It's one of those days where the news is telling you something. First off, there's the report that the Budget Office modelled what the GST revenue would look like if marijuana was legalised. The estimate sits at about $300m year.
The PBO, which was set up to provide independent and non-partisan budget analysis to politicians, did the costings at the request of libertarian crossbench senator David Leyonhjelm, who wants marijuana fully legalised.
If such a policy were introduced in July 2017 it would raise $600 million in GST revenue in the first two years, the PBO found.
That money would flow on to the states but the policy would also help the federal government through reduced law enforcement costs.
The government would save about $100 million a year in reduced Australian Federal Police and Australian Border Force costs, the PBO says.So tire's actually a money incentive to legalise marijuana that's spelt out in a report. $300m a year is not chump change. That's money right now that's totally underground in the black market so you'd think it would been the interests of the government to stop letting that revenue going the pockets of criminals and put it to good use. There's even a $100m dividend for the savings with the AFP which could be put to use elsewhere. You'd think it's a no-brainer, but I guess it's just too permissive and too hard for conservatives to do it.
In the mean time, there's reports of some idiot kid who consumed "synthetic cannabis" and got himself killed. I guess if you're young, you do these things. But you also think that if marihuana was legalised, then the temptation to put weird chemical cocktails into your system might be significantly lowered.
So there's that too.
When Amanda Writes You Off, Maybe You Should Go, Tony
Here's Amanda Vanstone doing the statesmanly thing and whacking her own.
Unless I have been lied to, and that can happen, Abbott has told a number of people that he is young enough to have another crack at the leadership. Even if that is meant in the most pure and innocent form, as in "Well, the Prime Minister might be hit by a proverbial bus", it does not augur well for the future. It shows an incapacity on Abbott's part to see what went wrong and how much of that related to his own behaviour. It also reveals a failure to recognise that there are others who have come up in the ranks and will continue to so do. It is not a static world through which only he progresses.
Sadly, it would also mean every decision Abbott makes will be firstly about positioning himself for that opportunity rather than firstly about securing a team win now.
Political teams are like rose bushes – you have to keep pruning or there are no new blooms. When John Howard gave me the flick in 2007 he offered to say that I had decided I would move on. I declined the offer; the truth is what it is. My press release thanked him and the Liberal Party for the opportunities I had enjoyed and others had missed out on. My spot was filled by Malcolm Turnbull. Pruning delivers results.
Bronwyn Bishop, Philip Ruddock and a few others should stop being so selfish, start showing a bit of gratitude for all they have enjoyed, and allow some new blooms to burst forth.
People might say that "You have had a fair go; now you should be fair and go" sounds harsh. But in this case I think it would be the best and fairest thing for Abbott. And for the party that gave him such tremendous opportunities.
It's kind weird when Amanda Vanstone is the voice of reason, but there you have it. It's noteworthy.
It's A Horrible Year So Far And It's Forecast To Stay That Way
What do you do? The war opened pretty badly for the markets. If anything had anything to do with China, it's been like a baseball bat to the head, although ASX isn't as bad as other markets. It's been pretty ordinary more than anything else. The Santa rally was hardly anything to write home about. The IMF downgraded growth forecasts for the year, with only a month in.
The survey run by Business Day says it's going to stay this way for the rest of the year. It's going to be not enough growth, not enough inflation, not enough employment, but not enough bad news for rates to be cut further. It's enough to make you take up Astrology, apparently.
Of course, Japan's central bank just cut their interest rates to negative, so chances are, there'll be a flood of money form Japan looking at our 2% interest rate thinking it's a great deal.
Over The Ditch And Down The Slope
New Zealand is apparently headed for outright deflation.
A 1.8 per cent slump in tradeable prices drove the weak quarterly CPI number, particularly for vegetables and fuel, where a stronger Kiwi dollar over the period played a part in depressing prices. Domestic prices rose by 0.5 per cent, or by 1.8 per cent year-on-year, thanks to higher housing and airfare costs.
"With dairy prices still sliding, and 2 per cent inflation more elusive than ever, we expect a genuine easing bias" from the RBNZ next week, TD Securities economist Annette Beacher said. "Anything less will reverse today's NZD sell-off, and more."
No government or central bank likes a deflation. The thing is, it's not bad for everybody. If somebody is sitting on cash, waiting for the right price, a deflation is exactly what you want. The corresponding lowering of interest rates to spur you to spend that money is just the government and the central bank bullying you out of your cash position into riskier assets.
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