Saturday, 29 November 2008

The leadership obsession continues

Malcolm Turnbull had better watch out. The leadership obsession among political writers is growing again. So far this quite amazing concentration on who leads what political party has not spread to the federal Liberal Leader himself. For the moment it is his Deputy Julie Bishop featuring in the speculation but come the end of summer without any significant change in the readings of the opinion pollsters and the pundits will start turning from the sorcerer's apprentice to the sorcerer himself.
Leading the pack in this latest search for a leadership challenge is The Australian's Dennis Shanahan. Dennis clearly finds writing about who may or may not end up in a position of power far easier than telling his readers what those in power are actually doing with it. And he is not, of course, alone in that.
Back at the beginning of September I did a little survey of what political stories actually appeared in the nation's newspapers and found that nearly 12% of them were leadership speculation of one kind or another. The only more popular subject was stories based on opinion polls at 13% and they were really nothing more than another kind of approach to leadership.
But back to the Shanahan story which is bound to be followed by others in the press gallery herd in the coming weeks as the silly summer season approaches. "Julie Bishop is under growing internal pressure to step aside as the Coalition's Treasury spokeswoman," he wrote this morning, " amid growing dissatisfaction with her performance." The nub of his argument is that Liberal MPs are becoming frustrated with Ms Bishop's errors and her inability to have any impact on Treasurer Wayne Swan. He accuses the Deputy Liberal Leader as being plagued by plagiarism charges, accused of not having any ideas for the Liberals and making mistakes in parliament.
Perth academic Peter van Onselen joined in to dismiss Ms Bishop as "a lead weight in Turnbull's saddle" and allege that an exasperated "Turnbull has privately complained to supporters in recent weeks that he is doing the job of both the leader and the deputy, as well as functioning as a de facto shadow treasurer."
No doubt the Opposition Leader would have found more annoying the suggestion by John Howard's biographer that Peter Costello is still lolling around on the backbenches as a leader in waiting. "The sands of time must pass for the federal Liberals to again rise as a political force,"van Onselen wrote. "When they do, don't be surprised if Costello is ready to lead."
With gusto this morning the herd charged into the leadership story this morning. Michelle Grattan in The Age and Mark Metherell in the Sydney Morning Herald had their pieces fuelled by some wonderful hints by Ms Bishop at a conspiracy theory involving the editor of The Australian Chris Mitchell.

Friday, 28 November 2008

Some discreet words of warning

The Annual State of the Service Report by the Public Service Commissioner is not a document that sends the Canberra press gallery in to a frenzy of excitement. Apart from The Canberra Times, which has a particular readership to appeal to, and a minor reference on ABC radio, yesterday's words of Commissioner Lynelle Briggs escaped media attention. Which is a pity really because hidden away am ong the many platitudes and endless statistics is an important, if discreetly written, warning to the Finance Minister Lindsay Tanner about the dangers of indiscriminate budget cutting.

It has been a feature of governments for many years now to impose what is euphemistically called an efficiency dividend on departments. Instead of governments making the hard decision to scrap or wind back particular programs, the order goes out that the public service must cut administrative expenses by an across the board two or three or whatever percent. A recent addition to this philosophy of finding savings is to insist that any salary increases for individual bureaucrats in a department must be compensated by a similar reduction in the total departmental wages bill.

It sounds very simple and perhaps for a year or two it was but Ms Briggs in this year's report draws attention to some of the undesirable consequences. "Many agencies," she writes, "are now at financial crossroads—the impact of continued across the board efficiency measures is making it extremely difficult to properly maintain their core functions."

Particularly hard hit are some of the smaller agencies where it is not easy to find a few indians to get rid of so that the chiefs can be paid public service market rate salaries. The result is that good staff just don't want to work for these small agencies no matter how important their function might be. Or, as Ms Briggs puts it:

"The combined effect of the efficiency dividend and the partial funding arrangements for remuneration increases have placed pressure on some agencies whose size, or the nature of their activities, affect their potential for cost saving productivity gains to be generated year after year. For some agencies this has impacted on the remuneration levels they are able to offer. A key issue is how to ensure the APS operates in a sustainable way so that agencies of all types and sizes can attract and retain staff with the capability to deliver on their core functions. It may be timely to consider putting a safety valve mechanism in place to ensure the ongoing ability of lower paying agencies to attract and retain a skilled workforce in what will no doubt continue to be a tight fiscal environment."



Pathetic pettiness over Walkleys

Newspapers blowing their own trumpet is one thing. Excluding the name of journalists who work for rivals from coverage of the Walkley awards for journalism is another altogether.

This morning the Australian press displayed all the pathetic pettiness which helps bring the whole profession in to such disrepute.

In The Australian they headlined The Australian scoops three Walkley Awards then almost grudgingly acknowledged that the now defunct 9 Network Sunday program picked up the top gong - The Gold Walkley - and mentioned winners from 7 News, Reuters, the stablemate the Sydney Daily Telegraph, and their own company's Australian boss. The only reference to a Fairfax winner was to note the Most Outstanding Contribution to Journalism going to the late Pamela Bone for her support of humanitarian causes and commitment to the advancement of female leaders in the media. In a display of churlishness there was no reference to the fact that Ms Bone used to write for the Melbourne Age.

Winners from the ABC and SBS got not even an oblique mention.

Coverage in the Melbourne Age was even less gracious. Past and present journalists of The Age were last night honoured at the annual Walkley Awards, it said and listed its own winners. The Sunday program got a gong but no one else qualified - not even the Walkleys won by sister Fairfax publications the Sydney Morning Herald, the Australian Financial Review and the Illawarra Mercury.

For the SMH it was Super 12: Fairfax journos shine - a story which, fair enough, featured its own six winners but did not list the other six from its stablemates with the exception of a reference to Ms Bone. The award to the journalist from the Fairfax owned Illawarra Mercury was not even counted in reaching the total of 12 mentioned as shining.

The ABC followed the lead of the daily papers in slanting its Walkley story towards some self congratulation. "The ABC picked up nine Walkley Awards for journalism at a ceremony in Melbourne last night," it trumpets on its website this morning. "The broadcaster made it a clean sweep in the radio category, with awards for news, current affairs and feature reports."

It might have added that the feat illustrates the paucity of fair dinkum news reporting and current affairs programming on commercial radio!

Sunday got a mention for its Gold as did Bone, Hartigan and Don Watson, a speech writer for former prime minister Paul Keating who won the Walkley for best non-fiction book for American Journeys. Reuters photographer David Gray was acknowlledged as press photograpoher of the year and writing about Aborigines clearly qualifies non-ABC journalists for a mention. The Australian newspaper's Tony Koch and Padraic Murphy were noted for their story about a group of men who escaped a jail term after pleading guilty to raping a 10-year-old girl at Aurukun in north Queensland. Other print journalists were not so lucky and nor was 7 News for wi nning Television News Reporting.

For the record, you will find a full list of the Walkley winners by organisation on my website here.

Thursday, 27 November 2008

One for the political afficianados

They are still counting the votes in Minnesota for the Senate race between Republican Senator Norm Coleman and the Democrat candidate Al Franken and there are suggestions today that it may be well in to the new year before a decision is finally made about who won. At the moment the incumbet Sen. Coleman is some 200 votes in the lead but the Democrats are crying foul because some absentee ballots which favour their man have been excluded. It is becoming a wonderful occasions for the lawyers with challenges in the courts and a reference to the Senate as the finla arbiter quite probable.
The other state where a Senator has yet to be chosen is Georgia where Sen. Saxby Chambliss and Democratic challenger Jim Martin take part in a run-off ballot next week after neither got to 50% of the vote on 4 November. The Crikey election indicator puts the Republican as a 93.5% chance of victory.
Should the bolter get up and take the Democrats to 59 Senate seats then an attempt to have the Senate decide would demonstrate clearly what is at stake in Minnesota. The Republicans would engage in one of those filibusters where Senators just keep talking so that a vote cannot be taken. The Democrats need to get to the magic number of 60 to be able to stop this time honoured American political tradition which has been such an impediment to progress over the centuries.
The Wall Street Journal recalls this morning how in 1975, the Senate refused to accept New Hampshire's certification that Republican Louis Wyman had won by two votes. The seat was vacant for seven months, with the Senate debate spanning 100 hours and six unsuccessful attempts to break a filibuster and vote on who should be seated. The impasse ended only when a special election was agreed to, which was won by Democrat John Durkin.
The Crikey election indicator on the Minnesota race puts the Republicans as a 65% chance of ending up with the Senator.

A cool Conroy is a king of spin

Chat with Labor MPs about communications and you quickly learn that it has only taken one year for this government to feel as filthy about Telstra as its predecessor ended up after 11. It is now rare indeed to hear a good word from a politician of any side about the telecommunications giant in which the government, through its Future Fund, is still the major shareholder. If the politicians could achieve it they would delight in using the current tender for the development of a national broadband network (NBN)to help a strong competitor emerge.
Given Telstra's dominant position as the owner of so much of the national infrastructure that is easier thought than done. Yet you have to hand it to the Minister for Broadband, Communications and the Digital Economy Stephen Conroy - in public he keeps up the pretense that all is well in his kingdom with the NBN project completely on track. "The strong response from industry proponents is vindication of the Government's commitment to undertake a fair, open and competitive process," he declared in his press statement yesterday. "The stage is now set for an extremely competitive assessment process." There was not so much as a hint in these prepared words that Telstra was again playing games which will surely delay even further the evaluation process by the Government's independent Panel of Experts and the Australian Competition and Consumer Commission.

Today's survey of news by survey

The Brisbane Courier Mail finds a survey by NRMA Insurance which alleges that Queenslanders are less likely to know the people next door than are residents in other states. This scandalous slur by an organisation based over the border in NSW sent the paper scurrying to provide an explanation. It settled on some "experts" declaring that the reason was Queensland's rapid population growth and not an innate unfriendliness.

Wednesday, 26 November 2008

A speechless Belinda at local speech night.

A report has just reached me of an appearance by Belinda Neal MP at one of her local schools for a speech night presentation to students. Fresh from her escape from any prosecution over the incident at the Iguana night spot, John Della Bosca's better half was apparently left speechless when she had her own words from that night quoted to her. Shaking hands with one of the lads getting an award she asked: "And what's your name?" to receive the reply: "Don't you know who I am?" The boy should have a big future in politics.

Learn a lesson from Queensland.

The Federal Opposition should learn a lesson from what happened politically in Queensland yesterday. That silence is often the best tactic when a government is doing something unpopular was illustrated when Premier Anna Bligh pulled the plug on two controversial water projects. For months now, as readers of The Australian would be well aware for it has covered the issue in considerable depth, the Liberal National Party has delighted in playing on the fear people have of drinking recycled water. A new whiz-bang recycling system was going to be one part Labor's answer to ensuring that the south east of the state was never threatened again with running out.
The other initiative promised was to build a new dam at Traveston which was vigorously opposed by local residents who were aided and abetted in their nimbyism by the LNP. Premier Bligh has an election due early next year and with the recent heavy rains around Brisbane lifting water levels from their the dangerously low levels caused by drought, she yesterday took the opportunity to scuttle both projects. Two potential vote winners for the Opposition are now gone.

Some encouragement for Wayne.







The economic pundits (yes – the very same ones who wrongly kept maintaining that Chinese growth would insulate Australia from any world recession) have all turned very sceptical about Treasurer Wayne Swan continuing to maintain that economic growth will continue at a level that should preserve at least a small budget surplus.
Well, maybe the gloom and doom brigade will be in error again for the construction figures released by the Australian Bureau of Statistics this morning show the benefit of the lags which occur between major projects started when companies are optimistic about the future and the onset of pessimism.
The statistician's trend estimate for total construction work done rose 2.4% in the September quarter 2008 with the seasonally adjusted estimate for total construction work done losing 4.4%, to $34,241.6m, in the September quarter, following a revised fall of 0.4% in the June quarter. While house building is clearly in decline, other building work is still chugging ahead.
And things are not expected to exactly grind to a halt in China either. While the days of 10% plus growth might be gone, this major Australian market is expected to do better than the rest of the world. The China Daily this morning gave a series of predictions for the year or two ahead.

Ugly rumours about a hero's death.


Terrible news in the London Daily Telegraph overnight which the Sydney version missed. Under the headline Batman to be killed off after 70 years – there's a story that Batman will suffer a gruesome end when his sidekick Robin goes over to "the dark side" and destroys him in a terrible betrayal. Comic books might never be the same again.

But nothing's changed at the Tele.

Words matter for the Telegraph's new editor Gary Linnell we were told in The Oz's media section this morning but there has to be some doubt about whether he cares if they are fact or fiction. For the Tele on its website this morning (having read it there I couldn't bring myself to actually pay for my normal newsprint copy) has perhaps the bodgiest opinion survey ever used by a news organisation in search of a cheap headline. No wonder the story on the web is without a by-line as any self respecting journalist would be embarrassed to put his name over "Kevin Rudd 747 rates an 'F' with readers, failing Prime Minister". The so-called evidence for this proclamation is an on-line poll from the newspaper's own web site where, of 1600 replies, 55.4 per cent said the Prime Minister had done a poor or really bad job. Just 26.2 per cent said he had done a good or a really good job, with 18 per cent describing it as "average". The story boldly concludes that this majority view of Telegraph responders justified the declaration that Kevin Rudd has been a failure since his election 12 months ago.
The Gary Linnell Tele would have us believe that this is "crushing news" for Kevin Rudd while the story admits that "the survey didn't cover a representative cross-section of the electorate and about 60 per cent of respondents did not vote Labor on November 24, 2007" and "it clashed with opinion surveys showing the Government and the Prime Minister in strong positions over the Opposition of Malcolm Turnbull." The story surely marks a new low point in the idiocy of the Telegraph's version of political journalism.

A pleasant change at The Oz.

What a pleasant change from the normal ramblings of Dennis Shanahan this morning to find the Newspoll findings explained by a journalist who is both literate and numerate. George Megalogenis wrote how a strong majority of voters would be concerned if the federal Government pushed the budget into deficit next year to stimulate economic growth but saw that as the only blip in yet another dominant Newspoll for Kevin Rudd and Labor. Newspoll has Labor leading the Coalition 55% to 45% and that is the most successful opening year by a Government in the history of Newspoll, while the Coalition has endured its worst sequence on record with its primary vote stuck below 40 per cent.

A wrong choice by Telstra.

Telstra's hiring of Labor's pollster is right out of the lobbying text book and the research findings Glenn Milne wrote about in The Australian this morning should be dismissed as the rubbish that they probably are for that reason alone. Crude bullying tactics should be rewarded only if there is no alternative but to give in to the blackmailer. If that was the case with the national broadband network (NBN) proposal there would be no need for Telstra to be the bully in the first place and it could have saved the considerable sum it is paying to John Uttting's UMR Research. Utting, of course, is the man credited with providing Labor with the data it needed to plan Kevin Rudd's successful election campaign a year ago. Telstra, with all the rat cunning of a would-be monopolist, hopes that having an organisation Labor trusts tell the Government that the mob actually like and respect Telstra would carry considerable weight as decision day on the project arrives. My guess is that Telstra has misread the Rudd style with this assessment. The PM has shown considerable caution about exposing himself to any allegations of making decisions other than by the book and that he will want to avoid any suggestion of being influenced by a Labor mate.

News by survey update.

The proportion of the “news” we read each day that comes from some kind of survey or other just seems to keep growing. The Melbourne Age this morning makes much of a Nielsen poll on the attitude of Victorians towards public transport with 61 per cent of people saying they are dissatisfied with the Brumby Government on public transport — and only 27 per cent satisfied. I don’t think most people needed an opinion poll to learn of that particular dissatisfaction but I was surprised with the finding that 62 per cent want the Government to give public transport priority over roads, compared with 24 per cent who want roads to have priority. Perhaps the 62 per cent figure is so high because motorists think that better bus, train and tram services might encourage other drivers to get off the road so things get easier for them. That would be in keeping with the finding of the last major survey of drivers for the Australian Automobile Association when their primary unprompted concern was the behaviour and attitudes of other drivers - especially their perceived aggression and impatience.
This morning’s newspapers did bring another of those special interest polls (like the “A wrong choice by Telstra” mentioned in Crikey yesterday) conducted as part of a lobbying campaign. The public relations boffins for the Advanced Medical Institute got a run with their version of research showing that the public is not as prudish as the advertising watchdog thinks and their posters using the words "longer lasting s-x" should therefore be allowed. They’ll probably be happy with this further plug as well!

Stealing a good idea.

Malcolm Turnbull seems very frustrated by the lack of impact he is having on that Rudd popularity, but he should learn that giving his opponent a good idea is not a way of changing it. Yesterday’s suggestion at the National Press Club by the Opposition Leader that company shareholders should be able to pass binding rather than just advisory resolutions about executive salaries and bonuses will surely be taken up by the Government. The Acting Prime Minister Julia Gillard seemed quite gleeful about the prospect when she said in Question Time that she always liked it when the poacher turned game-keeper. Malcolm’s friends in the big end of town are not so likely to be happy about the prospect of lurks and perks being curbed but the traveler will be when he finds out. It is Rudd not Turnbull who will end up with the credit for a change that ordinary people will applaud.

Catching the wrong populist tram.

Playing to the envy ordinary people have when they see others jetsetting off around the world at first blush might seem like good politics. Clearly the Federal Opposition thinks so. They have been courting as hard as they can the instinct of the populist press to attack Kevin Rudd for spending so much of his first year in office overseas and were at it with particular vigour on yesterday’s election anniversary day. Yet you could hardly say that the tactic is having much of an impact. The Prime Minister starts Year Two with incredibly high popularity ratings in all of the major opinion polls. Australians seem to be putting aside their envy and showing at least a grudging pride in having a leader who can mix it with the leaders of the world.

Sunday, 23 November 2008

The IMF billions keep rolling out

On Friday it was Latvia's turn to knock on the door of the International Monetary Fund in Washington and ask for a hand to survive the horrors of the international financial crisis. No sum needed has been mentioned in the early reports but it's almost as if a billion or two between friends is nothing.
"We have decided to start official talks with the European Commission and the IMF about funding to stabilise the economy," Prime Minister Ivars Godmanis told reporters.
The Baltic country has seen a sharp economic slowdown this year, reports euobserver.com, with a contraction of 4.3 percent in the third quarter, breaking its previous record of being one of the fastest growing economies in the EU.The financial crisis has made it hard for Latvia to obtain funds in its attempts to counterbalance its large current account deficit. The government has been forced to take over the country's second largest bank of Parex and offer millions of euro as guarantees to its creditors.
When Latvia gets its IMF assistance it will be the second European Union country to do so with Hungary getting a $USA15.5 billion credit earlier this month. Now the guessing game is who will be next. Talks are under way between the IMF and the governments of Pakistan and Turkey and the speculation is that the other Baltic States and also Romania and Bulgaria will so0n be in the queue.



A fearless prediction

When I was a very young journalist who had just got the job writing politics for the now defunct Sunday Australian, I remember the advice that Ian Fitchett, then the Sydney Morning Herald's political correspondent and the doyen of the parliamentary press gallery, gave me about making predictions. The closer it gets to an event, said Fitch, the less definite should become your prediction. If you write something that turns out to be wrong just before the event everyone will remember your mistake. If what turns out to be wrong was predicted weeks before then no one will recall it but if your prediction was correct you can remind people of your wisdom.
Adrian Proszenko should have met an Ian Fitchett before he had his prediction about the rugby league World Cup final published in the early editions of Sunday's paper that went to bed just as the game was about to begin. By the time the paper was delivered he was clearly wrong, wrong, wrong.
It's the kind of example that should find its way into journalism course text books.

Shut due to public demand


Opening and closing a new business on the same day would not normally be a good sign but things are a bit different for Europeana. This new website went on line last Thursday making available an initial two million books, maps, recordings, photographs, archival documents, paintings and films from national libraries and cultural institutions of the EU's 27 member states. The site was instantly overwhelmed by the 10 million visitors per hour it was receiving and crashed mid-morning, requiring a quick doubling of the number of servers supporting the library. It crashed again in the early evening.
Europeana is a project of the European Commission which commission president Jose Manuel Barroso at the launch described as being much more than a library, but "a veritable dynamo to inspire 21st century Europeans to emulate the creativity of innovative forbears like the drivers of the Renaissance."Some 1,000 cultural organisations have provided material, from the Louvre in Paris to Amsterdam's Rijksmuseum and the British Library. By 2010, the project hopes to hold some 10 million items.
The great paintings of Europe, the musical scores of the continent's finest composers and documents of profound historical importance - from the Magna Carta to Vermeer's Girl with the Pearl Earring and Baudelaire's "Les Fleurs du Mal" - are now digitally available.
Website: europeana - European Digital Library

Friday, 21 November 2008

Will those years of wining and dining be rewarded?

The highlight of my survey of the international press this morning (Yes - old habits die hard and I'm posting my summary to my blog each day) was the news that the disgraced press baron Conrad Black is pinning his hopes on clemency from U.S. President George W. Bush as a last-ditch effort to get out of jail early. The story in the Toronto Globe and Mail showed that the jailbird has lost none of his arrogant disregard for other people's money - he wants his former publishing company to foot the legal bill.

Keeping the confidence up


With petrol prices falling rapidly, the interest payment to the bank dropping considerably and no friends and neighbours losing their job it does not really need a politician or a Reserve Bank governor to tell people not to panic. At this stage of the economic cycle the main reason people might be getting a little apprehensive is only because these people in authority tell them there is no need to. Even the annual statement from the super fund for the year ended 30 June was not too bad for those not actually on the verge of retirement. The loss of a few percent is not that troubling after all those great years of the recent past.
The Morgan Poll's Weekly Consumer Confidence Rating (the graph here gives the annual average since 1973) is still well above its record lows. True there was a drop of 4.6 points to 91.2 in the week ended 16 November but it got down to 72.8 in June 1989 . The mob are far from being at panic stations yet despite what they have been hearing and reading about the stock market crash.
It's the next progress super report showing the losses increasing, combined with unemployment going up at a frightening rate, and it is people you know without work, while the value of the family home is going down that will have an impact/ All the honeyed words from Prime Ministers, Treasurers and Governors will not stop despondency when that day comes.

Peter Garrett talks tough to Tasmania

Peter Garrett might be content to approve thousands of litres of poisonous effluent being pumped in to Bass Strait from a pulp mill but he has drawn the line at the galaxias auratus. Yesterday the Federal Environment Minister gave a resounding "No" to further entreaties from the Tasmanian Government to release up to five megalitres of water per day from Lake Crescent. “In making my decision I have taken into account the Interlaken Lakeside Reserve Ramsar site and the endangered golden galaxias - a fish which only occurs in Lake Crescent and the connected Lake Sorell,” Mr Garrett said.
Tasmanian Minister for Primary Industries and Water David Llewellyn wanted the water to ease drought conditions in the Clyde Valley around Bothwell.

Children betrayed - is nothing sacred?


The government owned Air Services Australia is betraying thousands of Australian children with its decision to get rid of red fire engines. The corporation yesterday trumpeted its decision to replace red with what it calls "a new bright ‘yellowish-green’ fluorescent colouring". The unthinking bureaucrats, with no regard to the danger of making all those toy red engines redundant, rejected the sensible compromise many of the world's fire services are following of having splashes of the apparently highly visible trendy new colour on predominantly red engines.

Thursday, 20 November 2008

Australia's secret shame

At People for the Ethical Treatment of Animals they call mulesing "Australia's secret shame" but my guess it will be less of a secret quite soon. The decision of woolgrowers to dump the board of Australian Wool Innovations because they were committed to ending the practice of mutilating sheep by 2010 and install directors who want to continue the practice for longer, will infuriate the animal rights activists. Kevin Rudd for one can expect to receive a rash of emails saying something similar to this:

I was shocked to learn that Australian farmers continue to partially skin lambs alive, despite growing international pressure from retailers and consumers to implement long-term, humane alternatives. Instead of taking real action, the Australian wool industry has turned to cheap and cruel plastic mulesing "clips," which are as cruel as hacking lambs' skin and flesh away with shears and are equally ineffective against flystrike. There is overwhelming scientific evidence that mulesing is so cruel that it adversely affects lambs for months, and the "clips" also cause great pain to the lambs. Viable, humane alternatives are already in use by many Australian farmers. There's simply no reason for the Australian government to continue to allow cruel mulesing mutilations and live export.

That's the suggested form of words on the PETA website savethesheep.com this morning.

A depressing analysis

I

If my colleague Glenn Dyer did not depress those still with jobs in the media enough yesterday with his piece in Crikey headlined "UK Media slashing jobs, looking to the future", then perhaps this will do the trick. Last week at the American Press Institute’s closed-door summit of 50 of the top newspaper executives from around the country, says a report I read this morning, James Shein, a turnaround specialist and professor at the Kellogg School of Management at Northwestern University, asked executives to calculate their company’s Altman Z-scores, which can help identify how close a company is to bankruptcy. A score above three is the accepted safe range. Shein said only one company was above that measure. EW Scripps Co. has a Z-score of 3.78, according to Bloomberg.

Writes John Templon of the Medill newsagency:

Lee Enterprises Inc., which publishes The Times of Northwest Indiana and the St. Louis Post Dispatch, has a Z-score of .56 and the Sun-Times Media Group Inc., which publishes the Chicago Sun-Times and a large number of community newspapers in the Chicago area, has a Z-score of minus 1.02.

McClatchy Co., which publishes The Miami Herald and 29 other daily papers, has a Z-score of .32. The company's stock "could be worthless," according to a report by Chicago-based Morningstar Inc.

"McClatchy has struggled under the multiple weights of declining revenues, high debt, outsized exposure to troubled housing markets, and the continuing shift of readers and advertisers from print to online," said equity analyst Tom Corbett in a report issued on Friday. "Given the persistence and severity of these conditions, we think equity shareholders are at risk of losing the entire value of their investment."




Comebacks can happen


Those who believe that the NSW election due in 2011 is all over bar the Liberal National Coalition Government being sworn in, should perhaps reflect a little on this little graph of the roller coaster ride that Labour has had in the United Kingdom.
Just six months ago the pundits were writing the political obituary for Gordon Brown when his Labour Government fell more than 20 points behind the Conservative Opposition. Today the average of the UK pollsters has that lead down to around five points and the most recently published Ipsos/MORI puts it at three.

Will Barack Obama prove more popular than George Bush?


It might he hard to remember, but George W. Bush was once a popular president. After his first month as President of the United States on 1 March 2001, he had an approval rating as measured by the NBC/Wall Street Journal poll of 57.0%.
Barack Obama will soon have his presidential popularity out to the test and the Crikey Political Indicator, based on prediction markets from around the world, gives him a 79% chance of having a higher initial rating as judged by the Real Clear Politics average job approval figure on 1 March 2009 than the man he will replace did eight years earlier.
As an indication of how the mighty can fall, have a look at the Gallup poll's quarterly ratings from 2001 until now.

Wednesday, 19 November 2008

Protectionism rears its ugly Victorian head

Kevin Rudd had no sooner returned from playing the virtuous international leader committed to a united action by the G20 to end the world's financial crisis than Victorian Premier John Brumby started making him look like just another political hypocrite. A key element of the so-called plan to save us all from the ravages of a depression was a decision that countries should avoid the protectionist mistakes of the 1930s. This time around there are supposed to be no barriers to world trade.
The Australian motor car industry subsidy came close enough to making a mockery of that promise by our Prime Minister but Mr Brumby has gone the whole hog with his decision to favour Victorian manufacturers over foreign rivals for billions of dollars worth of State Government contracts.

Dramatic ice improvement




What would have made the GISS temperature estimates even more remarkable was that the supposedly hot October coincided with a dramatic improvement in sea ice coverage in the northern hemisphere.


The polar bears, it is to be hoped, are safe for another year.

An embarrassing climate measurement mistake


Governments around the world are making expensive decisions designed to combat global warming based on the evidence provided by scientists showing that world temperatures are in fact rising. Most influential among those scientists is Dr James Hansen of Nasa's Goddard Institute for Space Studies (GISS) who has tackled the complex task of taking the readings from thousands of individual meteorological measuring stations to come up a virtual temperature reading for the world as a whole. So when GISS pronounced earlier this month that October 2008 was the warmest October on record there was a heightened sense of alarm among those with the task of reaching an international agreement to stop the dreaded gas emissions held to be responsible.


How embarrassing, then, that GISS has now had to withdraw its alarmist findings. Last month was only shown to be the hottest ever because the data Dr Hansen put in to his wonderfully powerful computer was substantially wrong.

You can get the picture from this pair of pictures which show a before the correction and after the correction computerised map of the world temperature in October. In the first map you will notice a large area of dark brown over Russia indicating average temperatures that were eight degrees and more above the average in the base period from 1951 to 1980. In the second map the brown has retreated considerably after a couple of sceptical climate change blogs, Watts Up With That and Climate Audit, began detailed analysis of the GISS data and made an astonishing discovery. As Christopher Booker reported in the London Daily Telegraph: "The reason for the freak figures was that scores of temperature records from Russia and elsewhere were not based on October readings at all. Figures from the previous month had simply been carried over and repeated two months running."

With itsw credibility under attack, GISS was forced into damage control. To quote Christopher Booker again:


"GISS began hastily revising its figures. This only made the confusion worse because, to compensate for the lowered temperatures in Russia, GISS claimed to have discovered a new 'hotspot' in the Arctic - in a month when satellite images were showing Arctic sea-ice recovering so fast from its summer melt that three weeks ago it was 30 per cent more extensive than at the same time last year.
A GISS spokesman lamely explained that the reason for the error in the Russian figures was that they were obtained from another body, and that GISS did not have resources to exercise proper quality control over the data it was supplied with. This is an astonishing admission: the figures published by Dr Hansen's institute are not only one of the four data sets that the UN's Intergovernmental Panel on Climate Change (IPCC) relies on to promote its case for global warming, but they are the most widely quoted, since they consistently show higher temperatures than the others."







Monday, 17 November 2008

The Sydney Tele Went on a Crusade and its Sales Kept Falling



The Sydney Daily Telegraph went quite overboard with its campaign to get rid of the NSW Labor Government and its sales just kept on falling. David Penberthy, the youthful editor who decided that being a political campaigner was the right course for the tabloid, has now been replaced. Presumably his replacement, newspaper veteran Garry Liddell, will put more emphasis on stories that his readers actually want to read and put an end to the political beat ups. This morning’s news sense certainly looks quite different from Penberthy’s efforts last week.

Coalition further behind


There is no joy at all for the Coalition in the latest opinion polls. The average of the two party vote from the three regular national pollsters has Labor further in front than at the last election.

The leadership change in the Liberal Party has not made a scrap of difference. Malcolm Turnbull's personal rating might be higher than Brendan Nelson's but the Coalition vote has declined rather than increased. And Kevin Rudd continues to maintain a huge advantage as the preferred Prime Minister.

Saturday, 15 November 2008

The Australian asserts the Prime Minister has lied

In an editorial yesterday The Australian said:

The contentious part of Franklin's story revealed that during the 30-minute conversation, Mr Rudd was stunned to hear Mr Bush say: "What's the G20?" We stand by the story with confidence.
On Thursday before leaving Canberra Prime Minister Kevin Rudd said:

Can I just say that if the White House says and I have said and the US Ambassador has said, that the reported remarks in this article were not made.
There is only one conclusion that can be drawn from this. The Australian is alleging that the Australian Prime Minister is not telling the truth

Friday, 14 November 2008

Australia's two nations



Australian Bureau of Statistics figures out this morning show clearly how Australia is like two different countries when it comes to economic growth. Queensland, Western Australia and the Northern Territory are well in front of the rest for the last decade although there has been recent improvement in South Australia.

Gross State Product (GSP) for the last year is shown in the table Gross State Product

The Average annual compound growth rate from 1997-98 to 2007-08 saw Queensland growing fastest at 5.0%, followed by WA with 4.4%, the NT 4.3%, the ACT 3.5%, Victoria 3.2%, NSW 2.8%, SA 2.6% and Tasmania 2.5%. Australia as a whole grew at a compound rate of 3.5% through the decade.

Adjusting for the impact of population growth on movements in GSP last year gives the chart GSP Per Capita.

Counsel for the defence replies

The Melbourne Age has been playing the role of public prosecutor in the trial by newspaper of stood aside Victorian Cabinet Minister Theo Theophanous so it is appropriate that the Melbourne Herald Sun has now come forward as counsel for the defence. This morning the Hun devoted its front page to a declaration of support by Rita Theophanous for her husband when she branded the woman who accused her husband of rape as a liar out for money.
The Melbourne press is certainly giving the criminal justice system a new dimension.

Reporting lounge room chatter is okay

Reporting private dinner table chatter might be a no-go for journalists with ethics but perhaps reporting lounge room chatter is okay. The Oz this morning picks up my grievous error of suggesting that its editor was being fingered as the source of a report based on what the PM said at the Kirribilli dinner table when he was among the guests. The paper's Cut and Paste section this morning points out that the political writer who broke the story, Matthew Franklin, made it clear on October 25 that Kevin Rudd was entertaining guests in the loungeroom at Kirribilli House with the PM still clad in the suit he had worn to a business dinner in the city. I am delighted to help clear up this vital detail and would be only too willing to print Chris Mitchell's explanation of who he told what about what he heard from the comfort of his armchair.

Thursday, 13 November 2008

I guess she asked for it

West Australian Labor MP Melissa Parke got a rousing reception when she rose to ask a question in the House of Representatives yesterday. "Not another Dorothy" was the cry as Opposition Members tried to suggest there was a touch of hypocrisy about the Member for Fremantle asking what was clearly one of those Dorothy Dixer prepared questions to the Minister for Defence Science and Personnel. For Ms Parke, you see, had earlier in the week received more than a little publicity for suggesting that the Parliament would be a more relevant institution if the practice of having questions asked of the government each sitting day by its own MPs prepared for them by senior ministers.

When you just have to have more Kevin


Need a little Prime Ministerial fix? Then click on over to KevinPM. The replacement for the Kevin07 website is up and running.
In the master's own words:
I'll be using the site to speak frankly with you about the big challenges facing Australia; the global economy, education, climate change, and the health of Australians, but just as importantly it will enable me to hear your ideas for the direction of the nation. You can submit your feedback using the form below.

Politicians behaving badly

They are just like footballers really. Queensland's Liberal National Party MPs were out on the town in Cairns, having a good time, and two of them followed the recent example of Brisbane Broncos players and left without paying.
The Cairns Post report said the group of about 20 MPs and party officials asked for individual bills and receipts and refused to leave tips, despite complimenting the service of two waiters assigned solely to their table.The booze-up ended when the two remaining MPs ordered final drinks then left, still owing money.

An Opposition spokesman last night confirmed two MPs left Fetta's without paying, but refused to identify them. The Cairns Post understands one of them was Robina MP Ray Stevens, who was also involved in a heated argument with fellow LNP member Ray Hopper over their share of food and drink costs at an Esplanade restaurant the following night.

A terrible slur hangs over Chris

What a pity that the editor in chief of The Australian, Chris Mitchell, will not have the opportunity to clear his name before a Senate Committee of the terrible slur that hangs over it that he is not a journalist a Prime Minister can trust to invite to Kirribilli House for dinner without private conversations being disclosed. Poor Chris's reputation is taking quite a battering over this "George didn't know what the G20 was" business. The rumour mill is blaming him for blabbing to his political writer Matthew Franklin about something Kevin Rudd told his guests on the night in question after his phone call with President George W.Bush. Protocol for members of the fourth estate on occasions like this is to treat private dinner table chatter as being private dinner table chatter. Get a reputation for not being trustworthy about such a matter and not only will the dinner invitations dry up but an editor's reputation for honesty gets torn asunder.
Editor Mitchell at least has been keeping a discreet silence about what really was said by whom at Kirribilli that night since the Liberal Party started trying to use the Franklin story as evidence of a Prime Minister prepared to put Australian-United States relations in jeopardy for the sake of an amusing throwaway line while pouring another glass of wine. By acting in this Trappist like fashion The Australian's head honcho has unselfishly condemned himself to the feeding of that rumour mill and the continued trashing of his reputation.
The efforts of Family First Senator Steve Fielding to establish an inquiry into the leaking of the phone call would have presented Mr Mitchell with an honourable way out. Because of the high regard in which he holds the Senate he surely could have felt obliged to answer questions put to him. But, alas, this morning the Greens would not support a reference to a Senate committee. "What Senator Fielding - who is quite new in the Senate - doesn't understand is that the Prime Minister can't and won't be brought before such an inquiry," Senator Brown told Alexandra Kirk on AM before the vote. "Either the inquiry will fail, or if there was a move to force witnesses like the Prime Minister before the inquiry, we end up with a constitutional showdown between the houses, with the potential for journalists to be brought before the bar of the house and potentially sent to the dungeon."
Come to think of it, perhaps a little continued speculation about not being a totally honourable dinner guest is preferable to ending up in a Senate slammer for contempt.


Wednesday, 12 November 2008

The Chinese nanny indicator

The extent to which the world economic crisis affects Australia will depend largely on what happens to our new biggest export market China. If China continues growing at seven or eight per cent a year our major export industries will not fall over and Australia as a whole will avoid falling into a recession. But should things turn out worse in China than its Government expects then we too will be in dire trouble.
In determining what is happening in China there is the difficulty of getting reliable information from a very bureaucratic and autocratic state. Official statistics are not as reliable as those from the Australian Bureau of Satistics so we must seize on what clues are available.
And here today's offering is not good. The People's Daily is reporting that "with the financial crisis' heightening sense of menace, many are reconsidering what they can and can't afford - and employing a nanny at 30,000 yuan ($4,280) a year is falling into the latter category." The hurricane howling through the world's financial markets, the People's Daily reports, has left an oversupply of nannies in its wake. A source from a local domestic service company said the city's nanny market had dropped 20 to 30 percent in the past year, with nannies' average salaries also decreasing from 2,000-2,500 yuan to 1,300-1,800 yuan.
The current oversupply of nannies is attributed to a flood of workers laid off as businesses have failed.

Do Liberals really want to abolish the last remnants of Westminster

The accusation of cooking the books that is being levelled at the Federal Treasury by the Liberal Party suggests that we are now not far away from completely ridding ourselves of the notion of an independent and impartial public service. If the alternative government really believes that the public servants are falsifying the growth figures to aid and abet the Labor Government then they are saying that our senior public servants are people of no integrity. They are either Labor stooges or public service whores who will do the bidding of whoever instructs them. In either case we would then be better off making clearly political appointments.

Why the hurry?

I've never really understood why opposition political parties are so keen to seize on things like their current suggestion that the books are being cooked to show that economic growth is expected to be 2% n0t 1.5% or some even lower figure. The public will end up judging the Government not by whether their estimate proved right or wrong but what the figure ends up being. If growth staggers to a halt the Government is in trouble and will be punished for it with the previous optimistic forecast available to be used as evidence of the incompetence that caused the problem. Should it turn out to be round about right or a little on the low side in a year's time there will be no merit marks awarded for making an accurate assessment back in November 2008. Whatever the case, the impact will have nothing to do with anything the Opposition says or does now.

Take Tony up on his suggestion

A Labor Party not overcome with conservative caution would be rushing today to take up the suggestion by Liberal frontbencher Tony Abbott for a change in the Constitution to to empower the national parliament to make laws generally for the peace, order and good government of the commonwealth. Mr Abbott's proposed amendment to section 51 of the Constitution would not abolish the states, just ensure that in the event of disagreement the national government calls the shots.
The proposal was put forward this morning in a column written for The Australian and shows there is merit in encouraging MPs who are not ministers to supplement their income by a little journalism on the side. Tony Abbott knows that to keep getting the earn he needs so his lifestyle does not suffer too much from the loss of the perks of office that it is necessary to have something to say other than cheap political point scoring. His analysis of federal-state relations does that and is a reminder that he is one of the brighter men to serve in the House of Representatives.

Should Victoria be able to veto reform of water use in the Murray-Darling Basin? Should NSW be able to opt out of an education revolution? Should all the states bar Western Australia be able to stymie a national bid to provide more disability accommodation? I doubt it. Should modern Australia consider itself bound by the intergovernmental arrangements of a previous century, even as adjusted by the High Court? Or should matters in dispute be settled by the national parliament as the highest democratic authority in the land? On this, I think we all have a clear sense of where the public really stands.

Of the three options for fixing the federation, mere tinkering, on the grounds that this is about as good as it can get, is really a cop-out. Giving more authority and commensurate revenue powers back to the states is possible but implausible. So why not give the national government constitutional authority to match people's expectations about who should really be in charge? Let's amend section 51 of the Constitution ...
Tony Abbott believes change will come once the Rudd version of co-operative federalism fails, as it inevitably will, so people had better all start thinking about the best ways to make it happen.
Kevin Rudd would be wise to agree and a House of Representatives committee chaired by Tony Abbott would be an excellent way to get things started.

A drug dominated election for election junies

It's hard for election junkies not to have withdrawal symptoms after that lengthy United States campaign so just a little something to be going on with. The people of the tiny west African nation of Guinea Bissau (population 1.7 million) go to the polls on Sunday to elect a Parliament after a campaign dominated by talk of drug trafficking.
Guinea Bissau, one of the world's poorest nations, was described in a recent Agence France Press report as an important transit point for cocaine coming from Latin America en route to the lucrative European markets. Bissau's biggest opposition party the African Party for the Independence of Guinea and Cap Verde (PAIGC) has accused political rivals of receiving campaign money from drug lords. "Only blind people cannot see that certain parties are financed with drug money," PAIC leader Carlos Gomes Junior told a October 29 rally.
The leader of the newly formed Republican Party for Independence and Development (PRID), former prime minister Aristide Gomes, a close ally of president Joao Bernardo Viera, boasted that it was during his tenure that the only seizure of cocaine was made in Guinea Bissau.
In September 2006 , 647 kilos of cocaine were seized by the police but the drugs disappeared while being transferred to the public treasury for security reasons.
A little bit of that should help someone have a real Don's Party.
Unfortunately for we election addicts the next poll on the list, that for president of the Ivory Coast scheduled for 30 November, has been postponed indefinitely because of delays in voter registrations and security concerns. We will now have to wait for Ghana on 7 December when drug trafficking will again be a major issue. Kwesi Aning, head of research at the Kofi Annan International Peacekeeping Training Centre recently said he was amazed at the amount of money being splashed around in Ghana ahead of presidential elections.
It is not known if the NSW Branch of the Labor Party has sent observers to West Africa to observe the latest election fund raising techniques.


Tuesday, 11 November 2008

And News Limited is not keen on the truth either!

Phil Gardner has been appointed editor-in-chief of the Herald & Weekly Times newspaper group in Melbourne they told us on the media section of The Australian website this morning. Those who wondered what this meant for the future of Bruce Guthrie had to wait until the eighth par to learn that he "will leave the company at the end of this month". No explanation other than a somewhat grudging comment from News Limited chairman and chief executive John Hartigan that Guthrie had overseen strong gains in the newspaper's Monday-to-Saturday readership.
At least in his old paper the sacked editor was given the additional praise of
having guided the Herald Sun to the PANPA Newspaper of the Year award. Now that's a golden hand shake for you!






Economists support the telling of lies

It is interesting to note the ease with which the financial community condones the telling of lies. In the minds of many of these economists and analysts it seems to be the view that the public is not clever enough to be trusted with knowing what is really going on. K
That keeping the truth to the inner circle which understands these things is the preferable course is clear in two commentaries this week appearing in the Sydney Morning Herald. Yesterday that normally sound and seemingly very moral man Ross Gittins had this to say about economic forecasts by the Treasury:
There's more guesswork in economic forecasting than economists like to admit, but that must be doubly true at a time when such unprecedented (and scary) upheavals are occurring in the global economy. The econocrats always err on the optimistic side at this point in the cycle (the point where we ask whether the landing will be soft or hard) and I'm not one to criticise them for that. You've got to cut them some slack.

Because they get taken so seriously, the predictions of treasurers and central bank governors have the potential to be self-fulfilling - particularly negative predictions at a time when confidence is lacking - so it's not in the economy's interest to have officials spreading pessimism.

The emphasis declaring that telling pessimistic truths should not be disclosed is mine.
And then today it was Ian Verrender's turn. "Treasurer puts the right accent on the positive" they called his daily financial commentary that outlined the dire circumstances confronting the Australian economy in the coming months as things got tough for China. But don’t frighten the populace.
For the moment, though, Swan is keen to keep the mood buoyant and to play up the positives. He knows expectations become self-fulfilling. And the last thing Australia needs now is for fear to take hold.
I suppose we should all the grateful that the mob don't venture into the second half of Granny. If people actually read Ian Verrender and took any notice of his views then what Wayne Swan does or does not say would be irrelevant!


Ponting a victim of lack of political plotting

There is nothing newspapers like better than a leadership coup but those rotten politicians have not been very obliging in recent weeks with scarcely an excuse for journalists to get the rumour mill going. Hence, no doubt, the attention being paid to Ricky Ponting and his future as captain of the Australian cricket team. In the absence of a Prime Minister, Premier or even a Leader of the Opposition for the media to get its teeth into, the Punter will have to do.
But maybe, just maybe, relief for Ponting is at hand - at least in the city which the expatriate Tasmanian has made his home. This morning the Sydney Daily Telegraph has taken the egg beater to the future prospects of newly installed Premier Nathan Rees with political writer Simon Benson raising the prospect of him having only a short life expectancy. "ALP plotters stir the pot already over Rees' leadership" said the headline under which Simon Benson wrote that NSW Labor Party bosses have been secretly canvassing backbenchers to gauge waning support for Nathan Rees in the party room, just two months after he was installed as Premier.
The idea that the NSW Labor Party would actually consider installing a new Premier before the next election is so preposterous that perhaps it is true. No stranger than the suggestion from the cricket writers that Australia needs a new captain because Ricky Ponting dared to try and play the game within the spirit of the rules and bowl the correct number of overs in a day.



Friday, 7 November 2008

Those strange people running smh.com.au

Never has the divorce between the Sydney Morning Herald as a newspaper and its website been more apparent than this morning. The paper's state political editor Andrew Clennell led the SMH print version with a real exclusive telling how the State Government plans to increase the tax rate for people owning investment property worth more than $1.8 million from 1.6 per cent to 2 per cent - a move that should raise between $150 million and $200 million a year. But there was no mention of the story among the tens of different items on the home page of the SMH website until it made an appearance on the list of most read items after sufficiently devoted searchers had found it tucked away inside.

Dealing with a real crisis

Forget about all that international financial turmoil business. The Rudd Government now has a real crisis to deal with. The prospect of 25 per cent of Australian kids in child care not having a place where their parents can drop them off in the morning is giving Labor nightmares. Should the worst happen and ABC Learning Centres be shut down, then the Government would be facing a dramatic drop in popularity. It might be possible to recover from the coming recession but not from the anger of all those working families.
The receivers of ABC, those nice people from McGrathNicol who are looking forward to a wonderful earn from this company collapse while saying that the "interests of children and families are central to our considerations", are well aware of the political realities. They know the federal government has no option but to provide the money to keep the kiddies with a place to be deposited so they are working, as they said in a letter to the parents yesterday, "constructively with the Group’s management, its financiers, the Australian Government and other stakeholders to determine the way forward."
"Following extensive consultation between the Group’s financiers and the Commonwealth Government, a range of measures is being put in place to ensure the stability of childcare services for ABC families," is how the letter delicately put the matter of this government bailout of a private sector failure. Translated it means that taxpayers will be kicking the receivers can for tens of millions of dollars.

Tuesday, 4 November 2008

Don Burke a Worthy Nominee

As president of the green sceptics' group, the Australian Environment Foundation, Don Burke had probably already done enough to win a nomination as the Crikey Audacious Lobbyist of the Year without taking a gig with the Gunns pulp mill project but once he did so he clearly became a front runner for this prestigious award.
Mr Burke, who achieved fame with his Burke's Backyard television program, has taken the job as Gunns Limited's paid "honest broker" for its environmentally challenged Tasmanian mill.
"I don't like old-growth logging," he told the Sydney Morning Herald when his paid appointment was announced. "My track record is going into the areas where the greenies will never go, and actually getting better outcomes."
Gunns executive chairman John Gay confirmed Burke's role. "We're committed to sustainable environmental practices and Don will have no problem telling us if we are falling short," he said.
With our Crikey Audacious Lobbyist of the Year Award we are looking for the lobbyist, company or lobby group that in 2008 has employed the most deceptive, misleading, or otherwise problematic lobbying tactics in their attempts to influence political decision-making. The first nominee was Clubs Australia President Peter Newell whose story appeared in Crikey on 22 October.
Entries from readers are encouraged and should be emailed to to boss@crikey.com.au before 14 November. Our judging panel at Crikey will draw up a short list to put to a vote of readers.

Will the Bank trick the favourite betters again?



Those positively un-Australian people who gather around the Reserve Bank Board table every Melbourne Cup Day are the kind of narks who would just love to upset favourite backers so take the short price about a half a percent fall in interest rates at you peril. Last month they surprised the market by going for a full one percent reduction when the half was the odds on pick and maybe they'll do it again. Here's the latest latest Crikey Indicator on the November decision:

State governments love monopolies but racing will miss them more

The so-called commitment of State governments to competition policy has been made a joke of again - this time by Victoria with promised legislation to allow a betting exchange to operate in the state. The decision to licence an exchange, like Betfair which operates from Tasmania, was announced on Melbourne Cup eve by Deputy Premier and Racing Minister Rob Hulls. But there will be no new entrant into the wagering business with the new business to go to whichever organisation takes over the operation of the TAB from 2012.
Clearly the government decision is intended to provide an incentive to someone to take over the operation of the totalisator in a way that minimises the compensation the government will have to find to pay the existing operator Tabcorp for handing over its existing infrastructure and agency network.
Watching in a rather horrified fashion from the sidelines as Mr Hulls tries to ensure a future for the racing codes at somewhere close to their existing prosperity are Racing Victoria Limited, Harness Racing Victoria and Greyhound Racing Victoria. These three controlling bodies are beginning to understand that there is a real risk they will receive far less revenue from the new totalisator operator which will not have a share of poker machine revenue. Their chairmen last night issued a joint statement in response to the Government’s "announcement of wagering tax reforms for the new wagering licence to offset the loss of VRI (Victorian Racing Industry) gaming revenue from 2012 and to legislate for a review and adjustment process for ensuring the tax rates meet that objective."
The joint statement is clearly sceptical that the Government decision to reduce the government tax take from wagering will provide sufficient compensation. It said:
“The diversity and growth of gaming revenue has been a critical asset to the VRI since 1994 and its loss must be fully addressed.
“We will work with the Government to ensure that there is an agreed safety net that properly takes into account the full extent of the loss of the VRI’s ongoing normal gaming revenue and the future growth it would have achieved over the period of the new licence had the gaming licence structure not been changed.
“It is imperative that the Government work closely with the VRI to develop an effective mechanism that will adjust the tax rate to fully meet the loss of gaming revenue and that the partnership agreement between the VRI and the new licensee delivers the funding arrangements that are necessary to secure a viable and growing foundation for the VRI’s long term prosperity."
This is going to be a messy and troubling negotiation for the racing industries as the Treasury will be reluctant to continue the generosity that then Premier Jeff Kennett bestowed on them when he privatised the TAB. The gambling industry has changed considerably in the last few years after the Northern Territory Government broke ranks and gave favourable taxation conditions to corporate bookmakers and the High Court hinted thatrestrictions on advertising by them were illegal.
A glance at the advertisements in the Melbourne Cup form guides shows how the corporates are appealing to anyone half serious about having a punt. Tabcorp has joined in with its own corporate bookmaking business to add to the poaching of tote turnover and by 2012 the agencies it must be prepared to hand back will be the expensive to operate dinosaurs of the betting business.
Those international invaders lining up at 3pm for a share of that $5.5 million in prize money should enjoy it while they can. The way things are going the horses will be racing for considerably less in the Melbourne Cup five years from now.

What a difference a day makes

RBA may hold back on rate cut

David Uren, Economics correspondent | November 03, 2008

EXPECTATIONS that the Reserve Bank will cut official interest rates by 50 basis points tomorrow could be dashed, with a chance emerging of a smaller reduction or even none at all because of the inflationary effect of the Government's economic stimulus package. …

Reserve Bank to cut interest rates as housing prices crash

David Uren, Economics correspondent | November 04, 2008

THE biggest fall in house prices in 30 years and manufacturing output dropping to recession levels will leave the Reserve Bank board with no alternative but to cut interest rates again today.

Saturday, 1 November 2008

Buy Chinese, Buy Bad

The economists who speculate about the future trend of the Chinese economy tend to concentrate on such matters as the extent to which the country's exports will be affected by the world's economic slowdown. That might be the primary short term concern but the more significant one is the growing lack of trust that consumers can have in the sAfety and quality of Chinese made products.
The latest scandal, written about today in the Hong Kong edition of the China Daily, is the way that the industrial chemical and human poison melamine is used in animal feed. This case is far worse that the one earlier this year which resulted in the death of many dogs in the United States. This time it is people who are liable to suffer as the melamine travels through infected animals into the human food chain.
This week, said the China Daily report, four brands of eggs were found to contain the chemical and it quoted a story from the Nanfang Daily on Thursday which said it was an "open secret" in the livestock and fish food industry that melamine was mixed into animal feed. Melamine scrap was repackaged in to a product labelled "protein powder" and the sold to feed suppliers.