Thursday, July 30, 2015
TPP: Australia on the verge of joining huge new Pacific trade deal
Trade deals always have downsides as well as upsides so it is childish to want it to be all-win. The only question is whether the upsides are preponderant. They should be but we are unlikely to be sure immediately
Australia is on the cusp of joining a huge new United States-led trade deal which will "set the rules" for doing business in the region at the expense of China.
The Trans-Pacific Partnership, involving twelve Pacific-Rim nations, could be sealed in coming days, after talks that had drifted for five years narrowly escaped death in the US Congress.
"It could be done this week," said Trade Minister Andrew Robb last night, as he prepared to depart for what he hopes will be one final round of talks in Maui, Hawaii.
"There's no guarantees but the whole mood has shifted", he said, referring to a last-minute US Congress decision to give the White House autonomous negotiating powers.
"We're close enough, we're down to the really difficult ones – like sugar."
Aside from Australia's long-suffering sugar farmers, who have missed out in previous trade deals, Mr Robb said divisions remain over a US proposal to extend intellectual property protections for "biologics", which would increase the price of medicines.
Mr Robb said beef farmers were set to be winners alongside a range of professional services firms.
But the recent surge of negotiating momentum owes at least as much to geopolitics as it does to economics.
A range of nations that might once have bristled at American muscle-flexing are now encouraging it – as they hedge against China's growing propensity to throw its weight around.
Fairfax can reveal that the twelve prospective members have agreed to rules that would make it harder for the kind of state-owned enterprises which dominate China's outward investment profile.
"One rule is that governments can't give SOEs benefits that allow them to undercut the market," said one source close to negotiations, saying that SOEs would be penalised if they received discount loans when investing in TPP nations.
"Also, SOEs are not allowed to discriminate against other TPP parties in the way they sell and buy their products – it's an extension of government procurement rules," said the source.
Tellingly, it is understood that negotiations for this novel SOE chapter have been led by Australia, despite its reliance on Chinese trade, and endorsed by Vietnam, despite its own reliance on state-owned firms.
In another global first, the TPP will include enforceable anti-corruption provisions which will also have an outsized impact on Chinese firms.
They will mirror the OECD's anti-corruption guidelines and the UN Convention against corruptions, except that they will link to dispute resolution provisions.
And the single biggest winner out of this agreement is likely to be China's arch-rival, Japan.
The TPP will increase Japan's GDP by between 2 and 4 percent over a decade, according to estimates by economists at the International Monetary Fund.
Manuel Panagiotopoulos, from Australian and Japanese Economic Intelligence, said the TPP will provide Prime Minister Shinzo Abe with the impetus for much-needed domestic international reforms while laying a foundation for regional integration and security.
"What a lot of economists don't get is that geo-politics is more important than trade flows," he said.
"If the security foundation doesn't work then trade flows will dry up in an instant."
While China anxieties have loomed in the background of these negotiations, the economic giant could still join the group after the rules have been set.
"Both we and China should want to see China in the TPP – and sooner rather than later," said trade consultant Andrew Stoler, formerly deputy director-general of the World Trade Organisation.
Earlier, when Mr Obama was wrestling with Congress, he told the Wall Street Journal: "If we don't write the rules, China will write the rules out in that region."
And US Defence Secretary Ashton Carter went further: "Passing TPP is as important to me as another aircraft carrier."
The twelve negotiating parties are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and the United States.
'Scientific Method' Australian Government style
Written by John Elliston AM, FAusIMM(CP)
Since 1936 the ‘scientific method’ has been recognised by Australian law (Subsection 73B(1) of the ITAA 1936) as: - ‘Systematic investigative and experimental activities that involve testing a hypothesis (new idea) by deductive formulation of its consequences. aussie scientific method
These deductions must be rigorously tested by repeatable experimentation and logical conclusions drawn from the results of the experiments. The hypothesis must be based on principles of physical, chemical, mathematical, or biological sciences’ (this would include the Second Law of Thermodynamics).
In 1972 Australian universities abandoned the procedure that had been used for award of their highest degrees in science to that time. DSc candidates were required to submit a doctoral thesis embodying an original research finding (details of a tested hypothesis). This was “peer reviewed” by two or more external scientists selected by the university as most appropriately qualified.
It was recognised that a candidate who had tested an original hypothesis may be equally or better able to interpret the results than an external reviewer. Candidates were therefore entitled to a “right of reply” to the written report or comments of the universities’ reviewers. In reply they could produce references or call on reviewers of their own selection.
University authorities were able to fairly assess the candidate’s new research finding and determine if it merited the award of their highest degree. This procedure raised standards in all scientific disciplines to which it applied but by 1974 it was abandoned by all Australian universities as too tedious and time consuming to cope with the rapidly increasing number of candidates aspiring to higher degrees.
With continuing rates of increase since 1970’s, Australian universities now resemble production-line ‘higher degree factories’! They quite rightly require higher degree candidates to meet very high standards but they are uniform standards requiring each candidate to conform to the limitations of the knowledge of his or her degree supervisor. corrupted scientific method
Significant new discoveries cannot conform to what is currently “generally accepted”. All publicly funded research in Australia tends to digress, at least to some extent, from the scientific method toward the extreme case depicted in the American cartoon (pictured right). Competitive research proposals are written to get research grants rather than to advance our knowledge by resolution of long-standing problems.
Geological researchers spend more time looking at computer screens than looking at rocks and mineral deposits!
Shorten: A leader on a leash
LABOR has two leaders: Bill Shorten and Tanya Plibersek.
From the applause Plibersek received from her gay marriage rally cry yesterday at the ALP conference in Melbourne, it is the deputy in name only who clearly has the numbers.
Any victories Shorten can claim to have achieved over the weekend — such as narrowly fending off a binding gay marriage bill and securing boat turn backs on asylum seekers — were pyrrhic victories at best.
His senior left-wing shadow ministers have sent a clear message to him: “We have the numbers, and you know it.”
Shorten now leads a party furiously divided over key election issues, and one that has shown a willingness to abandon longevity and substance for short-term expediency.
Not since former NSW premier Morris Iemma was rolled at a state conference on power privatisation, and perhaps Calwell and Whitlam in the 1960s on US foreign policy, has an ALP conference been so hostile to a leader.
But it shouldn’t surprise. The structural problems that began in NSW in 2007 have manifested in the Left finally flexing its new-found muscle at a national ALP conference.
Shorten may have secured the numbers to allow him the luxury of adopting turnbacks, but it came with a very expensive price tag.
His own faction was rolled on the Israel/Palestine issue, he lost the numbers for a conscience vote on gay marriage, and he has been forced to adopt a renewable energy target that would elevate Australians’ electricity bills to among the highest in the world.
To top it off, the conference voted to censure Martin Ferguson, one of the party’s last remaining voices of sanity.
The optics for Shorten are now clear. The Left is in control of the Labor Party, and if he doesn’t dance to the beat of their drum, he is gone. It doesn’t get much uglier than this.
Labor returns to Kevin Rudd’s 2007 campaign
BlLL Shorten says he has learnt from Labor’s mistakes but that certainly hasn’t stopped him repeating them.
If anything, he has been channelling the same grandiose policy ideas outlined by Kevin Rudd in the 2007 campaign.
The old themes of stop-the-boats and turnbacks, a ramped-up scare campaign about global warming, a promise of new carbon taxes and expensive investments in unreliable renewable energy, even a totally ineffectual 50 per cent emissions reduction by 2030, mirroring Rudd’s promise of a 60 per cent cut by 2050, have all made a comeback.
Recycling is clearly the Labor way, even though the nation is still deeply in debt and borrowing billions to pay for the failed policies of the last Labor government.
With an election looming within the next 12 months, Shorten is pitching his spiel to Greens and the Left and not to average Australians or even traditional Labor Party members.
While Labor’s true believers may have given his speech pro forma applause on Friday there was a distinct lack of spontaneity and enthusiasm.
They had heard it all before. Labor MPs present appeared disengaged, Shorten’s closest supporters looked concerned. As always, the biggest disconnect was between his rhetoric and any cost considerations.
Trying to gloss over the fury within the party over his eleventh-hour backflip on boat turnbacks, Shorten avoided any mention of what he and his supporters euphemistically describe as a policy “option” by introducing shadow immigration spokesman Richard Marles and noting that he will deliver policies that are “safe and humane”.
That opacity covers a lot of water and will be seized upon by people smugglers waiting offshore to resume their lethal trade.
It puts back into play what former Indonesian President Bambang Yudhoyono once called the Australian “sugar on the table”.
The Labor Left has demanded a doubling of the current refugee intake of 13,750 places as a quid pro quo for its support for the turnback policy, an increase on Labor’s promise of a 20,000 per year humanitarian intake it took to the last election of 20,000 per year.
There are obvious implications arising from such a promised increase as doubling the refugee intake would cost something in the region of an extra $2.7 billion over the forward estimates, not including the longer term costs such as welfare dependency, which is a growing transgenerational problem in some communities which have failed to integrate into the general population. For the same amount of money the current social services grants program could be more than tripled.
There is also the issue of the very real anger that such an increase of new arrivals would create in the migrant community where many have been awaiting the arrival of relatives through regular channels for years and are justifiably concerned that their relations would once again lose their places in the migration queue.
There is also real anxiety about the ability to absorb any increase in refugees into the workforce when the current numbers of unemployed are expected to increase with the final phasing out of car manufacturing.
Traditional Labor Party voters will stand to lose the most under an expanded refugee resettlement program unless Shorten and Marles believe that the refugees will largely comprise doctors, engineers, plumbers and electricians.
The same Labor voters will also be stung the most by higher power prices should Labor get elected and institute the Shorten-Rudd energy policy.
Shorten’s grand vision for energy relies on nonsensical claims that renewable energy helps generate lower prices, creates jobs and investment and pays for itself.
If any of this was so, the world’s coal mines would all be closed and there would be no need for further debate.
The truth is all forms of renewable energy are more expensive than traditional coal power and the jobs and the investment aren’t sustainable without heavy subsidies.
Renewables only pay for themselves with a hefty dollop of taxpayers’ funding.
Shorten sees the sunshine that falls on Australia as a great natural advantage, and doubtless it is, but it is worth more as a tourist magnet than as a power generator.
Far greater natural advantages are the cheap and accessible coal and natural gas reserves Labor wants to lock up to the disadvantage of the nation and the power hungry millions in other nations, particularly the Third World countries which actually seem to enjoy as much sunlight as we do but don’t appear to hold it in the same high regard as the Greens and Shorten.
In May, 2007, Rudd laid out the blueprint for his energy policy and carbon tax, stressing the urgency of his idea by saying “an effective emissions trading scheme must recognise the need to act now ... as soon as possible to minimise the costs of inaction because economic modelling clearly shows that early action is far less costly than delayed action”.
The reality was that inaction would have been a lot less expensive and less lethal than Rudd’s energy and border protection policy proved to be then and will be again if Labor should win the next election.
A politicized public school
A poster mocking Obama would never even have been thought of
A POSTER erected on the streets of a small Victorian goldfields town has sparked a war of words about democracy, censorship and public art. The poster was plastered on hoardings opposite the public library in Castlemaine, not far from Bendigo, in March. The artwork was commissioned by the local council.
It features a black and white photograph of Prime Minister Tony Abbott and the words “Australia Needs an Abbott Proof Fence”.
It was put there by art students from Castlemaine Secondary College who had been studying the film Rabbit Proof Fence, the Bendigo Advertiser reports. The students expected it to create some discussion, but never expected it to lead to calls for teachers to be dismissed.
“Education needs to be apolitical,” Mark Jackaman wrote on a petition labelling the artwork “disgusting” and demanding a formal apology. “Shame on your teacher and your school!” Kat Molnar wrote.
“It’s a disgraceful act and any teacher that has allowed this should be dismissed immediately. This is the leader of our country,” David Hawkins wrote.
“Schools are not for POLITICS ... Teachers need to keep their own views to themselves. It’s no wonder that we have hordes of young people leave school still not knowing proper history and correct spelling. Shame,” Shirley Cameron wrote.
Joshua Thom used the phrase "leftist scum” to drive home his opposition.
But the school has been quick to defend its students and its reputation. Principal Mary McPherson told news.com.au she was shocked and surprised by the level of vocal opposition. She said the school encouraged students to think critically.
“We want our students to have opinions and be critical thinkers and to understand about the world. We want students to be prepared to make a difference. We don’t want them to come out compliant, but to challenge and question.”
Ms McPherson said the Abbott Proof Fence poster will not be coming down any time soon.
“In a democratic society, it’s important to question the (government’s) policies,” she said. “It’s part of our school culture. It’s about having your opinions and listening to other opinions.”