Fast Forward News #3

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Creative Commons License photo credit: Corey Tegeler

David Pecotic

Two great new Australian e-gov mashups:
Key Indicators Graph
[Over at their Betaworks blog, the ABS has published an interactive graph that can display key indicators such as the unemployment rate, the consumer price index, gross domestic profit, average weekly income, and (most importantly for our purposes) the house price index. This is the latest in a series of visualisations of ABS data that not only make it fast and easy for our customers to find key figures but make it understandable to the non-statisticians (i.e., the rest of us).]

Atlas of Productive Ageing
[Another Australian e-gov initiative: provides maps and data for a number of indicators of ageing at different geographical levels.]

Is the Australian government equipped to provide collective public goods online?
[On the other hand … Gov 2.0 Taskforce’s Chairman Dr Nicholas Gruen stated that “it was the government’s job to build Google, Facebook, Twitter. I’m quite serious about that.” Most of us accept that one of the core purposes of government is to develop and provide infrastructure for its citizens, public goods that benefit nations and states but are often too expensive, unprofitable or may be a national security risk if left in the hands of private or foreign entities (how we fund that is another matter). But what about virtual public infrastructure: providing collective public goods that many people, including many Australians, use on a daily basis, whether for the storage, organisation, distribution or discovery of information? Or should they leave it up to the market?]

Garrett gives Gorgon gas go ahead
[Federal Environment Minister Peter Garrett has given the nod, with conditions, to the construction of the $50 billion Gorgon gas project on Barrow Island off the West Australian coast. An extra 28 conditions have been imposed on the project to ensure that Barrow Island, which is a Class A nature reserve, is adequately protected. Mr Garrett says as well as the extra conditions, 20 management plans are also in place.

Dr Andrew Burbidge, who is a consultant for Chevron (one of the joint venture partners), says, however, that the project should not go ahead because it will threaten the island’s biodiversity.]

Projected rises in sea level to curtail development
[PARTS of the Queensland coastline will be declared off-limits for development under a coastal planning policy released yesterday that claims sea levels will rise 80cm over the rest of this century.]

Australia’s ski fields: 40% less snow by 2060
[I wonder how this will effect property prices in the Alps …]

A dangerous Labor blind-spot
[OHS consultant Kevin Jones wrote a piece for Business Spectator on ‘Utegate’ and the role of Godwin Grech last reported to be receiving treatment in a Canberra psychiatric facility. He points out that the saga illustrates issues of personal responsibility for safety, an employers’ OHS obligations, hours of work, allocation of work tasks, an employee’s physical and mental health, and industrial relations regulatory compliance. It raises legitimate questions about how a Labor government, the traditional friend of the worker, manages the safety of its employees.]

Perhaps overwork leads to lack of due consideration of good ideas – like Geonomics!
Forum hears plan to level housing taxes
[HOME owners should not enjoy a tax advantage over renters, according to a proposal presented to a Henry review conference on tax reform.

A Treasury official has canvassed the idea of charging a defacto tax for living in the family home with additional payments offset by a tax deduction for mortgage interest payments. The 157-page paper said the greatest tax distortions to the savings choices of households were caused by explicit decisions made by government in two areas: superannuation and capital gains taxation.

However, as pointed out by one seller in the article, it will also act as a disincentive to owners to spend money on improvements. Geonomics, on the other hand …

Predictably, the property industry came out swinging yesterday against it. They argued it would result in (warning: may contain old chestnuts) a shortage of property, lift rents, and would most affect the elderly.]

Check the commentary on this important report over at Prosper

Property, death & taxes: the home owners advantage over renters
[A useful round-up about the Henry Tax Review and the pros and cons of the usual suspects: stamp duty. capital gains tax, negative gearing and land tax. The following ‘handy hint’ from property author and financial advisor Margaret Lomas with state-by-state variations is very revealing of our contemporary bunyip aristocracy: she argues against land tax as it is one that, beacuse of state-by-state variations, can be avoided by spreading your investments across Australia to maximise the tax-free thresholds.]
The winds of opportunity assure Portland
[PORTLAND is Victoria’s oldest town and, if some of the major projects planned in the southwest come off, it will become its newest boomtown, writes Terry Ryder in his HOTSPOTTING column in The Australian. Insight into what motivates land speculators: look for public infrastructure projects, especially transport, and swoop in to privatise the uplift. A “green” twist this time – the expectation of benefit from planned series of gas-fired, wind, geothermal and wave energy power plants …]

ACT Government considers appealing utilities tax ruling
[ACT Treasurer Katy Gallagher says the Government is yet to decide if it will appeal against a Federal Court ruling quashing its utilities tax. The tax charges for the use of Territory owned land by utility networks. But the Federal Court yesterday ruled the tax to be invalid after the Queanbeyan City Council successfully argued the ACT Government had over-reached its powers by imposing the tax on Canberra’s water authority ACTEW. But it found the water abstraction charge was not a tax and therefore is a legally legitimate levy. The decision could strip the Government of $18 million in revenue. “It either makes the un-allocated savings task just that little bit bigger or it means we look to other revenue sources – land tax, payroll tax, conveyancing,” she said.]

Property giant Mirvac posts billion dollar loss
[Property development giant Mirvac has posted a full-year loss of more than $1 billion dollars, as falls in property prices forced significant write-downs in assets.]

Centro Properties Group debt headache causes loss
[CRIPPLED Centro’s latest losses have soared to a spectacular $6.22 billion after head stock Centro Properties Group yesterday booked a $3.54bn full-year loss, one of the single largest in Australian corporate history.]

The Simultaneous Policy – A solution to climate change?
[Dr Chris Riedy, aResearch Director at the Institute for Sustainable Futures with more than thirteen years experience as a researcher, consultant and author on sustainability policy, posts on the possible impact of the international Simultaneous Policy (Simpol) movement on the mitigating climate change: if all nations adopt the same climate change response policies at the same time, none will be unfairly disadvantaged relative to the others.

Could Geonomics be added to their arsenal …?]

Carbon tax better: Clinton official
[TRADING of emission permits around the world will become a financial rort that fails to reduce carbon emissions – and will ultimately be scrapped, claims Robert Shapiro, former US undersecretary of commerce in the Clinton administration and author of Futurecast, predicted that the US Senate would reject the emissions trading scheme proposed by President Obama, which is now before it. A better solution is to impose a carbon tax on emissions and return the revenue from it to households so people are not made worse off, Dr Shapiro said. A similar approach in Sweden has cut emissions there by 8 per cent since 1990 while GDP rose about 40 per cent.]

Shadow inventory weighs on US home prices
[ROBERT Shiller, who helped develop a closely watched house price index, says it’s too soon to call a turning point in US home prices. It all depends on how many homes come on the market as owners deal with defaults, pay cuts and job losses. This “shadow inventory” will create new downward pressure on home prices.]

Banks Sitting on Bad Mortgages, And They Aren’t Getting Any Better
More reason to view Case-Shiller data with caution …] But David at least Case-Schiller does not include the sale of new properties, in acceptance that developers enforce scarcity to bump up prices, so individual sellers are more reflective of the true market price. It would be good if data renegades like SQM Marketing (Sydney) gave the Oz buying public an indice like that…

Chinese central government bans petitioners from travelling to capital to lodge complaints
[Petitioners have traditionally visited Beijing to raise concerns about land issues, including land grabs by local government officials. The large number of petitioners visiting Beijing is a source of embarrassment for the authorities.]

Moscow scorched by property slump
[There is little sign of life in the Russian capital’s troubled property market.]

Professor Paul Krugman at war with Niall Ferguson over inflation
[It’s the populist Battle Royale: left Princeton v. right Harvard (née Oxford, what)! Henry Kissinger, who knows a bit about fights, both political and intellectual, once observed that the reason academic tussles were so vicious was “because the stakes are so small”. And although that is true in one sense it is wrong in another: it is about whether we are fixing the problems or whether we are just papering over the cracks, and so just storing up more trouble a few years down the road.

Ferguson put the case for fiscal conservatism, warning of a “rapid explosion of federal debt” and the “financial credibility of the United States.” Krugman, an ultra-Keynesian, argued for stimulus spending, describing Ferguson’s views as “really sad” and “depressing” and belonging to “the dark ages of economics”.

“It is a brave or foolhardy man who picks a fight with Mr Krugman,” Ferguson wrote in response. “Yet a cat may look at a king, and sometimes a historian can challenge an economist.” He even went so far as to foolishly compare Obama to Felix the Cat, which lead Krugman to deploy the nuclear weapon of American academic arguments — an accusation of racism.

But even Krugman (who some accuse of causing the housing bubble) would agree that public debt cannot carry on building up forever. In that, Ferguson is far from alone. Warren Buffett, the world’s richest man, was warning last week of the dangers of what he called, with his skill for a pithy phrase, “greenback emissions’: the vast accumulation of public debt that risks turning America into a “banana republic”.

While both continue to argue over kings and cats, neither has yet seen the cat. If people are looking for guidance from historians as much as economists. Because while the economists blithely assure the public that the policies are the right ones, you don’t need to be a Harvard history professor to know the past tells us that the prescriptions of experts often go badly wrong, no matter how confidently the medicine is administered.]

The risk of a double-dip recession is rising
[And now from an economist who actually predicted the recession: Roubini wonders if whether the recession will be “W-shaped” or “U-shaped” – oil, energy and food prices are now rising faster than economic fundamentals warrant, and could be driven higher by excessive liquidity chasing assets and by speculative demand.]

In the new revolution, progressives fight against, not with, the poor
[The old, transformative alliance between the intelligentsia and the poor has been broken by the intelligentsia itself, argues David Edgar, formerly of Marxism Today.]

Speaking of democracy, I’ll on a positive note – last night I attended a public lecture given by John Keane at the brand spanking new Museum of Australian Democracy (a.k.a Old Parliament House), talking about the just published The Life and Death of Democracy, his history of democracy and the the first in over 100 years. Professor of Politics at the University of Westminster and a Fellow of the Royal Society of Arts, John Keane is the founder of the Centre for the Study of Democracy, a consultant to the United Nations and a recent member of the American Institutions of Democracy Commission. His earlier books include Global Civil Society?, Václav Havel: A Political Tragedy in Six Acts and the prize-winning biography Tom Paine: A Political Life (one of the many pre-Georgist proponents of economic rent collection as the source of public revenue).

To get a flavour of what I heard, jump to:

Democracy failure. Politics & the Great Recession

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