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Dear Sole Subscriber,
Parliament's back in session, and much to the surprise/delight/slight disappointment of the gallery and interested observers, it seems to be proceeding in an orderly fashion.
Read below »
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Dear Sole Subscriber,
Parliament's back in session, and much to the surprise/delight/slight disappointment of the gallery and interested observers, it seems to be proceeding in an orderly fashion.
As Geoff Kitney wrote in The Australian Financial Review this morning: "No one looking on could help but notice that order has replaced chaos in federal parliament. And while it is obviously unwise to make too much of it yet, a fair portion of the credit for this should go to the new speaker, Peter Slipper ..."
Yes, he whose head is still being photoshopped into a rat on the front of The Daily Telegraph, who was widely maligned for the rumour that he was about to wig-out for his new role (he opted for a slick robe instead, the choice of coalition speakers before him), the man for whom the word "Slippery" is usually fronting his first name, is actually garnering some good reviews.
Kitney continued: "Slipper has taken to his new job with clarity, sureness and even-handedness that has left MPs with little room for misbehaviour."
The man himself has announced a set of new rules in his second Speaker of the House vodcast. And so, a note of substance seems to have slipped into question time.
This may not last long. It's early days. But in the spirit of this new era of enlightened debate and conversation, of civility and contemplation, free of cardboard cut-out figures and Harry's vexed cry of "order", start lobbing your questions into OurSay's The People's Question.
Today Bernard Keane profiles three questions -- on the NT intervention, banking regulation and MP's personal wealth, so there's something for everyone. But if you think we're not talking about the right issues, get involved. Start posting questions here and stay tuned for our mystery MP to lob in your view at question time in March. By then, it may all have gone to hell in a handbasket ...
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1. Possum: Labor's problem is an immovable 2PP vote
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Possum Comitatus of Crikey politics blog Pollytics writes:
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As we all get reacquainted with the madness that is the first week of the new political season, the time is ripe to do a bit of a comprehensive rundown about the actual state of play of our political polling. We'll start off looking at the trends and finish with an election simulation for the December quarter.
First up, the two-party preferred trend might surprise a few folks that take their media polling commentary too seriously -- it reminds me of a line from Chicken Run: "The polling flashed before my eyes, and it was really boring."

Over the three months from mid-November, nothing has changed at all in the two-party preferred status -- zip, zilch, nadda. Federal politics has been glued to a 54/46 split for nearly 90 days straight.
The primary votes however are a little more interesting, with some compositional change occurring underneath that rather dull looking straight line ...


While the Labor primary continues to recover from its July tanking -- albeit at a pace not dissimilar to continental drift over the last few months -- Coalition primary support fell to 46% at the end of last year, before bouncing back slightly post-Christmas. It's interesting to ponder whether that is an effective Coalition vote floor under the prevailing dynamics.
Meanwhile, the Greens continued their year-long voyage of exploring political life between 11% and 12% public support and the broad "others" -- apart from pollsters having considerable variation in their vote estimates for this ragtag group -- appeared to show a continuation of the slow fade that started after their June 2011 highs.
As of last weekend, the actual point estimates of the trends and the changes from the last election look like this:

The government has a 5.4% swing away from them on the primary vote, washing out to a slightly smaller 4.3% swing away from them on the two-party preferred. The Coalition has picked up 3.1 points on their primary while the Greens have lost 0.4 points. The broad "others" have picked up 2.7 since the 2010 election.
Moving on now to December quarter’s election simulation. For those not familiar with it, we grab three months worth of polling from the major pollsters and a few bits of unpublished stuff (usually giving us a pooled sample of around the 13-15,000 mark), break it down by geography (by state first and foremost, but also by region when possible), turn the derived swings from those polling results into probability distributions for each seat (taking account of their sub-state geography) -- then test those swings against the current seat margins about a million times with a monte carlo simulation and aggregate the results. We end up with a simulated election that shows us how many seats would have changed were an election held during that period and the results of the election closely resembled the polling.
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2. Rundle12: Santorum takes bad speeches to a new multiverse
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Guy Rundle in Las Vegas writes:
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2012 PRESIDENTIAL ELECTION, RUNDLE USA 2012
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Down in Colorado, they have a problem with black bears. They'll sometimes wander into populated areas, and they have long since ceased to be afraid of human beings. Indeed, they are wont to attack, in dark places in the city. Worse, the male bears when in rut, have been known to attack in an, erm, pretty intimate way -- always men, whom they mistake for she-bears. Black bears, like many species, have pretty jagged, razorish equipment, and if one goes all the way with you, you are going to be grievously torn up in the process. Say you were a political candidate, smelling sweet, walking through a car park, on your way to a big event, on an evening in Colorado. You might in the snow of a dirty car park, be r-ped by bear with a razor-like p-nis.
So, given all that, technically, it would be possible for Mitt Romney to have a worse time in Colorado than he did last night. But it's pretty hard to imagine. Last night, as the results started to come in, and it became clear that Rick Santorum would either get a clean sweep, or force a virtual tie in Colorado, the minds of viewers and TV pundits alike turned to one thing -- not, what will he do now, but, what will he say? What can he possibly say to his troops after losing Colorado, a state central to both the nomination process, and to the November contest? Would he appear at all? Or would he just go back to the Radisson, order a club sandwich and a fifth of Jack Daniels, and sob beneath the sheets, while the low-fat vanilla pay-per-view p-rn unspooled on his plasma?
That would be the human thing to do, and no one would blame him for it. There would be a modicum of respect for a candidate who just got up and said:
"Screw it ... I screwed up totally. I don't know why I'm doing this. I've never known why I'm doing this. I've never known why I've done anything. I am a shadow of my father, I am a shadow of myself. I am the original 'lonely crowd' other-directed man. Preaching individuality, I look outside myself for who I should be, and, today, I see nothing, nothing. I am happiest in Atlanta Airport on a three-hour layover, reading a back issue of Forbes and eating at Cinnabon ... and at no other time am I happy. Leave me alone. The deep degree to which I do not want to be President is coming across as a desperate desire to have this, and you are misunderstanding me. I want this even less than Huntsman wanted it, and he wanted to be President of the United States less than anyone, with the possible exception of Mahmoud Ahmadinejad. We are Mormons, our souls were crushed at birth to save time. Leave me alone, I want to enjoy my pickle and home fries. After soothing myself, I will watch a repeat of King of Queens, in oneness with the universe. Thank you and God bless America!"
But nooooooooo! He gave some boilerplate about the campaign, and how there was a lot of work to do, and "come November, we will all get behind the candidate". The candidate? He can't even say that he will be the candidate. Gingrich, every time he gets up to deliver another defeat speech, tells you what he'll be doing the first day of his Presidency. This has become more specific as time has moved on. "On the afternoon following the inauguration I will repeal Obamacare. At 4.23 I will retire to quarters and lay a cable of shipping hazard dimensions. Then I will bomb Iran and go to the celebratory balls." To be fair, Romney's speech was solid, held it together, kept his minuscule base fired up. But its greatest virtue was in minimising the gaffes -- even then he managed to refer to the idea that he would be a candidate, because he had more money behind him than the other guys.
Gingrich had spoken first last night. He knew he was going to lose all three (indeed, wasn't on the ballot in Missouri), and so he got it out of the way. Truth be told, being back in New York for this final engagement, I was out and didn't even see it.
Sadly, I returned in time for Ron Paul's excursus, another of his 20-minute lectures on sound money, delivered from deepest Minnesota, which the cable networks, desperate for filler, relayed in full. Paul had a good night, despite not winning anything -- though he may win Maine, which is currently on a week-long vote to conclude Saturday -- and, as he intimated, would do well in Missouri, because his crew were the only ones who had mastered the arcane arts of getting appointed as delegates to the state convention.
I'm not averse to a Ron Paul speech -- it, at least, has content, an argument about how the world works, a limited appeal to the Deity, etc, etc. Indeed, I have wondered for weeks why I cannot feel any hostility to Paul, even though I have not drunk the Kool-Aid as has some of the Left. A recent profile in the NYT answered it for me -- a profile that emphasised Paul's German roots, and how his parents would sometimes use German in the house -- and speak, of course, of the German hyperinflation of the '20s, the crisis that drove them to emigrate. That's what makes Paul's arguments so meaty -- he's really a European, debating issues of fundamental governance, not an American blathering on about God-given rights. In one respect. In another respect, his views are totally mythological, but there's no time to go into that now.
Anyway Gingrich had spoken, Paul had spoken, and Romney was hanging out, and it was Santorum's turn. He had won three magnificent victories, four of the eight first contests, more than anyone. He was the natural, the leader, his personable and reasonable attitude was in contrast to all the others, and a real vote winner -- and he gave not merely the worst speech of the primary, but the worst political speech I have ever seen, anywhere, any time. I mean, this wasn't just a disappointing speech, it was a fall-apart thing. Professional pollies give bad speeches -- regional managers with Asperger's called on to deliver quarterly results at a Rapid City managers' conference give the sort of speech Rick Santorum made. It will be somewhere on the YouTube that the kids like -- check it out. It's appalling, and if he ever became the candidate, Obama, far from the best debater, would chop him up like Philly cheesesteak sashimi. Then Romney spoke and we all switched to a sitcom.
So that's where it stands ... Romney still leads but he shifts in his posture as if he is a man who has been R-PED BY BEARS ... Gingrich is holding out for Super Tuesday, and Santorum wants to be VP and then President in '20, in bubblehead jesusfreak multiverse ... or not. Who knows? Official results with 100% of precincts reporting have Santorum capturing 40.31% of the vote, followed by Mitt Romney with 34.85%, Newt Gingrich with 12.79% and Ron Paul with 11.75%. Watch for bears, if you're moderate ...
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Rundle12: the return of Santorum opens the Republican race | Compared to these guys, Obama is Howard Zinn on bad acid | Rundle12: Ron Paul beckons the lost boys and girls of Las Vegas
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3. The Power Index: spinners, 'appalling' Toby Ralph at #8
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Matthew Knott of The Power Index writes:
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Toby Ralph has no office, no job title and no qualms about spinning for the forces of darkness.
He's a "mercenary" and a "bounty hunter" one PR veteran tells us; he's "to the right of Ghengis Khan" says another.
Tobacco companies, the nuclear waste industry and banks wanting to kill off the four pillars policy are some of the flamboyant freelancer's controversial past clients.
"I like working for things where people's first reaction is to say: 'that's wrong'," the Liberal party campaign veteran tells The Power Index over a bottle of Shiraz. "I'll work for anyone who pays me. I'm a taxi: flag me down and I'll take you wherever you want to go.
"I'm appalling but at least I know I'm appalling."
If you watched Gruen Planet last year you'll probably remember him: Ralph was the bloke in a black skivvy with a razor-sharp wit and a lisp that'd make Ita Buttrose blush.
Renowned for his skills as a hatchet man, Ralph worked as a strategist on two of last year's most explosive political issues: the live export trade and the battle over the Murray-Darling Basin.
When Four Corners aired a story last June on the mistreatment of Australian cattle in Indonesia, a coalition of interest groups including the National Farmers' Federation and Meat and Livestock Australia hired him for advice. The industry lobby couldn't avoid an initial ban, but it did manage to have it lifted after only a month, a result that angered animal rights activists and the Labor Left.
Over the past year, Ralph has also been running a campaign for the Basin Communities Association (BCA), a collective of irrigators, farmers and locals opposed to big government water buybacks in the Murray-Darling Basin. The group has become a key player in the water reform debate, despite environmentalists slamming it as a front group for big business.
So far, Ralph says, the BCA campaign has been "incredibly measured". That will change if the group's members don't get what they want.
"Hopefully we won't get to a campaign, but if we have to we will," he says. "I have made direct political threats to people [in the past]. I've done it with both sides of politics."
Ralph declined to discuss specific work with past clients, citing confidentiality agreements.
However, The Power Index understands, from sources close to the campaign, that Ralph was intimately involved in an aggressive effort by the National Australia Bank to convince the Howard government to allow it to merge with ANZ. Millions of dollars were spent, detailed polling was conducted and advertisements were made, but the bid was abandoned when ANZ pulled out.
In 2007, the Australian Constructors Association hired him to develop a strategy to unleash a "politically damaging campaign" against Labor unless it watered down its opposition to WorkChoices. The plan was shelved when Labor agreed to postpone its plans to abolish the building industry watchdog.
Despite a 20-year association with the Liberal Party -- Ralph worked on all of John Howard's election campaigns -- he's adamant that he's not "even slightly" political. His work for the Libs, he says, is just another gig.
"I'm far more interested in business than politics," he claims. "If you want to influence public policy you can probably do it a lot more powerfully outside of parliament than inside. Business has money and time and focus and strategic intent and will commit to a 10-year plan. Politics is so immediate and you have to make so many compromises."
*Read the full profile at The Power Index
This story is just a taste of what Crikey subscribers will have access to on The Power Index.
Learn more about it from Paul Barry here.
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4. Weak prices, outlook pressure Alcoa -- not the dollar
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Crikey's Glenn Dyer and Bernard Keane write:
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ALCOA, ALUMINIUM PRICES, AUSTRALIAN DOLLAR
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Blaming the value of the Australian dollar for all the problems and ills in manufacturing has become the easy option for companies, the media and politicians. We’re getting another round of this with the Alcoa coverage.
But it's not just the high value of the Australian dollar, it's the weak prices and outlook for aluminium, and possibly the impending end (in 2014) of a lucrative power contract, that has seen Alcoa review its 49-year-old Point Henry aluminium smelter in Geelong, Victoria. Alcoa didn't shy away from listing the problems for the smelter, but failed to mention the power agreement, which might be a sign of its importance.
As Crikey explained last year, Alcoa and other aluminium smelting companies, which account for up to 7% of our total greenhouse emissions, benefit from state government subsidies worth hundreds of millions a year. There’s a cosy union of interests between companies, unions and state governments that have kept the details of these subsidies from ever being properly revealed.
Again some of the Australian media has failed to provide a proper context for a controversial decision in the business arena. Yesterday's initial report on The Australian's website was typical -- head for the easy political option, rather than do a bit of digging. And the federal opposition, which can’t even work out whether it will have a budget surplus or not, is even more culpable, trying to blame the carbon pricing package even as local Alcoa MD Alan Cransberg denied it.
The Australian’s report was outright wrong in suggesting that "higher metal prices" were a factor. In fact the Alcoa CEO said in his statement yesterday:
"… it is important to note that the review has not been prompted by a future price on carbon. The present situation is a result of low metal prices, a high Australian dollar, and input costs. The future price on carbon would be an additional cost, however Point Henry smelter is already losing money."
The weak aluminium market has put downward pressure on alumina prices, which Alcoa said fell 9% in the fourth quarter while its selling price for metal fell 12% in the same period. Alcoa controls its alumina input costs (its second biggest cost after the cost of power) because it controls 60% of Alcoa World Alumina and Chemicals (AWAC) which is one of, if not the largest, alumina producer in the world. The listed company, Alumina Ltd owns the remaining 40%.
Alcoa’s problem is lower metal prices, and a weak outlook resulting from Europe that is having as much impact on this review as the value of the Aussie dollar. But contrary to the impression in media reports, the review isn't just limited to Australia. It is part of a company-wide restructure by Alcoa to try and lower costs given the weakness of world metal prices. Alcoa has been revealing cuts since announcing its 2011 results in early January.
It has said that it will curtail operations at three facilities in Italy and Spain by the first half of 2012. The decisions are part of a plan to close or curtail approximately 531,000 tonnes, or 12%, of Alcoa's global smelting capacity, to cut costs and increase the company's competitive position. Alcoa says the smelters at Portovesme, Italy and La Coruna and Aviles, Spain are "among the highest-cost producers in the Alcoa system," the company said and account for 240,000 tonnes of capacity . Alcoa has also announced the permanent closure of its in Alcoa, Tennessse, smelter, and two potlines at its Rockdale, Texas, smelter. That's another 291,000 tonnes of capacity. Alcoa plans to close the Portovesme in Italy facility permanently, while the La Coruna and Aviles in Spain facilities would be closed partially and temporarily. Alcoa reported a loss for the fourth quarter 2011 of $US191 million. The losses were blamed on falling aluminium prices as well as weaker sales.
Rio Tinto is tipped to take a $US5 billion charge against its Alcan aluminium business in its 2011 results today, and is closing or spinning off facilities in Australia, NZ and other countries. Again, this has nothing to do with the carbon price. Rio Tinto bought Alcan for $US39 billion in 2007, at the top of the market, a deal that almost sent the company broke and into the hands of the Chinese government.
Global aluminium prices fell 27% from their peak last April to the end of the year, including a 12% drop in the third quarter alone. But despite the fourth-quarter loss, Alcoa has a very profitable 2011. It earned a net profit of $US611 million and revenue of $US25 billion for 2011. This compares to $US254 million in net income and $US21 billion in revenue for 2010. The group is optimistic about 2012 and beyond, saying in its first quarter report:
"For 2012, we expect global aluminum demand to grow 7 percent and are forecasting a global deficit in primary aluminum supply. In fact the company forecasts a doubling in global aluminum demand between 2010 and 2020."
As we’ve seen with the car industry, manufacturing is increasingly becoming a heavily politicised debate, in which everyone -- companies, unions, governments, oppositions and the media -- all bring a determination to fit the facts into whatever narrative they want to push.
And when that happens, it’s taxpayers who end up coughing up as often as not.
Send your tips to boss@crikey.com.au or submit them anonymously here.
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5. Tweeting Rupert skips earnings grilling from analysts, hacks
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Stephen Mayne writes:
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CHASE CAREY, DAVID DEVOE, KIM WILLIAMS, LACHLAN MURDOCH, NEWS CORP, NEWS LTD, NEWS OF THE WORLD HACKING SCANDAL, RUPERT MURDOCH
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For the second straight quarter, News Corporation's executive chairman and controlling shareholder Rupert Murdoch skipped the quarterly earnings call with analysts and journalists this morning.
In what was quite a lacklustre 52-minute discussion starting at 8.30am, COO Chase Carey and CFO David DeVoe seemed cautious in allowing too much extra information to seep out.
The results themselves saw a solid 16% gain in operating profit to $US1.5 billion for the December quarter. The bottom line jumped from $US642 million to $US1.05 billion and these are real profits as the quarterly tax bill jumped from $US190 million to $US373 million.
After a one-off restructuring charge of $US91 related to the hacking scandal in the September quarter, News Corp backed up with another $US87 million one-off charge in the December quarter.
On top of this $188 million hit for the half year, DeVoe warned that operating profits from the British newspapers would be down $US150 million in the 2011-12 financial year, with the biggest factor being the last income from the News of The World against a high fixed-cost base.
News Corp has recently built the biggest print facility in Europe, but it now only services three newspapers rather than four.
Former News of The World chief reporter Neville Thurlbeck has been blogging about why News Corp’s UK newspaper division is stuffed because The Times and The Sunday Times lose about $100 million a year and The Sun’s operating model has been destroyed by a sudden obsession with ethics.
While the 60 payouts -- including another nine settlements overnight -- have been getting all the headlines, DeVoe said about 85% of the one-off costs related to "professional fees". In other words, News Corp is funding a massive lawyers' picnic.
Investors were told that News Limited's Australian newspaper business is headed for a "significant decline" in 2011-12, which is why Carey said the management had been changed ahead of a significant restructuring program.
While the world’s biggest and most powerful newspaper empire is suffering a world of pain in the print business, television, pay-TV and film continue to perform strongly.
For all the headlines about phone hacking, News Corp shares have jumped 15% over the past three months and it is now a $US52 billion with net debt of only $US6 billion. Then again, Apple is capitalised at $US437 billion.
News Corp shares have been helped by a $US2.7 billion buyback, but Carey was right to say the balance sheet would remain "overly liquid" once the $US5 billion buyback of non-voting stock was completed.
And with the Murdochs carrying no debt on their $US7 billion stake -- plus holding external assets estimated at about $2 billion, the world’s most powerful family remain in rude financial health, albeit with a battered reputation.
After about a dozen analysts asked questions over 25 minutes this morning, the media were given less than 10 minutes. The speaking order was Bloomberg, The Wall Street Journal, The Financial Times, Reuters, Associated Press and finally Peter Ryan from the ABC who got nothing out of DeVoe after asking how the hacking settlement process worked.
The moderator asked for a seventh and final question but none were forthcoming, which does not reflect well on Fairfax and News Ltd, which both declined to participate.
And with that, we were done. The market digested all that was said and sent News Corp’s voting shares 11c higher to $18.85 in morning trade.
With Rupert exempting himself from official business, News Corp followers will have to look to his Twitter account for thoughts from the great man about the greenie-captured Gillard, the likelihood of Israel bombing Iran, Mitt Romney’s devastating tax problems, the disaster of the euro and why all Europeans should become German.
Rupert's last tweet was at about 7am AEST yesterday when he declared: "I have nothing to do with Sky News." And it was a real shame he certainly had nothing to do with today’s News Corp earnings conference call.
The most relevant question for Rupert today came from a Reuters correspondent who asked when Lachlan Murdoch would return to the Australian business. Carey simply said that Rupert has publicly endorsed such a move but that "right now there are no plans to announce".
Lachlan was seen mingling with News Ltd's new CEO Kim Williams at the 103rd birthday for Dame Elisabeth Murdoch in Melbourne last night.
While Rupert didn’t find time for a tweet for his mum’s birthday, 63 Murdoch family members turned out after Melbourne City Council voted unanimously in December to make her the first Freewoman of the City. This is the highest honour a council can give and there have only previously been nine Freeman, the last being Nelson Mandella 22 years ago.
The other particularly pertinent issue for Rupert on the conference call relates to his current obsession with education. A puzzled analyst asked what’s it all about and DeVoe admitted education losses would exceed $US75 million this financial year.
Joel Klein, the man who transformed public education in New York and was hired to build News Corp’s global education offering, has instead found himself totally consumed by the phone-hacking scandal.
Send your tips to boss@crikey.com.au or submit them anonymously here.
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7. Tips and rumours
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Sky News newsroom under attack! Disturbing news from the Sydney headquarters of Sky News: the place has been overrun with fruit flies. "Presenters swallow them on air, studio guests are forced to swat them away and the hard-working newsroom crew have to put up with them buzzing around whenever food appears," the desperate staffer reveals. "Unfortunately, management hasn't seen the need to take action."
The anonymous plea from the Macquarie Park studios was signed: "Please help." We'd like to, but our requests for comment to Australian News Channel CEO Angelos Frangopoulos were not returned. And, to be fair, we didn't see any presenters swallowing flies during broadcasts this morning. But stay safe, Sky Newsers. Stay safe.
MP between gay marriage and a Right place. Labor backbencher Stephen Jones put his hand up last year to sponsor gay marriage legislation in Parliament. But we hear the left-winger is under considerable pressure by powerbrokers in his electorate -- all right-wing players -- to tone down the rhetoric. "Jones needs to step very carefully if re-selected for Throsby," says a Labor insider. "He is doing a good job but is constantly vilified by the Right faction. So he is in an invidious situation. Hence the less said the better!"
Police probe links with bikie gangs. Three strike force operations within NSW Police are currently investigating police involvement with "right-wing motorcycle gangs", an anonymous tipster whispers. Plus a four-and-a-half-year private investigation "which includes hard target surveillance, wire taps [and] hacked computers". We're told to stay tuned.
Qantas caught short on co-pilots? We're told some Qantas A380 pilots are operating as second officers in some sectors due to pilot shortages in that rank. Another example, says our insider, of an "exodus of very talented Qantas pilots to the competition airlines".
Do you know more? Send your tips to boss@crikey.com.au or submit them anonymously here.
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POLITICS, THE UNIVERSE, ETC
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9. OurSay challenges MPs on intervention, banking and personal wealth
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Crikey Canberra correspondent Bernard Keane writes:
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BANKING, HUMAN RIGHTS, INTEREST RATES, NORTHERN TERRITORY INTERVENTION, OUR SAY, OURSAY, THE PEOPLE'S QUESTION
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Parliament's back in session, Peter Slipper is running the show as speaker of the House, and questions on the NT intervention, a people’s bank and MPs' tax returns have emerged in OurSay’s People’s Question project.
A question from Emily Price raises the government’s Stronger Futures in the Northern Territory Bill, introduced by Jenny Macklin in November:
"The proposed Stronger Futures legislation has not been consented to by communities in the NT. The legislation is also a continuation of the NT intervention, which has been criticised by representatives of the United Nations as being in breach of international law. Will the government please recommend the passing of a motion that the legislation be assessed by the Joint Parliamentary Committee on Human Rights?"
The new Joint Parliamentary Committee on Human Rights will be established in the current sittings after the government’s human rights package passed Parliament at the end of last year, with the committee’s role to assess whether legislation is compatible with human rights. The Stronger Futures Bill would make for an interesting first-up test of the committee's role, which will rely heavily on UN conventions in assessing legislation.
Geoff Pain has picked up on the idea of a people’s bank floated two years ago:
"To the Treasurer: an Australia Post People's Bank would allow taxpayers to easily regain the advantages of government owned and operated banking. All of the electronic transfer infrastructure already exists and it would provide job opportunities in the smallest communities where the big four and their co-branded derivatives don't want to open a branch. It would not charge exorbitant illegal fees and would always follow Reserve Bank leads on interest rates. Operating surplus could assist budget bottom line. Will you make it happen?"
The idea of a “people’s bank” was raised by the “Six Economists” who urged a new financial inquiry and a range of other measures in 2009 in the aftermath of the financial crisis with Australia Post proposed as the vehicle for increasing competition in a market dominated by the big four banks. The letter raised 14 specific questions, each of them meaty issues. I wrote about the issue at the time (in the shadow of the GFC and with Kevin Rudd at the helm):
"It merits serious consideration because the long-term project -- pursued by both sides of politics -- to maintain competition in lending in Australia is failing. It depended on the availability of externally-sourced capital for the residential mortgage-backed securities (RMBS) market, which was fine while the world financial system was spilling over with finance but ended the moment the crisis hit -- especially after the bank guarantee massively strengthened the hand of the major banks over what was left of the non-bank lending sector.
"... It’s hard to see what downsides there are for the government in conducting the sort of inquiry urged in the letter. It has handled the triage stage of the financial crisis very well. Now is the time to take a step back and consider an overarching strategy.
"How long until the government is again confronted with one of the banks unilaterally raising interest rates, particularly for business lending? The problem of Australia’s banking oligopoly needs a long-term solution."
And just to highlight that this issue is just as relevant as it was in July 2009, there's currently speculation that, in the absence of an RBA rate cut, ANZ is considering lifting interest rates despite recent claims from banks about rising funding costs repeatedly being discredited.
Peter Asnins challenged MPs to reveal their tax returns
"To all members of government in both houses, as you can see, in the run up to the election in the US, candidates have chosen to make their tax returns public. Would you be prepared to publish your tax returns for the past five years so the Australian public can see the effective rate of tax paid. Income would be assessed as salary, tax free allowances, dividends and capital gains."
Asnins’s question might be brushed aside as not falling within any minister’s responsibility; MPs and senators are currently required to declare pecuniary interests via a paper-based system (Open Australia maintains an electronic record of them) but tax returns are a different matter; attention would focus on MPs like Malcolm Turnbull, Peter Garrett, Barry Haase and Mark Dreyfus rather than the majority of MPs who have no income or wealth outside their political careers.
A notable absence from the questions so far is foreign policy, beyond a question on the government’s treatment of Julian Assange (which is currently one of the top five questions).
Geoff Pain also proposed an intriguing question about the use of Australian uranium in armaments such as armour-piercing ammunition and the exposure of Australian troops to uranium dust in previous and current conflicts. Syria and the continued presence of a Syrian ambassador in Australia looks to be a potential issue, as is the looming budget which is now 12 weeks away.
Nominations and voting close on March 4.
*Crikey and OurSay are giving you the opportunity to get your question asked in the House of Representatives. Each week Crikey will feature a new reader question, and will look into the where/how and why of the issue and the politics behind it. A mystery member of parliament has agreed to take part in this OurSay initiative and take the People’s Question to Question Time in March. Start hitting OurSay with questions here: @OurSayAust, @OurSayPeoplesQ (#PeoplesQ #auspol) or on Facebook. Or go to thepeoplesquestion.oursay.org for more information.
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10. Indigenous community pleads with minister on NT nuclear dump
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Crikey intern Freya Cole writes:
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ABORIGINAL LAND RIGHTS, LUCAS HEIGHTS REACTOR, MARTIN FERGUSON, NUCLEAR WASTE DUMP, RADIOACTIVE WASTE MANAGEMENT, TRADITIONAL OWNERS
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"We want our land to stay in one position, we want our land to be safe so we can have a better place to live in and a better place to go and have a look around the beautiful land."
They're the words of protest from the traditional owners of Muckaty Station, a small NT homestead, 110 kilometres from Tenant Creek. The traditional owners of the land, made up of several families, say they have continually been ignored by the Labor government, which is pushing through legislation to construct a nuclear waste dump on their land.
Muckaty was nominated by the Northern Land Council for the National Radioactive Waste Management Bill in 2007. The nomination was approved by one small family of traditional owners, who are now considered by the majority of residents isolated from the local community. Since this date, the majority of traditional owners have tirelessly protested the bill with letters and petitions addressed to federal Resources Minister Martin Ferguson.
Jim Green, from Friends of the Earth, says Ferguson has falsely claimed that Muckaty traditional owners support the nomination of the site.
"He knows that many oppose the dump -- he has received a letter opposing the dump signed by 25 Ngapa traditional owners and 32 traditional owners from other Muckaty groups," he told Crikey. "Senior Muckaty traditional owners have initiated legal action in the Federal Court challenging the Muckaty site. Yet, Mr Ferguson persists with the fiction the nomination of the Muckaty site has the support of traditional owners."
The letter addressed to Ferguson and other government officials expressed desperate pleas from locals to have their opinion heard. They also invited the minister to visit the region so he can experience first-hand their spiritual connection with the land.

"We want you to come face to face … As the Warlmanpa group, we want to tell you what the country means with the designs and with the paints we have on our body," they wrote.
Lawyer and human rights advocate George Newhouse is representing the traditional land owners.
"They are fighting for their land because it appears to the traditional owners that their sacred site has been taken from them and sold for a pinch of salt to the federal government, without their informed consent and in breach of the Aboriginal Land Rights Act and other laws," Newhouse told Crikey.
Ferguson's office insists the minister met with a large delegation of Ngapa clan members and executive members of the Northern Land Council in Darwin in March, 2010. A spokesperson says the meeting confirmed the continuing support of the Ngapa clan and the full Northern Land Council for the facility.
"Five parliamentary inquiries in five years have dealt with the issue of radioactive waste management legislation, including traditional ownership of the site nominated by traditional owners at Muckaty Station," the spokesperson said. "At the 2010 Senate inquiry, Kumanjayi Napurrula Lauder-Dixon (who has since passed away) said: 'We are satisfied that the waste can be stored safely provided it has been through the environment impact process to be followed over the next few years. We are united on this decision as the Ngapa clan'."
But Jim Green says the Ngapa clan are only a small family in the area who by no means represent the entire community of Muckaty.
"It beggars belief that Martin Ferguson and the Labor government consider it appropriate to move forward with the NRWMB -- in particular those provisions in the act which target Muckaty and legitimise a sham 'consultation' process -- while the Federal Court case unfolds," he said.
Environmentalists and concerned interest groups have lined up to oppose the site. The Medical Association for the Prevention of War (MAPW) is concerned that nuclear medical waste is being used as a cover-up for the material being transported to the dump.
"I believe that Mr Ferguson feels the general public will be more accepting of the need for a nuclear waste dump if he says the waste is a byproduct of life-saving cancer treatments, and medical tests," Margaret Beavis, who represents the group, said. "My sense is that this is politically driven."
Beavis says all radioactive medical material needed could be sourced from overseas and can be stored and disposed of safely without the need for a dump.
"The vast majority of medical isotopes very rapidly loses their radioactivity, and after local storage is disposed of safely in the normal waste system," she said. "In addition, we do not need a reactor in Australia to produce medical isotopes. They can easily be imported, just like other countries do."
Ferguson says the dump will be used for waste from the production of nuclear medicines, not from medical treatments in hospitals.
"It is indisputable that production of medical isotopes at the research reactor at Lucas Heights produces radioactive waste that requires suitable long-term management arrangements," the minister's spokesperson said. "Hospitals all over the world use radioisotopes in medicine. In 2009, shortages in the supply of one of the most frequently used radioisotopes as a result of the temporary shutdown of reactors overseas, affected patient services for almost eight months."
Australian supply made some contribution to addressing this global shortage, the spokesperson says. It also means Australia is insulated from the worst of a global shortage.
Read the full story on our website
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11. How to get off scot-free after a massacre -- the playbook
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Crikey Canberra correspondent Bernard Keane writes:
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ANONYMOUS, HADITHA MASSACRE, US MARINE CORPS, WAR ON THE INTERNET, WUTERICH
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Another Anonymous crack of another US corporation has again yielded a significant insight into the operation of the US military-political establishment.
The US law firm Puckett & Faraj successfully defended Frank Wuterich, who was leading a Marine patrol in the Iraqi town of Haditha in 2005 that massacred 24 men, women and children and then tried to cover it up. In a plea deal in January, Wuterich pleaded guilty to "negligent dereliction of duty" and had a pay cut and a demotion. No one has been sent to prison for the massacre.
The "punishment" serves as a dramatic counterpoint to the treatment of Bradley Manning, accused among things of leaking video of another unpunished murder by US forces in Iraq, involving Apache helicopter attacks on unarmed men and children in 2007, which resulted in the deaths of eleven people including two journalists. The US military's only response after a "review" of that incident was to recommend that journalists wear identifying vests to avoid being killed.
In response, Puckett & Faraj had its website defaced and a trove of emails stolen by unidentified people associated with Anonymous, later called "cowards" by the firm in a tweet laden with probably unconscious irony. The emails are now starting to surface. The crackers still had access to the firm's IT even after news of their exploit was broken, which prompted Wuterich's lawyer, Neal Puckett, to email colleagues asking them to explain what exactly had happened. "Can someone explain to the old guy what the author means?"
Puckett emails colleagues after receiving an email headed "YOU GOT OWNED, YOU SICK, TWISTED RUBBISH". As the panicked realisation that they've been cracked takes hold, another member of the firm declares: "This may completely destroy the Law Firm."
But the operations of the law firm shed considerable light on some of the inner workings of military industry and its close links with the US governmental apparatus. An extensive set of emails demonstrate how the firm went about its work of trying to get the charges against Wuterich reduced or dropped altogether, by lobbying congressmen. The firm worked closely with Republican congressman Allen West, a former Army lieutenant-colonel and Iraq veteran who himself had managed to avoid serious repercussions after leading the abuse of an Iraqi man in 2003, for which he was eventually fined $5000 -- a case in which West was represented by Puckett.
West introduced Puckett to the Assistant Commander of the Marine Corps, Gen Joseph Dunford, to whom Puckett then wrote proposing to brief him on the "chilling and as yet undiscovered facts" of the Wuterich case. "As a retired Marine officer (and possible TBS classmate of yours in 1977)," Puckett piously wrote, "I feel an obligation to brief you on issues that extend far beyond the court-martial and the interests of my client." Dunford's response is (as yet) unknown.
Washington "superlawyer" Mark Zaid was engaged by the firm to reach out to other congressmen and military officials, though apparently not to the satisfaction of Puckett. After Zaid reports that Californian Republican and former chairman of the Armed Services Committee Duncan Hunter would be "willing to help see about making this whole case go away", Puckett complains "Hunter blew you off." Another retired marine colonel who "is also willing to do what he can, including talking with the current Marine Commandant who he knows, about dropping the case", "doesn't have the horsepower", complains Puckett.
West is clearly the firm's key man and Puckett is anxious to cultivate him. Puckett sends out a spam email in September 2010 to everyone he knows asking them to attend a West fundraiser later that month. "Our friend, Allen West, a retired Army LTC, is running for Congress in the 22d District of Florida (Fort Lauderdale area). We would not normally send you a request like this, but we know the character of Allen and his truly unselfish intentions to serve this country once again."
Puckett even tries to influence media coverage, writing to right-wing blogger Michelle Malkin "to bring something to your attention, not for attribution to me since we're in trial", complaining about mainstream media coverage of the trial and attacking one of the witnesses against Wuterich.
The firm's website remains down a week after the attack, despite Puckett asking his IT provider to "help us cure the problem immediately" on February 3.
The crack emerged at about the same time as it was revealed another activist associated with Anonymous was able to access and record a teleconference between the FBI and Scotland Yard discussing tactics about the investigation and prosecution of the group and some alleged members in custody. The invitation for the teleconference had been sent to a wide group of US, British and French law enforcement officials, suggesting someone within one of those groups either has some sympathies with Anonymous or an inter-agency agenda to push.
Either way, the impression that the days of the military, political and law enforcement establishments operating without public scrutiny are coming to an end strengthens with every activist exploit.
Send your tips to boss@crikey.com.au or submit them anonymously here.
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12. Wind farms, the Waubra Foundation and a post-office box
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Simon Chapman, professor of public health at the University of Sydney, writes:
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AUSTRALIAN LANDSCAPE GUARDIANS, ELECTRICITY GENERATION, JOHN MADIGAN, MINING COMPANIES, MINING INDUSTRIES, WIND FARMS
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On January 24 I was interviewed in prime time by ABC 702’s breakfast radio host Adam Spencer about wind farms and health. During the interview, I noted that two prominent anti-wind farm groups, the Waubra Foundation and the Australian Landscape Guardians, shared a post-office box with a mining investment company.
The president of the Australian Landscape Guardians Inc, Randall Bell, subsequently emailed the producer of Spencer’s program as follows (the anti-wind farm movement is thankfully both infiltrated by leaking rats and populated by naive individuals who drop such gems into one’s inbox):
Hi Amy,
Professor Chapman makes disparaging remarks in this interview about the Landscape Guardians' claiming its address is that of a mining company and whatever that association means but the implication is clear to all unless you have been living under a rock all your life it’s not favourable.
Well I have to fail the Professor.
You see the address of the Australian Landscape Guardians Association Inc. (it later changed its name to Australian Landscape Guardians Inc. dropping 'Association' in the year of its incorporation, 2007) when it was registered was "Mawalloc" 3594 Geelong Road Stockyard Hill Vic. 3373.
I have visited Mawalloc about three times. It is near Beaufort in Western Victoria and is a FARM.
The address then changed to L4, 117 Myers Street Geelong and Box 292 Geelong 3220, the address of my legal practice since the middle 1970s.
The co-tenants on L4, are currently an accountant and financial planner. THERE IS NO MINING COMPANY. Your colleague Andrew Fowler brought up this same assertion when he interviewed me for 4 Corners. Co-incidence I suppose?
What worries me is that Professor Chapman made a fairly big thing in the interview about the 'address and the mining company' but he obviously didn’t bother to check his facts.
He could have been accomplished by a search of the Victorian Business Affairs Office. I did this myself today and you can see for yourself.
If the Professor got something as basic as this WRONG what does it say about whatever else he has to say. Some might conclude that the Professor has made a fool of himself over this.
My advice for the Professor is should remember my father’s first rule of carpentry, 'measure twice saw once' as it’s often hard to stick the wood back together.
Sorry for such a long email but I have been busy reading 9 peer reviewed reports published these last few months on infrasound and the health impacts of industrial wind turbines. Be sure to tell your listeners of the Professor’s blue and copy this email to him for me.
You never know he might even send me an apology.
You have my permission to circulate this email.
Regards,
Randall J Bell LLB
President Australian Landscape Guardians Inc. President Victorian Landscape Guardians Inc.
A submission sent in February last year to the Senate inquiry into wind farms, authored by Peter Mitchell, offers the address: PO Box 1136, South Melbourne, Victoria 3205. Mitchell’s email is peterm@lowell.net.au. Lowell Resources Funds Management Limited is a mining investment company that seeks to attract investments in Australian mining ventures. Its portfolio represents "a range of commodities including gold, iron ore, coal, oil, gas, uranium, rare earths and strategic minerals, copper and other base metals".
Lowell Resources also has the same South Melbourne post-office box as that used by Mitchell in his submission to the Senate "on behalf of" the Landscape Guardians". The Waubra Foundation website shows it also shares the same post-office box.
Despite its sanctimonious name, the Australian Landscape Guardians apparently has no interest in guarding the Australian landscape from the activities of open-cut coal miners. Search and you will not find any instance of them lobbying against this sort of massive scarification of the Australian landscape.
Their activities are focused entirely on efforts to denigrate wind energy. Bell shared an Australian Environment Foundation meeting stage with Ian Plimer in 2010, as the program shows ...

There have now been 17 reviews of the "evidence" that wind farms cause health problems. Read that list and its extracts and marvel at the consistency of the conclusions that this is essentially a psychogenic phenomenon being whipped up in communities of people who are often envious of the good fortune of their neighbours who have "dought-proofed" the farm with annual turbine rental windfalls and who mysteriously never get the symptoms themselves.
This long list of problems said to be caused by exposure to turbines stretches for pages. Meanwhile, the brightest bulb in the house, DLP Senator John Madigan, is due to call for a total moratorium on all wind farm development while the rest of the world reached a record level of output, with wind now contributing 3% of the world’s electricity generation.
Backwater nations such as China, India, Germany, US, Canada, Spain, France and Italy have appeared to ignore the authority of the Landscape Guardians by all continuing to increase output.
*Simon Chapman (@simonchapman6) is professor of public health at the University of Sydney
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13. Liberals wimp out on another byelection
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Charles Richardson writes:
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BYELECTIONS, JEFF KENNETT, NIDDRIE, NIDDRIE BYELECTION, TED BAILLIEU
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The Victorian Liberal Party put off the decision as long as it decently could, but on Tuesday night state director Damien Mantach announced what had long been expected, that the party would not contest the Niddrie byelection caused by the retirement of the state's deputy opposition leader Rob Hulls.
The byelection -- to be held on March 24, the same day as the Queensland election -- will now be fought between Labor, the Greens and whoever else puts their hand up. Niddrie, in Melbourne's middle north-western suburbs, is relatively poor Greens territory (they managed 7.8% last time), so there no reason to think Labor will be troubled.
The trouble instead is for the Liberals, who are facing considerable criticism for the decision. Last week The Age editorialised that it showed "a pusillanimous attitude", and yesterday's report quoted "a Liberal source" describing it as an "act of rank cowardice".
It's not hard to see why. Last year in relation to nearby Broadmeadows, I said that: "No party these days should feel guilty about not contesting a seat that needs a 21% swing." But Labor's margin in Niddrie is only a third of that -- just 6.9%. If a government doesn't try to win a seat like that, it's not clear where it would ever try.
But only does the Liberal Party (like its opponents) have form on this issue, it even has form in Niddrie itself. Back in 1996 a byelection was scheduled there when Labor member Bob Sercombe transferred to federal parliament. The Liberals refused to field a candidate, even though the margin at the time was only 3.6%, giving Hulls the victory unopposed (although premier Jeff Kennett subsequently called an early state election before he took his seat).
More interesting is the way that Ted Baillieu's position has changed.
All reports say that the rank-and-file and the administrative wing of the party (controlled by Baillieu's opponents) were in favour of running, but the premier successfully argued against it. Last time this was argued out, in relation to Albert Park in 2007, they were on the reverse sides; Baillieu wanted to run, but the Kroger-Costello group was against it.
That partly reflects the change of being in government. For an opposition leader, a byelection is an opportunity; for a premier, it's a nuisance. The change, of course, has also made a difference to Baillieu's influence: in 2007 he was embarrassingly rolled by the administrative committee, whereas this week he got his way.
But the decision will upset a lot of people. Historically it's a wasteland for them, but the Liberals have been mounting something of a comeback in the northern and western suburbs in recent times. Although the swing in Niddrie in 2010 was only 4.3%, neighbouring Derrimut, Essendon and Keilor all swung by more than 9%, and the party won an extra seat in each of the two upper house regions on that side of the city.
As class comes to carry less weight in political terms, ideology carries more, so it's not surprising that the area is a stronghold for the party's hard right. That also may have something to do with the premier's reluctance to enter the contest.
Either way, however, it shows a divergence of interest between party and government. The government wants a clear run at governing, free from distractions and unnecessary risk. But the party, to the (limited) extent that it thinks about its long-term future, needs to be building its brand in less-friendly areas, exploiting opportunities for growth and development. Most of all, it needs to remember that it and the state are separate entities, and it does not exist just to serve the premier's interest (or vice versa).
Democracy requires choice, and a party that gets into the habit of denying the voters a choice is failing in its primary duty, however convenient that might be for its elected representatives.
Baillieu has often professed his admiration for Kennett, but in office he been careful to steer clear of many of his predecessor's mistakes. It's sad to see him now following him in his disdain for democracy.
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14. Richard Farmer's chunky bits
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Richard Farmer writes:
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EUROPE ECONOMY, GREECE ECONOMY, PETER SLIPPER, SPEAKER OF THE HOUSE OF REPRESENTATIVES
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Bring back the wig. I'm all for a bit of pomp and ceremony myself so I'm in favour of rescuing Doc Evatt's wig from its display in the Old Parliament House and putting it on the head of Peter Slipper at least on the weekly ceremonial day the House of Representatives will have in future with the Speaker following the mace in a procession into the chamber.
Who knows, it might even make the decorum of parliamentary proceedings a bit more like that of the High Court when Dr Evatt last wore the horse hair before donating it, when he became an MP, to be worn by the Speaker.
Not that the dignity of the Speaker's office can come from the costumes alone. As in all good theatre the actor must be able to act. And in that regard it seems to me that Peter Slipper has made quite a promising start. On the admittedly small sample of the couple of days this week he has had more control during question time than his predecessor.
Believing in the tooth fairy. There seem to more episodes in the negotiations over Greece's austerity package than there were in Blue Hills. Presumably there will eventually be an agreement between the three major Greek political parties on the one side and the troika of the European Community, the European Central Bank and the International Monetary Fund on the other.
Not that such an agreement will mark the end of the serial. One of the key components will be a 20 per cent wages cut and, not surprisingly, that idea is not going down well with the voters who are being hit as well with increased taxes and charges. Agreement among the Greek leadership will be no guarantee that the necessary legislation will pass through the Parliament.
And then there will be a little matter of an April election. Support for PASOK, the governing party before the imposition by the troika of an economic bureaucrat to "run" the country, is down to 8% according to one recent opinion poll. At the last election PASOK got 47%. The principal opposition party, New Democracy, is down to 18% while assorted parties of the far left who are not parties to the agreement being negotiated are polling in the mid 30s.
It is not a promising outlook for words about accepting tough measures actually being turned into reality.
No wonder there's pessimism. In the face of the current economic and political troubles it is not surprising to find Greece on the list of international polling company Nielsen's list of countries where consumer confidence is declining.
As Ambrose Evans-Pritchard writes today on his London Daily Telegraph blog:
Greece’s tax revenue from VAT collapsed by 18.7pc in January from a year earlier.
Nobody can seriously blame tax evasion for this. It has happened because 60,000 small firms and family businesses have gone bankrupt since the summer.
The VAT rate for food and drink rose from 13pc to 23pc in September to comply with EU-IMF Troika demands. The revenue effect has been overwhelmed by the contraction of the economy.
Overall tax receipts fell 7pc year-on-year.
This is a damning indictment of the EU-imposed strategy. Greece is chasing its tail. The budget deficit is stuck near 8pc to 9pc of GDP because the economic base is shrinking so fast.
Here in Australia we are in the group where optimism exceeds the pessimism with Nielsen putting us in the top 10 on its confidence scale.

Those naughty young men. It is 18 year old men who are the most prolific criminal offenders. The Australian Bureau of Statistics tells us so today. Police took action against almost one in ten eighteen year old males during 2010–11 -- that was the nation's peak offending age with 9925 offenders per 100,000. Young women lagged behind but their criminality peaks earlier -- at 16, but with a much lower rate of 3120 offenders per 100,000 females aged 16.
According to the Bureau the most common offence for both male and female youth offenders was theft. The male youth offending rate for theft was 1161 offenders per 100,000 males aged 10 to 19 years while the female youth offending rate was 772 offenders per 100,000 females aged 10 to 19 years.
During 2010–11 police proceeded against 371,040 alleged offenders over the age of 10, with males accounting for more than three-quarters (78% or 287,632) of the total. The number of male offenders was down by 0.9% on the previous year, while females offenders dropped by 1.9% (82,502) for a total decrease of 1.1%. Overall, this represented 1,892 offenders per 100,000 people aged 10 years and over.
The most common principal offence for male offenders was Public Order Offences (20%) while theft was most common with female offenders (30%).
Send your tips to boss@crikey.com.au or submit them anonymously here.
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15. What would a second Sydney airport cost?
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Alan Davies of Crikey blog The Urbanist writes:
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To cut straight to the chase, the "correct" answer is $15 billion. Or at least that’s the widely accepted estimate.
It’s cited in this 2010 story quoting the chairman of Infrastructure Partnerships Australia, Mark Birrell; in this 2011 interview with former deputy PM and rail enthusiast Tim Fischer; and more recently in this submission by the Australian Airports Association to the federal and NSW government’s Joint Study on Aviation Capacity in the Sydney Region.
But where the hell did this figure come from? How accurate and reliable is it? Was it estimated by a technically skilled and independent body?
Thanks to the diligent research of one of The Urbanist’s many smart readers, I can tell you that $15 billion figure first appeared in a 2010 report by industry lobby group Infrastructure Partnerships Australia (IPA), titled A realistic pathway to very fast trains. This impressive-looking report says (page 48):
"In 1999, the cost for the second Sydney airport was reported to be in the region of $6 billion to $8 billion. A more recent media article said the cost of building a second Sydney airport had inflated to $15 billion."
That "recent media article" appears to be the real source. But here’s the interesting bit -- the report says it’s an article titled Do The Numbers Support The Very Fast Train?, published byThe Melbourne Urbanist, on May 3, 2010.
Now I was flabbergasted to read that because I know the said Melbourne Urbanist rather well -- after all, I am he (or at least I was up until three weeks ago when I came across to Crikey and shortened my moniker to The Urbanist). I can therefore tell you with the utmost authority that The Melbourne Urbanist did not estimate the cost of a second Sydney airport to be $15 billion. In fact The Melbourne Urbanist never attempted to estimate the cost. Period.
This is what I actually said in that post on Very Fast Trains (VFTs, also known as HSR, for High Speed Rail) on May 3, 2010:
"The cost of a second Sydney airport at Badgery’s Creek was estimated at between $6 billion to $8 billion in 1999. Clearly the viability of a VFT will be greatly influenced by how much a new airport and associated transport links cost. If it were to cost around $15 billion and emit similar levels of GHG during construction then a VFT would be competitive on the assumptions I’ve made here."
Cleary, my figure of $15 billion wasn’t an estimate of what it would cost to build a second airport; rather, it was an estimate of what it would need to cost in order to make high-speed rail between Sydney and Melbourne viable. I was referring to the fact that the lower the cost of a second airport, the less likely it is the numbers would stack up for high-speed rail.
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16. Letter from: Beijing ... reading China like reading tea leaves
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Matthew Clayfield, a freelance foreign correspondent, writes:
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CHINA, CHINA ECONOMY, LIU XIAOBO, PRESIDENT HU JINTAO, TIANANMEN ANNIVERSARY, TIANANMEN SQUARE
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Arriving in Beijing during Chinese New Year celebrations is a little like flying into a war zone. The machine-gun fire of the crackers and the mortar blasts of the rockets start jangling nerves around noon and continue long into the night. Driving through the city in a taxi, you are treated to at least 10 fireworks displays on any given evening, random flares finding the gaps between buildings and bursting on either side of the ring road. In the morning, the streets and alleys are festooned with scraps of red paper, the remnants of the firecrackers that, during the night, had you waking up up in a cold sweat, convinced that your hour had finally come.
It would be easy to read all this pyromania as pent-up political frustration. Easy, but not necessarily accurate. Reading China is like reading tea leaves: it involves a great deal of guesswork and a great deal of projection. Not that this stops people from trying. Foreign policy wonks and commentators have spent the greater part of the past two months doing just that.
Those who predicted an Arab Spring-like uprising at the beginning of last year have necessarily revised their positions, but only insofar as to admit that they were off by about 12 months: this year, such commentators staunchly maintain, the revolution is on for young and old. Those who insisted there would be no such uprising last year have continued to insist that there won't be one this one.
Pointing to the Chinese Communist Party's forthcoming congress, which will see more than 60% of its central committee, including President Hu Jintao and and Premier Wen Jiabao, stand down in favour of a new generation of leaders, both groups agree on only one thing: in a year as important as this one, with the whole world watching its every move, the party will brook even less dissent than it already brooks, which is another way of saying no dissent at all.
Not that dissent is especially visible on the streets of the capital, of course. China's domestic tourism industry is booming and the primary goal of that industry is to inculcate a sense of loyalty to the regime. In the National Museum of China's permanent exhibition, "The Road to Rejuvination", fascinated out-of-towners pore over wall panels about the failures of democracy, the inevitability of socialism, and the necessity of uniting behind the party's leaders. (The exhibition's last room, dedicated to pictures of Hu meeting US President Barack Obama and attending meetings of world leaders, including Kevin Rudd when he was still prime minister, is the weakest. One assumes that it has been designed for easy dismantling later this year.)
If they don't pore over wall panels about the Great Leap Forward or Cultural Revolution, that's only because there aren't any. Not much appears to have happened in China between Mao's proclamation of the People's Republic in 1949 and Nixon's visit to the country in 1972.
Dong Xiwen's painting of the former event, Founding Ceremony of [the] People’s Republic of China, is the centrepiece of an even more popular exhibition, "Masterpieces of Modern Chinese Fine Arts", which is dedicated almost entirely to aesthetically subpar paintings of Chairman Mao. (My favourite image was Al Zhongxin's Crossing the Yellow River at Night, a blatant and inferior rip-off of Emanuel Gottlieb Leutze's Washington Crossing the Delaware.)
But not even the famous portrait of Mao on the Gate of Heavenly Peace compares to the real thing, which is why hundreds of visitors file through daily to pay their respects to his waxwork corpse. The mountain of flowers at the mausoleum's entrance may look artificially large, but enough people buy them, and bow to the marble statue of the long-dead dictator as they lay them at his feet, to suggest that its height is an accurate representation of the florist's profit margin.
As armed guards usher you quickly through the tomb, and you glimpse the dead man's face protruding from a pair of well-pressed fatigues wrapped tightly in the old hammer and sickle, the displays of reverence, and the tears they occasionally give way to, all feel uncomfortably real. The line may include a morbid sceptic such as your correspondent, but it mostly consists of true believers.
Back out on Tiananmen Square, past the kitschy stalls selling Mao memorabilia, it is difficult to square the square's touristy vibe with the image in your head of Wang Weilin, the man who, on June 5, 1989, stood alone before a line of tanks on Chang'an Avenue. (The shot of him standing motionless is perhaps the most famous, but the real victory of the ironic mind over the literal one was when he sidestepped to prevent the tanks from going around him.)
Read the full story on our website
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17. Power Shots: Murdochs pay out (and party) ... in Smith's interest ... GetUp! goes Gina ...
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Murdochs face 50 more hacking claims. The queue of people suing Rupert Murdoch's News of the World for hacking into their voicemails and putting them under surveillance is getting longer, despite 16 cases being settled overnight in London's High Court.
Hugh Tomlinson QC told Justice Vos there are now another 50 plaintiffs ready to march into the courtroom, with half a dozen already lined up as test cases. However, Rupert and James Murdoch will doubtless be relieved that a couple of their loudest critics -- comedian Steve Coogan and the Liberal Democrats deputy leader Simon Hughes -- finally went quietly. -- Paul Barry (read the full story here)
Murdochs throw a party for Dame Elisabeth. It was all hands on deck for one of Australia's most powerful families last night, as Dame Elisabeth Murdoch celebrated her 103rd birthday at the Melbourne Recital Centre.
A significant philanthropist (the hall where the party was held bears her name), the mother of media baron Rupert Murdoch was recognised by being made a freewoman of the city for services to the City of Melbourne. Dame Elisabeth's grandchildren, Lachlan and Elisabeth, were in attendance to help cut the cake, while dignitaries Victorian premier Ted Baillieu (No. 2 on our Melbourne list), lord mayor Robert Doyle (No. 7 in Melbourne) and News Limited boss Kim Williams (our No. 4 Media Maestro) also joined the celebrations. -- The Power Index (read the full story here)
Mike Smith's interest rates power play. Last year, we named RBA chief Glenn Stevens as our No.2 Money Mover because of his huge say over interest rates. Tomorrow we might see Stevens' place on the power list threatened, with ANZ chief Mike Smith set to go it alone in shifting the bank's rates.
The ANZ will announce on Friday whether it plans to shift its rates independently of the RBA, when the bank's new rate-setting committee meets for the first time. -- The Power Index (read the full story here)
GetUp’s birthday gift for Rinehart. Gina Rinehart turns 58 today. But, with her family dispute continuing, and a new advertising campaign launched by GetUp! questioning the motivations behind her Fairfax raid, the celebrations are bound to be relatively low-key.
And given her current courtroom dispute is against three of her four children who allege their mother has been involved in "serious misconduct" as the trustee of the family's trust fund, we're guessing the family birthday wishes will be in short supply. -- The Power Index (read the full story here)
This story is just a taste of what Crikey subscribers will have access to on The Power Index.
Learn more about it from Paul Barry here.
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18. What do we mean by 's-xist' when we refer to criticisms of Gillard?
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Robin Cameron, on This Blog Harms, writes:
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The lack of agreement on the question of whether undue criticism of Julia Gillard is s-xist boils down to how we think about s-xism. Is s-xism something we view at an individual level or a wider social structural level? Is it still s-xism, when gender discrimination occurs at a structural level?
Before addressing this, I’d just like to mark a special moment that arose because of this issue; Monday saw Christopher Pyne and Bob Katter coming out in support of women’s rights. Who would have thought that in 2012 Katter and Pyne would be the standard-bearers in the fight against s-xism?
Oh, except they really aren’t.
After reassuring the Australian people on Monday that he would be the first to call out any s-xism against Gillard, two days later Pyne was labelling her "worse than Lady MacBeth". Way to single her out specifically on the basis of her gender characteristics, Christopher Pyne.
And then there’s Katter. He correctly identified that Australia has a female Governor-General, a female Premier and female Prime Minister. You’re right, Bob Katter, Australia couldn’t possibly be denying opportunity to women. But it took only one sentence for him to say that it’s "you know, if anything probably the other way around". Oh well, back to square one.
But "hey!" you might say, "is it really s-xist to compare Gillard to Lady MacBeth? After all they are both women and that seems pretty good grounds on which base a comparison". This is a good point, one that was addressed by Cheryl Kernot and Kerry Chikarovski in a thoughtful and articulate interview that is really worth having a listen to.
Pre-empting Pyne’s Lady MacBeth comparison, Kernot suggest "that there are elements of our cultural conditioning … the palace coup, the Lady Macbeth image is deeply ingrained in us". She goes on to say more directly:
"She’s the leader of a political party. Do we allow women to be politicians first or women first? Or do we always expect them to be women first and load them down with expectations that they should talk in a particular way and be domestic in a particular way. We don’t ask that of our male politicians."
What Kernot is highlighting is that the gender roles society expects from women do not entirely line up with what we expect from our Prime Minister.
Gillard herself touched on the at times discordant expectations we have of women and politicians in an interview on Sunday night. In what was actually kind of a touching moment of personal candor, she said she had always thought of the Prime Minister as "a bloke in a suit". And then in what is also a pretty reasonable comment, she offered that she "is a different image of leadership" and understood that it might take "a bit of time to settle with the Australia public". Then the next day, after having tried to be less cold and present more personality, Abbott goes and accuses her of playing the "s-xism card".
The expected repertoire of the female politician, it seems, is a complicated balance. It is important to be demure but not weak, authoritative but then not cold and tough but certainly not hysterical. So far Gillard has not been judged favourably. While the calculating political logic of the Machiavellian Prince is deemed to be "part of the game" for most politicians, when Gillard exercises the same pragmatic ruthlessness it it is widely read a deadly betrayal.
Chikarovski addresses the perception that women are not political operators, referring equally also to her own experience:
"People don’t expect women to do those things, which is kind of bizarre when you think about it. Paul Keating knifed Bob Hawke, Bob Hawke knifed Bill Hayden. It’s kind of the way of Australian politics. Yet women when they do it cop an enormous level of abuse."
This again is the Macbeth image of betrayal and manipulation, an image that has stuck more firmly to Gillard than other politicians. There is a sense that the betrayal is personal. She stabbed Rudd in the back, betrayed Andrew Wilkie. But come on, really? Its politics, not dating.
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19. Media briefs: cartoon offends ... Syrian journo killed ... Fairfax v Gill ...
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FAIRFAX, MICHAEL GILL, NEWS OF THE WORLD PHONE HACKING SCANDAL, PORT DOUGLAS & MOSSMAN GAZETTE
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How to offend your readership 101. Today's Port Douglas & Mossman Gazette apologised to its readers after running a cartoon last week that offended the township of Cooya Beach -- one of the Gazette's readership hubs.

The offending cartoon -- the regular feature by Mike Drinkwater called "Dr. Inky" -- made disparaging comments of Cooya's residents. We'll let you decide if it's funny ...

Fairfax taken to task over court case delay
"A judge chided Fairfax Media yesterday for its delay in responding to a discrimination case brought by one of its former top executives as the company indicated it might seek to have the case thrown out." -- The Australian
Syrian journalist killed in Homs
"The Committee to Protect Journalists mourns the death of Syrian journalist Mazhar Tayyara, a stringer for Agence France-Presse and other international outlets, who was killed by government forces' fire in the city of Homs early Saturday morning." -- The Committee to Protect Journalists
Washington Post will further reduce staff
"The Washington Post announced a new round of buyouts on Wednesday, the latest in a series of staff reductions that have decreased the size of its newsroom by more than 200 people over the last three years." -- The New York Times
Ten appeals Molloy defamation verdict
"Ten is appealing a ruling in a defamation case involving comedian Mick Molloy and former ALP candidate Nicole Cornes." -- TV Tonight
BBC clamps down on Twitter use by journalists
"Journalists for the BBC have been told not to tweet breaking news before they’ve filed a story, as it would slow down the process of getting newsworthy stories into the BBC’s newsroom." -- All Twitter
Here’s what Facebook stock looks like
"In a few months time, here’s what the world will be fighting to get its hands on, or get rid of depending on your confidence in Facebook’s business plan. The image of a Facebook stock certificate was included in the amended S-1 Facebook filed today with the SEC." -- Tech Crunch
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20. Last night's TV ratings
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Glenn Dyer writes:
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The Glenn Dyer breakdown: Looking at last night's ODI cricket match on Gem between Sri Lanka and India and the evening audience of 280,000 viewers, you can understood why Nine didn't want to show it on the main channel. It was one of Nine's worst nights of the year so far.
Meanwhile, it was Ten's best weeknight of the year in metro areas. Talkin' 'Bout Your Generation, 758,000, in metro markets wasn't very solid, neither was the 718,000 for The Biggest Loser. But they were enough.
And why, on Adam Hills in Gordon Street Tonight, which returned to ABC 1 last night, did Hills direct questions to Rob Sitch and actor Josh Lawson during the interview with Jonathon Lynn, one of the creators of Yes Minister and Yes Prime Minister. They detracted from Lynn's presence and looked rude and demeaning. With his background, he would have been entitled to a longer, solo segment.
Tonight: The Straits, episode 2 on the ABC at 8.30pm; Family Confidential at 8pm. My Kitchen Rules on Seven, and if you are interested, Grey's Anatomy returns at 8.30pm. Ten has The Biggest Loser and Law & Order: S.V.U.. Nine has CSI and CSI: NY. Be very, very wary.
The top 10 national programs (metro & regional combined):
- My Kitchen Rules (Seven) -- 2.061 million
- Seven News -- 1.592 million
- Nine News -- 1.564 million
- A Current Affair (Nine) -- 1.500 million
- Home and Away (Seven) -- 1.439 million
- Today Tonight -- 1.283 million
- ABC News -- 1.231 million
- Talkin' 'Bout Your Generation (Ten) -- 1.075 million
- The Biggest Loser (ten) -- 1.045 million
- Absolutely Fabulous 20th Anniversary Specials (ABC 1) -- 965,000
Metro Winners:
- My Kitchen Rules (Seven) (7.30pm) -- 1.453 million
- Seven News (6pm) -- 1.113 million
- Nine News (6pm) -- 1.063 million
- Home and Away (Seven) (7pm) -- 1.021 million
- Today Tonight (Seven) (6.30pm) -- 1.010 million
The Losers: Nine last night. What a waste of time and effort, even though it is not official ratings yet.
Metro News & CA: Nine News won Sydney and Melbourne, A Current Affair won Sydney, Melbourne and Brisbane.
- Seven News (6pm) -- 1.113 million
- Nine News (6pm) -- 1.063 million
- Today Tonight (Seven) (6.30pm) -- 1.010 million
- A Current Affair (Nine) (6.30pm) -- 993,000
- ABC News -- 891,000
- Ten News (5pm) -- 701,000
- 7.30 (ABC) (7.30pm) -- 631,000
- The Project (Ten) (6pm) -- 506,000
- SBS News (6.30pm) -- 186,000
- Lateline (ABC) (10.30pm) -- 180,000
- The Business (ABC) (11.05pm) -- 129,000
- The Drum (ABC) (6pm) -- 122,000 (+28,000)
- SBS News (10.30pm) -- 109,000
*On News 24 simulcast
In the morning: Status quo, Nine's new Mornings lost a little ground from the opening two audiences where it averaged 104,000 viewers. (I reported yesterday that its audience lifted to 155,000: that was its national figure and there was no growth in the metro markets).
- Sunrise (Seven) (7am) -- 348,000
- Today (Nine) (7am) -- 302,000
- The Morning Show (Seven) (8am) -- 149,000
- Mornings (Nine) (9am) -- 98,000
- The Circle (Ten) (9pm) -- 43,000
Metro FTA: Seven (3 channels) won with a share of 31.1% from Nine (3) on 24.7%, Ten (3) on 23.1%, the ABC (4) on 15.5% and SBS (2) on 5.7%. Seven leads the week with 31.4% from Nine on 26.0% and Ten on 21.8%. Main Channels: Seven won with a share of 22.5% from Ten on 16.0%, Nine was on 14.6%.
Metro Digital: Gem with the ODI cricket from Perth had an easy win with a share of 6.3%. 7TWO had a share of 4.8%, GO and 7mate were on 3.8%, Eleven 3.7%, ABC 2 was on 3.2%, ONE was on 3.3%, SBS TWO was on 1.1%, News 24 was on 0.8% with ABC 3 on 0.5%. The 10 channels had a share of 31.7% last night. 7TWO leads the week now with 3.8%, with GO and Gem on 3.7% each.
Pay TV: Seven (3 channels) won with a share of 25.5% from Nine (3) on 20.2%, Ten (3) on 18.9%, Pay TV (200 plus channels) on the ABC (4) on 15.5% and SBS (2) on 5.7%. the 15 FTA channels had a share of viewing last night of 84.6%, with the 10 digitals on a high 25.7% and the five main channels on a low 58.9%.
The top five pay TV channels were:
- Fox 8 (3.42%)
- Lifestyle (2.99%)
- UKTV (2.15%)
- Fox Classic (2.03%)
- TV 1 (1.87%)
The five most-watched programs on pay TV were:
- Selling Houses Australia (Lifestyle) -- 157,000
- The Simpsons (Fox 8) -- 78,400
- Cricket Superstar (Fox 8) -- 77,500
- Country House Revisited (Lifestyle) -- 70,700
- Grimm (Fox 8) -- 69,100
Regional: Prime/7Qld (3 channels) won with a share of 32.4% from WIN/NBN (3) on 27.4%, SC Ten (3) was 20.8%, the ABC (4) was on 14.6% and SBS (2) was on 4.9%. Prime/7Qld won the main channels with 21.9% from WIN/NBN on 15.8% and SC Ten on 14.3%. Gem won the digitals with 7.6%, with 7TWO on 5.8% and 7mate on 4.6%. The 10 digital channels were boosted by the cricket on Gem to a very high 34.8% share of FTA viewing. prime/7Qld leads the week with 31.7% from WIN/NBN on 29.0%.
The five most-watched programs in regional markets were:
- My Kitchen Rules --608,000
- A Current Affair -- 506,000
- Nine News -- 499,000
- Seven News -- 479,000
- Home and Away 419,000
Major Markets: A clean sweep for Seven overall and the main channels. Ten was second overall in Perth in front of a weak Nine. Ten was second in the main channels everywhere in front on Nine. Gem won Sydney, Melbourne, Adelaide and Perth with the ODI, but not Brisbane, where 7TWO won. Seven leads the week everywhere. In Perth Ten is second and Nine third.
(All shares on the basis of combined overnight 6pm to midnight All People)
*Source: OzTAM, TV Networks reports
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Read more from the world of TV on Dan Barrett's blog White Noise
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21. Our banks are too big to fail, too few to be competitive
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Mark Bouris and Christopher Joye, of Property Observer, write:
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BIG FOUR BANKS, GLOBAL FINANCIAL CRISIS, RESERVE BANK OF AUSTRALIA
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Before the global financial crisis, Australia had a diverse and highly competitive financial system. The four major banks went head-to-head with the likes of St George, Bankwest, Bendigo Bank, Aussie, Adelaide Bank, RAMS, Wizard and Challenger.
Today every single one of these entities has disappeared as a genuinely independent concern, wholly or partly acquired by the majors (with competition concerns waived by the ACCC), or merged with one another.
Before the crisis, Australia's banks were not explicitly government-backed. And taxpayers had never guaranteed bank deposits before (or conceived of providing such guarantees for free as they currently do), nor had they ever guaranteed the banks' institutional debts.
The taxpayer-owned central bank, the Reserve Bank of Australia, had also never lent to the banks on the much longer-dated and more flexible terms that it offered as the financial markets meltdown started to gather momentum, and continues to offer to this day.
The reason taxpayers had not got into the business of bailing out private banks was because of a well-founded fear of "moral hazard". That's the concern that once you start insuring away a private company's risk of failure, you remove the critical disciplining influence of free markets. And executives will, over time, start behaving less responsibly, and expose taxpayers to even greater risk of loss.
Banks have nevertheless always been different to private companies because they perform a vital social function: they take our short-term savings and transform them into long-term loans. They run this constant "mismatch" between the term of the funding they receive from depositors (eg: mums and dads) and the length of the loans they give to businesses and households.
As a result, banks have always risked insolvency if their funders rapidly withdraw their money. In the 1890s, before the RBA existed, most of Australia's private banks failed. That's why we now have a public "central bank" that lends directly to the private banks. And it's the reason we have a banking regulator, APRA, to ensure that the banks hold enough "capital" to cover liquidity shocks.
We were compelled to write this op-ed because we're convinced that the policymaking surrounding Australia's banking system has been predicated on a flawed and risky paradigm: the frequently referenced -- by APRA and the RBA -- trade-off between "competition" and "financial stability", which ends up favouring a more concentrated industry.
Today Australia's prosperity relies on four colossal banks -- or "oligopolists" -- worth about $50 billion each. They control 80-90% of all financial transactions executed across the country. Importantly, the introduction of government guarantees for the first time during the GFC bequeathed them with a unique comparative advantage.
In contrast to their smaller rivals, the four majors are now regarded by credit rating agencies and investors alike as "too big to fail". The majors get the benefit of credit ratings that have been explicitly lifted "two notches" higher than they would otherwise be because Standard & Poor's thinks they alone can depend on "extraordinary government support" in a crisis.
This helps them raise money much more cheaply than their smaller peers, which in turn means it is almost impossible to compete effectively against them. Size thus begets more size.
Some recent advertising campaigns have claimed that "the banks are at war for your home loan". Both the new head of the ACCC, Rod Sims, and we disagree. A few weeks ago Sims concluded:
"Normally four players in a market should lead to a lot of competitive activity. In the banking sector it seems to need more because even though there are four of them there is a lack of full and effective competition."
While they rank among the 30 largest banks in the world, Australian policymakers have worked surprisingly hard to have the four majors excluded from the extra capital charges that global regulators are sensibly insisting the biggest, and most "systematically important", banks hold.
For several years we've suggested this is misguided and symptomatic of a worrying oligarchy between Australian banks and their policymakers. Last month the IMF agreed with us, arguing that Australia's major banks should, in fact, be forced to hold extra capital as systematically important institutions. More capital means less leverage and less taxpayer risk. So why exempt the majors, particularly when they have designs on higher-risk growth strategies overseas?
An additional capital buffer for systematically important banks would also be an intelligent disincentive to becoming too big to fail. And it recognises a point we've made for some time: in many ways the catastrophic risks posed by smaller and simpler banks, like Bendigo & Adelaide, Bank of Queensland, and Members Equity, are a fraction of those threatened by the majors.
In all properly functioning financial markets there is an inexorable trade-off between risk and return. The higher the risks you take, the higher the returns you generate. But in Australia this maxim has been turned on its head: in Australia, the supposedly lowest risks banks with the highest credit ratings -- the majors -- are somehow able to yield the highest shareholder returns. In contrast, the smallest banks, with the lowest credit ratings, produce much lower returns on equity. This complete reversal of the inverse relation between risk and return is the purest possible illustration that taxpayer subsidies are being used for the benefit of the banking oligarchy to the detriment of meritocratic democracy.
During the GFC, most of the smaller banks did not use the taxpayer guarantees of wholesale debts because the premium paid for the guarantee was, ironically, based on the banks' credit ratings. This made it cheapest for the major banks to use the government’s insurance, which they did in vast volumes. It was peculiar that Treasury decided to price its insurance using the same rating agencies that had missed so many of the moral hazards that triggered the crisis in the first place.
A more subtle example of how the system encourages extreme size is the terms on which the banks borrow from the RBA. When doing so, banks have to pledge an asset as collateral to get RBA funding. Included in the list of "eligible" assets the RBA will accept as collateral is any senior debt issued by an Australian bank. But historically that debt had to have a credit rating -- yes, there it is again -- of A- or higher, which excluded the debts issued by smaller regional banks and building societies. Since the major banks were among the few that qualified for the RBA's funding, this helped further support investor demand for their bonds, and thus lowered their cost. While this month the RBA cut the minimum rating to BBB+, this still excludes several smaller banks and building societies.
*This article was first published at Property Observer
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22. Why we need a big green bank for low carbon transition
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Giles Parkinson, editor of RenewEconomy, writes:
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CLEAN ENERGY FINANCE CORPORATION, CLIMATE CHANGE, SOLAR FLAGSHIPS, SOLAR PROJECTS
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One of the arguments that has been thrown forward against the proposed Clean Energy Finance Corporation -- and will no doubt continue to be so in the coming months -- is that it will be good money thrown after bad, and the $10 billion planned injection by the federal government is out of all proportion to the task at hand.
And, it is argued, it is not necessary in the light of a carbon price. Or it should be restricted to R&D. The opposition -- taking its cues from the energy debate in the US and Canada -- as it has done on climate change policies -- has vowed to repeal it.
There is a general assumption, as there was in the carbon debate, that Australia is doing something that no one else has contemplated, and that it is recklessly and needlessly leading the world. But as in the carbon pricing debate, this is not so.
The experience of the Solar Flagships, and other grants-based programs for that matter, highlight the need and the opportunity for the CEFC. Institutional investors, noting the $100 billion that will be required in renewable energy investments at a minimum over the next two decades, insist that such an independent financial institutions will play a critical role in stimulating the transition to a clean economy.
Recent surveys suggest that this is the approach of all the countries that are currently playing a leading role in clean energy investment -- Germany, China, the US and Brazil -- and each have state-owned development banks, or their equivalent, underwriting the majority of clean-tech investment.
An analysis conducted by Bloomberg New Energy Finance found that possibly the most influential player in the global energy market in the past year has been the German state-owned development bank, known as KfW, which in 2011 alone committed E22.8 billion ($29 billion) to climate and environment projects -- mostly through lending at discounted rates and providing loan guarantees. The funding was split among energy efficiency investments (E10.1 billion), renewable energy (E9.4 billion) and waste management (E3.3 billion). KfW accounted for nearly half of all German clean-tech investment.
The bank plans to increase its allocation in 2012, as part of a five-year E100 billion investment spend out to 2015, to support the government’s pus to a 35% renewable energy target by 2035. Its portfolio includes solar farms, low-interest lending programs for building efficiency, regional power-grid growth, rooftop solar, energy-storage projects and it is expected to play a critical role in the deployment of large, capital intensive, offshore wind farms. Germany’s own investment requirement to meet its goals are estimated at E250 billion by the end of the decade.
The BNEF survey found that the global leader in the number of large-scale solar deals completed in 2011 was the US Federal Financing Bank, which played a critical role in the loan guarantees handed out by the US Department of Energy. Despite the politics over the failure of one investment, the start-up solar module developer Solyndra, more than 98% of the estimated $45 billion of loans made by the DoE since the GFC, including 15 large-scale solar projects, have been sound. These include loan guarantees to huge projects such as the BrightSource 392MW Ivanpah solar thermal portfolio and the 290MW Agua Caliente PV plant. It has also extended its reach to battery, energy efficiency and wind technologies.
BNEF notes that Chinese (and other) state-owned banks have also been active in the past year, but the sums of money involved is difficult to track because of the lack of transparency on these deals, but other estimates suggest that the China Development Bank provided $45 billion in cheap line of credits to solar and wind investments. BNEF also notes that Brazil’s development bank, Banco Nacional de Desenvolvimento Economico e Social, or BNDES, has been a significant lender to Brazilian biofuels and wind projects, and ranked second in identified clean energy deals across the globe in 2011.
The European Investment Bank is also playing a critical role, deploying at least $6 billion in 2011, and other country-based development banks, including in Denmark, have provided cheaper loans to support their technologies, including for the $800 million Macarthur Wind Farm in Victoria, which is using Danish Vestas turbines and that will be the largest in the southern hemisphere when it is complete.
Given this, the $10 billion to be invested in the CEFC appears relatively modest. But it could, given the experience play a key role in unlocking money from superannuation funds and other institutional funds as a co-investor, in much the same way as the DoE has forged a path for the likes of Warren Buffett, Bill Gates, Google and others to follow in their footsteps.
*This article was first published at RenewEconomy
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COMMENTS, CORRECTIONS, CLARIFICATIONS, AND C*CKUPS
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23. The Lobby Restaurant responds
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AIRPORT SCANNERS, SYRIA
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A correction:
Bruce Gibbs, operator and licencee of The Lobby Restaurant, writes: Re. "Tips and rumours" (2 February, item 6). Crikey published:
"Asks one Crikey reader: 'Wasn’t Tony Abbott’s name listed outside the Lobby as attending the Australia Day ceremony for at least a week beforehand?' We’re not sure, was it?"
I would like you to correct and check your sources/bloggers before putting a complete incorrect comment on your site
The comments about the Australia Day Julia Gillard/Lobby affair and the suggestion that The Lobby Restaurant or any of its staff had placed notification in the windows is completely untrue. I am the operator and licencee of The Lobby. At no time have we displayed anything regarding clients upcoming events in the windows of the lobby. If a client wants to stick up a attendance list we supply a foyer board.
We have been written to by the government agency that booked the event asking if the comment displayed on Crikey was true.
The whole affair and the stories about have done damage to our reputation, and the good relationship we have had with the Tent Embassy over my nine years at The Lobby. We would have preferred never to have had the event had known what was going to happen.
I will be displaying a statement regarding our take on what happened, and "The Lobby Restaurant moving forward" from the events of this Australia Day.
Airport scanners:
John Richardson writes: I have to disagree with Alex Mandl’s assertion (yesterday, comments) that the acquisition of body scanners to be installed at all international airports in Australia is "an absolute disgrace".
Alex, it’s not an absolute disgrace, it’s an absolute scandal that the federal government (or any government for that matter) can make multimillion dollar purchasing decisions, without having evaluated the capabilities of the equipment concerned or having engaged in a competitive tender process.
And to further make your point about the corrupt processes and relationships that enable such criminal outcomes, how is it that the budgie smuggler and his accomplices, who regale us daily about the evils of the current federal government’s decisions on pink batts, computers for students, the cost of school halls and wasteful spending at every turn, have not a word to say on this issue nor, for that matter, the even larger F-22 procurement scandal?
It seems that our political system runs just like the butcher who owns shops at either end of the street: we customers/taxpayers expend our time and energy running up and down between each shop, looking for the best possible deal, while the butcher profits regardless.
Syria:
Niall Clugston writes: Re. Yesterday's Editorial. Wednesday's editorial illustrates why intervention in Syria is a bad idea.
According to the paradigm of dichotomies presented, the outside world (inevitably Washington and its allies) would be intervening against secularism, against religious minorities (in the first place, the Alawi), and against the cities.
In geopolitical terms it would be attractive for the US to outmanoeuvre Russia and Iran by overthrowing Assad. However, this is the same kind of Frankenstein foray that launched Osama bin Laden from Afghanistan.
The main difference with Libya is that, in Libya, NATO claimed to be protecting civilians, while they were actually intervening in a civil war. They can't pull the same con twice.
Should cyclists be registered?:
Ava Hubble writes: Re. "Should bicycles be registered?" (yesterday, item 13). There are any number of signs advising motorists of what they can and cannot do, but in Sydney I never see a sign that reminds cyclists that it is an offence to ride on the footpath (unless they are teaching a child to ride a bike or travelling on a designated shared path).
Even on shared paths cyclists are obliged, by law, to ride at no more than 10 kilometres an hour and to give way at all times to pedestrians. I am all for cycling, but not on our footpaths. It is making the equally Green exercise of walking a frightening pursuit.
I often think I am far more likely to be inadvertently felled on the footpath by a reckless cyclist than a drive-by shooter.
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