Abetz fights the last war and other news and views for Wednesday 29 January

Fighting the last war. So the Employment Minister Eric Abetz is worried that Australia risks a wages explosion that could push thousands of Australians out of work.  Here’s a version of the Abetz address as reported by those unpatriotic people at the ABC:
2014-01-29_abetzvideo
That sounds a lot like one of those generals preparing to fight the last war. See for yourself with these handy graphs from the Reserve Bank’s chart pack:
2014-01-29_wagepriceindexgrowth
2014-01-29_unitlabourcostsgrowth

Hardly evidence there that in recent years unions in some sectors have gone too far in their demands for wage rises and conditions.
The Minister should have a read of President Barack Obama’s State of the Union address and turn his mind to reversing the growing concentration of income by the highest earners. See the extract below from Sharing the Gains from Economic Growth.
Surely Ray Hadley is just for campaign time. I wrote yesterday how the federal coalition government clearly is in election mode and I don’t criticise it for that. Griffith and Western Australia are important elections and Tony Abbott should be giving them plenty of attention. And part of successful campaigning is to get your message across and a sympathetic radio talk show host is a good way of doing that. But surely weekly chats with Ray Hadley are not going to be a long term substitute for actually answering questions from the mainstream media? To try and make it so guarantees that it will not just be the ABC and Fairfax that are giving the government what it thinks is an unfair and hard time.  There are few things so savage as a journalist spurned.
Righto John, time to give it a miss. I’m getting a bit tired of the constant appearances of John Howard commenting glowingly on the performance of his boy Tony. Surely it’s time for the old PM to start fading away and let his protege sink or swim on his own unaided.
From earlier in the dayPreventing government IT disasters
An international view. News coverage from outside Australia seems to be getting less and less so if you are interested in an international view may I recommend my regular daily features on this blog – Asian newspaper front pages,European front pages and American (north and south) front pages? Not tht I can’t be parochil too – there’s always my morning coverage of the Australian papers
Some other news and views noted along the way.
  • China Is Poised To Force ‘Times’ Reporter Out Of Country – “In a move that’s being seen as retaliation for negative stories about its leaders, China’s government has told a New York Times reporter that he must leave the country when his visa expires Thursday. The government has not granted a request for a new visa that was made last summer.”
  • Sharing the Gains from Economic Growth - “Even though worker productivity has gone up over this time period, wages and income have stagnated. Workers are not getting what they deserve according to economic theory and the societal norms we have adopted that say people should be paid according to their contribution to the productive process. We need to understand why the distribution of income is broken, and then figure out how to fix it. My own view is that the decline in unions and the increase in political power among the wealthy have caused a very unequal bargaining position between workers and firms. The unequal power relationship has allowed wages to stagnate while incomes at the top have soared. But whatever the cause, the mechanism that distributes income to various groups in society is broken, and this important problem needs to be better studied and better understood. That is why Obama’s shift in emphasis from inequality to opportunity and his fear of being accused of class warfare is a mistake. We need better opportunity, particularly at the lower end of the income distribution, but we also need to be sure that when those opportunities are realized income rises with productivity. When it doesn’t, correcting the problem through taxes and transfers or other means is not class warfare. It simply takes income that was undeserved according to societal norms, and sends it where it rightfully belongs.”
  • The UK’s vanishing Aussies are missed – “The success of their home, resource-driven economy is putting Australians off staying in Britain.”
  • The Three Leakers and What to Do About Them – “What should we make of Edward Snowden, Bradley (now Chelsea) Manning, and Julian Assange? Their names are known across the globe, yet the actions that made them famous have also driven them to lives of intense isolation—in hiding, in prison, or in a foreign embassy. They have been lionized as heroes and condemned as traitors.”
  • Shadowy world of Britain’s discount hitmen revealed in new study – “Contract killing is one of the least studied, but most intriguing areas of organized crime; and new research into British hitmen has found that in some cases victims were murdered for as little as £200. The first typological study of British hitmen, published in The Howard Journal of Criminal Justice, identified four main types of contract killer; the novice, the dilettante, the journeyman; and the master.”

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