There’s a lot happening and plenty I don’t have time and/or expertise to cover. A few selections. Over at Crooked Timber, Henry Farrell looks at the rejection of the proposed EU constitution by a referendum vote in France. Mark Bahnisch looks at welfare and unemployment. And Gary Sauer-Thompson covers DIMIA’s (mis)handling of detention.
While I’m on the topic, my Fin column last week was about the National Water Initiative, which is in danger of becoming collateral damage in the fights between the Federal government and the states. It’s over the page.
Read more…
A couple of people have suggested that I should comment on some stories in the Australian about water and the rice industry. Since I’m busy, along with the RSMG team, working on models of this very topic (for all irrigated industries, not just rice), I’m happy to oblige.
The first, by Amanda Hodge and Matthew Denholm, presents a fairly negative view of the rice industry as a profligate user of water, and the second, by Laurie Arthur, is a response from the industry. A lot of interest focuses on the amount of water used to produce a kilogram of rice. In the original article, this was erroneously reported as 21 000 litres: the correct figure is about 2000 litres/kg, or 2Ml/tonne which is still a lot of water[1].
Read more…
Another huge current account deficit, coming in at around 7.2 per cent of GDP. And that’s with high commodity prices and low world interest rates, thanks to the ‘global savings glut’. Put commodity prices back to normal, and interest rates up by a couple of percentage points, and we could easily be running a deficit in excess of 10 per cent of GDP. At that rate, net overseas obligations would be in excess of 100 per cent of GDP within five years.
Australia has been called a miracle economy on the strength of an impressively long, but by no means unique, economic expansion. But if we manage sustain this kind of imbalance for another five years it really will be a miracle. As far as I know, no economy has ever managed anything like it.
An anonymous reader has sent me some interesting charts on average tax rates. The first shows the average income tax rate for a single person, taking into account the Medicare levy and the low income tax offset. The average tax rate rises with income as you’d expect but much more slowly than the marginal tax rates
The second takes into account the withdrawal of social security benefits, to compute an effective average tax rate, where the denominator is private income+maximum transfer payments and the numerator is tax paid+benefits withdrawn. The third does the same for a couple with one child. These average tax rates peak at a fortnightly income of about $500 for a single person and $1000 for a couple, and are otherwise fairly flat.
The pics are attached over the fold
Update Sorry, all that there are some problems with these pics. I’ll try and fix them ASAP.
Jack Strocchi points me to this piece by Tony Parkinson in the Age, which tries to score some points on the number of deaths caused by the Iraq war. Not only does Parkinson get nearly every point in the debate wrong (he misdescribes confidence intervals, fails to note that the UN study he’s touting covered only the first year of the war, ignores the difference between direct war casualties and “excess deaths” and so on) but he’s presenting as news an issue that was covered exhaustively in blogs weeks ago (you can start here and work back. As usual Tim Lambert does the heavy lifting. For a review of the earlier debate, see Daniel Davies at CT. For a more defensible version of the case Parkinson is trying to make, go here.)
I think we can add this to the list of issues where you’re better off getting your information from blogs than from the “quality” press.
As usual on Monday, you are invited to post your thoughts on any topic. Civilised discussion and no coarse language, please. I’m planning something on industrial relations reform before long, and I’d be interested in your views.
EJ Dionne at the Washington Post discovers right-wing postmodernism, something Ozplogistanis have been banging on about for years.
The more this point gets hammered, the better, particularly as there are still some conservatives out there who actually care about old-fashioned things like objective truth.
This regular feature is back again. The idea is that, over the weekend, you should post your thoughts in a more leisurely fashion than in ordinary comments or the Monday Message Board.
Please post your thoughts on any topic, at whatever length seems appropriate to you. Civilised discussion and no coarse language, please.
Like lots of others, I’m not too happy about the Corby case. But I think most of the complaints from Australia have been misdirected. The problem is not with the trial which, while not as procedurally tight as the Australian equivalent, seemed basically fair[1] to me. The real problem is with Corby’s twenty year sentence. The likely imposition of the death penalty on the Bali heroin smugglers is even worse.
The reason that attention hasn’t been focused on this issue is that, as a society, we’re fairly hypocritical about the war on drugs. At one level, we recognise that it’s essentially pointless and unwinnable, like a lot of wars. So we’ve gradually backed away from lengthy prison sentences for bit players, and even abandoned the idea that the capture of a few “Mr Big Enoughs” would make any real difference. But it’s still convenient for us that our neighbours should have draconian laws, the burden of which falls mainly on their own citizens. It’s only when a sympathetic figure like Corby gets 20 years for an offence that might have drawn a good behavior bond in Australia, or when some stupid young people end up facing a firing squad that the contradictions are exposed.
fn1. That is, as fair as other drugs trials. The nature of the war on drugs is that normal legal principles have to be suspended if the law is going to be made to work at all. The routine use of procedures bordering on entrapment, and the effective reversal of the onus of proof, once possession is established, are examples of this, in Australia just as much as in Indonesia.
This blog, with quite a few others, gets a run in an Age Media Blog story headlined When are bloggers journalists? (hat-tip Jozef Imrich)
With the Howard government focusing on industrial relations reform, it’s important to be well-informed about what’s going on in the labour market. Last time I posted on this topic, a number of commentators suggested that I had missed some important recent developments. In particular, regular commenter Derrida Derider supplied me with some useful stats that support this, so I need to begin with a revised assessment.
During the 1990s, I argued consistently, and I think correctly, that measured gains in productivity were being driven by increased intensity in the pace of work, longer working hours and a labour market that marginalised those unwilling or unable to put in long and intense hours, notably including older workers.
It now seems clear that most of these trends levelled out in the late 1990s, and went into reverse after 2000
Read more…
I forgot to mention that Crooked Timber has posted a seminar on Steve Levitt’s Freakonomics including a contribution from me, and, more significantly, a response from Levitt. As usual with CT seminars, Henry Farrell put it together and did a great job.
Australian blogger Arthur Chrenkoff has attracted a lot of attention for his “Good news from Iraq” posts. Not only has he had a piece in the New York Times, but he’s been at the centre of a lengthy debate between Media Watch and the Australian (covered here by Tim Dunlop)
One problem with good news, though, is that it tends to be announced, reannounced and then re-reannounced for good measure. During the Boer War, Lloyd George caused a stir in Parliament when he did the sums and found that, according to the body counts announced by the British Government, they had killed more Boers than the entire Boer nation contained. According to Orwell, Arthur Balfour rose to his feet and shouted “Cad!”
Tim Lambert applies the same metric to electricity, finding that, despite nearly continuous good news, electricity generation is lower now than in the immediate aftermath of the invasion, and far below the level prevailing in 1991.
That’s the time-series approach. I thought I’d take a different tack, and look at the bits of bad news that can’t be concealed, even when, like Chrenkoff, you are looking exclusively for good news. That is, I’m doing what Chrenkoff does, but in reverse, using his news stories as the source.
Here’s a selection from Chrenkoff’s April 25 edition. Remember this is all supposed to be “good news”:
“The State Department has ordered a major reevaluation of the troubled $18.4 billion Iraqi reconstruction effort, blaming problems on early decisions to hire US companies for major infrastructure projects.”
“In a report to Congress last week, the State Department said reconstruction officials will cancel several planned water and electricity plants”
“The three-story hospital in downtown Fallujah sits empty and abandoned”
“Most of Iraq’s schools are still run down and out of date. According to the Ministry of Education, 5,000 additional schools are needed, and repairs are required at 80 percent of existing ones.”
” The Baghdad Police College says it has no shortage of recruits. In a country with unemployment well over 50 percent, a police paycheck — about $200 a month — is simply too tempting.”
“The stock exchange may be one of post-war Iraq’s few success stories”
” Production from the southern oil fields has recently reached 1.1 million barrels … The rate is close to what the company produced before the war …”
Why bother hammering the bad news? The obvious reason is that, until the failure of existing policies is recognised, there’s no chance of any better policies being adopted. The whole history of the occupation has seen the US persisting with policies long after they were obviously doomed, from radical economic reform, to the “regional caucuses” plan, from Chalabhi to Allawi, from Najaf to Fallujah and beyond.
According to the People’s Daily
China firmly supports Uzbekistan’s moves to crack down on the “three evil forces” of terrorism, separatism and extremism, and maintain domestic and regional stability for peaceful development, a Foreign Ministry spokesman said in Beijing Tuesday
To the extent that the Chinese regime has any coherent foreign policy, its primary principle is opposition to any intervention in the internal affairs of dictatorships. The more brutal the dictatorship, the happier China is to lend its support, and of course, the better the Chinese regime looks by comparison. Sometimes, this principle brings China into conflict with the Bush Administration, as in the case of Iraq. In other cases, as in that of Uzbekistan, the two see eye to eye.
I look forward to a possible future when only democratically-elected governments are regarded as legitimate. That doesn’t mean support for the Bush doctrine that any external enemy who wants to overthrow such a government by force should be free to do so. But it would mean suspension from the UN and all similar bodies, in the same way as currently happens in the event of a military coup in a Commonwealth country, as well as embargos on any form of military contracts or arms sales. The critical requirement for such a future is a democratic China. As I’ve written before, I don’t think this is as impossible as it seems. The apparent solidity of the Chinese regime conceals the erosion of its foundations in Communist ideology, and in the historical legitimacy of past generations of leaders. It’s a statue with a golden head and feet of clay.
According to this site, I’m a C-list Blogebrity. I assume this means that I get to go on Blogebrity Survivor and similar.
I was reading this story in The New Republic (subscription required, I think) about the problems of US cities and it struck me that little of the discussion would make sense in an Australian context, simply because Americans and Australians understand the city-suburb distinction quite differently. As noted here, in Australia , a suburb means “one of the units comprising a city”, corresponding roughly to the American “neighborhood”. By contrast, in the US the term is understood to mean “a district, especially a residential one, on the edge of a city or large town”. British usage is somewhere between the two, but closer to Australian.
This distinction is reinforced by the fiscal system in the US, where more tax is raised, at the local government level, and more functions, notably education are undertaken by local government, so the boundary between local governments makes a bigger difference. This seems to cause a lot of problems, with the result that US cities seem to be in difficulty most of the time. Perhaps the Australian setup produces different problems that aren’t so obvious or pressing.
Beyond this, though, I think there really is something to the Sapir-Whorf hypothesis here. The fact that everyone in Australia regards the suburbs as part of the city to which they belong, regardless of local government boundaries, affects the way we think about all sorts of things. For example, even if inner-city suburbs are thought of as hipper and cooler than the outer suburbs, the distinction is one of degree rather than kind, since there is no sharp dividing line between the two, so we don’t really have an urban/suburban distinction in the way that Americans do.
Brad DeLong coins a useful phrase. Referring to Bernanke’s global savings glut theory. He says
I’m very skeptical. It is of a brand of macro that I think of as one-identity-economics. You take an accounting identity. You assume that certain terms of it are fixed. And you then derive conclusions–in this case, that the growth of the budget deficit has moderated the fall in private savings.
The problem with one-identity-economics lies with the assumption that certain terms in it are fixed. There are lots of channels of adjustment in the world economy, and it is a safe bet that with different levels of interest rates and different levels of wealth we would see different levels of corporate investment and of net exports.
Some other examples of one-identity-economics are the crowding out hypothesis and the twin deficits hypothesis.
The NYT has survivors’ accounts of the massacre in Uzbekistan. Meanwhile, on last night’s ABC News, I saw the commander of the US base in Uzbekistan interviewed. He said something like “The host country military are doing a wonderful job protecting the base and we have had no trouble from the disturbances”. That’s the same host country military that was murdering hundreds of its own people a few days earlier. I can’t find a link to this on Google news, so I’d be grateful to anyone who can point me to a transcript.
Bush’s friendly relations with the Uzbek dictator Karimov have been unshaken by this, and any stated opposition to Karimov’s use of torture and murder is meaningless: it’s an open secret that a good deal of it is being done on behalf of the Administration, as part of the policy of extraordinary rendition.
The blogospheric right has mostly been either silent or supportive, along with much of the pro-war left. But some cracks are emerging. Here’s a piece by Stephen Schwartz and William Kristol from the Weekly Standard. And on the pro-war left, there are some good pieces from Eric the Unread and Harry’s Place.
Update JF Beck offers a defence of the Karimov dictatorship, ending rather lamely with the weasel words “Now don’t get me wrong, I’m not supporting the Karimov government or its actions. I’m simply pointing out that the “wanton murder” scenario being pitched by the left is open to question”. For Beck, and the rest of the RWDB crew, the important thing is to support Bush and attack the left on every possible occasion, even if it means giving someone like Karimov the benefit of the doubt.
As usual on Monday, you are invited to post your thoughts on any topic. Civilised discussion and no coarse language, please.
I’ve just bought the new Nick Hornby novel, “A Long Way Down” first person narrative from four people who meet on a rooftop, each planning suicide. It looks promising so far – the implication is that all survive, but for all I know they may end up back on the rooftop, or may be speaking from the next world[1]. No spoilers, please.
I went with my son to Revenge of the Sith, which was certainly better than Episodes 1 and 2. My big complaint is that we’ve been waiting since 1978 or thereabouts to find out how Princess Leia comes to be fleeing from Darth Vader at the end of episode 4, and now we find that episode 3 ends with her in nappies. If Lucas meant to make a hommage to 1950s serials he hasn’t done a great job in this respect.
Better news is that I’ve got something to watch on Saturday nights again, with the arrival of a new series of Dr Who. Apart from the occasional Lions game (and they haven’t been too rewarding lately), I haven’t had any options since I abandoned The Bill a couple of years ago.
fn1. This device, effective in “The Lovely Bones” (Alice Sebold)The Lovely Bones seems to be getting hackneyed
ViaTimothy Noah at Slate, I learn that the NYT is going to start charging for access to its opinion columns. It’s not clear whether, and how, bloggers will be exempted from this – the NYT provides blog access to the archives (otherwise pay-per-view) through its RSS feeds
Speaking as a reader, I wouldn’t want to pay for the NYT Op-Ed page. The Editorials are worthy, but not very exciting. Of the columnists, only Krugman is consistently excellent, and most of his columns consist of necessary repetition of important truths well-informed readers are aware of, but most commentators are unwilling to harp on for fear of being called “shrill”. Kristof, like the little girl in the rhyme, is very, very good when he’s good, but that’s not always. And Herbert is steadily good, if sometimes overly earnest. After that, there’s a long tail, with columns more often useful for mockery than for endorsement.
As a blogger, there’s no point in paying for something if you can’t link to it. That’s why the WSJ is so thoroughly marginalised in the blog world. So unless the NYT finds a way around this, they’ll be cutting themselves off from the most active part of the public debate, and presumably missing out on quite a few potential readers.
Here’s my piece from yesterday’s Fin. I’ve edited it to include a point that I omitted in the published version and should have pointed out. Although John Williamson of the Institute for International Economics coined the term ‘Washington consensus’, he didn’t endorse all the policies that were subsequently associated with that label, particularly unrestricted financial deregulation.
Read more…
This regular feature is back again. The idea is that, over the weekend, you should post your thoughts in a more leisurely fashion than in ordinary comments or the Monday Message Board.
Please post your thoughts on any topic, at whatever length seems appropriate to you. Civilised discussion and no coarse language, please.
Over at Crooked Timber, Eszter has a post on physicists doing social network theory , which raises the issue of ‘reinventing the wheel’. In this case, the physicists are breathlessly announcing results that sociologists have known about for years.
That’s obviously silly, but I don’t think reinventing the wheel is entirely a bad thing. Whenever I start on a new research topic, I like to spend a bit of time thinking about the issues on the basis of first principles, before I start reading the literature to see what others have done. The benefit of this is not that you’re likely to discover anything fundamentally new, but that it makes it easier to see what is central to the literature and what’s merely the accidental result of its development history (Professor X, the founder of the field, stressed assumption A, so all subsequent writers pay homage to it, and so on). Of course, this is only useful if you can subsequently engage with the existing literature.
My short summary “By all means have a go at reinventing the wheel, but don’t try to patent it[1]”
fn1. Apart from anything else, this guy has already done it
Update As James Farrell reminds me, I’m reinventing my own wheel here.
Today’s Fin ReView section (alas, subscription only) has a great article by Peter Manning, reviewing Ridley Scott’s film Kingdom of Heaven but also spelling out what a terrible crime the Crusades were, and how they are still affecting both the West and the Islamic world after nearly a thousand years. Manning is particularly good on the issue of just war doctrine, and the relationship between jihad and crusade.
Among the few good things to come out of our current trials is the fact that the word “crusade” is finally getting the evil connotations it deserves. A few years ago, George Bush was using the term “crusade” to describe the struggle against terrorism, and the US was about to build an artillery system called the Crusader. Now, just about the only time you hear the term is pejoratively, from bin Laden and like-minded jihadists.
Whether you call it crusade or jihad (or, for that matter, revolutionary communism), holy war is the worst of evils.
As I mentioned a couple of posts down, I’ve become pretty blase about letters from journals, at least to the extent that getting a rejection doesn’t bother me in the slightest. But I still get excited about the results from my annual karate grading, and I’m happy to say the news is good. I was hoping to be promoted to 7th kyu, which would have given me a black tip for my blue belt. Since our Kancho (founder) doesn’t encourage you to grade unless he thinks you’re ready, I was reasonably confident, but still nervous[1]. But when the results were announced, I’d reached 6th kyu and a yellow belt. Standards in our style are pretty high, and I can’t imagine ever getting a black belt. But a year ago, I would have thought a yellow belt was unattainable.
If you live in Brisbane or the Gold Coast and would like to learn karate in a rigorous traditional style, but with a friendly and non-threatening, mixed-age and mixed gender group, give Seiyushin a try.
fn1. Another successful grading meant I won a bet, in which my forfeit would have been watching a Dragonball Z movie marathon. Deliverance!
I happened to notice a story in the local suburban newspaper about the midnight opening of Revenge of the Sith which begins “Hundreds of fanatics will brave the cool to be among the first to see …”
In my first post on the Bagaric-Clarke paper advocating torture, I said “I haven’t seen any comment yet from pro-war bloggers, but I hope at least some of them will repudiate this terrible proposal”.
Andrew Norton[1] stepped up, pointing out that Bagaric has previously been identified with leftish positions, and criticising his current views. And regular commenter “Razor” on this blog says “As a confirmed RWDB and ex-soldier I can’t support the use of torture”.
Apart from that, I’ve come up blank. It’s easy to find pro-war bloggers and commenters supporting torture with more or less tortured arguments, defending Bagaric and Clarke’s right to speak and staying mum on the substantive issues, or just blogging on about Newsweek. I won’t bother linking to them – visit the obvious sites and you’ll find them. No doubt there are exceptions I’ve missed, but they aren’t very prominent.
This is a bit disappointing, but it provides a useful lesson. Next time you read one of these guys talking about Saddam and his crimes, remember it’s just a factional brawl within the pro-torture party. If Saddam had stuck to fighting wars against Iran, and torturing Iraqis, instead of invading Kuwait, he’d still be “an SOB, but our SOB”, just like Karimov in Uzbekistan.
Update Tim Dunlop has lots more on this here and here
Further update In comments, Andrew Norton advises that he was pro-war but didn’t blog on it directly, and Andrew Leigh is in a similar category. I can’t read Currency Lad’s blog (for heaven’s sake ditch the wallpaper!) but I’m not too surprised to learn from the comments that he is opposed to torture. And that’s it so far. Of the legion of noisily pro-war RWDB bloggers (a group from which I exclude CL), not one has so far taken a position any different from that of Saddam Hussein, and most of the noisiest have eagerly lined up with Saddam.
fn1. I should say that I haven’t actually seen anything Andrew’s written on the war, so I’m only guessing that he fits into the pro-war anti-torture category. I’ll be happy to correct this if it’s wrong.
Yesterday’s mail from the journals included one rejection, one acceptance and one revise-and-resubmit. Not a triumphant day, but I was happy enough, since major economics journals often have rejection rates of 90 per cent or more[1], and revise-and-resubmits generally lead to acceptance in the end.
As a result of this process, a big part of an academic’s research life consists of dealing with rejections. I gave up counting them after the first hundred or so, and it’s water off a duck’s back to me now, but this is something people starting out in academic life often find very hard to deal with. I can’t say I find the system satisfactory, but I don’t have an adequate alternative to offer.
fn1. The same is true in quite a few other disciplines, though not all.
Recent Comments