as critical infrastructure, we can carve 12 months off the planning and assessment timetable,” he said.

In May, Mr Knowles made it clear in Parliament he was determined to abandon stringent environmental requirements for controversial projects such as the desalination plant because NSW’s economic health depended on business being able to work with certainty, a minimum of risk and low transaction costs.

Desalination is clearly a part of the landscape, now. Perth has one, South Australia is going for one, Brisbane is on for one, as is Melbourne. Clearly there is a mentality of trying to preserve the myth of our national anthem, with its bloody golden soil, and beauty rich and rare (sitting, unfortunately, atop coal, gas and uranium).

Will desalination save us just as rainfall in Australia dries up? I doubt it. Desalination is geared towards supplying secure futures of potable water. That isn’t going to help agriculture, it isn’t going to help the water table, and it isn’t going to save the country. Just ask China.

Someone in the city/Gets a piece of paper/Someone in the bush/Holds the law in their hands

Hello, new readers who followed Crikey’s blogwatch. I’m sorry you came for Kevin Rudd vs. John Howard and mostly found a tonne of stuff about mining, Peak Oil and Merrill Lynch last night.

I also discovered one of my posts (Dr. Price, if you’re there) re-posted in full at some blog called green.bligblog.com. With no attribution (really, even politeness dictates a link, something). It got back to me only because I linked myself in the same post (which is not why I do it. Self-refernece is pure ego). I confess to feeling somewhat put out by such behaviour.

But onwards. I’ve noticed there’s a pattern to my posting, and it begins with Australian stories (I always start with Australian media, and their news cycle ticks over just after I’ve gone to sleep, so it’s usually on in the morning that I find anything). So now as ever. Speaking of Crikey, I hadn’t bothered pointing to them over their wonderful dissection of the report Little Children Are Sacred, because I didn’t have much to say, let alone add.

There has been a big to-do (not that there shouldn’t be, but bear with me) over the findings concerning child abuse in Indigenous communities in the north. Our gaily bedight Prime Minister declared

“This is a national emergency,” Howard told Australian parliament. “We are dealing with a group of young Australians for whom the concept of childhood innocence has never been present. That is a sad and tragic event.

“Exceptional measures are required to deal with an exceptionally tragic situation.”

We assume, no doubt, the worst (that is, the worst of Aborigines). Except that, as this article states later and Crikey discussed at greater length still,

Myth: Aboriginal men are the only offenders …It is the Inquiry’s experience that the s-xual abuse of Aboriginal children is being committed by a range of non-Aboriginal and Aboriginal offenders …The Inquiry…remains concerned that, at times, Aboriginal men have been targeted as if they were the only perpetrators of child s-xual abuse in communities. This is inaccurate and has resulted in unfair shaming, and consequent further disempowerment, of Aboriginal men as a whole. (Report, p. 59)

I wake this morning to find Australia’s soft paternalism has hardened, somewhat. From the Guardian:

Pornography and alcohol will be banned for Aborigines in Australia’s Northern Territory, the country’s prime minister, John Howard, announced today, after a report found that “rivers of grog” were leading to rampant child abuse.

“This is a national emergency,” Mr Howard told parliament. “We’re dealing with a group of young Australians for whom the concept of childhood innocence has never been present.”

The sale, possession and transportation of alcohol would be banned for six months on Aboriginal-owned land in the Northern Territory, Mr Howard said, and sales would be reviewed after that.

It’s a national emergency now?! I will remind our non-Australian readers that John Howard has been Prime Minster since 1996.

Alcohol is an important part of the Inquiry’s recommendations, but only a part. The report also mentions

a number of individual non-Aboriginal “p-edophiles” had been infiltrating Aboriginal communities and offending against children …As is often the case, these offenders appeared to have offended against many victims. However, they…often held positions of influence or trust in a community rather than being a “stranger”. (Report, p. 63)

I wonder how restricting the availability of alcohol, something we’ve spent 2 centuries of neglect and cultivated welfare-dependency getting indigenous communities addicted to, will affect this? I wonder what such circumstances will do to the influence and trust non-Indigenous people will gain when they can brink alcohol in to communities without decent amenities, and who’ve managed to interest the government only enough to have them ban alcohol, rather than provide schools, expanded horizons and the same opportunities that the rest of us have?

The report also made a bundle of recommendations concerning education and community empowerment. I wonder how long before the Prime Minister notices that ’state of emergency’?

Real research into indigenous communities can be found at places like CAEPR. I will leave you with Crikey’s original commentary. Squalor pornography indeed.

Aborigines are in the same predicament. So are people in East European cities like Kishinev, Moldova, where the 12-year-old crack whores will pester you all the way from the station to your hotels. Or half a hundred other places across the globe.

Bad enough this is happening, worse that people are pretending it can be solved quickly, or that the report’s release will make any major difference. Thus Nicholas Rothwell, whose work veers between good sense and received wisdom:

“A LINE has been drawn in troubled sand. A taboo, long and artfully maintained, stands broken. From this day on, no one can say they do not know how deep the nightmare is in remote Aboriginal Australia, or how urgent the need.”

Empty pointless rhetoric. Most people will never hear about it and few will care for more than the space of a news bulletin. Aborigines are 3% of the population, most living far from the Californian hyperspace of white/Asian Australian suburbia. For the latter, anything happening north and west of Broken Hill is another country, and nothing that happens there to people white or black is of much concern, no matter how many bridges are walked over.

What we will get is more squalor pornography — thousands of words poured forth detailing this rape that beating at this camp this settlement, jaded playwrights and novelists making flying visits to cart away a bit of homegrown horror. The ostensible purpose will be to expose terrible conditions for which we are all etc, the real effect is to make people reading the Saturday papers feel good about their own lives. Catharsis sells, as does an implicit sense of racial superiority.