The markets:

Bill Williams writes: Re. “Mayne: markets crash but we’re well placed to ride out the storm” (Friday, item 2). Australians can only hope that Stephen Mayne’s analysis and prediction that “we’ll be OK” proves to be correct. A more pessimistic analysis might look beyond market economics and consider possible behavioural outcomes: what happens when the herd panics?

Most of us take for granted the relative stability and orderliness of group behaviour but in doing so underestimate its fragility. In the Western world we have had only occasional glimpses of what can happen when a community experiences an extreme “loss of good authority”. One of those examples occurred in 1992 in Los Angeles when a jury acquitted four white police officers accused of  beating up of black motorist Rodney King (the truth of video could not be denied). Thousands of people rioted, 53 people died and property damages were in excess of $1 billion.

More recently we have observed uprisings in various Middle Eastern nations … again, in response to a perceived loss of good authority. Most analysts attribute the influence of improved communications through social networking websites as the most significant catalyst. In so doing they underestimate the impact of the price of wheat. Nothing sharpens the focus of human endeavour and strategy like an empty stomach … especially a stomach craving cheap carbohydrate, when it is not available.

The loss of good authority in the governance of the world’s economy probably started in the US … a country whose culture enshrines “independence” at the expense of “interdependence”. The Washington consensus, or what we call “rational economics” in Australia, took hold like an economic religion. Keynes was ridiculed. Schools of economics preaching anything other than the “free market” mantra found themselves irrelevant. Too much government intervention in markets gave way to too little, especially as it turned out, in the financial markets that, left untended and inadequately supervised by government, found new ways to leverage debt.

This leveraged debt started causing problems that required central governments to start printing money … publicised as “monetary stimulus” after 2008, but probably occurring from as early as 1997 in less obvious ways  and through creative accounting practices after September 11, 2001 (such as leaving the cost of military expenditure out of government current account figures because the US was on a “war footing”).

The world is now staring into the face of a possible depression with the potential to be much worse than that of the 1930s. How so? There are already too many people in the world for the earth’s biomass to sustainably feed. Billions are already hungry … and that’s with the world’s economy fully functioning. Imagine what could happen if the human group loses confidence in the very financial system that it depends upon to supply food? During the ’60s, ’70s and ’80s the world had huge stockpiles of food … “grain mountains” as they were called. In 2011 the world has less than 15 days of soybeans, 20 days of corn, 27 days of rice and approximately 127 days of wheat (source USDA).

Put more simply, the world’s unsustainably high population is being fed (already inadequately) by a financial system that seems very badly damaged as the result of governments inadequately managing that system.  Worse yet is the fact that there is no system of global government with the authority to tackle the global problem (as we have already seen with global warming and Copenhagen, etc).

So Stephen, Australians will be hoping that you are correct in asserting that we are “well placed to ride out the storm”. Certainly we should have enough food for ourselves … but what about the rest of the world?

The Australian Building and Construction Commission:

Leigh Johns, Australian Building and Construction Commissioner, writes: Re. “Building industry watchdog slammed over sham contracted migrants” (yesterday, item 13). The ABCC’s commitment to eliminate sham contracting from the building industry is demonstrated by our conduct this year of a national inquiry into the problem.  The involvement of the academics who did attend the sham contracting round-tables greatly supported that process. Professor Mitchell would have been a welcome participant.

I would expect academics and commentators to have regard to the full range of views on this important national debate when forming their opinions. Anyone who heard or later viewed the speech I gave to the 19th Annual Labour Law Conference at Sydney University last Monday would know how seriously the ABCC takes this issue.

Out on building sites, ABCC investigations into sham are consistently hampered by the refusal of some industry participants to provide relevant information, even while accusing the ABCC of inaction. Despite this lack of co-operation, the ABCC is to date the only litigant in this country to have successfully prosecuted a building and construction industry employer for sham contracting, with other similar matters on foot presently.

Abolishing independent contracting is not the answer to this problem, and I doubt Professor Mitchell would find many who would support his view.   There is an absolute consensus within the building and construction industry, including the CFMEU, ACTU, MBA and other industry associations, that the role of legitimate contracting needs to be defended, and that sham contracting needs to be stamped out.

With the help of the employer associations, unions, academics and all building and construction industry participants, that is exactly what the ABCC is seeking to do.

High-speed rail:

Jackson Harding writes: Re.”High-speed rail: pulling a very fast one on capital” (Friday, item 3). Bernard Keane must have really developed a pathological hatred of the poor old choo choo.

Three hours Melbourne-Sydney. Compared to air. Which takes an hour and 25 minutes. But let’s not compare apples with oranges. Let’s try apples to apples. It’s an hour and 25 gate to gate, Tullamarine to Mascot, but it’s not an hour and half CBD to CBD and try as they might to market their airport meeting rooms not everyone takes them up on the offer.

As well as our 85 minutes in the air there’s the 20-minute ride to the airport, the minimum 30-minute pre-departure check in limit, the minimum 30-minute wait for a cab at Sydney plus at least 20-30 minutes in the cab getting to your CBD destination.  So we have 1h25 + 20 + 30 +30 +20 = 3h5m.  Anyone who does it regularly will vouch that’s about what it takes.  The same time as a decent fast train.  And if it’s anything like fast rail in Europe you’ll have mobile phone coverage and mobile broadband the whole way, so you’ll be able to get 90 minutes of work in as well, not just the meagre 20 minutes or so the airlines let you use your laptop (and your phone not at all).

Stephen Luntz writes: I’m not qualified to take a position in the debate between Ben Sandilands and Bryan Nye (Friday, comments) on the commercial attractiveness of high-speed rail. However, I’m astonished no one has pulled Ben up when he questioned the environmental advantages of high-speed rail over air.

Ben argues the power for the proposed line will come from coal, but thinks at least half the fuel for aeroplanes will be biofuel from algae. Does no one see the contradiction?

Hopefully algal sourced fuels will prove effective — it will be a great way to get down emissions from intercontinental flights. However, research in the area is very much in its infancy, probably less developed even than wave power. Algal biofuels are 10 years behind solar thermal, 20 years behind photovoltaics and 30 years adrift of wind.

Long before we are using biofuels to power aircraft on any large scale any new demand for electricity will be sourced from renewables. That goes double for something like high-speed rail, which will be used primarily in the day time, with a route passing near some very  sunny areas.

Chris Virtue writes: Can someone tell Bryan Nye that Ben Sandilands isn’t the only person not excited by high-speed rail in Australia. I’m not either. I would rather they invested in Sydney’s ailing rail network, where oddly enough, a train trip to Newcastle now takes longer than it did when John Bradfield built the line. Now, if someone such as Bradfield was in charge, I could get excited. That man got results.

Keith Binns writes: Ah yes, high-speed trains. I know about them. I went on one that did about 170kph back in 1980 in Europe. Only 30 years behind. Why, if it comes off as a nation we’ll be entering the latter half of the 20th century …

Australia’s orchestras:

Nick Byrne, artistic director, Improvention 2011, Canberra, writes: Re. “The costly disease in our backing orchestras” (Friday, item 15). The cost of orchestras for opera and ballet are just one expensive component in the arts funding debate, but an excellent case study. In the same way that governments unsustainably bolster traditional manufacturing industries for perceived benefits beyond the bottom line, large scale stage productions are extremely costly exercises that provide cultural benefits that are difficult to measure.

The question is not whether the arts require funding that can be justified in terms of direct financial viability, but the distribution of that finding, and the size of the bucket, overall, that matters. In comparison to the respect paid to artistic pursuits in many other countries, Australia’s bucket is more of a thimble, and this spotlights the importance of getting the distribution right.

There is a case for supporting traditional or classic forms of stage production, certainly, but in terms of the percentage of funding absorbed by them, they hold back the advancement of arts in this country, because the potential classics of the future, (I refer to those in performance genres outside opera and ballet), are too rarely given the opportunity to achieve that potential. Those artists most likely to be our leaders and mentors in 20 years are working in hospitality or telemarketing wine clubs or leaving the industry in the belief that their parents’ advice to do so was right. Under funding arrangements that have been in place for decades, this is unsurprising, but sabotages our industry’s future.

I applaud The Australia Council for taking this issue seriously, and making headway towards a sustainable future. I ask them to bite the bullet and act decisively, while there is time to sniff the recent bloom of new artistic endeavours in this country. I implore governments to understand that we need to capitalise on a clever-country mindset and understand that there is the same potential financial merit in promoting the growth of our arts industry as there is in promoting sustainable environmental technologies. I urge opera and ballet companies to radically innovate to prove me wrong.

Apologies to all my friends in orchestras. As a former professional musician, I understand that you may not share my feelings, but I have also had many of my most rewarding and recent artistic growth experiences with those of you who have branched out to discover the options above the pit and in the light where your talents can viably shine for contemporary audiences.

Caroline Storm writes: I think it’s quite to possible to have most enjoyable performances of opera and ballet with much smaller orchestras. Listen to the wonders of the Brandenburg and smaller chamber orchestras. For baroque operas  hardly any brass is needed. We can surely size down.

Byron Bay kebabs:

John Leahy writes: Re. “First Dog on the Moon” (Friday, item 7). I have been holidaying at Byron Bay for nearly 30 years and have always managed to find a good kebab.

Perhaps, FirstDog should ask the locals instead of hanging around with Bob Carr et al.