Wednesday, 31 December 2008

Blagojevich to pay the Christmas credit card bill

I am counting down the minutes of this old year with greater enthusiasm than normal having backed Illinois Governor Rod Blagojevich to still be in office as 2009 rolls in. When the market back in early December had him only a 20% chance to keep his job by year's end I could not resist a wager and I hope some of my readers copped the tip. As I wrote at the time, I doubted whether the Governor's Illinois colleagues would really have the enthusiasm to move quickly agaisnt him.
My current interest in the current affairs betting markets is of a non-political kind. In the spirit of the silly summer season I am researching that major cultural event the Oscars and will attempt to repeat my Blagojevich good fortune with a dollar or two on the best film and best director. Keep watching this space.

What makes news?

Goodness knows how many people died in the conflict in and around Darfur today. There are very few journalists around to count the bodies but it's a fair bet that it leaves the 300 or so casualties in Gaza well behind in the body count. Yet throughout the world the military action by Israel in Palestine is headlines in the papers and dominating the television and radio news bulletins while Darfur gets nary a mention.
I really don't understand why it is so. In the Darfur conflict this century alone the estimate is of 400,000 deaths. And that pales in to insignificance compared with perhaps 1.8 million killed in the Congo. Yet there is no sense of outrage at these slaughters while Israel gets condemned as if it is some kind of mass murdering regime.
Why, too, is there no general outrage at the barbaric deliberate slaughter of innocent civilians by Muslim suicide bombers comparable to that which is accompanying the peripheral killing of innocent civilians as the Israelis attempt to persuade Hamas to stop lobbing rockets on to the homes of ordinary Israelis?
I find it hard to believe other than that anti Semitism is alive and well.

Monday, 29 December 2008

Hotelling's law and the tragedy of Afghanistan

Keeping yourself closer to the consensus view of the voters than your opponent is a good starting point for someone wanting to win an election. During the Australian election campaign last year, when it came to matters of foreign policy and defence, Labor did it with great skill. 
On the question of committing troops to the war in Iraq, Labor's Kevin Rudd put himself closer to public opinion, which had grown against the invasion, than the Liberal-National Coalition. His was a "we will withdraw as soon as it can decently be done without upsetting the Americans too much" kind of policy. John Howard remained dedicated to the interventionist cause. On a scale of 0 (get out immediately) to 100 (stay as long as it takes to win) the public view was, say, at 35, Labor around 50 and the Coalition 70.
On Afghanistan, where public opinion broadly favoured letting Australia's involvement stay as it was, both Labor and the Coalition were slightly more gung-ho with both sides favouring a slightly greater Australian commitment to a decreased one.
That sound election winning strategy will now present Prime Minister Rudd with some difficulties. The withdrawl from Iraq is scheduled for mid year but when that happens there is likely to be increased questioning of what the Afghan war is really all about. It will not take many deaths of Australian soldiers to see public support start deteriorating. Labor will need to be careful to ensure that the Coalition in Opposition does not start moving closer to that point of view.

Sunday, 28 December 2008

The madness of markets

As I reflect on the year nearly passed and ponder the one about to begin I am left with the frightful thought that we are about to recreate in trying to deal with climate change all the artificial absurdities that led to the international financial crisis.
In the financial system people have lost faith in the ability of markets to deliver the best of all possible solutions. Greed combined with clever minds adept at devising wonderful ways of clipping the tickets to earn a dollar have brought the world to its most parlous state in generations. Yet the very same smart minds have been given the go ahead to devise so-called market solutions to the creation of the gases which the scientists tell us are the cause of global warming.
With the game of financial derivatives now at an end, get ready to play the new one with carbon and a host of intricate schemes to create tickets to be clipped by merchant bankers and other traders.

Friday, 26 December 2008

Rio Tinto - Australia's disaster?

Australians might joke about Americans saying that what is good for General Motors is good for the United States but we do have our own example. BHP, which now has that funny word Billiton tacked on, is the symbol for Australians of the good and safe company that helped build a nation. If that mining giant was ever to be under threat of collapse there really would be a crisis of confidence for ordinary Australians. Thus we should all be grateful that finally the big Australian abandoned its quest to become the giant international  by taking over fellow mining company Rio Tinto. 
The sad truth is that Rio Tinto,  the second biggest company in the Australian mining industry, is crippled and if BHP Billiton had taken it over if too would be a threatened species.
There was a rather harsh assessment of the troubles confronting Rio in the London Daily Telegraph just before Christmas with the comapny described as sinking under a huge $39bn debt pile. The debt was created, said the paper, to finance the $38bn Alan deal -  a deal that will never ever, create value for shareholders.
What is truly troubling is the inability of the management of Rio to concede that there was anything wrong with the Alcan purchase. The chief executive Tom Albanese told the Toronto Globe and Mail this week that "I think, again, creating without exception the world's leading aluminium company is something that I'm proud of, what I've seen go on over the past 12 months."

Just worry about Japan

It has become very fashionable for Australians to look to China as the great salvation for our economic prosperity but it really is Japan that we should be worrying about. The growth in Australian exports to China might have been dramatic from a low base but it is still Japan that contributes the greatest number of dollars. And, unfortunately, it is Japan which is suffering the greater economic hardship as a result of the international financial crisis.
The news out of Japan today was grim indeed. Bloomberg reports Japan’s recession deepened in November as companies cut production at the fastest pace in 55 years and rising unemployment prompted households to pare spending.  Factory output plunged 8.1 percent from October, the Trade Ministry said today in Tokyo, more than the 6.8 percent estimated by economists. The jobless rate climbed to 3.9 percent from 3.7 percent. Household spending slid 0.5 percent, a ninth drop.

Bring back a little class war fare

There's nothing like a little bit of class war fare to enliven a British election and that voice of the middle class Conservatives, The London Daily Telegraph, is doing the right thing

Monday, 22 December 2008

A typically incompetent farewell by the Sydney Morning Herald

For 21 years Alan Ramsey wrote a Saturday column for the Sydney Morning Herald. The last of them before his retirement appeared the Saturday just past.  I would like to be able to refer you to it but alas I can't. For some strange reason the Herald has chosen not to post it on its website.
What you can read is a thoughtful and considerate piece by David Marr describing a political journalist who was "right passionately, wrong passionately and patronised at times by his hardboiled colleagues for taking a stand in their shifting world."

Sunday, 21 December 2008

Be skeptical of miracles

It's probably unfair of me to pick on Thomas L. Friedman because there are literally thousands of articles that described Ireland in the early part of this century as being the home of an economic miracle. But his article in The New York Times extolling the virtues of economic management in the Irish Republic comes near the top of the list in a Google search and is so well written that reading it with hindsight is more amusing than most of the others.

This is what Friedman wrote in May 2005

Here's something you probably didn't know: Ireland today is the richest country in the European Union after Luxembourg.

Yes, the country that for hundreds of years was best known for emigration, tragic poets, famines, civil wars and leprechauns today has a per capita G.D.P. higher than that of Germany, France and Britain. How Ireland went from the sick man of Europe to the rich man in less than a generation is an amazing story. It tells you a lot about Europe today: all the innovation is happening on the periphery by those countries embracing globalization in their own ways - Ireland, Britain, Scandinavia and Eastern Europe - while those following the French-German social model are suffering high unemployment and low growth.

And as a comparison consider these words from this morning’s Irish Sunday Independent newspaper:

At an office in the IFSC in Dublin on Tuesday night the owners of commercial property were told to expect that a third of retail businesses throughout the country will close between January and Easter next year.

The shocking assessment was delivered in a week in which definitive evidence emerged that the cosseted political and banking establishment are operating in what several observers have described as a “virtual world”.

The devastating impact of the economic crisis has been evident for some time: official figures last week showed that unemployment jumped from 4.6 per cent earlier this year to 7 per cent at the end of September.

The ESRI has predicted that unemployment will hit 10 per cent next year. But many economists believe that figure has already been reached and is likely to be surpassed: some say unemployment may even exceed an astonishing 12 per cent, or close to 500,000 people.

… In Ireland, the economy will decline by at least 4 per cent, perhaps up to 6 per cent. As a result, at least 117,000 people will lose their jobs next year and a minimum 50,000 will be forced to emigrate.

Friday, 19 December 2008

The Owl/Crikey election indicators

Getting under the statistician's skin

.” Lies, Damn Lies and AFR Editorials on statistics” is what Brian Pink has called the statement on the ABS website this morning responding to an editorial in yesterday’s Financial Review. The Australian Statistician is clearly peeved the Fin has resorted “to a conspiracy theory to seek to explain my decisions over the past 12 months on changes to the statistical program of the ABS.”

Mr Pink also expresses his disappointment that “the AFR published this opinion without paying me the courtesy of contacting me to get my views on the situation.”

Clearly Mr Pink is a sensitive fellow who does not fancy with being portrayed as the villain whose changes to data collection made retail sales statistics unreliable and that is understandable enough. If there is a villain in this story of budget cutbacks it is those dreadful fellows in the Department of Finance with their love of across the board efficiency dividends. At least the Statistician can console himself with the knowledge that this little stoush will make it more likely that his budget will be dealt with more sympathetically in the round of discussions now getting under way.

When something doesn't work use more of the same

It's almost a law of governments - if something you are doing doesn't work don't change it just do more of it. We see this principle regularly applied in various attempts at social engineering and now I  notice it has spread to economics.

One of the necessary first steps in the global financial crisis was a slavish belief in those strange institutions called ratings agencies who charge those wanting to borrow money to obtain a credit rating. To get the fee for doing the work the ratings agency first has to be chosen by the borrower. Human nature being what it is, borrowers look for an agency that will give them the highest possible rating so the interest they have to pay is as little as possible. The temptation for the ratings agency to be generous in its assessment is considerable for if they don't get the job they don't get the fee.

So it came to pass that all those collateralised debt obligations or whatever they are called, ended up changing from sub-prime mortgages made to people buying houses they could not afford into triple A rated securities. It turned out to be a con on a major scale with ratings agencies nothing more than negligent money grabbers determined to get in for a share of the ill gotten gains.

To save financial institutions from collapse the American Treasury had to come to the rescue and take over billions of dollars worth of dud paper. But how to work out how much to pay banks to rescue them from their mistakes? Why, trot along to those very same ratings agencies of course and pay them a fee to value it for you.

The Bloomberg news agency gave US taxpayers this good news this morning. Federal Reserve Chairman Ben S. Bernanke, it said, is basing hundreds of billions in emergency lending on credit ratings from companies that gave AAA grades to toxic securities.

The Fed has purchased $308.5 billion in commercial paper and lent $631.8 billion under eight credit programs, most of which require appraisals of short-term debt and loan collateral by “major nationally recognized statistical ratings organizations.” That, in effect, means Moody’s Investors Service, Standard & Poor’s and Fitch Ratings.

It is foolhardy to rely on the three New York-based companies, said Keith Allman, chief executive officer of Enstruct Corp., which trains investors in financial modeling and asset valuation. The major raters issued top marks to $3.2 trillion in subprime mortgage-backed securities at the root of the financial crisis.

“They’re outsourcing the credit assessment to a group of people whose recent performance has been unbelievably bad,” said Allman, the New York-based author of three books on structured finance and a former vice president in Citigroup Inc.’s securitized markets unit. “If their goal is to not take a loss on these assets, they should be hiring independent analysts.”

Thursday, 18 December 2008

What sagging national trend?

Preaching to the converted is a hard habit forThe Australian to break. From the moment Labor nearly lost the Northern Territory election, the paper's political writers -- federal and state -- have all been going on about some sagging national trend for Labor. The actual West Australian defeat was confirmation that the resurrection was underway and Labor's slide in the polls in New South Wales was portrayed as inevitable.

Then along comes the opinions of those pesky Queenslanders and Victorians. In both states, Newspoll has measured Labor on the improve. How can we fit that into our sagging national trend? Yesterday, bringing the Newspoll news about Queensland, where the two party vote is now 57% to 43% on a two-party basis, Sean Parnell made the grudging concession that "Labor has slowed the momentum of the Liberal National Party's run to the next election" but Premier Anna Bligh is struggling to keep pace with her Opposition and satisfy community expectations.

Just run that by me again: Labor's vote is going up and the LNP's is going down and Labor would bolt in if these figures were repeated on election day, but the momentum of the LNP has only been slowed? Clearly there's something that Sean knows that I have missed.

At least this morning, giving the Newspoll verdict of Victorians, Ewin Hannan did not try to hide that Labor has "performed a remarkable turnaround", regaining a commanding lead over the Coalition at the mid-point of the state's electoral cycle. The same 57 to 43 two party vote share as in Queensland is higher than the Steve Bracks-led Labor Party got at the last Victoria election. There's not much evidence of a sagging national trend there, nor is there in the Newspoll federal findings, which also has Labor further in front than at the election a year ago.

The perpetual motion machine

Surely the battery must run out eventually. Our Prime Minister is just like a perpetual motion machine that cannot stay in one place for a moment.
The way Kevin Rudd treats every day as if there is an election in a week's time would fill me with fear if I was Malcolm Turnbull. This Prime Minister just keeps ticking all the boxes you need to if you are preparing for a double dissolution next year. 
Start the week doing something about global warming. End it visiting the troops in Afghanistan. The man just cannot stop spinning.

Starting at the top

No doubt the world wide recession will get us all in the end but at least this one seems to be starting in a different way. As the London Evening Standard pointed out over nuight, it is the middle class professions such as finance, advertising and consultancy that are being hit first. 
London now has an unemployment rate of 7.6 per cent with new rounds of retrenchments being announced almost daily.

Checking the power of Crikey

My colleague Ruth Brown had an entertainingly witty piece in Crikey last Friday P*nis in a park bench looking at the 100 most read stories for the year on the website. Now I notice that the most read story overnight at was a similar list of the 50 biggest online stories of 2008Quite an achievement for a once great paper when the most interesting thing to read on its website is a story about what things have been most read over the previous 12 months. Maybe it is not so surprising when you study what made the list and discover what Age readers really like.
Not wishing to be a spoil sport I have left off the year's most popular story. To find the winning entry, click here.
2. Outrage as ex-Clinton staffer runs debate
3. Oral sex blamed for throat cancer rise
4. Ponting 'must be sacked' 
5. Victoria's killer weather causes chaos
6. Stolen photos from laptop tell a tawdry tale
7. 'Terrorist' gunmen massacre scores across Mumbai 
8. Nine million Australians are a ticking 'fat bomb'
9. Condoms? You've stumped me: McCain
10. Court hears sordid tale of bullying, sex, buggery 
11. 9/11 collapse mystery solved: scientists
12. Call for help: 'I think he may be dead'
13. Warning of new bin Laden attack
14. Party's over for Playboy king Hugh Hefner
15. New world a wonder for Austrian cellar children
16. Rudd unveils $10.4b stimulus plan
17. Why 10 is too young for your first Brazilian
18. Historic victory for Barack Obama
19. The controversial career of Bill Henson
20. McCain goes for jugular, but misses
21. How Google put Bill's grief on show
22. Malcolm Turnbull wins Liberal leadership
23. Streaker no match for Symonds
24. C--- does not have to be the dirtiest word
25. Legend, moron or just a naughty boy
26. 'Kristen' and the Emperor: how the mighty have fallen
27. I lost 26kg with stingy exchange family: teen
28. Train journey ended with blood on the floor
29. Woman tells of being 'raped' by minister
30. The frightful things 'Client 9' asks of women, including his wife
31. Hack into a Windows PC - no password needed
32. RBA stuns with massive rate cut
33. A shattering moment in America's fall from power
34. Principal 'molested schoolgirls'
35. House prices are a bubble waiting to burst 
36. Tears in Melbourne as PM delivers apology
37. Party boy achieves global notoriety
38. Man 'had 7 children by daughter in cellar'
39. The porn supremacy
40. A man walks into a bar ... ouch!
41. Big Brother housemates revealed
42. Palin into insignificance?
43. Teacher 'wanted to be boy's sex slave'
44. Bi the Way, what does push women's buttons?
45. Hostel employee's shock over last known Britt photo 
46. Melbourne's Mr Sushi shuts up shop
47. Commuter train kills driver in level crossing smash
48. Republicans fear historic landslide defeat
49. Men behaving badly
50. Father, sons die in wharf tragedy

Who knows, the power of Crikey might even be enough to return it to the top of the most read list tomorrow for yet another day.

Wednesday, 17 December 2008

An anomaly of hard times

Australian elections in the second half of the 1980s and the early 1990s produced the seemingly anomalous situation where a Government presiding over difficult economic times kept winning elections. Now there are signs that the British Labour Government is benefiting from a similar phenomenon. In the midst of this giant economic crisis where banks are being bailed out and recession has struck, Labour is narrowing the gap in the opinion polls between itself and the Conservatives.

The Guardian/ICM poll out this morning shows the gap between the two main parties has dropped from 15 points to just five.

The Guardian says that voters are sceptical of the opposition's ability to handle the economy. Asked to compare Conservative Leader David Cameron and Prime Minister Gordon Brown on a series of characteristics, Brown pulls ahead by 11 points as the person most likely to get the economy back on track. He scores 35% against 24% for Cameron.

A clever Christmas e card from Malcolm

Australian politicians are beginning to get into this internet business. I received my first Christmas e-card last night and a charming effort it was too. Malcolm Turnbull has gathered together literally hundreds of illustrations from children around the country and I predict there will be lots of proud Mums and Dads forwarding the Opposition Leader's words to friends and relatives in the next few days. Clever viral marketing is what I think the experts call it.
Nothing yet from the Prime Minister but I live in hope. The Labor Party even seems a bit slack in updating his new Kevin PM site. The last video added was on 20 November and out-of-date sites are probably worse than not having a site at all. 

When competition for news gets close to blackmail

Giving in to blackmailers is rarely a sensible thing to do. Even if the one you pay sticks to the bargain and goes away after taking the money, the payment encourages someone else to do the same.

Being a willing party to publishing the embarrassing material in the event that the blackmailer's bluff is called is not only a pretty grubby act but serves as a warning to future victims of extortion attempts that payment is preferable to publication.

Which makes this morning's case involving the Channel Seven presenter Andrew O'Keefe a particularly sordid affair that exposes yet again the appalling morality of commercial television networks.

As told in the Confidential pages of the Melbourne Herald Sun Nine spokesman David Hurley claimed Seven allegedly paid $25,000 to a bouncer hawking mobile phone footage of its star Andrew O'Keefe on a wild night out in South Yarra last month. The footage, which has been seen by Nine sources, is claimed to have been taken of O'Keefe in Chapel St.

The story continued:

"The vision is absolutely clear and irrefutable," Hurley said last night.

"O'Keefe's splayed in the street, profoundly inebriated. He has to be helped to his feet by a blonde woman who disappears down the street.

"I don't think you'll be seeing it anytime soon on Today Tonight."

The bouncer confirmed he had spoken to Seven and Nine about the tape.

"Do you want a story as well? You come with the folding as well," he said when asked if he had sold the tape to Seven.

The grainy footage allegedly shows O'Keefe lying on his back on the footpath outside the Revolver nightclub.

The vision allegedly shows O'Keefe crawl along the footpath. He tries to get to his feet and then heads off along the footpath with a blonde female friend.

The entire episode takes about a minute. It is believed there is more than one copy of the footage.

Now when you are a television star whose program is shown to Mum, Dad and the kids in prime time, being captured on camera legless is not exactly the look  your network would want from you. That, presumably, is why Seven bought the tape with no intention of showing it. It was a way of protecting their investment in this particular piece of talent.

I am no lawyer and the particular nuances of the law of extortion or blackmail are outside my area of expertise. But I did find during my quick Google search this morning that the NSW Criminal Trial Courts Bench Book, which suggests words that their Honours might use in summing up such a case, says the following: "The offence of extortion or blackmail is committed when one person dishonestly makes a demand on another person for specified property in the possession of or under the control of that person, and that demand is accompanied by threat or force."

I did note as well that the Wise Geek drew attention to "A relatively new form of blackmail, more similar to extortion, [that] is known as commercial blackmail. In this crime, a business is the victim. The blackmailer threatens an action which would be devastating to the company's sales or reputation and typically demands a large payment."

Tuesday, 16 December 2008

Just when you thought it couldn't get worse!

As if the story of the $50 billion fraudster who has given us the latest world financial shockl was not bad news enough, this morning's The Independent has a really frightening story. Arctic at tipping point brings the glad tidings that scientists have found the first unequivocal evidence that the Arctic region is warming at a faster rate than the rest of the world at least a decade before it was predicted to happen. Evidence that air temperatures in the region are higher than would be normally expected during the autumn because the increased melting of the summer Arctic sea ice is accumulating heat in the ocean, a phenomenon, known as Arctic amplification, will be presented overnight at a conference of the American Geophysical Union in San Francisco.

Not playing Perkins

There might come a time when Australian politicians will need to make some hard decisions about measures to combat global warming but this is hardly one of them. Both Prime Minister Kevin Rudd and Opposition Leader Malcolm Turnbull know it and showed it yesterday with their statements on an emissions trading scheme. Both securely headed for the middle of the spectrum of possibilities where electoral safety lies. Both want to wait and see if the world reaches a global agreement before promising to create too much of the hardship of dramatic change.
Perhaps Kevin Rudd has put himself more squarely in the centre than Malcolm Turnbull. The Government has gone for minimal targets reducing carbon emissions that can be undone without too great a cost should next year's efforts at an international agreement fail completely. The opinion polls suggest that some action is considered by voters to be preferable to the Liberal position of postponing any action until there has been more study.
Where a politician interested in being re-elected does not want to be (and there are few politicians not so interested) is at the poles of possible action. Being a climate change denier is as sure a way of losing votes as being a zealot who advocates doing what he or she thinks is right irrespective of the short term consequences on the voters.
The inhabitants of those poles are like the air force commander in Beyond the Fringe.
"Perkins, I'm asking you to lay down your life. We need a futile gesture at this stage – it'll raise the whole tone of the war. Get up in a crate, Perkins... pop over to Bremen... take a shufti... don't come back. Goodbye, Perkins. God, I wish I was going, too."
"Goodbye, sir. Or is it... 
'au revoir'?"
"No, Perkins."

The Governor: Coming or Going?

The Governor of Illinois Rod Blagojevich has sensibly ignored the clamouring of the out of Chicago media for him to resign after being caught on phone taps trying to raise a dollar or two in campaign funds. Like that other Chicago son of a migrant, Barack Obama, the Guv rose in a tough school to reach high political office. He knows that it is not network television hosts who will be voting on his impeachment. His principal wheeling and dealing will continue to be done within the confines of the local Democratic Party.
And what wonderful wheeling and dealing it will surely prove to be. The prospect of Gov. Blagojevich singing along to the Federal Attorney General about the fund raising and other activities of some of those gunning to get him should have Republicans salivating. No wonder Team Obama was so quick to declare that their man had had no contact with the man about who would choose his replacement as a Senator. 
The team of the family headed by the Revd Jesse Jackson, whose son Jesse Jr was a co-chairman of the Obama presidential campaign, has not escaped as cleanly.  Evidence of discussions with the embattled Governor about getting the nod to be the replacement Senator can not be denied although Jesse Jr strongly refutes any suggestion that he has offered a lazy half a million or to ensure selection.
So far there is no sign that Governor Blagojevich is in any mood to gracefully retire from the Governor's mansion. It will take several weeks apparently for the Federal Attorney General to gather evidence to put before a grand jury and the process of impeachment by the Illinois House of Representatives would spill well over in to the new year.
Having backed the man to still be Governor come New Year's Day when the market rated it an 80% chance that he would not survive that long (see Not Many without sin) I note that this morning the market puts survival as a 50:50 bet. I'm in no mood to take my profit yet as this wonderful example of how politics is really played continues to get such readable public exposure.

Monday, 15 December 2008

Feeling happier about a President Obama

I admit to feeling happier this week about the world having a President Obama as its supreme ruler. Until the case of Rod Blagojevich broke forth I was a bit nervous about whether this seeming political novice was made of the right stuff to safely guide us through a world of Muslim terrorists and greedy but incompetent international financiers. There was this terrible fear that this wizard of oratory's words would be insufficient protection when confronted with the collection of hard men he will have to deal with come the end of January.
Reading about the troubles of Governor Blagojevich showed me the error of my ways. Barack Obama has grown up in what is surely as tough a political school as anything Vladimir Putin confronted in the KGB. Osama Bin Laden proved he is a master manipulator by getting young men to blow themselves up for his cause but the incoming President of the USA fought his way up through the Democratic machine politics of Illinois.
The thing that shows how great are Obama's political skills is that his progress through the ranks from southside lawyer to state senator to US Senator to President occurred without his reputation being tarnished. That's a mighty achievement in a city where, as Chicago Tribune columnist John Kass described it recently, Gov. Blagojevich in his tapped phone calls was acting like just another corrupt Chicago politician. "He squeezed people," wrote Kass. "That's how things are done in the city that is not Camelot."
Some of those Chicago Democrats who quickly turned on their man the Governor and demanded he go and go quickly were clearly motivated by a desire to stop any poking around by a Federal Attorney General, who was not one of their boys, turning into a broader investigation of the way Illinois politics is played. They had their own skins to protect and didn't want Obama's reforming parade rained on before he even took the oath on Capitol Hill.
And then there was the one who wanted Blagojevich's job for herself- State Attorney General Lisa Madigan who on Friday asked the State Supreme Court to declare the Governor "disabled." John Kass describes her role thus:
What they didn't report on the evening news is this: Lisa Madigan is more than just "the people's lawyer." She's a candidate for governor and Dead Meat is in her way. Her daddy is Mike Madigan, powerful boss of the machine's 13th Ward and speaker of the Illinois House who hates Dead Meat. 
Her dad wants to make her governor. She wants to be governor. And the best way to get there is to whisk Dead Meat into a political straitjacket and lock him in the political version of a padded cell.
And as for President elect Obama, columnist Kass asked his readers to "just imagine if Dead Meat talks to the feds, or stands up on his hind legs to fight back if fellow Democrats impeach him in the Illinois legislature. The governor might actually mention a few of the legislators' deals. Ouch.
"Obama, though not personally implicated in any of this, wouldn't like it much. The national media outlets were desperate to portray him as someone about to transcend our politics. But in Chicago he was just a smooth guy on the way up, looking the other way."
A smooth guy yes and he probably just was looking the other way but success for President Obama will not come because the American national media can portray his as someone who transcends politics. His success, because of the all pervasive influence of the United States on the rest of us will only come if he can actually play politics. And the evidence of this little post election episode suggests that he can.

Some defamation common sense

It was pleasing to see common sense prevail in two quite different defamation cases in two different countries in the last few days. In Adelaide a jury found two child protection advocates not guilty to charges of criminal libel. In London Sir Elton John lost a case brought against The Guardian over a spoof diary written by Marina Hyde.
The South Australian case was perhaps the more significant of the two. Criminal libel is a rather draconian way of curbing political debate even if the comments made are both very hutful and very wrong. 
Barry Standfield, 67, and Wendy Utting, 39, were the first people charged with the offence since the attempt to jail Rohan Rivett, the then editor of the now defunct Adelaide newspaper The News, 48 years ago. The pair were charged with four counts of criminal defamation over the faxing of documents on April 1, 2005, to the media naming two political figures and two senior police officers as alleged pedophiles. The court has suppressed publication of the identities of the men who all gave evidence during the criminal libel trial denying that they engaged in sex acts with children.
It is surprising to me that the case received so little publicity but there was a comprehensive summary in The Weekend Australian.
The Guardian case has more of a humorous touch about it with the spoof diary entry "A peek at the diary of Sir Elton John" having recorded his fictional thoughts about his annual White Tie and Tiara ball, which raises millions of pounds for the Elton John Aids Foundation.
"Naturally, everyone could afford just to hand over the money if they gave that much of a toss about Aids research - as could the sponsors," Hyde wrote, in the persona of the singer. "But we like to give guests a preposterously lavish evening because they're the kind of people who wouldn't turn up for anything less."
Reporting the decision by Mr Justice Tugendhat, The Guardian said:

The singer, represented by solicitors Carter Ruck and, in court, by William McCormick, claimed that the article suggested that John's commitment to the charity is so insincere that he hosts the ball knowing that only a small proportion of the money raised will go to the charity, and that he uses the event "as an occasion for meeting celebrities and/or self-promotion".

It was also suggested that Hyde acted maliciously, as she was aware that the sponsors covered the costs of the ball and all the money raised - between £6.6m and £10m - went to the charity. In Hyde's "diary" she suggested that "once we've subtracted all these costs, the leftovers go to my foundation. I call this care-o-nomics." The Guardian, represented in court by Gavin Millar QC, denied John's claims and argued that the article had to be taken in context. It was also argued that no reasonable reader would have believed that the words were meant to be taken at face value. The judge agreed.

"The transparently false attribution is irony," said Tugendhat, in a 17-page judgment. "Irony is a figure of speech in which the intended meaning is the opposite of that expressed by the words used ... The attribution is literally false but no reasonable reader could be misled by it." The judge added: "Irony is not always a form of sarcasm or ridicule."

For the Guardian, Millar submitted that the words used were "obviously a form of teasing" and the judge accepted this. "The words complained of ... could not be understood by a reasonable reader of the Guardian Weekend section as containing the serious allegation [that only a small proportion of the money raised went to charity].

"If that was the allegation being made, a reasonable reader would expect so serious an allegation to be made without humour, and explicitly, in a part of the newspaper devoted to news."

The judge suggested that "if the Guardian were to expose a fraud of the kind that is alleged ... then such a reasonable reader could be sure that the exposure would be written without any attempt at humour". He added: "It is common ground that the meaning of words, in law as in life, depends upon their context."

A story that lives on

A wonderful example this morning of how stories published on the internet can live on and attract new readers for weeks after someone, somewhere posts a link to them. Back on 9 December the Melbourne Herald Sun ran an item saying discrimination against dominant white males will soon be encouraged in a bid to boost the status of women, the disabled and cultural and religious minorities. This morning it finally made it to the top of the most read list on the paper's website - Discrimination against white males will soon be encouraged

Giving Simon a rest

For many days now I had been wondering whether the Sydney Daily Telegraph still had Simon Benson as its state political editor as he failed to be the author of any stories I could list on my blog of what the papers say. He missed out on the news pages again this morning as the paper continues to steer away from the outrageously over the top kind of reporting that coincided with a falling circulation. When Big boobs are not a sickness is the top of the paper's most read list it tells you that your clients are unlikely to be all that interested in the comings and goings of politicians. But at least political editor Benson was allowed to join the Tele's columnist Piers Akerman this morning in serving up the kind of analysis that does no harm on an editorial page that proper Telegraph readers would not turn to in a fit anyway.

The beginning of a what if nobody agrees strategy?

Getting the pictures right is a key component of the Kevin Rudd strategy of staying popular during troubled times. He knows that most of us have only scant understanding of what all that global warming and carbon emissions stuff is all about. So the Prime Minister just looks and sounds serious and earnest as he says the words, as I am sure his National Press Club appearance will show, while concentrating on giving us a vision that will leave us with an impression that he is doing something. 
He started the picture thing about global warming yesterday by posing with Queensland Premier Anna Bligh at a solar power farm in Windorah before flying to Canberra to prepare for his NPC appearance to release the white paper on climate change. The hard hats on the political heads, against the background of five 14 metre reflective reflective mirrors, certainly created the impression that this Labor Party lot are actually doing something innovative and new. 
While the critics from left and right argue in Canberra whether the White Paper goes too far or not far enough, Mr Rudd will be off to Western Australia to give us another illustration of a government that is doing something and not just talking about it. Last week in Labor's so-called "nation building package", $195 million was provided to be spent this financial year to support economic development in the East Kimberley region. 
The WA State Government has plans to double the size of the Ord River irrigation scheme from 4,000 to 28,000 hectares and the federal finance will help it speed up the development while providing plenty of happy snaps of a Prime Minister at the largest fresh water dam in the nation. The hope of the image makers is that there will be at least a subliminal message left in some minds that Labor is prudently preparing Australia for the day when global warming means that the irrigators in the Murray-Darling Basin down south are forced out of business. Expect to see lots of lovely melons and mangoes and plans for sugar mills on the television.
At another level, the Rudd visit up north suggests that he is beginning to turn his mind to the real problem this country will face if the nations cannot reach agreement on limiting greenhouse gas emissions and temperatures do rise in the way the scientific experts predict. We should all be thankful for that as the latest round of international talks which finished in Poland last week hardly give cause for optimism that there will be a meaningful cut in emissions anytime soon. 

Friday, 12 December 2008

This sporting world - drug bans come to chess

I was so fascinated by the Crikey coverage of the world chess championship that I now get one of those Google news messages each day to keep me up to date. Not that I play the sport, mind you - I'm strictly a draughts man, but those that do are such characters, And I use that word sport advisedly because in this morning's message is the terrible news that Grandmaster Vassily Ivanchuk refused to submit a urine sample for a drug test at the Chess Olympiad in Dresden and is now considered guilty of doping. Chess has subjected itself to the rigours of the World Anti-Doping Agency run by our very own John Fahey because the World Chess Federation (FIDE) has been trying, since the late 1990s, to make chess an Olympic discipline. Here's the link to this latest drugs in sport scandal.

Paying the government to mind your money

You just know that things have got to be serious when some people are prepared to pay the government to hold on to their money for them. I know it sounds mad but I'm a sucker for listening to news of the financial crisis and I keep hearing on Bloomberg that three month US Treasury notes occasionally sell at a negative yield. They rallied somewhat this morning to close yielding a magnificent 0.01%.

Not many without sin

President elect Barack Obama has thrown a couple of verbal pebbles at Rod Blagojevich since the Illinois Governor was exposed doing a little fund raising but generally American politicians have been relatively mild in their condemnation. Which does not surprise me at all really for in my experience there would be many of them who have engaged in similar behaviour even if their methods are generally slightly subtler and not subject to being phone tapped.

I base this terrible accusation on my experience lobbying on Washington's Capital Hill back in the early 1990s when doing a little stint for the Croatian American Association. The task was to convince the politicians that gallant Croatians were legitimately battling for their deserved independence from nasty communist Serbs and that the United States should remove an embargo on arms sales and support the fledgling democracy. After considerable effort a delegation of Congressmen was persuaded to visit Yugoslavia and make their own assessment which they duly did.

It was with some satisfaction that I listened to these commendable Congressmen brief the press and argue the Croatian cause but no sooner had they finished then off I was taken by their staff for coffee and a cake and a discussion of how the Congressmen were to be paid for their efforts. It was every bit as blatant as any of Governor Blagojevich's recent efforts and the sums this politician of Serbian dissent talks about are little different to those paid by the Croatian community back then to get support from Senator Bob Dole.

It is with this experience in mind that I wonder just how resolute Illinois politicians will prove to be in pursuing the suggestion that Governor Blagojevich should be impeached and thrown out before year's end. Far better for other politicians with a little fund raising experience of their own to leave the matter in the hands of a zealous Attorney General while talking about their reluctant acceptance of the principles of natural justice needing to be followed.

Having noted that the general view on the Intrade events market as to the likelihood of removal was different to mine I this morning snapped up some of the equivalent of 4/1 (see the accompanying graph about the Governor still being the Governor as the New Year dawns.

Thursday, 11 December 2008

The Fairfax message says it all really

They used to be the quality newspapers of Australia - the Sydney Morning Herald and the Melbourne Age. The kind of papers you read if you aspired to drive a Mercedes or a BMw. Perhaps that dwindling band of purchasers of these once great broadsheets are still that kind of people but the publishers clearly think their readers on the internet are a different kind altogether.
As evidence I product this email received yesterday. Win a Ute! it says. "The search for Australia's Hottest Tradie is on! At RSVP, we're saying goodbye to the metrosexual male and celebrating our hardworking tradesmen. One winner will be crowned Australia's Hottest Tradie and will take home a brand new Ute plus a host of fantastic prizes. So, if you're a tradie enter now and ladies... we're counting on your vote!"

Drunk and dangerous islanders

Actions lead to reactions. Ban kava and encourage the booze. Without their traditional drug of choice, Pacific Islanders are no longer as pacific. The cultural meetings at kava clubs are being replaced by drunken gatherings. Increased violence is the result.
The ban introduced on kava imports last year by the Coalition Government was one of the more stupid elements of the radical attempt to protect Aboriginal Australians from harming themselves. Apparently the use of the drug in the Northern Territory was not instead of alcohol as with the Pacific Islanders but as well as. Without thinking of the broader implications the import of kava other than in small quantities as luggage for personal use was outlawed.
Our Customs Service was boasting last week that it had intercepted an illegal shipment of four tonnes of kava. They should be embarrassed at having to perform such duties.

Too long in NSW

It must be all the time I spent in New South Wales but for the life of me I cannot see what all the fuss is about over the charges being laid against Illinois Governor Rod Blagojevich. From what I have read the only thing that Blagojevich has done that is not common place among politicians of all persuasions is that he gives thye impression that he may be intending to keep some of the money raised for his own personal use. Normally such standover tactics are done in the cause of raising campaign funds.

What the story did do is remind me with admiration the response of Mayor Richard Daley (the father not the current son) when a pesky journalist was once impertinent enough to suggest impropriety at a rare Mayoral press conference held on the eve of an election. What, the journalist demanded, did the Mayor think about the insurance company that his son had just started working for being awarded a large slice of the city's insurance business without tenders being called. Without batting an eye the great political machine boss replied that any father who would not help his own son did not deserve to be called a father. He called "next question" and that was that. Re-election duly followed.