News &Views, No 7, Oz, 5-11 March, ‘A new world disorder’.
Updated: Apr 14
Paul Kelly, ‘Scott Morrison is calling for Western nations to unite against the autocracies of Russia and China’.
What could be better than Paul Kelly’s call to arms, actually.
Greg Sheridan’s, ‘A wake-up call for the West: we need to beef up our defence’.
It is scary when one reads the useless defence updates – under way from our hopeless defence bureaucrats. I strongly advise that readers without the newspaper should buy the Oz and read Kelly’s and Sheridan’s long and effective contribution.
Greg Craven says: ‘Would we fight like Ukraine? All the evidence indicates no.’
I hope we would but sadly my more realistic expectation says ‘no’.
‘Countries like Switzerland have compulsory military service. Why not Australia?
AFR, 5 March, Paul Simon’s ‘Exclusive interview’.
‘Putin brooks no dissent, but he is becoming more, not less, vulnerable. It’s to hard to speculate on his future just yet, but the emerging trend of personal miscalculation, combined with the loneliness of supreme leadership that he seems to prefer, does not auger well for his future’.
The Insiders, today, 6 March, ‘Hosting Peter Dutton’.
He spoke brilliantly but was presumably irritated by being talked over by the host. Toward the end of the interview, Mr Dutton decided not the allow that and at least twice he talked the (rude) host into silence.
The interview showed Peter Dutton to be passionate, committed and knowledgeable. Here is an unusual proposal.
Assuming Labor wins the next Federal election, Mr Albanese should persuade Peter Dutton to serve as his Minister for Defence. The world is rapidly becoming a very dangerous place, and Peter Dutton would be far too good to work as Shadow Minister of Defence or even as Shadow Prime minister.
The Oz, March 7, ‘All or Nothing, death of King of Spin’.
Peter Lalor said: ‘Every day dawns with further confirmation there is nobody quite like Shane Warne, individual in every sense, he is simply irreplaceable’.
There surely has been more press coverage of Shane Warne than any other sportsman, perhaps (allowing for a different age) the death of Bradman. I can add nothing except like many others I was a great Warne supporter.
The lead story, Warne on the front page said: ‘West’s sanctions a declaration of war.’
A further snippet on the front page said ‘Australia to duck fallout as conflict hits global economy’. The idea is that Australia ‘should escape the worst of the fallout as demand for commodities strengthens’.
Yes, but what if China tries to grab Taiwan?
AFR has its usual list of excellent stories, the most original this Monday being Phillip Coorey's who points out on P1 that there is to be a ‘Nuclear subs base for the east coast’. Slight difference between Scomo and Peter Dutton - whether new base will be before the election or after - but perhaps this is just a slip by one or the other.
Adele Ferguson reports on P40 ‘Turbulance for insurance firms’, not to mention big problems for uninsured home owners. I am not amazed at all that Aussie battlers are criticising Scomo, or their Premier, or just ‘the guvment’.
On P39, James Curran says ‘Sanctions offer no playbook for China and Taiwan’.
His further comments says: ‘The West’s earlier exclusion of Russia from a peaceful and prosperous Europe looks mistaken. It would be foolish to try the same approach over Taiwan’.
This is one to actually read, highly recommended.
The Oz, March 8, P 10, ‘Arc of autocracy’ warrants strengthening our defences.’
‘The world has entered a period of profound strategic challenge and disruption. For too long, democratic nations did too little to counter the autocrats. In 2007, Mr Putin told the Munich Security Conference he was determined to see Moscow regain control over Ukraine. Yet, when he overran Crimea in 2014, the Obama administration did little to his ambition to regain Ukraine. Democratic nations , belatedly, are upping defence spending to play catch-up.
AFR, March 8, P1 and 6, ‘War ‘means faster rate rises’ says Tony Boyd and James Gorman.
‘We have been in a very benign interest rate environment for the past decade, with an accommodative Federal Reserve. 2022 will be a very different year, characterised by rising rates and a Fed that is no longer providing the level of support from balance sheet expansion that markets have become accustomed to’. (James Gorman)
The Editorial & Opinion column (P 42) offers ‘A call to arms for Australia’s growth agenda’.
‘After the worst pandemic in a century, Australia needed a jolt of tax and workplace to lift the performance of an economy that was sluggish before covid-19, and to help to pay down the $1 trillion pandemic debt faster.’
AFR, March 9, Business Summit 2022, ‘Hinge of history calls for action’.
This twelve page masterpiece wraps around the normal newspaper, which also has some excellent contributions.
I shall pick the eyes out of both items and hope I have summarised the main issues.
‘A gradual multi-decade energy transition, a renewed push for productivity-driven economic growth and strategic investments to shield Australia from global turbulence were all advanced at the Australian financial Review Business in Sydney yesterday’ wrote Ronald Mizen.
The big challenge in this excellent list is ‘productivity-driven economic growth’. Bob Hawke, who Labor’s Albanese now wishes to follow, did a lot of productivity change. Since then, productivity has been far harder to achieve and leaders of the main parties have failed to tell us what they plan to do.
‘Instability and higher inflation loom, so its time to raise rates’ says Peter Costello. Former RBA board member, Warwick McKibbon, on Mr Costello’s group, supported Mr Costello’s views, and for what it is worth has been my cry for months now. But the overall problem is who has firm ideas about fixing productivity?
‘Get greedy when everyone else is scared’ says James Gorman. This is excellent advice, but still no clear discussion about how to raise productivity.
The editorial on P 42 of the regular edition of AFR finishes as follows: ‘Despite his protests about supporting pro-business growth, Mr Morrison is too inclined to lean against the reform door himself. Nor is he averse to picking industry winners when it is advantageous. It is disappointing that yesterday he rejected the AFR’s view for a broader GST and the invisible hand of a carbon price as ‘retro’ – and not greater business certainty, just higher tax.
… Creating a new platform for growth with structural improvements in tax beats industry tinkering every time’.
Yes, I agree, but still no productivity boost.
Past examples of policies for productivity increases
Despite recent disappointment, particularly in the decades of the 2000s and 2010s, Australia in the past 60 years has benefitted from a number of important policies to increase Australian productivity. These included:
Freeing ability to mine resources, started in 1960/61 by a government facing an unexpected recession.
Cutting tariffs, started by Whitlam government as an anti-inflation policy, continued by Hawke, Howard governments.
Floating the Australian dollar in 1983.
Financial Deregulation, perhaps as elsewhere overcooked but providing a substantial positive effect on national productivity.
Partially deregulating industrial relations, started under Hawke government, continued by Howard government and reversed by the Rudd government.
Establishing a GST, with some offsetting cuts to income taxes, tried by Hewson’s opposition, implemented by Howard.
The substantial pro-competition reforms to public utilities (commercialisation, corporatisation, privatisation).
Here is another, more recent, list of productivity promoting issues.
The following list of ‘Significant Industry Impediments’ and what can be done about them shows the options available to any government prepared to fight for productivity improvement.
Reduce cost of coastal shipping compared to foreign flag vessels used for imports, by reform of the current cabotage system that protects high-cost coastal shipping.
Restore domestic production of petroleum and other oil-based products. Solar or wind products will keep ships, trains, road trucks or even domestic cars running for many years, but even then reliable baseload energy will be needed.
Regulate impacts on power and energy costs by insisting on a seriously inexpensive base load high efficiency supercritical coal-fired generation capacity. If private enterprise will not do this job, arrange government set-up and eventual sale to the private sector.
Reform company tax so that depreciation write-off for new manufacturing equipment match rates in overseas companies. When fiscal situation allows, reduce company tax rate to current USA levels.
Increase labor flexibility and opportunities for productivity improvement in the workplace. Management must be involved and an appropriate culture embedded.
Increase government grants of money spent on R&D and improve taxation treatment for results of R&D spending.
Create opportunity to tax capital inflow to reduce exchange rate to eliminate excessively high exchange rate, thus improving competitiveness of exports and reduce competitiveness of imports.
Give priority to mergers that create stronger groups that can hold their own in international markets. Take care to carefully consider likely effect of foreign takeovers which are likely to hinder development of international trade.
Create a culture that minimises red tape and bureaucratic obstacles to industrial progress and is kinder than at present to entrepreneurial efforts.
How to greatly improve Australia’s defence is a very important issue on its own. Please put some serious brainpower to work on this question Mr Prime minister.
This list was developed in 2014 by Richard Morgan, Peter Jonson, Mark Rayner and Colin Tease, Growing the Trade Exposed Industries. No response from key pollies or senior bureaucrats.