Knox trial pure voyeurism
Peter Lange writes: Re. “Rundle: Amanda Knox’s story, full of violence and lies” (yesterday). What was Guy Rundle actually writing about? I tried to read past the first paragraph but when I realised he was both contradicting himself and yet failing to justify his further serving of lurid crime faction, I lost interest. Amateur detective fantasies of journalists who ought to know better are not why I read Crikey. Pull your socks up and get serious, Crikey. Trash.
Let the market decide
Tamas Calderwood writes: Re. “Toyota exit without an industry policy is economic vandalism” (yesterday). Paddy Manning wants the government to indicate where the “new jobs for manufacturing workers [are] going to come from — if not precisely, at least roughly?” He also suggests green-energy subsidies and the government-funded NBN could help to create the “industries of the future”.
But who saw the mobile computing revolution before the iPhone? Even Microsoft missed it, let alone governments. And how does the mobile revolution play into the fixed-line government-funded NBN? In 1995 information technology was 6.4% of the global equity market while telecommunications was 5%. Today, IT is over 12% of the global market while telecoms has shrunk to less than 4%. Furthermore, governments didn’t plan the fracking revolution that has created abundant new low-cost energy supplies — energy was 5% of the global market in 1995 and has expanded to 9% today, while industrial stocks have fallen from over 14% to around 11% today.
How do governments plan for all that? They can’t. Central planning simply doesn’t work. The only thing governments can do is stand back and let the market decide — to grow an industry, shrink an industry, innovate and from time-to-time, sideswipe an incumbent. Economic growth is a bottom up process, driven by people on the ground who listen to their clients, spot new opportunities, take a risk and figure out how to do something better, quicker, cheaper. Governments should lower taxes, create a business-friendly environment (including education, infrastructure and the rule of law), and get out of the way. It is government intervention that usually turns out to be “economic vandalism”.
Say no to foreign second-hand cars
Mary Trewby writes: Re. “Toyota decision should herald the immediate end of car tariffs” (yesterday). There is a very good reason for not following New Zealand’s mass importation of used cars. The cars’ histories were often unreliable (and often this only became obvious when the car needed to be repaired), parts were unavailable for many models ( and some strange models ended up there), and there were even instances when one car contained parts from two or more wrecks. New Zealand ended up with a lot of cars that should have been sent to the wreckers in their country of origin rather than be imported — they were unsafe and broke lots of environmental regulations. Do some serious research before recommending Australia adopt the same policy.
Ah Tamas,
So fracking has provided cheap abundant energy? Gas is cheap in America, because it doesn’t yet have the infrastructure to export fracked gas. The market for domestic gas is saturated so the price is depressed.
Back in 1995, the global price for oil was around $18 per barrel. The average global price in 2013 was around $90 per barrel. The price of energy across the various sources (oil, gas, coal, etc) tends to be roughly equivalent.
It would be expected that the share of the global economy of energy would be expected to increase as the cost of energy increases to the extent it has.
Energy isn’t cheap if it costs almost twice as much as previously – money that could be going in paying for jobs elsewhere.
Peter Lange – maybe try reading the article before calling it trash?
Tamas, if the government steps back any further from regulating the CSG/LNG industry (at least in SE Qld) the Great Barrier Reef will decline into a stony algae-covered undersea landscape and the southern Queensland coastal hinterland will slowly become a foreign-owned quasi-industrial wasteland. Sure, it will be a landscape and sure a quite large number (slowly declining) of people will be employed there and sure it will be in one of the climatically attractive parts of Australia. But for what? What is the big deal about shitting in one’s own nest, denying you are doing it and insisting that government look the other way?
Suppose you were a timber cutter on Easter Island, the last of the master craftsmen – last because there was only one more tree left. Would you be encouraging your leaders to build a new ceremonial canoe for a fertility ritual or would you insist on withdrawing your labour so that a couple of impoverished fishermen could build two or three scruffy fishing vessels which could at least supply your next meal?
The ruthless pursuit of cheap fossil fuels comes at the expense of something else. Deny it all you like but when the hydrocarbon resource has been depleted and the mist before your eyes clears, you’ll realise that there’s bugger-all left.
Mary,
Your comments were very typical of views expressed when used imports began in New Zealand. That’s until information began appearing about the superior engineering in overseas assembled vehicles. The specific one I recall is that crash bars inside the doors of imported cars were missing in the ones emerging from NZ’s own tiny industry.
And assembling on driveable car from two wrecks – give me a break! That’s a time honoured dodgy practice that has been around for decades. Are you telling me such cars are not on Australian roads today?
Wayne – US shale formations have unlocked vast swathes of new energy resources. This is pushing energy prices down. As you say: ‘gas is cheap in America”.
My broader point is that governments can’t plan for these things. Only markets can allocate resources efficiently.