From The Pleiades Mailbag - 22/Oct/2014

The Gough Whitlam Articles

Digging in to the Pleiades mailbag today...
Some poignant articles have been written in the wake of Gough Whitlam's passing.
Here's one from Helen Razer that's worth a read. This bit stuck out as particularly worthy:

It’s tricky to do this and not least because the cultural and political right has done such a marvellous job these past 40 years of rewriting Whitlam’s reforms as naïve. While it is certainly true that the man’s cabinet behaved, at times, like toddlers unchained in a left-wing lolly shop, it is also true that the Ideology V.2 that grew in the rotten bog of ’70s stagflation had much worse consequences for the nation and the world than the purchase of Blue Poles.  If you want delusional thinking on political management of the economy, there is no better place to look than Milton Friedman whose works would influence all western liberal democracies, including our own, from about the day Whitlam was ousted. Friedman’s thinking led to inequality. Whitlam’s led to a brief moment of reform with some stubbornly enduring heritage. If Whitlam was history’s most naïve politician, then last night’s X-Factor Grand Final was a glorious moment of uplifting hope.

Here's one from Michael Pascoe.

He had done all and more that a man might reasonably think possible to do. 

His contribution had been huge and the years were reducing him. And even Gough had suggested that even Gough might not be immortal. To recall a phrase, it was time. 

So why does his inevitable and any-day-now-for-the-past-several-years death strike such a chord? 

I think it's partly because of the invidious comparison with what our nation has become.
The optimism, the positivity, the change, the opening up, the justice, the independence, the betterment of the nation, the internationalisation that Whitlam sought and represented has been replaced after four decades with a more general negativity, with so little ambition, with a conservative determination to uphold the status quo or even return to some earlier imagination of it, with white-bread nationalism resplendent. 

I fear we don't mourn Gough, but ourselves.

There's a lot of truth right there too. Pleiades also dug up this beauty from somewhere on the internet:

It was the Whitlam Government that:-1. ended Conscription,2. withdrew Australian troops from Vietnam,3. implemented Equal Pay for Women,4. launched an Inquiry into Education and the Funding of Government and Non-government Schools on a Needs Basis,5. established a separate ministry responsible for Aboriginal Affairs,6. established the single Department of Defence,7. withdrew support for apartheid–South Africa,8. granted independence to Papua New Guinea,9. abolished Tertiary Education Fees,10. established the Tertiary Education Assistance Scheme (TEAS),11. increased pensions,12. established Medibank,13. established controls on Foreign Ownership of Australian resources,14. passed the Family Law Act establishing No-Fault Divorce,15. passed a series of laws banning Racial and Sexual Discrimination,16. extended Maternity Leave and Benefits for Single Mothers,17. introduced One-Vote-One-Value to democratize the electoral system,18. implemented wide-ranging reforms of the ALP’s organization,19. initiated Australia’s first Federal Legislation on Human Rights, the Environment and Heritage,20. established the Legal Aid Office,21. established the National Film and Television School,22. launched construction of National Gallery of Australia,23. established the Australian Development Assistance Agency,24. reopened the Australian Embassy in Peking after 24 years,25. established the Prices Justification Tribunal,26. revalued the Australian Dollar,27. cut tariffs across the board,28. established the Trade Practices Commission,29. established the Australian National Parks and Wildlife Service,30. established the Law Reform Commission,31. established the Australian Film Commission,32. established the Australia Council,33. established the Australian Heritage Commission,34. established the Consumer Affairs Commission,35. established the Technical and Further Education Commission,36. implemented a national employment and training program,37. created Telecom and Australia Post to replace the Postmaster-General’s Department,38. devised the Order of Australia Honors System to replace the British Honors system,39. abolished appeals to the Privy Council,40. changed the National Anthem to ‘Advance Australia Fair’ (confirmed at 1977 Referendum),41. instituted Aboriginal Land Rights, and42. sewered most of Sydney. (Hard to believe, isn’t it, that Sydney wasn’t even sewered 40 years ago???)Mind you it took ‘em all of 3 years!!!

3 years of furious reforms. 

Soft Landing in China?

There are two big assumptions about the Australian economy going forward. One is that property rices will never go down, even if they don't exactly keep going up. The others that iron ore and coal exports are going to pay for everything, and that China is going to keep on gorging itself on our commodities exports.

Here's an article that begs to differ.

Back in 2009, problems for China were external. Now, apart from still sluggish export demand from Europe, they are pretty much home-grown. China is suffering from massive debt hangover from the stupendous multitrillion-dollar stimulus its government sprayed in every direction in response to the GFC. The country is also hindered by an economy that continues to misallocate capital, is far too reliant on state-owned enterprises, and a population that is beginning to age before the country has reached even middle-income status. 

As its hedges its bets a little, the government has been pumping money into the banks and providing low-level stimulus, so some economists reckon that official figures may lift in the fourth quarter. But next year ain’t looking as good, with many economists predicting sub-7% growth. 

But if the official figures — much derided by many economists — look bad, the key measures, to which Chinese Premier Li Keqiang has previously said he pays most attention, look decidedly worse. The so-called Keqiang Index consists of electricity consumption, rail freight and credit growth. 

“Electricity consumption improved, up by 2.7% year on year in September after a 1.4% decline in August, but is still the second-lowest print in 18 months. Railway freight traffic fell further, down by 6.2% y-o-y after falling by 0.2% in August. New RMB loans rose more than expected, but outstanding loan growth slowed to 13.2% year on year from 13.3% in August,” analysts at investment bank Nomura said. 

With that on the table, the forecasts from the Australian Treasury, which underpin the budget, are already starting to look a little loopy. Treasury’s global GDP growth figures for this year and the next two years are now consistently ahead of the latest forecasts from the World Bank — this year by 0.7% and next year by more than 0.5%. In a world where growth is only 3% to 3.5%, such differences — of up to 20% — are meaningful.
Treasury’s forecasting 7.25% growth for China next year after 7% for this year. Those now look a little high, but it’s the figures underneath these big picture estimates that look even more divergent from the emerging reality. 

Treasury has Australian metallurgical coal exports doubling over the next four years to 300 million tonnes, but the latest forecast from UBS expects these to top out at 175 million tonnes by 2017.

It feels like the RBA might be a little too optimistic with its forecasts. In turn, we might be headed for a pretty big recession the next time China hits a snag. That being said, China seems to keep on coming up with ways to cheat the slow down. It's a desperate thing for us, but its even more desperate for the Chinese leadership. Perhaps this tends to focus their minds on their issues harder. So far they keep on bailing out strategic companies and banks without handing out a big stimulus.

But one does wonder about the sudden ballooning debt and the demographic issues.

The Singularity Gets Its Serving

Look, I'm actually a convert to Ray Kurzweil's Singularity vision. If you haven't heard about it by now, here he is doing a Ted talk explaining his diabolical thesis he came up with based on grabbing empirical evidence. People tell me it's fanciful but... I dunno, I have to hang my hat on something, so I choose to hang it on humanity and tech. :)
This is his talk from 2007. 

In the seven years since, we have Siri, we have Googleglass and the Apple watch, he's been pretty accurate. Just today a guy with a broken spine got up and walked and that was down right miraculous by scientific standards only 3years ago. 

People may laugh, but I get what he's saying about the accelerating curve. The cutting edge of tech is going places a lot faster than they ever have before. One would underestimate where things are going at one's own peril - and that is for better and for worse. 

Anyway, Pleiades thinks I'm a little too optimistic about all this, so he sent in this little crit. It's a pretty cool video.