TPA's perverse effect on investment

Letters by Michael Crouch (October 30), and Julian Tapp (October 31) argue that the Treasurer was justified in requiring BHP Billiton to share its Pilbara rail line with other companies because of the original state agreements' contractual conditions.

Actually, those original state government agreements required BHP and Rio to provide haulage to third parties. Requiring them to permit others to use their track for this purpose goes somewhat further.

More importantly, the original agreements' requirements on haulage services were not the basis of the requirements to open the lines to third parties. The case, endorsed by the Treasurer, for the regulatory control over these facilities that was put by the National Competition Council and the Australian Competition and Consumer Commission was based on the lines having some monopolistic characteristics.

But almost all infrastructure has such features. The decision of the Treasurer therefore sets a precedent that grants government agencies wide powers over all infrastructure.

Allowing government agencies to set the prices and conditions for a firm's property is a sure-fire way of suppressing new private sector investment.

This demonstrates that Part IIIA of the Trade Practices Act and other competition provisions are now having a perverse effect on investment by giving officials too much power to override commercial decisions. This is undermining the incentive for infrastructure investment that was a major objective of the national competition agreements. It compounds a problem, identified in the government's mid-term statement, that there is now rather less government money to build new infrastructure.

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The unseen art of political ventriloquism

At last month's launch of his book Churchill and Australia, Graham Freudenberg was genuinely shocked that some people were genuinely shocked "that some politicians don't actually write their own speeches and articles".  He was responding to a 29 October Sydney Morning Herald report that revealed some senior Liberals had not, alas, written their own contributions to a new book on the future of the party.

No wonder Freudenberg was taken aback.  He is the doyen of Australian political speechwriting.  As a wordsmith for Labor icons from Arthur Calwell and Gough Whitlam to Bob Hawke and Bob Carr, he has such gravitas in ALP circles that virtually everyone in the party has, at one point or another during the past 40 years, talked like him.

Nothing surprising or wrong about this;  the art of speechwriting has been an established practice for generations.  The demands of high-profile public life -- from conducting daily radio, television and newspaper interviews to non-stop meetings with all segments of society, great and small -- are so rigid that it is very difficult for party leaders to sit down for days and weeks to reflect and write long, considered speeches or articles all by themselves.  Only the naive or ignorant would think otherwise.  Gone are the days when leaders such as Robert Menzies could take advantage of lengthy sea voyages to pen their own 5,000-word theses.

I mention all this because the aforementioned report also revealed that I wrote the then Liberal leader Brendan Nelson's chapter, and that parts of it had appeared in these pages under my own name.  (Full disclosure:  I was originally commissioned to write a chapter for the book, but once I accepted employment in the opposition leader's office and found out that the leader himself had not been solicited, I decided to withdraw my piece under my name and, as senior adviser, write the Nelson chapter after consultation with the boss.  Regrettably, other sentences and phrases from that chapter have appeared in my own speeches and other articles over the past year or so.)

Nelson, ironically, delivered few set speeches.  Like John Howard and Peter Costello, he was a rare political breed:  an off-the-cuff speaker, and a good one at that.  Rarely -- the May budget reply, for instance -- would he revert to script.  For Howard's part, he was primarily the master of his own oratory, delivering not only brilliant speeches without any notes, as he did in Bali following the terrorist attacks in October 2002 ("The young of Australia will always travel"), but also penning personal moving tributes in op-ed format as he did in the Australian following the Gipper's death in June 2004 ("I was wrong about Ronald Reagan").

At any rate, the controversy has thrown the relationship between speechwriter and politician once again sharply into the spotlight, raising the issue of who's really speaking here:  politician or adviser?  Leaving aside this and the issue of plagiarism, which has a long and undistinguished history, the point here is that this recent episode is hardly novel.

John Curtin's New Year Message of 1941 in which the Labor PM said Australia "looks to America" was drafted by his adviser Don Rodgers.  Ming wrote most of his own work, but his successors Harold Holt, John Gorton and Bill McMahon relied heavily on their offsiders such as Tony Eggleton and Graham Fell.  Malcolm Fraser leaned on Owen Harries, David Kemp and Alan Jones.  Mark Latham, Wayne Swan, Simon Crean have all used the academic Dennis Glover's pen.

Keating once said of his close relationship with Don Watson:  "It's a very personal sort of matter to have someone who writes for you because anyone who writes for you is thinking for you, too.  I found when I spoke to him that a lot of my views about Australia were shared by him.  We shared common views about the nature of the place, the antecedents of its history, the threads of its history, its complexion."

Nor is speechwriting merely an Australian phenomenon.  The two most memorable US presidential inaugural addresses of the 20th century were Franklin Roosevelt's in 1933 and John F. Kennedy's in 1961.  Neither was exclusively the product of the speaker.  In FDR's case ("The only thing we have to fear is fear itself"), it was the combined work of Louis Howe and Sam Rosenman.  And JFK's address ("Ask not what your country can do for you;  ask what you can do for your country") was principally written by his adviser Ted Sorensen, who also drafted Kennedy's Pulitizer Prize-winning Profiles in Courage.  A substantial part of Sorensen's new memoirs are dedicated to -- wait for it -- writing speeches for a president.

The columnist Peggy Noonan -- think of the speech to mark the loss of space shuttle Challenger and its crew in January 1986 -- was the most influential wordsmith for the Great Communicator.  David Frum broke his anonymity and boasted that he wrote George W. Bush's post-9/11 address, in which he warned:  "Either you are with us, or you are with the terrorists."  And Barry Goldwater's book The Conscience of a Conservative was written by Brent Bozell, and his acceptance speech at the 1964 Republican convention was so polarising ("Extremism in the defence of liberty is no vice!  Moderation in the pursuit of justice is no virtue" -- later revealed as a paraphrase of a passage from Cicero) that the real author, Karl Hess, joined the New Left.

Of course, not all modern-day political speeches and articles are ghost-written.  During the decade I was a newspaper opinion editor, I published hundreds of politicians' articles.  Most were written by offsiders;  but notable exceptions come to mind:  Tony Abbott, Tony Smith and Malcolm Turnbull on the Liberal side, and Lindsay Tanner, Mark Latham and Kevin Rudd on the Labor side.  Uninspiring though he is as a public speaker, the PM wrote his own op-eds when he was a relentlessly self-promoting opposition backbencher.

The truth, though, is that most senior politicians don't write their own work, and those who do the ghost-writing are often very proud of their copy.  Consider this:  in 1995, a former speechwriter revealed he was the author of a memorable address by a Liberal leader.  "I wrote [Andrew] Peacock's 1983 Deakin Lecture and I've heard people quote that lecture endlessly since," he lamented.  "When I hear them, I think, "Little do they know they're quoting me."  Some of them would be appalled if they knew.  Nevertheless, Peacock signed off on it and that goes down in history as Peacock's work, not my work."  The aggrieved writer:  Alexander Downer.

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Hitler's grotesque economics

The Wages of Destruction:  The Making and Breaking of the Nazi Economy
by Adam Tooze
(Allen Lane, 2007, 799 pages)

In the acclaimed television series Band of Brothers the Webster character abuses a column of German prisoners of war, "Say hello to Ford, and General fuckin' Motors.  You stupid fascist pigs.  Look at you.  You have horses.  What were you thinking?"  In The Wages of Destruction:  The Making and Breaking of the Nazi Economy, a recent and controversial book Adam Tooze, senior lecturer in economic history at Cambridge, sets out what the Germans were thinking.  He has provided an exhaustive account of the economics of the Third Reich.

In particular he sets out the economic constraints facing the Germans in the prosecution of the war.

War history normally consists of battlefield or political maneuvering -- this history however concerns itself more with balance of payments, over-valued currencies and coal supplies.  This is a perspective that many general readers or the average arm-chair expert on WWII will be likely to appreciate.

The controversial aspect of the analysis is that the Nazi's were not simply madmen.  They were highly rational and acted consistently given their warped world-view and the economic and political constraints they faced.

This makes their "grand plan" all the more grotesque.  It is well-known that Nazi Germany invaded Russia in order to expand its own territory and to provide Germany with "living space".  Tooze explains how the Nazi's went to war in order to murder millions and millions of people.  The Holocaust was not simply a case of murdering a hated minority;  it was the starting point of a planned mass murder on a far greater scale.

The war had caused substantial economic problems in Europe.  The food supply was severely disrupted.  It was only the mass murder of eastern Jews and Ukrainians that allowed for sufficient food supplies in 1942.  Tooze explains the trade-off associated with the need for slave labour, the need to murder and the food supply.  It is a horrific story of incentives, economic constraints, perverted worldviews and amoral pragmatism.

This "Hunger Plan" is well worth a book by itself.  Tooze, however, is comprehensive.  He touches on many other aspects of the war economy.  The balance of payments was a problem for Germany, ultimately solved by non-market means.  As Gustav Schlotterer told German businessmen in July 1940:

Our tendency is to use sleight of hand, guile and possibly violence to get the European states to sell their goods to Germany, but to leave their credits, when they build up, in Berlin.

At least he was honest.  Tooze has taken a disliking to Albert Speer, and spends a great deal of time and effort documenting how dishonest he was.  In particular, Tooze expresses surprise that Speer was not executed after Nuremburg.

Tooze describes Speer as a power hungry man who inflated his own abilities and expanded his bureaucratic empire.  Ultimately Speer is portrayed as a self-serving bureaucrat and a spin-doctor.  It is difficult to know what to make of Tooze's portrayal of Speer.  Being a spin-doctor is not a crime against humanity.  Speer may have been morally complicit in many of the crimes of Nazi Germany, but Tooze's new evidence is not enough to doubt the judgement at Nuremberg -- which chose to merely imprison, rather than execute, Speer.

Ultimately Germany lost the war because they could not match the resources of the Americans, British, and Soviet economies.  Had the Allies done more to destroy the German economy, the war could have ended earlier -- more bombing of the Ruhr Valley and less bombing of Berlin.  Some high ranking German officers, such as General Georg Thomas also knew the balance of resources was unfavourable.

Tooze has little time for the argument that the German war economy was inefficient and German planning incompetent.  As he indicates the Germans fought the world to a standstill.  So why then did the war break out when it did?  The usual argument is that Hitler miscalculated.  Tooze's argument is that there was nothing to gain by waiting -- the outbreak of war was a calculated risk.

Tooze has made an important contribution.  Some aspects are likely to be controversial.  Understanding the economic constraints facing the Germans during the war, and the incentives the Nazi's perceived provides a greater insight into those terrible events.

It will be difficult for future historians to write about WWII without paying serious attention to this well argued, well documented narrative.

Some readers will find the arguments dense and bewildering but the book is well worth the time and effort.

The ideological baggage of Old Europe

The Pursuit of Glory:  Europe 1648 to 1815
by Tim Blanning
(Penguin, 2007, 736 pages)

On the television show Backyard Blitz, household gardens are designed and built in a couple of hours.  In Britain in the eighteenth century people were prepared to take a bit longer.  As Tim Blanning notes:  "No one baulked at planting vast woods that could not possibly mature for two centuries."

Gardens feature prominently in Blanning's monumental The Pursuit of Glory:  Europe 1648 to 1815.  The gardens at Versailles in France were formal, regular, linear and arranged on an axis that had at its centre the royal palace.  There wasn't much left to chance -- everything was planned and rational.  The Versailles garden was making a political statement.  The attempt in 1661 of Charles II to bring Andre Le Notre, the designer of Versailles to London was regarded by many English at the time as another example of Stuart efforts to impose an absolutist regime on the nation.

By contrast the English garden self-consciously imitated nature.  The English regarded their landscape style as "free" and unrestricted.  The English believed that their method of gardening should match their method of politics.  In 1712 Joseph Addison discussed both:

The mind of man naturally hates everything that looks like a restraint upon it, and is apt to fancy itself under a sort of confinement, when the sight is pent up in a narrow compass ... On the contrary, a spacious horizon is an image of liberty, where the eye has room to range abroad, to expatiate at large on the immensity of its views, and to lose itself amidst a variety of objects that offer themselves to its observation.

Anthony Ashley Cooper, third Earl of Shaftesbury wrote about the symbolism of gardens.  One of Shaftesbury's tutors had been John Locke.  Shaftesbury said that formal gardens were a "corruption of taste" and that they were "unknown to our ancestors, and are unnatural to such a climate as Great Britain!"

The English didn't only use their gardens to make symbolic stands against continental despotism.  They used their gardens against each other.  Opponents of Prime Minister Robert Walpole retired to their estates to plot the leader's downfall and design their gardens.  Lord Cobham, one of Walpole's adversaries, constructed various temples on his estate.  There was the "Temple of Modern Virtue" in a deliberate state of disrepair which had a headless statue of Walpole;  a "Temple of Ancient Virtue" with various Greek heroes who had fought against corruption;  and a "Temple of British Worthies" (including King Alfred, Queen Elizabeth I, John Hampden, John Locke, and Isaac Newton).  It would be interesting to know whether Kevin Rudd has a statue of Ben Chifley in the garden of his Brisbane home, or Malcolm Turnbull a statue of Robert Menzies.

Blanning is not afraid of giving an opinion.  Take for example his analysis of the French Revolutionary Wars, which is quite a bit different from the nostalgia and romanticism with which they are usually viewed:

... for the hapless Belgians, Germans, Spanish, Dutch and Italians in their path [of the French], they brought not liberation but exploitation in the form of cash levies and the requisition of everything that could be consumed or moved.  As the armies were both exceptionally large and exceptionally undisciplined, they also inflicted looting, murder and rape on an unprecedented scale.  Although attempts by the locals to resort to armed resistance were ruthlessly crushed, persistent passive resistance ensured that the French could maintain their conquests only by force.

It was a dismal experience for the revolutionaries ... The rest of Europe, they concluded, had shown that they were still steeped in ignorance and prejudice, unworthy of liberation.  Robespierre was not alone in thinking that the French people had outstripped the rest of the human race by two millennia and now constituted what amounted to a different species.

A good example of Blanning's manner is the way in which he considers the implications of Catherine the Great's annexation of Crimea in 1783 and Russia gaining access to the Black Sea and the four strategic rivers of Eastern Europe:  the Dniester, the Bug, the Dnieper, and the Don.  Blanning regards this as a geopolitical turning point comparable to the British defeat of France in the Napoleonic wars.  From the end of the eighteenth century onwards Russia regarded the Balkans and the Mediterranean as a sphere of interest and from it "came Russia's entry into the wars of the French Revolution in 1798 and the collapse of the First Republic;  the Crimean War of the 1850s and the expulsion of Austria from Italy and Germany;  and arguable at least, the First World War too".  Blanning could have gone on to say, but he doesn't, that from Russia's entry into the First World War came the Russian Revolution.

The Pursuit of Glory is about much more than European gardens in the years between the end of the Thirty Years War and Napoleon.  There's lots in it about roads, rivers, and religion.  And there's also lots of politics and war.  Many historians would struggle to cover any one of these topics properly.  Blanning deals with all of these topics, and many more brilliantly -- which is why this has been voted in numerous competitions as one of the best books of history in recent years.

Sporting prowess obscured by the history warriors

Tom Wills:  His Spectacular Rise and Tragic Fall
by Greg de Moore
(Allen & Unwin, 2008, 336 pages)

The 150th anniversary of the first game of Australian Football in 1858 has not passed without acrimony.

Some historical pedants have argued that because the first set of rules was not formalised until 1859, we should be celebrating the anniversary next year.  More substantially, there has been debate about which individuals should share the credit for the start of the game and, in particular, whether the form of the game was influenced by Aboriginal sources.

These debates posed a conundrum for Greg de Moore, the biographer of the individual most associated with the game's commencement, Tom Wills.  It is the sort of dilemma that often confronts biographers who have to weigh the amount of space they give to the aspects of the life that are of greatest interest to the modern reader versus what was important to the individual and his contemporaries.  Wills is almost a classic case of the conundrum.  While he is now remembered as the founder of Australian football, and has become something of a cause célèbre for those interested in Aboriginal issues, to contemporaries he was the best cricketer of his generation.

De Moore gets the balance right.  One is given a strong hint when one reads that the PhD thesis from which the book arose was called "Tom Wills:  A Nineteenth Century Sporting Hero".  However, he helpfully provides an afterword for those wanting answers to the two major modern-day questions about Wills -- was he the major contributor to the foundation of the game and were the rules he devised for the game influenced by his childhood contact with Aboriginals and their game of Marngrook?  De Moore's answers are yes to the role in foundation, and no to the Aboriginal influence.

De Moore does not have a background as a historian or biographer, nor has he come to the topic with an obvious agenda from previous work.  He is a consulting psychiatrist at Sydney's Westmead Hospital and it was the nature of Wills' suicide that originally piqued his interest in the topic.  He could not understand how someone clearly in a psychotic state had been allowed to leave hospital the day before he ended up taking his life in May 1880.

De Moore's research began by unearthing the medical records that explained what had happened in the days leading up to Wills' particularly violent death.  The research was painstaking, but also blessed with a strong element of good luck as he found not only the relevant medical records, but also buried away in outback Queensland, a treasure-trove of letters, and even school books from Wills' time at Rugby School.

While born in New South Wales, and forever associated with Victoria, Queensland played a crucial part in Wills' life.  It was only by chance that Wills himself did not become a victim of the largest massacre of white settlers by Aborigines in the history of frontier violence in Australia.  In 1861, Tom accompanied his father, Horatio, in establishing a property at Cullin-la-Ringo, two hundred miles inland from Rockhampton.  Shortly after arrival on the property, Tom led a small party on a journey to acquire provisions;  when they returned a week later his father and 18 other settlers were dead.  Retribution soon followed with an estimated sixty or seventy local Aboriginals being massacred.

Being a psychiatrist, de Moore can explain "how the human mind and body responded to a traumatic experience was poorly appreciated in 1861" and how it was during the American Civil War, later in that decade, that the first studies of how to handle survivors of trauma were completed.

Unsurprisingly, given the focus on "history wars" type issues, newspaper reviewers have tended to focus on Aboriginal issues, with one commenting that Wills' "complex relationship with Aborigines" is "the central fascination of the book".  There is certainly a complexity that often eludes simplistic debates on these topics, because just a handful of years after the massacre, Wills captained an Aboriginal team against the Melbourne Cricket Club.  It is pleasing to read how the white colonists reacted to this contest.  De Moore writes that it was clear that "the sympathy of the colony was with the Aboriginal team" as they shared with them "a common grievance against what the Melbourne Cricket Club symbolised".

Wills himself had a love-hate relationship with the MCC, the club being one of many for whom he played in that less regulated era.  While always playing officially as an amateur himself (even when he was payed), Wills hated the discrimination against professional players -- discrimination that remained commonplace in the game for many decades of the twentieth century.  On a cricket visit to Launceston in 1858, the Victorian team were not welcomed in the homes of their hosts because the hosts could not distinguish between amateur and professional and thus did not know who to exclude.  As de Moore comments, if it were not possible to distinguish between them, either by looks or behaviour, why not admit them all?  Wills also insisted that Victorian teams be chosen on merit and he encouraged players from lesser Melbourne and country clubs.

There is no doubt that Wills was a sporting champion and what de Moore makes very clear is that he was performing on a big srage.  Inter-colonial cricket matches between New South Wales and Victoria were huge events.  For instance, the match against NSW at the MCG in early I860 was attended by 25,000 people (out of a population of approximately 125,000), while the 1863 encounter in Sydney produced a serious riot.  In the 1860 game, Wills not only top-scored for Victoria, but also bowled unchanged through both NSW innings.

A central theme of the book is that sporting genius and flawed character often go together.  Indeed, the link between cricket and suicide throughout history is so strong that a book has been published on the subject.  Wills's private life included a broken engagement and a long-term relationship with a woman to whom he was not married.  Even within the sporting environment, his erratic behaviour earned him many critics with whom he regularly conducted spirited debates in the letters' pages of contemporary publications.  De Moore observes that "those most critical of Wills still admired his sporting abilities, even if it was the colder admiration reserved for those with excessive talent and confidence ... his forthright tactics, which might have worked on the field had limited value in life".

It is perhaps his role as a nineteenth century flawed sporting genius that provides Wills's ongoing significance after all.  In a wonderful piece of sports writing in 2006, The Times' Simon Barnes observed of Shane Warne's single-handled mental destruction of England in the Adelaide Ashes Test that what was remarkable was Warne's unique ability to impose his will on the contest.  Having listed a long list of sporting greats, Barnes argued that:

alone among this collection of greats, Warne is possessed of that touch of devil.  In his real life -- an area in which Warne has proved himself consistently inept -- the devil led him into trouble again and again.  But in sport it was the making of him.

De Moore's biography makes it clear that Wills also had "that touch of devil".  He provides an authoritative account of Wills' role as an outstanding footballer in the code he helped to found, and of his involvement in important aspects of Australian race relations.  However, he also makes it clear that to Wills and his contemporaries he was a cricketing great:

Tom may not have understood how a cricket ball obeyed the laws of physics but he was able to instinctively shift to that other world of the divine, where the few with true genius play sport.  When he played cricket, it was not merely a game amongst mortals -- Tom Wills bowled with the Gods.

The machinery of the 2007 federal election

Inside Kevin07:  The People, The Plan, The Prize
by Christine Jackman
(Melbourne University Press, 2008, 320 pages)

If you are looking for hard-hitting political analysis of the Kevin07 campaign in the 2007 federal election, this probably is not the book for you.  That being said, Christine Jackman's purpose in writing Inside Kevin07 seems to have been to tell a more personal drama about flesh and blood people on the inside of a modern political campaign machine, which she does exceptionally well.

Inside Kevin07 contains a colourful cast of backroom dealers, marketing gurus, push-pollers, focus group buffs and senior electoral staffers.  Each character is explored both through their official role in the campaign, but also through their personality and character (both flaws and strengths), serving to remind us that the grey-faced political apparatchiks, we on the outside love to hate, harbour the same needs and flaws as we do.

Nevertheless, it is difficult to believe someone can rise to be ALP National Secretary despite being as agreeable as Tim Gartrell is depicted by Jackman, especially coming from the most ruthless and factional of political arenas, the NSW ALP.

Since the sources Jackman used to inform her work and the subjects that her work depicts seem to be mostly the same, it is unexceptional that they are treated more glowingly in Jackman's book than they might otherwise have been.

Jackman highlights facts of historical note, such as the revelation that ACTU National Secretary Greg Combet (now a federal Labor MP) actually hoped to negotiate a compromised industrial relations reform package with the Howard Government, but Labor knew this would blunt their biggest weapon against Howard in the lead up to the 2007 election.  Labor was happier to see the coalition destroy itself than engage the government in negotiations to find a middle ground between flexibility and "fairness".

Jackman goes into excruciating detail about the sting on Liberal campaigners distributing fake "Islamic Australia Federation" flyers, an incredibly embarrassing moment for all Liberal supporters of tolerant and liberal-minded disposition.

Some important questions arise from the events covered by Inside Kevin07.  Was Howard the wily politician he was made out to be, or had the electorate been itching to vote him out as soon as they were offered a credible Labor alternative?  The question that will continue to preoccupy commentators for years to come is whether or not Peter Costello could have performed better if he had been made PM some time prior to the election campaign.  It would certainly have been much harder for the ALP to cut through with their old vs. new narrative that it built its campaign upon.  Jackman seems to skirt the issue, but it is covered more fully in Peter van Onselen's Howard's End, which is a useful companion to Inside Kevin07.

Despite being an absorbing and educative insight into the inner-workings of a modern campaign war-room, you can't help but come away from Inside Kevin07 disappointed about the road Australian politics is heading down.  Australia has never enjoyed inspired leadership, as Donald Horne pointed out in his The Lucky Country:  "Australia is a lucky country run mainly by second-rate people who share its luck".  If the trend towards symbolism over substance and publicity over policy continues, all sides of politics will have to play along, to the vast detriment of long-term policy outcomes.

The blog Larvatus Prodeo admonishes Inside Kevin07 as "a geneology of advertising slogans".  This shouldn't be so much a criticism of the book, but of Australian politics in general, and the modern ALP in particular.  If there is one criticism to make of Inside Kevin07, it isn't critical enough of Rudd's preference for trivial media engagement, and his avoidance of mature in-depth scrutiny.  But again, this book is more a political drama than a polemic, so it is unremarkable that it only confronts Australia's slide into political decadence in passing.

Biotechnology is bioterrific, not bioterrifying

Edging Towards Bioiltopia
by Richard Hindmarsh
(UWA Press, 2008, 330 pages)

Near the beginning of Richard Hindmarsh's Edging Towards BioUtopia he provides, apparently un-selfconsciously, a persuasive illustration of the chasm between scientists using rDNA techniques (the creation of artificial DNA) and critics of biotechnology such as himself.

In 1977 an international group of senior scientists under the auspices of the US National Academy of Sciences met to discuss the regulation of the then-new rDNA experiments.  Opponents of all rDNA work used threats of violence to successfully demand participation in the meeting.  Their spokesperson was accorded a plenary session to present his case while, as Hindmarsh relates, "his colleagues, dressed up as human mutants, stretched a banner across the stage with an infamous quote from Adolf Hitler:  'We will create the human race.' "

The central proposition of this rather odd book is that a self-interested elite, comprising of scientists, government and corporations (especially multinational corporations) has deliberately set out to suppress dissent and proper regulation in their pursuit of a "bio-utopian" future.  To make his case, Dr Hindmarsh takes the reader on a largely chronological -- yet still strangely disjointed -- journey from the discovery of recombinant DNA to the end of the moratoria on growing GM canola in NSW and Victoria.  While the focus of the book is the release of agricultural plant GMOs into the environment, the author is keen to include examples of animal experiments gone wrong and controversies over experiments on human-borne viruses, perhaps because the agricultural sphere does not offer sufficient stories of an impending mutant-driven Armageddon.

Despite the publication of over 200 peer reviewed articles demonstrating the safety of GM crops and a plethora of government reports concluding the same thing, Edging Towards BioUtopia dismisses this inconvenient body of literature as the product of "collegiate review" by a closed system of mutually reinforcing pro-GM scientists.  The potential and actual benefits of agricultural GM technology are similarly dismissed.  The significant reduction in insecticide use in cotton, the switch from highly toxic, cancer causing chemicals, banned in many jurisdictions, to the far more benign Roundup on canola, and the reduction in toxins in corn that cause birth defects -- all proven benefits of current GM crops -- are not refuted.  Future benefits that will raise yields, confer drought tolerance, add functional food benefits and lower production costs are similarly not part of this book.  Nowhere does Hindmarsh face the unpalatable fact that the reason GM crops have been so successfully planted in so many countries is because they are good -- a marked improvement on other agricultural methods, bringing benefits to both farmers and consumers.  Instead, for Hindmarsh, this is all some vast co-dependent conspiracy between big business, big science and big government.

Hindmarsh is correct in identifying the interest of the broader society in scientific research and the continuing controversy over the boundaries of appropriate science.  Hindmarsh states his purpose clearly, writing that his "project, with this book, [is] of addressing a new politics of reordering life and its democratic challenge."  This is an important debate.  Whether molecular biologists are experimenting with DNA, medical researchers are working with stem cells, or physicists are colliding atoms, the potential exists for unfettered experimentation to wreak havoc on individuals, societies and ecosystems.  Society has a role in questioning and limiting scientific endeavour, hence the evolution of new laws regulating everything from stem cell research, to IVF access, to the subject of this book, genetic engineering.

But political science has long been interested in how regulatory regimes develop.  In more recent times, the traditional view of regulatory development -- where regulations arise from an agreed public interest response involving impartial experts who formulate policy approaches -- has been largely superseded by the view that sees regulation develop as a result of interplay between competing interest groups.  Public choice theory, with its emphasis on rational action, accords with the interest group approach and argues that all interest groups -- the bureaucrats, pressure groups and business interests -- act self-interestedly in pursuit of their goals.

Yet, in a startling omission from a book dedicated to examining how policy is constructed, Edging Towards BioUtopia fails to engage with any of these concepts or research literature.  The claim in the book that "the genetic choreographing of nature and the environment is as much a social and political endeavour as it is technical", is not contextualised within other policy making processes.  Instead, the book challenges representative democracy itself;  arguing that, as governments of all political hues support biotechnology, neither the Liberal nor Labor parties are representative of "the people" who, in Hindmarsh's view, oppose biotechnology.

Furthermore, to the extent that interest groups are presented, only anti-GM activists are included and their role is seen solely as selfless defenders of the public good.  As a result, groups such as Friends of the Earth and the Australian Conservation Foundation are described as public interest groups while pro-GM voluntary famers groups such as the Producers Forum are omitted entirely.

In a book critiquing a particular kind of utopia, it is ironic the author is so drawn to another one.  The Arcadian idyll of the small farmer utilising organic methods pervades this work.  Organic industry figures such as Scott Kinnear or Bob Phelps are heavily cited.  A supposed concern against GM crops is that they are "monocultures" yet the same is true of conventional broadacre cropping -- how exactly could a farmer harvest multiple crops sown in the same field?

When Hindmarsh tries to tackle agriculture he is confused and dismissive.  He argues, for example, that "since its instigation, monoculture agriculture, especially industrial agriculture, has wreaked global havoc on ecosystems and people's living conditions", -- clearly showing a profound lack of understanding of the multiple benefits from industrialised agriculture in reducing global starvation levels.  The book is not helped by this openly anti-modern agriculture stance as it positions the book on the deep green fringe and is therefore unpersuasive to mainstream readers.

A key argument of the book is that Australia has been particularly poorly served by her regulatory regime compared to other countries.  Sometimes drowning in minutiae, the book details the development and nature of Australian biotechnology regulation and claims that "Australia's rDNA regulatory regime is in the vanguard of technical nepotism and subsequent public mistrust."  Yet there is no investigation of current international regulation.  Given 23 countries grew GM crops in 2007, including eight EU members, the US and Canada, there is significant scope to test the proposition that Australia's regulatory regime is inferior to comparable industrialised countries.  Without at least acknowledgement of other regulatory regimes that have led to greater approvals of GM crops the argument that the Australian regulatory system is more captured by biotechnology proponents than other countries is unconvincing.

To the extent international comparisons are given they are ad hoc.  For example, mention is made of a Brazilian state declaring itself a GM-free zone yet there is no discussion of the Brazilian regulatory regime that has led to Brazil currently being the third largest grower of GM crops.  Similarly, the book asserts Australian regulation is inferior to Europe, particularly in relation to lay representation on approval committees and in the Australian adoption of product rather than process regulation.  Yet there is no examination of how Europe manages lay representation or why Europe now has product based regulation.

Farmers, as a key part in any food chain, are a key battleground for both proponents and opponents of biotechnology.  As over 85 per cent of Australian farms are family run, the extent to which the currently approved GM crops are grown will largely depend on the individual decisions of Australia's cotton and canola growers.  The basis on which that decision will be made will overwhelmingly depend on an assessment of the economic impact of growing GM as opposed to conventional varieties.  In relation to the most contested crop, canola, over time Australian canola growers came to the view that GM varieties were at least worth trying and this view was reflected in the adoption by all major farming groups of pro-GM policy statements.  However, a reader of Edging Towards BioUtopia is not presented with this information.  Instead, the reliance on the statements of organic industry certification organisations and the small ginger group, the Network of Concerned Farmers presents a highly skewed view of what farmers, particularly the farmers who actually grow canola think of GM varieties.

And this, in the end, is the reason this book fails.  A scholarly work would at least strive to present a full picture of the issue under discussion even while still presenting a viewpoint.  Yet time and time again Edging Towards BioUtopia combines anecdote with selective reporting of data to present a picture that veers very close to suggesting a global conspiracy to force biotechnology on the planet against the wishes of the majority.  This polemical approach is bolstered by the highly irritating use of Hindmarsh's own made-up language -- we are presented with bioutopia and its converse biodystopia, we get biocrats, the bioscientific club, biotechnocratic regulation and the biopolicy network and all this occurs within a biopolitical struggle dominated by a bioelite towards the creation of a bioindustrial complex.

The brave new world of lifestyle capitalism

The 4-hour Workweek:  Escape the 9-5, Live Anywhere, and Join the New Rich
by Timothy Ferriss
(Vermillion, 2008, 308 pages)

"I believe that life exists to be enjoyed and that the most important thing is to feel good about yourself," writes entrepreneur Timothy Ferriss in The 4-hour Work Week:  Escape the 9-5, Live Anywhere and Join the New Rich.

If you're a cynic, you might object that happiness is overrated and that "feeling good about yourself" is a euphemism for being a self-indulgent narcissist.  After all, you don't get much done by being a Pollyanna and thinking everything is fine just as it is.  Ellsworth Toohey, the villain of Ayn Rand's The Fountainhead, has this to say:  "Have you noticed that the imbecile always smiles?  Man's first frown is the first touch of God on his forehead.  Ihe touch of thought."  It's our dissatisfaction with things that drives us to achieve, to improve our own lot and that of others.

What does an enjoyable life consist of?  Slate writer Seth Stevenson captures a typical vision when he meditates on the virtues of slacking and procrastination:

You nurture the creative sprouts that take root only in long hours of idleness.  You're open to soulful experiences that lie only beyond the bounded worlds of work and study.

Let's assume for a moment that this really is enjoyable, and that you want "long hours of idleness" in which to be "open to soulful experiences."  How to get them?  The obvious answer, today, is that you should find some way to rort the welfare system and adjust your consumption habits so you can live on your meagre government handout from the dole, sickness benefits, parenting payments, or whatever else is available to you.

But this would be resigning yourself to a life of poverty and dependence.  There's little that so crushes the spirit.  Never mind soulful experiences:  you'll spend much of your free time calculating how you can afford your rent and your next meal, and the rest of it wrangling with Centrelink over your mutual obligation requirements.

What's the alternative?  Should you enter a professional career, then work ten-hour days from your twenties through your fifties, investing the surplus wisely so you can retire in style with a couple of decades left to enjoy life if you're lucky?  Ferriss thinks this is a mistake.  "Grads from top schools," he says, "are funnelled into high-income ... jobs, and 15-30 years of soul-crushing work has been accepted as the default path. ... I've been there and seen the destruction.  This book reverses it."

Ferriss offers readers the prospect of practicing "lifestyle design" to secure complete financial freedom and the liberty to live anywhere.  More importantly, he holds out the prospect of spending your time (all but the four hours of your new work week) on whatever you find more important than the inefficient routines of workplace drudgery that make up many people's jobs.

Ferriss sees that most people waste huge amounts of time on activities that are neither particularly useful nor enjoyable.  The first part of his advice to aspiring pursuers of soulful experiences consists of how to be more productive as an individual by eliminating distractions and then extracting yourself from the traditional workplace.  A large part of this involves countering the effects of information overload and addiction to unnecessary communication, by limiting media intake, and avoiding meetings, phone calls, and email wherever possible.  In this way, the seeker after free time cultivates "selective ignorance."  "I read the front-page headlines through the newspaper machines, and nothing more," Ferris writes, "it gives you something new to ask the rest of the population in lieu of small talk."

He echoes, in a more irreverent style, quantitative options trader and author Nassim Taleb's preference for "the decorum of ancient thought" over the hullaballoo of daily media.  "For an idea to have survived," Taleb writes in Fooled by Randomness, "is evidence of its relative fitness."  Instead of sorting through mountains of media for the best ideas, you let others, less alive to this wisdom, do it for you.

Once you've eliminated distraction and improved your productivity, Ferriss offers employees a step-by-step guide to negotiating with the boss an agreement to work off-site.  This involves keeping your newfound efficiency under wraps while at the office, then unleashing it while working at home (or in a foreign country) to demonstrate just how much better the new arrangement is for everyone.  If this doesn't work, you might just have to rush on to the ultimate step in Ferriss's plan for your new life:  entrepre-neurship.

Ferriss contends diat you can have a life of wealth and leisure (call it idleness if that's what youre after), but as in that vision of the free market where all prosper as each pursues their own ends, this can only come through productivity that others will pay you to exercise.  Midway, the book becomes a manual on how to start a manufacturing business so that you can use modem technology and labour arbitrage to automate processes and make more profit, bringing in more money even as you put in less of your time.

As you would hope, Ferriss takes his own medicine.  Between 2001 and 2004, Ferris ran himself ragged running his business.  On the verge of a breakdown, he took an extended holiday to see how it would fare without him.  The end result?  By removing himself as a micromanaging bottleneck, and by letting the Pareto principle (better known as the 80-20 rule) lead him to some other efficiency gains, his business immediatelv increased profits by 40 per cent, while he went on to travel the world, dance world championship tango, and write this best-selling book.

It's worth noting thai Ferriss had laid the groundwork for this move when restructuring the company for possible sale, to make himself expendable.  His hard-won and hard-thought freedom from work took several years to achieve, if you factor in his early forays into business and his time floundering in an office job.  But his techniques, he writes, are replicable, and the book shows how others can achieve similar results.

The underlying assumption -- and it's quite a reasonable one -- is that we live in the world we do:  capitalist, relatively open to international trade in goods and services, and connected by the internet and mobile telephony.  In this world, you can choose a product to buy, license, or have manufactured, then resell it through the internet for a high markup.  You test-market your ideas using internet advertising until you find one with demonstrable appeal to customers, then procure your inventory and sell it.  Once you know your business works, you outsource fulfilment and customer service, and (optionally) relocate yourself somewhere life costs less (Buenos Aires?  Bangkok?  Berlin?), so your newfound fortune is worth more.  To free up still more time, you can fall back on one of the exercises Ferriss uses at the beginning of the book to help you become comfortable with delegating tasks:  hiring a personal assistant from a low-wage country such as India.

This slightly oversimplifies the process:  it is in this area that The 4-hour Work Week becomes a detailed manual and sourcebook for those genuinely interested in running a manufacturing business.  It's more accessible than your average MBA textbook, but it's serious stuff.

Here comes the first caveat for readers:  at the outset, Ferriss says you don't "need to be an Ivy League graduate" to make his advice work, but on reading the book it's clear you still have to be smart and energetic.  Taking the thread provided by global capitalism and weaving it into a profitable business that you can run in four hours a week from almost anywhere on the planet is not for the dull or the faint-hearted.

The second caveat is that living outside the United States makes his system not as easy.  Many of the services Ferriss recommends as building blocks cater mainly to a US clientele.  But that won't stop anyone who can Google from finding an alternative serving in their own country.  Far more importantly, the size of your home market will affect the return you can expect from your efforts.

Self-help books often get a bad rap from serious people.  This one deserves better.  As a bestseller, it will give many an introduction to the idea that running a business offers a kind of fulfilment few other career choices offer.  It may turn some would-be slackers into massively productive people who serve the needs of thousands or even millions.  And it could inspire some armchair fans of capitalism to give more concrete expression to their values by becoming living examples of the wisdom that by pursuing our own interests through the market, we tend to further the material welfare of all.  Beneath a veneer of outlandish promises, The 4-hour Work Week proves itself a solid primer for would-be entrepreneurs, and a manifesto for a new brand of lifestyle capitalism.

The Dark Mind of the Copywriter

Novels in Three Lines
by Felix Fénéon
(NYRB Classics, 2007, 176 pages)

Ernest Hemingway once said that his best story was his shortest story, deliberately limited to just six words -- "For sale:  baby shoes, never used" -- an exercise in radical economy which manages to imply a lengthy and tragic back story, without being predictable or hackneyed.  Hemingway's "novel", and the self-imposed restraint which inspired it, has been justly praised and imitated.

But eloquence under word limitations is a skill which has been practiced by working journalists almost since printing was invented.  Félix Fénéon's Novels in Three Lines demonstrates just how much literary power that can be achieved in an intimidatingly small space.

Novels in Three Lines -- a play on the French title, Nouvelles en trios lignes, which can also be translated as "news in three lines" -- is a collection of 1,220 tiny dispatches published in the Parisian newspaper Le Matin, all during 1906.  They were printed unsigned in an obscure corner of a Le Matin page.  Their topics are mundane, covering crime, death, celebrations and local controversies which would not deserve any more space in the paper than Fénéon's column would grant them.

Nevertheless when collected together, as Luc Sante has done in this appropriately thin volume, Fénéon's skill as a literary compositor and the artistry of his dispatches becomes clear.  Novels in Three Lines is a remarkable portrait of regional France in the first decade of the twentieth century, and a work of unacknowledged brilliance.

Félix Fénéon may have had a relatively anonymous job in 1906 when he wrote for Le Matin, but he occupied a central place in the artistic community of turn-of-the-century France.  He was a prominent art critic, whose writing on Georges Seurat was partly responsible for the latter's success -- indeed, Fénéon was the first owner of Bathing at Asnières.  He was a theorist of Pointillism, the post-impressionist movement for which Seurat has become the historical touchstone.

Fénéon was a serial magazine founder, writing journalism anonymously and criticism under his name.  When Picasso once asked Fénéon his opinion on Les Demoiselles d'Avignon he responded dryly:  "you should stick to caricature."

He was imposingly tall and contemporaries described him as enigmatic.  When Paul Signac, a follower of Seurat, painted Fénéon surrounded by garish proto-psychedelic abstraction, Fénéon was deeply unhappy with the portrait -- the publishers of Novels in Three Lines have used a much more stoic-looking photograph of Fénéon taken from French police archives, a decision which presumably the author would have preferred.

Fénéon's mug-shot is, anyway, more in keeping with the volume than Signac's painting would have been.  Novels in Three Lines is a collage of brutality and violence;  the vast majority of Fénéon's dispatches concern murders, suicides and accidents, punctuated by the occasional riot, theft, or crippling inquiry.  One random-chosen page describes four separate homicides, five accidental deaths, at least six major injuries, one woman committed for insanity, as well as this piece of bad luck:

Too bad!  Mentré of Longwy, who revealed to us that he was the winner of the 250,000 francs in the tuberculosis lottery, seems to have been hoaxed.

Fénéon works within the conventions of journalism.  He is careful to record names, locations, and more often than not, ages and job descriptions-butchers, clerks, merchants, nurses and soldiers.  His "novels" describe early automobile accidents, they record otherwise parochial regional arguments for a national audience (Le Matin was a Parisian paper), outbreaks of disease and building collapses.  It is one of the troubles of historical investigation that the underclass only enter history in times of tragedy -- most of what we know of the lives of the non-elites in early modern England comes from the proceedings of the Old Bailey.  Fénéon's dispatches are the only time that Jourdain, of Mézières, or the engineer Mahuet, or Langon, of Sceaux, or M. Jégou de Laz, of Cleden, would penetrate the historical curtain.

So much of the artistry of Fénéon's epigrammatic journalism rides on its elaborate construction, which constantly flirts with full-blown satire:

Napoléon, a peasant of Saint-Nabord, Vosges, drank a litre of alcohol;  very well, but he had put in some phosphorous, hence his death.

Mme Fournier, M. Vouin, M. Septeuil, of Sucy, Tripleval, Septeuil, hanged themselves:  neurasthenia, cancer, unemployment.

Often Fénéon delays the core of his story until the very last moment, or holds back a crucial piece of information which completely recasts that which preceded it:

To get back with Artémise Riso, of Les Lilas, was the wish of romantic Jean Voul.  She remained inflexible.  So he knifed her.

He smuggles slightly ambiguous moral commentary within his reportage, wavering between dispassion and irony:

What?!  Children perched on his wall?!  With eight rounds M. Olive, property owner in Toulon, forced them to scramble down all bloodied.

An unknown person painted the walls of Pantin cemetery yellow;  Dujardin wandered naked through Saint-Ouen-l'Aumône.  Crazy people, apparently.

In the London Review of Books, Julian Barnes points out that Fénéon had worked in this form before, but for explicitly political ends, in an anarchist journal in the 1890s, where his black sarcasm was deployed even more aggressively:

Dead sick of himself after reading the book by Samuel Smiles (Know Thyself), a judge just drowned himself at Coulange-la-Vineuse.  If only this excellent book could be read throughout the magistracy.

But in his Le Matin column, he eschews politics.  Luc Sante's introduction nevertheless emphasises Fénéon's complicity, if not outright responsibility for, some of the revolutionary anarchist terrorism that was common to western democracies in the pre-war period.  Fénéon was arrested for a bombing in 1894, and, while detonators were found in his clerk's office at the French War Department, and he was close friends with other convicted bombers, he was released for lack of evidence.  Whether Fénéon was guilty or not is sort of beside the point-Sante points out that Fénéon was a true believer in the anarchist cause, even if his printed material (he wrote, all up, very little, and even less under his own name) does not obviously reflect it.

For the turn-of-the-century anarchists, politics was as much an aesthetic practice as it was political.  In a twisted variation on the famous Robespierre/Lenin line that omelettes cannot be made without breaking eggs, the poet Laurent Tailhade once defended the bombing of civilians by asking:  "Of what importance are a few vague people if the gesture is beautiful?" Tailhade was the sole victim of a cafe bombing a few months later-he did not repudiate anarchism, but would not describe himself as "vague" either.

In Novels in Three Lines, Fénéon shares Tailhade's nihilism, if not his incredible anti-humanism.  Fénéon seems to be obsessed with the artistic potential of mayhem-the book jacket draws comparisons with Andy Warhol's "Death and Disaster" series-stripping the emotional core out of individual tragedies and recording them either with extreme passivity, or filtered through a dark irony.

So can Novels in Three Lines - which Fénéon never meant to publish, are only available in a collated form never seen by the author, and were intended at the time to be nothing more than journalistic hackery -- be considered in any way literature?

The Russian theorist Jan Mukarovsky spoke of a necessary "literariness", where simple communication is pushed to the background, made subservient to expression, or as Mukarovsky put it, the emphasis is given to the "act of speech itself".  Indeed, it is hard to avoid the impression that Fénéon was often much less interested in the subject matter of his dispatches than he was with toying with sentence structure and the ambiguities of language.  For Fénéon, the drudgery of copywriting seems to have inspired literary experimentation -- having to reformulate variations of the same misfortunes over and over would get very tedious.

Fénéon may have arrived at literariness out of nothing more than boredom, but he still arrived there.  Novels in Three Lines is an often comic and always disturbing snapshot of European nihilists and the world they disdained.

Housing price pain a tale of many cities

Saturday morning is a prime time for Melbourne house auctions.  Over the past few weeks fewer hands have responded to the auctioneers' calls.

House price inflation and subsequent price falls have been key ingredients in the current world economic maelstrom.

The US and Britain have been at the centre.  On average in the US, home prices are down 17 per cent over the past year.  This dramatic fall has come on top of already depressed prices.

But the adverse effect of the downturn on individual home owners is only fully revealed by examining different cities.  Phoenix, Miami and the Californian cities have seen price falls of more than 25 per cent.  By contrast, prices in Texas and most southern states saw little or no reduction in house prices over the past year.

Those experiencing the biggest falls were locations where restrictions on land use for new housing had previously brought very high prices.  Those relatively untouched were where land restrictions are less stringent.

Australia has seen much less diversity of house price bubbles than the US.  This is because in Australia all capital cities have seen mushrooming house prices stoked by easy money combined with a government-created land scarcity.

On the city edge this shortage has been due to the government adopting the elitist views of those urban planners who oppose "urban sprawl".

Victoria has suffered less than other states from the efforts of this plague of planners.  But only 0.3 per cent of the state's land is in urban usage and it is farcical to think we need to prevent low-cost new developments.

In Victoria and elsewhere, land shortages deliberately created on the city edge have been worsened by other government regulations.  In the inner areas a dense thicket of heritage, environment and other laws add to the costs of housing and further squeeze supply.

The Commonwealth Government, as part of its doomed-to-failure recession busting measures, is providing new subsidies for first home buyers.  But these offer far less compensation to the first home buyer than the inflated costs caused by state government restrictions on land usage.

In most respects, Victoria has been the least-worst state in its planning and land usage policies.  As a result, prices here are dropping less than elsewhere.  Even so, according to the Real Estate Industry of Victoria, average house prices dropped 5 per cent in the past quarter.  REIV also notes that sales are down by a fifth, which heralds further price softening.

The last major housing downturn in Victoria was in the early 1990s when prices in real terms fell 20 per cent and stayed subdued for years.

The state faces a different set of circumstances now.

In the years prior to the 1990s downturn, Victoria was economically crushed by years of incompetent government under Cain and Kirner.  The present impending downturn owes more to national and international forces.  The outcome will be different both in the nature of price falls and where they will be most savagely felt.

On average, house prices may not fall as much as in the 1990s.  But then again they may fall even more.

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From beggars to choosers

Tasmanians are the poorest Australians.  According to Australian Bureau of Statistics data, Tasmanians have a per capita gross state product of just $39,160.

Mean household net worth is $135,326 less than the Australian average.

True, the unemployment rate has rapidly fallen to 4 per cent -- lower than the national average -- but the participation rate remains below the national average.

Bear in mind, it was only last year that Tasmania had unemployment at about 5 per cent.

Overall Tasmanians receive more in social security than they pay in federal income taxes.

Of course, Tasmania is a massive recipient of Commonwealth grants and subsidies.  That is the Tasmanian status quo.

There is nothing wrong with wanting to maintain the status quo.

In his 1997 review of Tasmania, Peter Nixon spoke of an overwhelming inertia and the State Government response to the Tasmanian Chamber of Commerce and Industry paper is evidence of that.

Of course, nobody likes criticism, even perceived criticism, and the Tasmanian Government is no different.

We have no desire to exchange unpleasantries with the Tasmanian Government.

Our paper Tasmania:  An Imperative for Reform is simply a call for debate.  As we suggest, Tasmanians have the right to choose their economic destiny.

But how many Tasmanians have a sound understanding of their current economic situation?  It is simply nonsense to argue, as Michael Aird has, that we are calling for higher taxes on Tasmanians.

Tasmanians are -- as are all Australians -- already over-taxed.

Our argument is that Tasmania needs to be more economically self-sufficient.

The way to do that is to grow the Tasmanian economy, not increase taxes.

There are plenty of important reasons why that should happen.

The most important reason is that we live in a community not an economy.

It is only by having a sound, robust economy that Tasmanians will be free to pursue the well-rounded fulfilling lives that they want for themselves and their children.

Tasmania has some unique features.  Growing the economy needs to take into account the existing natural environment and the existing lifestyle choices of Tasmanians.

That is why we have called for an open and wide-ranging debate.

The same old business-as-usual approach that Michael Aird represents is a valid option.

Of course, we can all play debating games-this number is no good or that graph is better, or the ABS data is not up-to-date.

The point remains that Tasmania could do a lot better in both economic and community terms.

In defence of the State Government, they are severely constrained by the centralist tendencies of the Commonwealth.

All state governments are in the same boat.

Overall, the Tasmanian Government, like all state governments, has fallen for the financial divide-and-conquer strategies of successive Commonwealth governments.

It is really time to think outside the square and imagine ways of becoming more self-reliant.

Our argument is that Tasmanians can improve their lives and standing in the Commonwealth through different policy choices, but those policy choices need community debate, acceptance, and a willingness to challenge the assumptions of the status quo.

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Rudd's questionable call

Maybe Kevin Rudd has a sense of humour after all.  Or maybe events are getting to him.  Or maybe he genuinely believes that he should be left alone to run the country.

In a speech in Melbourne on Tuesday night, the Prime Minister spoke about the importance of maintaining business and public confidence during these "unprecedented times".  He went on to say:  "It is incumbent upon all of us in political leadership to be very careful about what we say.  Now is not the time to be questioning the head of the commonwealth Treasury.  Now is not the time to be attacking the head of the Reserve Bank."

If Rudd is serious, and as yet there's no evidence he was joking, the consequences of his statement are breathtaking.  The Prime Minister is in effect demanding a gag on public debate of his government's economic policies.  Yes, the condition of the world economy is serious.  But is it so serious to justify the suspension of the practices of liberal democracy?

The cause of good governance in these "unprecedented times" is best served by having more debate, not less.

No one is arguing against the notion that politicians and commentators should be careful discussing economic issues and that such discussion should be within the bounds of what's reasonable in the circumstances.  It would obviously be irresponsible for a politician to claim falsely that a particular bank was about to go broke.  But what the Prime Minister said goes far beyond this.

If now is not the time to be questioning the head of the Treasury, the Prime Minister could tell us when is a good time.  During the boom years Treasury's mistakes mattered less.  It was verging on a scandal that for year after year Treasury could get its projections for taxation revenue so completely wrong.

But in the 1990s no one seemed to mind too much.  In the current financial circumstances, if Treasury gets its revenue projections wrong, the consequences will be far more dramatic and serious than they were a decade ago.  In the midst of a crisis government decisions need to be especially scrutinised.

Likewise with the Reserve Bank.  During last year the RBA made its decisions to keep lifting interest rates according to the evidence available to it at the time.  In hindsight the RBA was wrong.  Is someone who says the RBA got it wrong therefore "attacking" the head of the Reserve Bank?

In his speech Rudd talked about the need to maintain "support for the independence and integrity of our national institutions".

It's fine for the Reserve Bank to be independent, but to whom is it accountable?  The Prime Minister appears to be coming perilously close to claiming that to criticise the Reserve Bank is to be "unAustralian".

The Prime Minister would like us to suffer in silence as he and his ministers spend half the budget surplus without the Treasury predicting what the outcomes of such spending might be.  This is hardly a model of accountable and transparent public administration.

Last year, while in opposition, Labor attacked the then Howard government for promising a $10 billion water plan without receiving departmental analysis of the plan.  Labor's criticisms were valid.

Yet Labor, now in office, is doing exactly what it attacked the coalition for.  No one should be surprised when a politician says one thing and then does something else, but Rudd said he'd be different.

The Prime Minister has two reasons why he thinks Australians should just sit down and shut up while he makes financial policy on the run.  First, he says we must get economic policies "right" and this is a process best undertaken without having an argument about them.  Second, he argues that the lesson of the bank deposit guarantee saga is that "politicising" such issues is "unhelpful in the markets".

The reply is simple.  Making policy in the glare of public scrutiny doesn't guarantee that the policy will be right, but there's a greater chance of it being right compared to having the policy made in secret.

Rudd is rewriting history if he believes it was the "politics" of the bank deposit guarantee that was unhelpful in the markets.

It's not politics that is stopping thousands of people from redeeming their funds held in cash management trusts.  The shemozzle over what deposits are -- or are not -- guaranteed is entirely a problem of the government's own making.

What's unhelpful in the markets is bad policy.

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A misguided desire to save the bush

There has been much written about Australia's national character emerging from a bush ethos -- the idea that a specifically Australian outlook emerged first amongst workers in the Australian outback.  But few now have anything much to do with the bush.  They mostly live in cities, or close to the beach, and spend holiday time on the coast.

However, the concept there is an outback still looms large and successive federal governments have claimed they can save it.

The previous Howard government was going to save the Murray from salinity and largely achieved this through the construction of salt interception schemes.

The new Rudd Government plans to save the Murray from climate change.  This is perhaps a more ambitious undertaking.

The Rudd government was elected with the help of internet campaigners, GetUp, and this group recently joined-in with a major online campaign claiming to provide an opportunity for ordinary Australians to "keep the rivers flowing" and "save Australia's food bowl" through a few mouse clicks at the home computer.

In particular it seems many city-based Australians believe that there is no water because of over-allocation exacerbated by climate change and so if the Government buys back some water there will be more for the remaining farmers and this will "save the food bowl".

Certainly, much of outback Australia is under pressure from a series of dry years and reduced runoff, including pressure from changed land management practices.  But as some farmers explained on ABC television's Four Corners, you can't buy back rivers, not even with billions of dollars.  The reason -- water allocations are just air space until it rains.

Furthermore, only a few thousand hectares of the Government's recent purchase, Tooralee Station, involved irrigated agriculture and now the 91,000-hecatre lot will be converted to national park.

While the latest city-based internet campaign claims to be about "saving the food bowl" there is much precedence to suggest that government interference will only result in less agriculture generally and the redistribution of some water downstream when it does eventually flood.

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Only our government failed to predict the crisis

It has been said that those who lack the imagination of disaster are doomed to be surprised by the world.  Kevin Rudd and Wayne Swan obviously don't enjoy watching a good horror movie.  In recent weeks they have been so surprised by the global financial crisis that they have declared a radically new economic agenda to combat what the Prime Minister calls a "rolling national security crisis".  What was once said of 9/11 is now said of the GFC:  everything's changed.

But as traumatic as the market mayhem has been, it was not only predictable but long predicted and warned against.  Nor were the reasons for such warnings hard to discern.  During the past year, Liberals from Peter Costello to Malcolm Turnbull have suggested that the US sub-prime mortgage collapse in September 2007 could lead to a financial tsunami all over the globe, and that Australia was not necessarily immune.  In this environment, Labor's tight fiscal policy, taken together with the Reserve Bank's (RBA's) tight monetary policy, to slay some inflation dragon would lead to lower growth, higher unemployment and make life tougher for millions of Australians.  Now, the chickens are coming home to roost.

The media has portrayed the Rudd government's response to the global contagion as an economic and political coup.  With his "decisive" move to shore up the banks and stimulate the economy with a $10.4 billion spending package, the PM has, we're told, restored confidence to the financial system and sold a coherent narrative to the Australian people:  Labor, the party of economic conservatism, is best able to save the nation from global recession.

The truth is very different.  For when it comes to running the economy, both Rudd and Swan are drawing confusing roadmaps and not surprisingly are swerving all over the street.  Already the duco is scratched and there are a few dings in the bumper bar.

Rudd and Swan insist they've been prepared for this global crisis since the beginning of the year.  Laurie Oakes recently retold a January conversation between the Australian treasurer and US treasury secretary about the dire state of Wall Street.  "An economic stimulus plan was already on the blocks," according to Oakes.  "As they became increasingly alarmed at what was happening overseas, Rudd and Swan had been working on it, just in case."

If indeed this was the case, why were Rudd and Swan so surprised by the collapse of Lehman Brothers and Bear Stearns in September which led to their sudden decision to spend half the budget surplus and guarantee bank deposits?  If they were so concerned about boosting growth, why were they hewing to the tightest fiscal policy since the early 1970s?  And if they were so concerned about stimulating the economy, why were they, as Turnbull consistently complained, "egging on" the RBA to raise interest rates?

Now, a strong case can be made for a bold, tight fiscal and monetary policy to put downward pressure on interest rates and inflation that has increased by 2 per cent since last November.  A case of a different kind can also be made for giving very high priority to boosting growth and safeguarding the Australian economy from the global storm.  But no case can be made for combining the two -- or dramatically shifting direction from one priority to another -- when the global outlook has remained gloomy for more than a year.  Yet this is what Rudd and Swan have been trying to do.

To reiterate:  it's not as if no one was warning that things could get worse.  In October and November last year, Costello suggested that the US sub-prime mortgage crisis would "create other problems around the world".  Although our economy was in relatively good shape, it was imperative that our leaders held their nerve and didn't panic.  "At a difficult time like this," he said on 25 October 2007, "it is important that we keep our economic management strong, in experienced hands, and that we keep Australia's economy growing strongly." No wonder the Liberal party's election campaign slogan was "Go For Growth".

Fast-forward a year to 20 October when Costello delivered a well received, but little noted address to a Quadrant dinner.  "Labor now wants people to believe that it has been preparing a fiscal stimulus since the beginning of the year.  No, it didn't underestimate the fallout from the sub-prime crisis," the ever so sarcastic Costello remarked.  "It just fooled us all by telling us the government needed to cut spending when in fact it was preparing to increase it."

The point here is that Rudd and Swan have been asleep at the wheel.  Against the backdrop of the US financial meltdown, Labor was more focused on trashing the economic record of the Howard-Costello years and talking up inflationary expectations than safeguarding the Australian economy.  If indeed Australia does go into recession, it will be partly seen as an own goal by an inexperienced Prime Minister, a nervous treasurer and a gung-ho RBA governor.  After all, they rushed into tight measures that were exacerbating the downward trend pressure on economic activity from abroad.

Amid economic uncertainty, the public understandably looks to their elected leaders and the senior public servants for reassurance.  But with its immense power and capacity to harm, government can itself become a source of panic.  In recent weeks, Rudd and Swan have taken extraordinary action to spend half the budget surplus and guarantee all bank deposits in a careless and hasty manner without a single minister discussing the matter directly with the RBA governor.

But how these decisions are implemented is important if they're going to reassure the public and markets.  The government's bungling of its emergency decision to guarantee without any caps all deposits of Australian banks, and the subsequent capital flight and stock market carnage, are evidence of the danger when our leaders take fright.

Having only recently awakened to the scope of the global crisis, Rudd and Swan are indeed frightened.  The need now is not for more dramatic knee-jerk policy changes that could incite severe runs on investment funds and across the financial system, but confidence that the government knows what to do.  Alas, the signs are far from encouraging.

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Train driven through rights

Treasurer Wayne Swan has added his own voice in support of a High Court decision requiring BHP Billiton to provide rival iron ore miner Fortescue Metals Group with access to its Pilbara rail lines.  This is contrary to the position the Australian Labor Party took to the last election and constitutes a staging post in a 15-year march through private property rights.

These rights are the key to ensuring efficiency in private enterprise economies.  They embody owners' abilities to do what they please with their property, and to exclude others from access to it.

This exclusivity provides the incentive to save and invest in an asset.  It allows an owner flexibility to use his assets without having to negotiate and seek permission.  Private property rights also prevent free riding, where users avoid paying the full costs, which is endemic in socialised systems.

If these decisions on the Pilbara railways were to apply to assets in general, then many would be cheering them as sounding the death knell of the capitalist system.  Owners' sole rights to use their property would be substituted by the state requiring that it be shared and setting the fee for such sharing.

The basis for the decision goes back to the 1993 Hilmer report on national competition policy.  Though paving the way for reform in opening up government monopolies, or "essential facilities", to competition, Hilmer also brought non-government within the net.  Recognising this could deter private investment, Hilmer excluded "production processes" from within the scope of monopoly assets that must be made available to all parties.  This recognised that new production facilities could always be built to challenge a monopoly.  The subsequent legislation was Part IIIA of the Trade Practices Act.

The Pilbara case has some way to go before BHP is forced to allow Fortescue and others to use its rail lines.  Further challenges to the High Court and the Trade Practices Tribunal will follow but, if finally allowed to stand, the government's approach sets a precedent with enormous implications.

Applying the case to a car assembly line, which is itself a transport facility, we have the equivalent of a rival car manufacturer seeking access to the Toyota plant.  Such an application would be ruled out only because that facility is defined as a manufacturing plant.  But this is an arbitrary distinction and, indeed, the National

Competition Council has argued that the exemption for manufacturing facilities should be revisited.

Even with that exemption, there are many areas of business that appear to be caught up in the socialisation net that the High Court decision reveals.  These include other rail lines such as BHP's own Hay Point coal line in Queensland.  This is integrated with BHP's mining and port facilities and as such has demonstrated advantages over the open access regimes in other rail-port systems.  Also in the net are gas pipelines and facilities such as private hospitals, theatres or sports stadiums.

Above all the decision has implications for telecom facilities.  In this respect, it confirms the wisdom of Telstra in refusing to build its fibre optic network without assurances that it would not be subject to Australian Competition and Consumer Commission regulatory seizure.

The fact is that Australia's definition of an essential facility under the Trade Practices Act is too wide.  The US, for example, does not allow access to be required just because it is "uneconomical" to develop another facility.  The present legal framework is the outcome of faulty analyses on the part of policymakers anxious to ensure access to facilities is not restricted by excessive business rivalry.

But this has created a new form of investment risk.  Firms will now be uncertain whether their facilities are to be opened to rival businesses on terms determined by a regulatory agency.  And they will have an incentive to hold off making investment decisions, hoping that a rival will move first and incur the risk of failure.

The adverse situation was created by government legislation.  It will require legislation to restore the encouragement to investment brought by private property rights.

Now, more than ever, we need to avoid measures that create additional investment risks that will hamper private provision of infrastructure.

The Treasurer and his advisers are yet to recognise the magnitude of the deterrence to investment they have created.

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Billions lost as SA finances melt away

In the modern economy, everything is interconnected.  Poor financial regulation in the U.S. leads to a meltdown in their housing market;  banks around the world start building up bad debts as international credit flows tighten.  A financial sneeze halfway around the world leads to the cold of an economic downturn in Australia.  Nobody is immune from the market adjustment.

South Australia's production is growing more slowly than the rest of the country.  House prices in Adelaide have fallen by 2 per cent over the September quarter, while manufacturing jobs have been lost over the past year.

The State Government Budget has also been affected by global financial market frictions.

Treasurer Kevin Foley made a statement to the Parliament in mid-October which makes for sobering reading for SA taxpayers.

The Government's superannuation investment arm, Funds SA, recorded a loss on its investments from July to September of $627 million.  This was on top of losses of close to $1.5 billion for 2007-08.

Unfunded superannuation liabilities are expected to increase by an additional $150 million.

Overall taxation revenue is expected to fall by about $100 million in 2008-09, mainly due to declining housing finance commitments impacting on the expected duty revenue take.

Declining consumer confidence is likely to reduce the flow of GST revenue by a further $30 million.

The extent to which the state's finances have melted away has been sudden as well as substantial, and looks likely to wipe out the $160 million Budget surplus estimated for 2008-09.

The Treasurer has not ruled out spending cuts or the deferral of capital projects.

However, the reforms needed to scale back the public sector are going to be much more painful than should otherwise be the case.

This is because the Rann Government coasted along during the good times, spending as much money as it could get.

From 2002-03 to 2006-07, the general government sector raised $2.4 billion in revenue and spent $2.6 billion.  This led to deterioration in the Budget surplus over those years.  In other words, less money was set aside for the "rainy day" of the current global financial crisis.  In its latest annual report, the Auditor-General also revealed a range of cost blowouts and poor management practices within government.  As government inefficiencies have grown, key ministers seem to have turned the other cheek.

The years of "maximum spending" and waste have come to haunt the Government as it undertakes the necessary task of putting the State Budget on a more sustainable footing.  The time for action is now.  Yet, Mr Foley has indicated that an economic statement informing people of the fiscal implications of the financial crisis will be deferred.

By contrast, other states such as Tasmania are bringing forward their midyear statements to bring business and the broader community into a discussion of the reforms that need to take place.

Now is not the time for the Treasurer to act like a rabbit in the headlights.

The State Government has no option but to cut the excess spending built up over the good times, and to do it quickly.

BLOATED GOVERNMENT

• Additional spending from 2002-03 to 2006-07 helped subsidise the employment of an extra 13,800 bureaucrats across the SA public sector.
• In 2006-07, about 14 per cent of people working in SA were employed by the Government, the second highest state proportion after Tasmania.
• The wages bill to support the extra state public servants has also increased over the life of the Rann Government.  Bureaucrat salaries now account for about 48 per cent of the general government Budget.
• With teacher unions taking industrial action seeking more pay, the challenge is on for the Government to quell further increases in public sector wages in the interest of taxpayers.

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Clamp on conflict of interest may hobble sound judgement

Do we want our councillors to be even less interested in local government policy than they already are?

As potential councillors submit their nominations for Victoria's council elections next month, this is the message the State Government is broadcasting.  A legislative change to local government administrative law now filtering through Parliament will exclude councillors from being able to vote on an issue in which they have an indirect interest.

Across the nation, councils have been embroiled in scandal after scandal over alleged corruption concerning development approvals.  It would be nice to clean up council politics.  But this new indirect interest rule is remarkably broadly defined.  Apart from the obvious possible conflicts of interest -- family members owning property that might be enriched by council decisions, and so on -- it also considers an improper interest to exist if the council member had, at any time in the past, made a submission on the issue at hand.

But what if the councillor was elected specifically because of his or her position on that issue?  Those activists who have in the past taken legal action against, say, the St Kilda Triangle or the 2am lockout would be unable to vote against them in council when the time came.

The only councillors who would be able to vote would be those who have no particular concern for the issue.  Imagine this rule extended to state or federal government -- democratic representatives could only vote if they didn't care about what they are voting for.

It would be wrong to have a politician determining fiscal policy if they have a mortgage, or health policy if they have a relative in hospital.

The Government claims this new rule will apply in a small number of cases, but the legislation is worded so ambiguously that many councillors will have to excuse themselves to avoid an inevitable legal backlash.

Other ways the Government believes that councillors might have an indirect interest are just as dubious.  One test is whether the councillor ever received a gift worth more than $200 from one of the parties appearing before the council.  A sum of $200 is ridiculously small considering most contentious council development applications involve projects worth many millions of dollars.

Does Spring Street really think that bribing local councillors is that easy?  If so, we have a much more serious problem than the State Government is making out.

When such trivial donations come to be considered a conflict of interest by the new law, councillors will find it hard to identify prominent members of the community who they don't have an indirect interest in.  Remember, councillors are politicians who have, over many years, needed to fund-raise from within their community.

While we all enjoy feigning moral outrage over the influence of money in politics, as long as councillors are able to make decisions that can make or break property developments worth millions of dollars, money is going to flow into councillors' campaign chests, whether overtly or covertly.

The problem the State Government is trying to tackle is actually quite real.  Councillors are asked to do two separate jobs that can easily come into conflict with each other.  Half the time, they are supposed to be politicians, pressing palms, kissing babies and pronouncing judgement on the issues of the day.

The rest of the time, their role in Victoria's planning framework requires them to be dispassionate judges, prostrating their personal opinions upon the cold concrete slab of administrative law.

This tension between councillors' democratic and quasi-judicial functions is one they are not well-equipped to manage.

Local government seems to attract the dregs of our political class.  There are young factional hacks from political parties who view local government as well-paid work experience.  There are activists who don't know much about government but know they hate ugly new houses spoiling their suburbs' "traditional character".  And there are earnest greenies who campaign to declare their council "nuclear-free".

Yes, local councillors are a bizarre collection of the uninformed, the uninterested and the weirdly over-interested.

But they were democratically elected.  The State Government should allow them to vote on the issues that got them there.

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