Prime Minister Kevin Rudd is trying to move away from his promise to hold a referendum on moving to a republic. Greens leader Bob Brown is trying to have that question included in the vote at the next Federal election.
The monarchy has served us well and a change to a republic would have no real benefit for this country - other than to massage some egos. It would cost a lot of money - not least the reprinting of all Commonwealth stationery - including our banknotes - and the renaming of all institutions prefaced with the word " Royal ".
Let us consider how it would look if we were already a republic - and we were considering returning to an Australian monarchy.
The task would be to find an Australian to elevate to the position of king. That person would have to be very special, because in perpetuity his offspring would rule this country and have a life of great privilege.
Even selecting a king would be argumentative. The women's movement would surely favour a feminine head of state. It could probably only be resolved by tossing a coin to decide which gender would be the primary ruler.
Then there would be the matter of rewriting the constitution to establish the rules under which the royal charter would rule.
In Britain neither the monarch or immediate heirs may be followers of the Roman Catholic church. Would an Australian monarchy be restricted to Christians ? Would Muslims be debarred from wearing the crown ?
Then there is the matter of a residence ! Obviously the king/queen would be required to live in Canberra, the national capital - but should there be a royal residence in each of the state capital cities ? And would this be a state or a Federal cost ?
In all probability the voters would baulk at the prospect of selecting an Australian citizen to assume the mantle of king in perpetuity. That simply does not make sense !
There is more appeal in voting into office a president every few years, because opinions change and a change of president brings with it a change of person - and a change of style.
When the decision on a republic or a monarchy is eventually made by the voters - whenever that may be - considering the issue along these lines may be helpful !
Sunday, 26 April 2009
Saturday, 25 April 2009
A tiger by the tail !
Kevin Rudd's government has a decisive decision to make ! Whether to end the first home buyer's scheme at the end of June - or to let it continue for another six months.
Damned if he does ... and damned if he doesn't !
If the scheme ends in June it is inevitable that the Real estate industry, the building industry and the huge supply infrastructure that supports the building industry will fall in a hole !
The sale of homes will slow to a trickle and there will be a vast lay off of sales people, those in the building trade - and the vast factory spectrum that produces building products.
The generous first home grants that provide $ 14,000 for existing home purchases and $ 21,000 for newly built homes has produced a reason to concentrate sales in the present time structure. When it ends, there will be an inevitable hiatus.
There have also been unintended repercussions for those in the renting market. The rush to get a foot on the home ownership ladder has concentrated home sales on the lower end of the price market, and induced the owners of rental stock to sell while prices are more favourable.
As a result, rent costs have risen sharply and there is a gross under supply of rental accommodation. We are therefore facing an increase in the number of homeless people - unable to find a place to rent at an affordable price.
On the other side of the equation, the ranks of first home buyers are mostly those who have borrowed to the max - and are young and vulnerable to job loss if the ranks of unemployed do exceed ten percent - as is predicted by many economists.
The first home grant scheme will have been a boon to many - provided this recession is short lived and does not become extreme. Otherwise it is simply a money trap - leading to default - home loss - and in many cases an ongoing debt if a price massacre erupts because of home resumptions by the banks.
The government may be wise to ease itself out of this dilemma slowly. Stopping the scheme dead in the water may be nothing short of disaster.
Perhaps the better option would be to retain the scheme, but to lower the grant progressively over a five year period. At least then those not sufficiently financially stable would have reason to wait a few months more rather than jumping in to meet a deadline.
In politics - the hardest decision is the one where something given is being withdrawn.
That has a tendency to swiftly come full circle - and bite you on the bum !
Damned if he does ... and damned if he doesn't !
If the scheme ends in June it is inevitable that the Real estate industry, the building industry and the huge supply infrastructure that supports the building industry will fall in a hole !
The sale of homes will slow to a trickle and there will be a vast lay off of sales people, those in the building trade - and the vast factory spectrum that produces building products.
The generous first home grants that provide $ 14,000 for existing home purchases and $ 21,000 for newly built homes has produced a reason to concentrate sales in the present time structure. When it ends, there will be an inevitable hiatus.
There have also been unintended repercussions for those in the renting market. The rush to get a foot on the home ownership ladder has concentrated home sales on the lower end of the price market, and induced the owners of rental stock to sell while prices are more favourable.
As a result, rent costs have risen sharply and there is a gross under supply of rental accommodation. We are therefore facing an increase in the number of homeless people - unable to find a place to rent at an affordable price.
On the other side of the equation, the ranks of first home buyers are mostly those who have borrowed to the max - and are young and vulnerable to job loss if the ranks of unemployed do exceed ten percent - as is predicted by many economists.
The first home grant scheme will have been a boon to many - provided this recession is short lived and does not become extreme. Otherwise it is simply a money trap - leading to default - home loss - and in many cases an ongoing debt if a price massacre erupts because of home resumptions by the banks.
The government may be wise to ease itself out of this dilemma slowly. Stopping the scheme dead in the water may be nothing short of disaster.
Perhaps the better option would be to retain the scheme, but to lower the grant progressively over a five year period. At least then those not sufficiently financially stable would have reason to wait a few months more rather than jumping in to meet a deadline.
In politics - the hardest decision is the one where something given is being withdrawn.
That has a tendency to swiftly come full circle - and bite you on the bum !
Friday, 24 April 2009
Atlas Shrugged.
There is a book all thinking people should read. It is titled " Atlas Shrugged " and it was written back in the 1930's by Ayn Rand. This writer died in 1982.
The 1930's brought with it " the Great Depression " and Rand's book is a thinly disguised account of a world that has embraced this new philosophy - Communism.
It was very relevant at that time. The Russian revolution was a recent event and to many people state ownership made an attractive appeal. No more rich people ! No more struggling with a house mortgage. No more competing with others for a good job.
It would be the responsibility of the state to provide everything. It absolved the individual of the need to - think !
We have seen how Communism destroyed initiative and the " command economy " reduced incentive to a " one size fits all " mentality. It still only exists in a few backward regimes where sheer military force keeps it in power.
But an equally destructive idea overtook capitalism. Globalization emerged with the credo of sharing work to those people who did it best. As a consequence, production of goods went offshore to countries with big populations - and as a consequence - a very low wage structure.
The rich countries ceased to produce goods and this work devolved to the world's poor. To keep people employed the rich countries invented " social " industries which returned intangible benefits - but could not be traded externally.
The result was huge balance of payment debts, and to fulfill this trade desert the minds of the great and powerful devised artificial schemes which were based on foundations of clay.
In due course, natural attrition took hold - and capitalism finds itself in the mess we are facing today.
Ayn Rand was a perceptive woman and in Atlas Shrugged she has drawn a vivid picture of the events leading up to the present recession - which could easily repeat the depression of the 1930's.
The moral of her story is applicable to today. We can not consume more than we produce - and we have entered an age when production is constantly decreasing.
Rand's story ends on a happy note reminiscent of a child's fairy tale - but the events she describes bears a striking similarity to what is happening in the western world today !
The 1930's brought with it " the Great Depression " and Rand's book is a thinly disguised account of a world that has embraced this new philosophy - Communism.
It was very relevant at that time. The Russian revolution was a recent event and to many people state ownership made an attractive appeal. No more rich people ! No more struggling with a house mortgage. No more competing with others for a good job.
It would be the responsibility of the state to provide everything. It absolved the individual of the need to - think !
We have seen how Communism destroyed initiative and the " command economy " reduced incentive to a " one size fits all " mentality. It still only exists in a few backward regimes where sheer military force keeps it in power.
But an equally destructive idea overtook capitalism. Globalization emerged with the credo of sharing work to those people who did it best. As a consequence, production of goods went offshore to countries with big populations - and as a consequence - a very low wage structure.
The rich countries ceased to produce goods and this work devolved to the world's poor. To keep people employed the rich countries invented " social " industries which returned intangible benefits - but could not be traded externally.
The result was huge balance of payment debts, and to fulfill this trade desert the minds of the great and powerful devised artificial schemes which were based on foundations of clay.
In due course, natural attrition took hold - and capitalism finds itself in the mess we are facing today.
Ayn Rand was a perceptive woman and in Atlas Shrugged she has drawn a vivid picture of the events leading up to the present recession - which could easily repeat the depression of the 1930's.
The moral of her story is applicable to today. We can not consume more than we produce - and we have entered an age when production is constantly decreasing.
Rand's story ends on a happy note reminiscent of a child's fairy tale - but the events she describes bears a striking similarity to what is happening in the western world today !
" Weasel " words !
Who would trust any statement made by the James Hardie company ?
This building materials manufacturer used asbestos in it's products for decades after the deadly nature of asbestos was known. This caused the death of both employees and customers - until Hardies was dragged kicking and screaming to introduce a voluntary compensation scheme to compensate victims.
We now know that it's board of directors breached the Corporations Act when they deliberately claimed that the James Hardie Medical Research and Compensation Foundation was fully funded. It wasn't - and it had a shortfall of over $ 1 billion !
These directors face fines of $ 200,000 each and may be debarred from holding executive positions in public companies.
We now learn that Hardies are claiming that the recession is causing a " negative cash flow " and as a result contributions to the revamped compensation scheme will cease next year - and not restart until conditions improve.
Given Hardies previous attempts to mislead it should be noted that Hardie's rushed into this voluntary scheme to avoid a class court action that may have ended with the company being wound up.
They have a proven record of using " weasel words " to try and avoid their obligations and this latest claim does not specify just who will determine when things have improved to the point that compensation will resume.
Reduced dividends to shareholders should not be a reason to stop the money flow to victims.
It would be reasonable for the compensation fund to apply to the courts to have a court appointed trustee examine the day to day trading of James Hardie - and to have the responsibility of determining profitability.
On previous performance, Hardies honesty is suspect !
This building materials manufacturer used asbestos in it's products for decades after the deadly nature of asbestos was known. This caused the death of both employees and customers - until Hardies was dragged kicking and screaming to introduce a voluntary compensation scheme to compensate victims.
We now know that it's board of directors breached the Corporations Act when they deliberately claimed that the James Hardie Medical Research and Compensation Foundation was fully funded. It wasn't - and it had a shortfall of over $ 1 billion !
These directors face fines of $ 200,000 each and may be debarred from holding executive positions in public companies.
We now learn that Hardies are claiming that the recession is causing a " negative cash flow " and as a result contributions to the revamped compensation scheme will cease next year - and not restart until conditions improve.
Given Hardies previous attempts to mislead it should be noted that Hardie's rushed into this voluntary scheme to avoid a class court action that may have ended with the company being wound up.
They have a proven record of using " weasel words " to try and avoid their obligations and this latest claim does not specify just who will determine when things have improved to the point that compensation will resume.
Reduced dividends to shareholders should not be a reason to stop the money flow to victims.
It would be reasonable for the compensation fund to apply to the courts to have a court appointed trustee examine the day to day trading of James Hardie - and to have the responsibility of determining profitability.
On previous performance, Hardies honesty is suspect !
Thursday, 23 April 2009
Unemployment ?
It seems strange that the Australian Navy has six Collins class submarines - but can only find enough crew to send three of them to sea at any one time !
It takes highly skilled people to run a submarine - and there are drawbacks to the job. Long and boring periods at sea. Lack of contact with friends and family. A claustrophobic life that would not suit everyone !
Picking fruit has none of those problems - and yet farmers find it impossible to recruit the people necessary to get the crop to market. That is left to illegal migrants and the backpacker fraternity.
We are in a recession and the unemployment rate is rising steadily - and will probably top ten percent by the end of this year.
Are we too choosy about what we will do and where we will go to get work ?
It seems to be a fact of life that five percent of the population seem to have the skills to employ the other ninety-five percent. What makes that five percent either self employed or managing companies ?
Basically, it seems to be the ability to see an opportunity that needs servicing - and the gumption to get moving and provide the service that is needed.
Right now there are a lot of people who will shortly be out of a job. It might be a good idea if they stretch their imagination, open their eyes - and think outside the proverbial nine dots !
For some - a recession is an opportunity to try something new - something that would be unthinkable when jobs are freely offering.
An opportunity to work for the best boss in the world !
Worth thinking about !
It takes highly skilled people to run a submarine - and there are drawbacks to the job. Long and boring periods at sea. Lack of contact with friends and family. A claustrophobic life that would not suit everyone !
Picking fruit has none of those problems - and yet farmers find it impossible to recruit the people necessary to get the crop to market. That is left to illegal migrants and the backpacker fraternity.
We are in a recession and the unemployment rate is rising steadily - and will probably top ten percent by the end of this year.
Are we too choosy about what we will do and where we will go to get work ?
It seems to be a fact of life that five percent of the population seem to have the skills to employ the other ninety-five percent. What makes that five percent either self employed or managing companies ?
Basically, it seems to be the ability to see an opportunity that needs servicing - and the gumption to get moving and provide the service that is needed.
Right now there are a lot of people who will shortly be out of a job. It might be a good idea if they stretch their imagination, open their eyes - and think outside the proverbial nine dots !
For some - a recession is an opportunity to try something new - something that would be unthinkable when jobs are freely offering.
An opportunity to work for the best boss in the world !
Worth thinking about !
Wednesday, 22 April 2009
The " gang of four ! "
In recent days the Reserve bank of Australia marginally lowered interest rates. The four major Australian banks cried poor - and refused to pass these savings fully to mortgage holders - and now they are talking of raising interest rates to improve their bottom lines !
This type of behavior was not always so. There used to be competition between the banks - and the pace setter was the Commonwealth bank. The private banks kept an eye on the government owned bank any time they considered change because the CBA would not go along with disreputable behaviour.
All that changed when the Paul Keating government decided that the state had no business being in banking - and sold the Commonwealth to the public.
Immediately the Commonwealth joined the private banks to form " the gang of four " and formed a cartel to ruthlessly exploit their monopoly. A host of new charges emerged and any idea of competition flew out the window.
Kevin Rudd admits that Australia is in recession and hints that the coming budget will contain stimulatory measures.
The greatest benefit the government could grant would be to make the formation of a new, government owned bank a part of that budget plan !
Times have changed and there would be no need for a vast branch structure. The private banks have reduced exposure because business is now done through ATM's and EFTPOS - but the presence of a bank trading on honest principles would reign in the marauders and reintroduce a missing component of trade - fair competition.
One of the reasons we are in recession is because the capitalist trading world lacked regulation and moved to excess. As part of that excess, we have our banks forming a cartel and gouging profit from both business and individuals.
The ball is in Kevin Rudd's court. Reverse the Keating disaster and add a fifth, free thinking bank to the Australian economic scene to break the cartel's hold on the money market.
That is exactly the stimulation the coming budget needs !
This type of behavior was not always so. There used to be competition between the banks - and the pace setter was the Commonwealth bank. The private banks kept an eye on the government owned bank any time they considered change because the CBA would not go along with disreputable behaviour.
All that changed when the Paul Keating government decided that the state had no business being in banking - and sold the Commonwealth to the public.
Immediately the Commonwealth joined the private banks to form " the gang of four " and formed a cartel to ruthlessly exploit their monopoly. A host of new charges emerged and any idea of competition flew out the window.
Kevin Rudd admits that Australia is in recession and hints that the coming budget will contain stimulatory measures.
The greatest benefit the government could grant would be to make the formation of a new, government owned bank a part of that budget plan !
Times have changed and there would be no need for a vast branch structure. The private banks have reduced exposure because business is now done through ATM's and EFTPOS - but the presence of a bank trading on honest principles would reign in the marauders and reintroduce a missing component of trade - fair competition.
One of the reasons we are in recession is because the capitalist trading world lacked regulation and moved to excess. As part of that excess, we have our banks forming a cartel and gouging profit from both business and individuals.
The ball is in Kevin Rudd's court. Reverse the Keating disaster and add a fifth, free thinking bank to the Australian economic scene to break the cartel's hold on the money market.
That is exactly the stimulation the coming budget needs !
Tuesday, 21 April 2009
Our vertical village.
Planet earth is fast approaching seven billion inhabitants. Australia will soon be home to twenty three million people. They all need somewhere to live !
As part of the evolving process of meeting our future housing needs the Wollongong LEP will change to allow five story apartment blocks in suburbs adjacent to railway stations and transport hubs - and this will not please many people !
The economics of housing are fairly simple. We need to concentrate numbers where we have transport facilities and to make use of the existing water, power and sewer services - and the only way to do that is to go - up !
It is called the " vertical village ".
If we insist on the old system of ever expanding outwards we create urban sprawl - and create miles of new roads with a huge investment in servicing costs. At the same time, we destroy farmland and bring decreased living conditions to those forced to live in urban housing estates.
It will certainly be unsettling to many to find a change of housing style happening in their suburb, but then in the past change has been constant.
The quarter acre block is now a distant memory. Land sizes have reduced at the same time as houses have got bigger - and land use has changed from cottages to villas and town houses.
We live in an ever changing world. The past is a time now gone - and the future is about to burst upon us. There is no point in bemoaning change. We may not like it , but economics mean that the " vertical village " is here to stay.
As part of the evolving process of meeting our future housing needs the Wollongong LEP will change to allow five story apartment blocks in suburbs adjacent to railway stations and transport hubs - and this will not please many people !
The economics of housing are fairly simple. We need to concentrate numbers where we have transport facilities and to make use of the existing water, power and sewer services - and the only way to do that is to go - up !
It is called the " vertical village ".
If we insist on the old system of ever expanding outwards we create urban sprawl - and create miles of new roads with a huge investment in servicing costs. At the same time, we destroy farmland and bring decreased living conditions to those forced to live in urban housing estates.
It will certainly be unsettling to many to find a change of housing style happening in their suburb, but then in the past change has been constant.
The quarter acre block is now a distant memory. Land sizes have reduced at the same time as houses have got bigger - and land use has changed from cottages to villas and town houses.
We live in an ever changing world. The past is a time now gone - and the future is about to burst upon us. There is no point in bemoaning change. We may not like it , but economics mean that the " vertical village " is here to stay.
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