Quote Of The Year

Timeless Quotes - Sadly The Late Paul Shetler - "Its not Your Health Record it's a Government Record Of Your Health Information"

or

H. L. Mencken - "For every complex problem there is an answer that is clear, simple, and wrong."

Thursday, May 20, 2021

The Macro View – Health, Economics, and Politics and the Big Picture. What I Am Watching Here And Abroad.

May 20, 2021 Edition.

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In India there are just the barest signs of improvement while SE Asia and Nepal are really failing.

Was\r has broken out between Israel and Hamas and it is getting out of control in terms of lives lost.

In the US seems to be unable to help in the Middle East while at home things continue to stabilise.

In the UK fears are building regarding the risks of a new COVID variant from India that may cause big problems.

In Australia we have had the Federal Budget and are in a major spendathon. Who knows when we will see any level of balance returning but it is clear it is a decade out at least!

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Major Issues.

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https://www.afr.com/policy/foreign-affairs/having-beaten-the-drums-of-war-first-labor-now-falls-silent-20210506-p57pg8

Having beaten the ‘drums of war’ first, Labor now falls silent

Pushback against China long ago ditched prudence for paranoia. But after starting the gung-ho rhetoric, Labor is now saying nothing substantial about Australia’s greatest geostrategic challenge.

James Curran Columnist

May 9, 2021 – 12.48pm

In recent weeks Australian ministers, senior public servants and military commanders have again worked themselves into a lather over China’s intentions towards Taiwan.

The public hears not only the beating “drums of war” but the march of its special forces into the “valley of hell”. In Canberra, tongues once more uncoil. Thought swirls in the very same cauldron as barely concealed racial anxiety. The region watches on as Australia jumps up and down in a time-honoured tradition of trying to put steel in America’s backbone. Asian capitals must either be aghast, amused or simply uninterested by such antics.

These latest remarks join exultation in some quarters that dissent on Australian China policy is steadily being driven into a ditch. Universities and business have been largely silenced.

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https://www.afr.com/world/asia/talking-up-war-over-taiwan-goes-against-australia-s-national-interest-20210509-p57q73

Talking up war over Taiwan goes against Australia’s national interest

Making clear a willingness to fight for democratic Taiwan in its hour of need might advance our status as a good international citizen, but it would also prejudice our own security and prosperity.

Gareth Evans

May 9, 2021 – 9.49am

It is never wise, in foreign affairs and defence policymaking, for emotion to trump reason, for politics to trump objectivity, or for sensitive judgment calls on major national interest issues to be made before they have to be.

Talking up, as so many now are, the prospect of war with China – with Taiwan as the likely trigger point – runs the risk of offending all three prescriptions.

Before pounding more rhetorical drums, and producing ever more strident legislative, executive, diplomatic and military responses, the Morrison government, and those in the commentariat who sail with it, need a reality check. They need to address the key factors in play here – focusing on the world as it is, not as they would ideally like it to be, or irrationally fear that it might be – as summarised in the following checklist.

First, China’s new assertiveness under President Xi Jinping is a given. China makes no secret of its ambition to match the United States as a global player, to carve out its own strategic space in the western Pacific, and to become a regional hegemon to which all its neighbours pay deference.

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https://www.afr.com/policy/economy/business-smarts-is-why-the-insolvency-cliff-has-disappeared-20210506-p57pga

Business smarts is why the insolvency ‘cliff’ has disappeared

There are few ‘zombies’ after the end of JobKeeper because firms have horded cash and restructured debt. The challenge now is seizing opportunities on the other side of hibernation.

Scott Langdon

May 9, 2021 – 3.16pm

Dire predictions about a COVID-19 insolvency “cliff” have failed to come true. Thousands of businesses decimated by the pandemic would never reopen, the doomsayers warned.

Zombie companies would disintegrate when JobKeeper and other federal government stimulus ceased. There would not be enough insolvency practitioners to deal with the avalanche of failed businesses.

Guess what? It didn’t happen. There is no cliff. There will be no deluge of insolvencies. Yes, there will be an increase from 2020 – which was abnormally low due to government intervention and external administrations were down 54 per cent from 2019 – but it will not be in mass proportions.

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https://www.afr.com/markets/equity-markets/australia-is-divesting-from-china-20210509-p57q8b

Australia is divesting from China

Australian investors, in a clean break from the rest of the world, are embedding a sovereign risk premium for China.

Grant Wilson Contributor

May 9, 2021 – 11.43am

Australian investment in China fell by 25 per cent last year. That is unprecedented, and ominous.

Once a year the Australian Bureau of Statistics (ABS) publishes supplemental statistics on Australia’s international investment position.

These provide a comprehensive assessment by country, which is not available in the quarterly balance of payments. We get to see where Australia has invested abroad, and which countries have invested in Australia.

The ABS began this report in 2001, when Australia’s external assets were $542 billion. The stock has increased in every year since.

This has been largely driven by compulsory inflows to our superannuation funds, and by their pursuit of international diversification. At the end of 2020, as disclosed by the ABS on Wednesday, Australia had $3.044 trillion invested abroad.

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https://www.theaustralian.com.au/commentary/greg-hunts-india-ban-highlights-risk-of-outsourcing-parliament-powers/news-story/c49bfa6ed275573e19ecc55c6436d177

Greg Hunt’s India ban highlights risk of outsourcing parliament powers

George Williams

The federal government has sensibly decided not to extend the threat of jail for Australians returning from India. This, though, should not be the end of the matter. The ban imposed by federal Health Minister Greg Hunt reveals deep problems with how laws are made during the pandemic. Australians are right to ask how a minister, at the stroke of a pen late one Friday evening, could subject citizens to imprisonment for returning home, without even the prospect of this being disallowed by parliament.

Parliament is meant to be the nation’s ultimate lawmaker. It has the legitimacy to make laws for the whole community because it is a representative body elected by the people. It also conducts its proceedings and debates in public, meaning that is always subject to scrutiny. The Constitution recognises this by vesting the legislative power of the commonwealth in our federal parliament.

Despite this, exceptions have arisen that permit laws to be made other than by parliament. Most importantly, parliament can delegate its lawmaking power to ministers in the executive government. This reflects the fact that parliament does not have the time to debate the detailed regulations often required to accompany its laws. Sometimes laws must also be made by ministers with urgency and decisiveness, especially at times of war and national crisis.

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https://www.afr.com/policy/foreign-affairs/digging-a-ditch-with-china-20210510-p57qkq

Lines of dispute with China are getting sharper

Josh Frydenberg’s big-spending budget and a booming domestic economy obscure the risks and reality of the fractured relationship with Australia’s biggest trading partner.

Jennifer Hewett Columnist

Updated May 10, 2021 – 5.47pm, first published at 5.36pm

The good news in this big-spending budget will totally overwhelm any pockets of bad news. But China, even if largely unacknowledged, remains central to both.

Record iron ore prices are certainly not the only reason Josh Frydenberg can spend tens of billions of  dollars more yet still boast of an improving bottom line. But with recent prices nearly four times the conservative $US55 a tonne predicted in the last budget, China’s demand for iron ore provides a generous buffer for Canberra’s own largesse.

That open spigot of money from Beijing may not be a permanent feature but the sunny outlook for Australia’s key export and Australia’s budget revenue is unlikely to change in the short term.

Despite its best efforts, China still has no alternative supply yet available either from potential new mines in Africa or from a decimated and distracted Brazil.

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https://www.afr.com/politics/federal/navy-goes-full-speed-ahead-on-south-china-sea-transits-20210507-p57pru

Navy goes full speed ahead on South China Sea transits

Andrew Tillett Political correspondent

May 10, 2021 – 4.13pm

Australian warships have already conducted four transits of the South China Sea this year, intensifying the tempo of operations in the heavily contested waterway amid growing tensions with China.

The navy last week publicised that three of the navy’s Anzac class frigates, Anzac, Ballarat and Parramatta, along with replenishment vessel HMAS Sirius, had sailed through the southern reaches of the South China Sea.

The pace of this year’s transits – four in the first five months – compares with six across all of 2020, Defence officials confirmed.

“[The ships] are currently conducting two separate regional presence deployments aimed at strengthening practical co-operation with regional partners and enhancing interoperability,” the Defence Department said in a statement.

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https://www.afr.com/policy/health-and-education/vulnerable-education-market-must-diversify-away-from-china-20210511-p57qqs

Vulnerable education market must diversify away from China

Julie Hare Education editor

May 11, 2021 – 12.03pm

Education is the only remaining Australian export market to China worth more than $10 billion that Beijing could target without inflicting significant harm on its own economy, a new report says.

Last week’s suspension of the China-Australia Strategic Economic Dialogue and reports that education agents have been instructed to discourage students from coming to Australia have raised alarm that the lucrative $12 billion sector is at risk of collapse following a 23 per cent decline in enrolments in the past year.

Given the potential vulnerabilities of the education market, Australia must adopt a more concerted and co-ordinated approach to diversifying countries from which students are sourced, a report from the National Security College at Australian National University says.

“If there was a significant drop in students from China, the revenue and research loss would be impossible to fully replace through other international markets because China is the largest source of globally mobile students. It would also be costly for the government to step in and fully fund the gap,” the report says.

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https://www.afr.com/policy/economy/industrial-policy-is-back-in-fashion-as-geopolitical-tensions-increase-20210511-p57qpk

Industrial policy is back in fashion as geopolitical tensions increase

The new cold war is driving the fashion for state intervention. But claims industrial policy will also produce better-paying jobs and a more productive economy deserve deep scepticism.

Gideon Rachman Columnist

Updated May 11, 2021 – 9.20am, first published at 9.13am

Old ideas are like old clothes – wait long enough and they will come back into fashion.

Thirty years ago, “industrial policy” was about as fashionable as a bowler hat. But now governments all over the world, from Washington to Beijing and New Delhi to London, are rediscovering the joy of subsidies and singing the praises of economic self-reliance and “strategic” investment.

The significance of this development goes well beyond economics. The international embrace of free markets and globalisation in the 1990s went hand in hand with declining geopolitical tension. The Cold War was over and governments were competing to attract investment rather than to dominate territory.

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https://www.afr.com/companies/mining/morrison-ministers-backing-iluka-rare-earths-hub-20210511-p57qrq

Morrison ministers backing Iluka rare earths hub

Brad Thompson Reporter

May 11, 2021 – 1.01pm

The Morrison government has thrown its support behind an Iluka Resources plan to develop the first fully integrated rare earths supply chain on Australian soil and in doing so create a processing hub for third-party miners.

A letter signed by Trade Minister Dan Tehan and Resources Minister Keith Pitt reveals they met the Iluka board to discuss the rare earths plans in March and formed the view it was a project worthy of backing.

Iluka has yet to put a price tag on the project but Goldman Sachs has estimated it will cost the company about $1.2 billion for a cracking and leaching plant, a refinery producing 20,000 tonnes of rare earths oxides a year and to develop the Wimmera mine in Victoria.

The processing plant would be built at Iluka’s existing minerals sands operations at Eneabba in WA.

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https://www.afr.com/policy/economy/stage-three-tax-cuts-are-on-a-collision-course-with-political-reality-20210512-p57r33

Stage three tax cuts are on a collision course with political reality

The better-off were supposed to get their tax cuts six years after the lower paid got theirs. That’s not how anything is working out.

Chris Richardson Contributor

May 12, 2021 – 1.31pm

The tax cut for higher income earners is toast.

That’s not what the Treasurer said on budget night. But it’s where the raw politics of the moment is taking us.

Let’s back up for a moment. Australia relies much more on personal tax than other nations. To do that, we’ve got a high top marginal rate, and that top rate cuts in at low multiples of average income.

That’s why the top 5 per cent of taxpayers pay a third of all personal tax.

So the government promised tax cuts that paid back bracket creep and simplified the rate scale. And, to improve the politics, low to middle income earners got their cuts six years before higher income earners were scheduled to get theirs.

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https://www.afr.com/policy/economy/income-tax-cuts-endangered-by-big-spending-20210512-p57r70

Tax cuts for high earners ‘doubtful’

John Kehoe Economics editor

May 12, 2021 – 4.02pm

Entrenched budget deficits and debt exceeding $1 trillion will force tax rises, big spending cuts or cancelling income tax cuts for higher earners a few years from now, economists said.

The budget projects annual deficits for another decade, equal to about 1.5 per cent of GDP by 2031-32, or about $30 billion in today’s dollars.

The government unleashed $95 billion of extra spending over five years in the budget, about two-thirds of which is permanent outlays for social programs such as aged care, the National Disability Insurance Scheme, mental health and childcare.

About one-third of the extra spending was temporary, for income tax refunds for low and middle earners and business tax breaks.

Canberra-based Outlook Economics director and former Treasury official Peter Downes said he was surprised by the lack of medium-term fiscal consolidation in the budget and that the affordability of the stage three personal income tax cuts was “very doubtful”.

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https://www.smh.com.au/money/planning-and-budgeting/confusion-reigns-over-various-types-of-financial-advice-20210507-p57pu2.html

Confusion reigns over various types of financial advice

By John Collett

May 12, 2021 — 10.00pm

Consumers do not understand the very real limitations of “general” financial advice and sections of the financial advice industry are calling for it to be renamed “information,” so as to better protect client interests.

General advice, unlike “personal” advice, is not required to take into account the client’s individual financial situation or needs. And more importantly, it does not have to be of any benefit to the consumer.

General advice can sometimes be nothing more than explaining the features of a financial product. That’s no problem if that is all it is. The risk comes when the person providing the information is trying to sell a financial product.

The problem has been underlined in a survey of consumers commissioned by the Australian Securities and Investments Commission (ASIC) that found no measurable difference in consumers’ understanding of general advice – regardless of what it was called.

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https://www.theaustralian.com.au/commentary/thanks-but-no-tanks-for-our-defence-please/news-story/a58174fe08361b96e28981c72c19b94c

Thanks but no tanks for our defence, please

Greg Sheridan

1:00AM May 13, 2021

The most depressing item of expenditure in the federal budget was not even specifically mentioned. But it was there in the weeds, the money carefully tucked away. We are going to spend $2.5bn on buying 75 main battle tanks and some associated kit from the US. And that is just part of more billions of dollars we’re spending on other, hugely heavy (and therefore largely unusable) tracked, manned combat vehicles for the army as part of the Land 400 program.

We know about this purchase partly because, in the vaguest, most generic terms, it was in the defence force structure plan. We know about it more specifically because, as my colleague Ben Packham revealed, the US Defence Security Co-operation Agency announced its approval for the sale. The US has laws which oblige its agencies to announce when such foreign sales have been approved, even if they haven’t been finalised.

Why do I find the tank purchase so utterly depressing? It’s not that they are instruments of war. All civilised human beings hate war. But if you value peace, prepare for war.

It’s not the martial aspect of tanks that is depressing. It is instead the sheer idiocy and the anachronistic frivolity of Australia acquiring tanks and similar heavy, tracked vehicles which can never be of the slightest military use to us. And our doing this at a time of acute strategic challenge in our own region, when our maritime assets are woefully inadequate to the need, reflects the kind of high-minded strategic blindness, the paradigm paralysis and inertia of the defence organisation. Australia has not used a tank in anger since the Vietnam War. Our combat troops were mainly gone by late 1971, so that’s 50 years in which we have had no use for tanks. But we’ve had them all that time.

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https://www.smh.com.au/world/north-america/payne-us-australia-alliance-should-embolden-others-on-china-20210514-p57ruj.html

Payne: US-Australia alliance should embolden others on China

By Matthew Knott

May 14, 2021 — 9.02am

Washington: Foreign Minister Marise Payne says the United States’ vocal support for Australia should embolden other countries to stand up to Beijing when the Chinese government threatens their national values and interests.

Payne held her first in-person meetings with US Secretary of State Antony Blinken in Washington on Friday (AEST) as well as meetings with other top Biden administration officials.

Payne said the Morrison government is pushing for a more thorough investigation into the origins of the coronavirus while maintaining its belief the virus probably emerged from wildlife rather than a Chinese laboratory leak.

At a joint press conference at the State Department, Blinken backed recent remarks by Indo-Pacific Co-ordinator Kurt Campbell that China’s economic coercion of Australia is a roadblock to a normalisation of relations between the rival superpowers.

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https://www.afr.com/policy/economy/markets-are-losing-faith-in-central-banks-20210514-p57rwl

Markets are losing faith in central banks

Bond vigilantes may stop believing the US central bank’s assurances that inflation is under control and take matters into their own hands, writes Ambrose Evans-Pritchard.

Ambrose Evans-Pritchard

May 14, 2021 – 10.16am

The US is engaged in an astonishing monetary experiment. The Federal Reserve is still conducting quantitative easing even as the rate of headline inflation hit 4.2 per cent.

Core inflation has risen to a 25-year high of 3 per cent, recording the biggest jump in a single month since 1981. Factory gate inflation has been running at a 7.1 per cent annual growth rate over the last six months even before full reopening.

The Biden administration is running a budget deficit of 13 per cent of GDP this year even though the output gap closed in April and large parts of the economy are overheating. Small firms cannot find workers. Unfilled job openings have reached a record high.

Yet interest rates are zero and the Fed is still buying $US120 billion of bonds each month, directly financing part of Washington’s “war economy” debt issuance. It is persisting even though the broad M3 money supply has grown at 24 per cent over the last year. It is downplaying all evidence of pent-up inflation as “temporary”.

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https://www.smh.com.au/politics/federal/job-seekers-to-be-switched-to-online-service-in-hidden-1-1-billion-budget-saving-20210514-p57s2y.html

Job seekers to be switched to online service in hidden $1.1 billion budget saving

By David Crowe

May 15, 2021 — 5.00am

A hidden $1.1 billion saving has sparked fears of cuts to services for Australians out of work despite a federal pledge to drive the unemployment rate to record lows by helping people find new jobs.

The efficiency drive will shift 1.2 million job seekers to an online service in a bid to replace face-to-face advice from employment service providers paid by the government to help the unemployed.

The savings were included in a series of measures listed in the federal budget on Tuesday night outlining sweeping changes to the JobActive system used for two decades to place people in work.

Community and employer groups are concerned the plan flouts a 2018 report to the government that said all the savings from the online model should be invested in better services for the long-term unemployed.

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https://www.smh.com.au/business/the-economy/we-need-to-wake-up-to-the-new-economic-normal-20210513-p57rsf.html

We need to wake up to the new economic normal

Ross Gittins

Economics Editor

May 14, 2021 — 11.35am

What this week’s budget proves is that fiscal (budgetary) stimulus really works, something many economists had come to doubt over the four decades in which monetary policy – the manipulation of interest rates – was the main instrument used to manage the economy’s path through the business cycle.

That potency’s the main reason the economy has rebounded from last year’s government-ordered deep recession far earlier and more strongly than any economist (or I) had expected.

It’s now clear that, by the March quarter of this year, the economy’s production of goods and services – real gross domestic product – had returned to its level at the end of 2019. The level of employment was a fraction higher than before the virus struck, and the rate of unemployment had gone most of the way back to its pre-virus 5.1 per cent.

And it was Scott Morrison’s massive boost to government spending – JobKeeper, the temporary JobSeeker supplement and all the rest – “wot done it”.

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https://www.smh.com.au/national/i-no-longer-feel-like-australia-is-my-home-the-people-quitting-our-shores-20210514-p57s3y.html

‘I no longer feel like Australia is my home’: The people quitting our shores

By Latika Bourke

May 16, 2021 — 5.00am

London: Cristina Williams came to Australia as a UN war refugee from El Salvador aged 10.

But she says the country that welcomed her with open arms is unrecognisable to her now as a result of harsh border bans that have trapped citizens inside the country, locked tens of thousands out and culminated in the threat to jail and fine any Australian who tries to flee coronavirus-ravaged India. Some have dubbed it Fortress Australia.

While much of the focus of Australia’s border closure has been on the difficulties citizens have returning home, lesser-known are the stories of the growing number of Australians looking to leave permanently.

“I was a UN war refugee. Australia was a place that rescued my family when we were in need but that Australia is dead,” 41-year-old Williams says.

“Australia has now taken other families that are suffering and instead of finding a way to get them here they’ve turned their back. They’re actively shutting people out,” she says, fighting back tears.

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https://www.smh.com.au/national/grieving-for-freedom-why-many-of-us-feel-trapped-inside-fortress-australia-20210513-p57rsd.html

Grieving for freedom: Why many of us feel trapped inside fortress Australia

By Dr Nancy Jiang

I learnt recently that one in four Australians is born overseas. I am one of them. My mother was granted political asylum by the Hawke government after the Tiananmen Square massacre and I have called Australia home since I was 10 years old.

I arrived with no preconception of what Australia was like and not a single word of English. As I learnt the language and the ways of society, I became proud to call myself an Australian. I went to school with people from incredibly diverse backgrounds. I became a medical doctor, and then an intensive care specialist. I have always been extraordinarily grateful for the life-changing move that my parents made and the opportunities I have had growing up in the freedom of the West.

However, that has changed. For the first time in the last three decades, I feel a growing sense of unease as the COVID-19 pandemic unfolds.

My father usually visits his elderly mother in China every year, he and his sisters having a roster to care for her. The roster, like many other things in COVID, has been thrown out the window. He hasn’t seen her for 18 months and his anxiety is growing. He is scared of not being able to return to Australia, that the borders could slam shut any time and that he would not have access to medical care for his own health conditions. He feels imprisoned in the country that he calls home because my grandmother is frail but not imminently dying. Apparently only being almost-dead or actually dead generates the amount of grief required for the government to let us out of prison.

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https://www.smh.com.au/national/truth-telling-paves-the-way-to-a-brighter-future-20210514-p57s3z.html

Truth-telling paves the way to a brighter future

If Victoria’s story is a book, then there is a whole chapter which is the Indigenous experience – the full story of which has never been told.

But the recent launch of Victoria’s truth-telling commission – the Yoo-rrook Justice Commission – offers the chance to tell it, to ensure that we fill in the gaps of the story of Victoria.

The commission will bring the good, the bad and the ugly; imperatives that will help us identify who we are and importantly, where we are going.

My hopes? That truth-telling will move to restore Indigenous culture and identity and empower Indigenous people to take control of their future; financially, economically and socially.

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https://www.theage.com.au/politics/victoria/we-must-abandon-fortress-australia-at-some-point-says-sutton-20210515-p57s7h.html

We must abandon fortress Australia at some point, says Sutton

Victorian Chief Health Officer Brett Sutton has told healthcare workers in a private seminar that the country will reach a critical juncture where it must abandon its fortress Australia approach to COVID-19 and “make a call on letting it run” once vaccinations have been widely offered.

In recordings from two recent events leaked by government insiders, Professor Sutton also revealed he had been “shocked” at the Victorian government’s “steadfast” refusal to adapt and acknowledge mistakes during the coronavirus pandemic.

Professor Sutton told the audience at an event in late April that vaccinations were not progressing as fast as he would like and Australians were lacking urgency because of the country’s success against coronavirus.

The Chief Health Officer indicated a time would come when the Commonwealth would have to reopen international borders and accept there would be cases of COVID-19, although the impact of those cases would be stifled by vaccinations.

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https://www.theaustralian.com.au/inquirer/defence-spending-needs-to-match-risk-of-conflict/news-story/63cf852d0073044110fb22b3644518dd

Defence spending needs to match the risk of conflict now

If Beijing wanted to slow down the growth of Australian-US defence co-operation in the Top End, surely a very clever way to do it would be to take control of the area’s most viable port ...

By Peter Jennings

May 15, 2021

In an expansionary budget, one area that felt a bit underdone was Defence. Here, the government delivered what it promised 12 months ago: $44.6bn, an increase over last year’s budget of 4.1 per cent in real terms.

At any time in the last 25 years a Defence budget growing at that level would have been welcome. But now Australia and the wider region faces the direst strategic outlook perhaps since the end of World War II.

It’s clear that Scott Morrison and his ministers understand that the region is facing a crisis brought on by an increasingly bellicose Chinese Communist Party. Taiwan is the immediate flashpoint, with the level of risk peaking in perhaps four to five years’ time. In that period, according to the US Defence Department, the People’s Liberation Army will gain a strong military edge over the Straits of Taiwan in air power, missiles and ships.

Would Xi Jinping risk his own future, as well as that of the Chinese Communist Party, to stage an attack on Taiwan? Xi has learned to turn risky situations to his advantage. In the illegal annexation of the South China Sea, in cyber spying and intellectual property theft, the imposition of Communist authority in Hong Kong and in the economic coercion of Australia, Xi took significant risks to strengthen his rule and largely got away with them.

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Coronavirus And Impacts.

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https://www.afr.com/world/asia/we-will-never-know-the-true-extent-of-india-s-pandemic-tragedy-20210507-p57psd

We will never know the true extent of India’s pandemic tragedy

Emma Connors South-east Asia correspondent

May 7, 2021 – 3.05pm

The crisis in India’s hospitals is likely to run well into July, even if the second wave of COVID-19 infections peaks this month – or at least that is the best guess forecasters can glean from limited data.

For national and international policymakers trying to chart a path through India’s pandemic disaster, the reported figures are an indication of direction, rather than a true measure of the disaster engulfing the country, observers say.

India reported a record 412,262 new infections and 3980 deaths on Thursday. Some predict the nation will report 500,000 new cases in a single day before infections start to diminish. The true figures are likely to be much higher – as much as 20 times, according to a prominent mathematical modeller, Professor Gautam Menon.

In an interview with Indian news site The Wire, Professor Menon said while reported cases would peak at between 500,000 and 600,000, the number of undetected daily cases would be between 8 million and 10 million a day.

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https://www.afr.com/policy/economy/global-solutions-require-help-for-two-thirds-of-the-world-20210510-p57qlb

Global solutions require help for two-thirds of the world

Like curbing global warming, containing the global pandemic requires tackling the vast inequalities between rich and poor countries that have been exacerbated by COVID-19.

Kenneth Rogoff Columnist

May 11, 2021 – 10.08am

What is remarkable about the increase in nationalist sentiment across the developed world in recent years is that it is occurring at a time when many of today’s most pressing challenges, including climate change and the COVID-19 pandemic, are fundamentally global problems demanding global solutions.

And the anger brewing among citizens of vaccine-poor countries – basically, the two-thirds of humanity living outside the advanced economies and China – could come back to haunt the rich world all too soon.

US President Joe Biden’s ambitious plans to address inequality in America are to be welcomed, provided the administration succeeds in covering the long-run costs through higher taxes or stronger growth, admittedly two big ifs.

So, too, is the smaller but still significant Next Generation EU scheme to help European Union members such as Italy and Spain that have been disproportionately affected by the pandemic.

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https://www.theaustralian.com.au/world/the-times/coronavirus-swedens-lockdown-delay-cost-2000-lives/news-story/a292e0a8adaee9dc083a975409a02386

Coronavirus: Sweden’s lockdown delay ‘cost 2000 lives’, study reveals

Sweden could have prevented nearly 40 per cent of the coronavirus deaths in its first wave had it imposed a timely lockdown, a study suggests.

While neighbouring governments closed shops, bars, schools and restaurants, and in some cases ordered citizens to stay in their homes, Sweden mainly relied in the early stages of the pandemic on recommendations and a ban on gatherings of more than 50 people.

Over the first six months nearly 6000 Swedes died of COVID-19, one of the highest per capita death rates in Europe at that time and substantially worse than other Nordic states.

Three economists in Germany have now estimated that at least 2,000 of those lives might have been saved with a prompt lockdown.

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https://www.theaustralian.com.au/world/coronavirus-pandemic-wipes-out-2-decades-of-life-expectancy-improvement/news-story/a0331fb8cd44eee3c70dfd917fe7e6c6

Coronavirus pandemic wipes out 2 decades of life expectancy improvement

Adam Creighton

The coronavirus pandemic has wiped out almost two decades of improvement in US life expectancy, according to new research that finds the chance of dying over the last 12 months was the same as it was in 2001.

Before COVID-19 emerged an 80-year-old man in the US had a chance of dying in the next 12 months of 5.82 per cent, according to JPMorgan analysis of official statistics, compared to 4.28 per cent for a similarly aged woman.

“Due to the COVID-19 pandemic, these probabilities rose to around 6.76 per cent and 4.83 per cent respectively, increases of 16 per cent, and 13 per cent,” said David Mackie, a JPMorgan analyst.

“This further widened the gap between mortality risk for males and females, because at all ages males have been more likely to die of COVID-19 than females,” he added.

Viewed another way, the increase in mortality risk for men aged between 75 and 84 of 1.15 percentage points was 64 per cent greater than the increase for women (0.71 percentage points).

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https://www.afr.com/politics/federal/australia-snaps-up-25m-doses-of-moderna-vaccine-20210513-p57reu

Australia snaps up 25m doses of Moderna vaccine

Hans van Leeuwen

May 13, 2021 – 2.37am

London | The Morrison government has snapped up 25 million doses of the Moderna vaccine, in a surprise boost to the nation’s COVID-19 vaccination rollout.

The deal will deliver 10 million doses of Moderna’s standard vaccine this year and 15 million of its booster vaccine candidate next year, the US-based pharmaceutical giant said late on Wednesday (AEST).

The company said it would “shortly” submit an application to the Therapeutic Goods Administration for its two-dose messenger RNA vaccine, which uses the same technique as the Pfizer/BioNTech jab.

The news came after the government announced in the budget that it planned to spend an unspecified amount bankrolling the creation of immediate, large-scale manufacturing capability for mRNA drugs in Australia.

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https://www.smh.com.au/politics/federal/step-out-of-the-covid-bunker-scientists-say-australians-should-embrace-more-risk-20210512-p57rde.html

Step out of the COVID bunker: Long border closure is questioned by experts

By David Crowe

May 12, 2021 — 7.17pm

Australians should embrace a different approach to risk from the coronavirus as millions of people sign up for vaccines, leading scientists said in the wake of a contentious budget assumption that could keep international borders closed until the middle of next year.

The warning will fuel a political debate over the vaccine rollout and border controls as Prime Minister Scott Morrison defends the big-spending federal budget against Labor accusations that he is not doing enough to speed up vaccinations and expand the capacity of the quarantine regime.

While the budget did not include new spending on quarantine facilities, Treasurer Josh Frydenberg signalled on Wednesday the government was open to a proposal from Victoria, and potentially other state governments, to build more facilities like the Howard Springs quarantine centre near Darwin.

NSW Treasurer Dominic Perrottet challenged the federal timeframe on borders by calling for a clear roadmap to opening Australia to the world, as business leaders also warned about the damage from turning away travellers and banning citizens from leaving the country.

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https://www.theage.com.au/national/who-s-counting-on-us-to-stop-the-next-pandemic-20210512-p57rdr.html

WHO’s counting on us to stop the next pandemic

By Brendan Crabb and Jane Halton

May 13, 2021 — 12.00pm

The pandemic has upturned many orthodoxies and expectations. But in this era of wild uncertainty, one thing is sure. There will be another pandemic.

That is why Australia’s enlightened self-interest demands a greater financial and intellectual contribution to global health efforts. Especially the reconstruction of the World Health Organisation.

The budget did little new for those who expect Australia to play its part in global humanitarian and health efforts. While the commitment to sharing vaccines from our own stockpile with poorer nations was laudable, there was no enduring increase to the overseas development aid budget. In fact, the permanent aid spend is projected to drift lower in the years to come and we are now ranked one of the least generous aid donors in the OECD, committing just 0.19 per cent GNI to foreign aid.

However, we do balance against this is the government’s habit of funding specific out-of-budget commitments. These include the half-billion-dollar commitment to Pacific and south east Asia vaccination, a four-year $485 million package of support for south east Asia, and an $80 million COVAX Advanced Market Commitment – the global vaccine co-ordination effort.

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https://www.theaustralian.com.au/world/counting-the-true-dead-of-pandemic/news-story/6afd567fe5ce32c1f6da59ef6ebe8dfb

Counting the true dead of pandemic

The Economist

Official figures say there have been 55,000 COVID-19 deaths in South Africa since March 27 last year. That puts the country’s death rate at 92.7 per 100,000 people, the highest in sub-Saharan Africa. It is also a significant underestimate — as, it seems safe to infer, are all the other African data on the disease.

Over the year to May 8 the country recorded 158,499 excess deaths — that is, deaths above the number that would be expected on past trends, given demographic changes. Public-health officials feel confident that 85-95 per cent of those deaths were caused by SARS-COV-2, the COVID-19 virus, almost three times the official number.

The discrepancy is the result of the fact that, for a death to be registered as caused by COVID-19, the deceased needs to have had a test and been recorded as having died from the disease. Although South Africa does a lot of testing compared with neighbouring countries, its overall rate is still low. And the cause of death is unevenly recorded for those who die at home.

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Climate Change.

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https://www.smh.com.au/environment/climate-change/to-power-to-our-emissions-target-we-must-double-our-energy-research-20210512-p57r54.html

To power to our emissions target, we must double our energy research

By Luke Heeney and Daniel D’Hotman

May 12, 2021 — 1.14pm

Australia is increasingly isolated on climate action. If we don’t increase our ambition soon, we will feel the heat diplomatically, economically, and physically.

Our largest trading partners are making bigger, bolder and more expensive commitments to decarbonisation. With their patience for laggards running out, Australia needs to get serious about decarbonisation. Even with this budget, we have more work to do.

Our policy of “technology not taxes” is unlikely to get us to net-zero by 2050. And if we don’t put our money where our mouth is, we probably won’t get close. Decarbonisation will not be free. “Technology not taxes″ simply means taxpayers will wear the cost of developing and commercialising low-emissions technologies.

We could develop these technologies more cheaply. An economy-wide carbon price would help to ‘pull’ technologies through and amplify the effectiveness of research and development spending. By refusing to price carbon, we make our task more difficult and more costly. So, we will need to spend even more on energy R&D to subsidise clean technologies until they reach cost parity with dirty alternatives.

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Royal Commissions And The Like.

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https://www.theaustralian.com.au/life/budget-2021-aged-care-funding-and-what-it-means-for-you/news-story/4c5f741934841212c8ef4dc587d043f8

Budget 2021: Aged care funding and what it means for you

Stephen Lunn

So you’ve started to think about aged care. It might be for you, one of the fast-growing cohort of older Australians. It might be for a loved one, who could do with some help to stay living in the family home or has reached the stage where ­residential care might be a safer option.

Or it simply might be that as a taxpayer, you wonder how much of the almost $18bn in extra funding committed to the aged-care sector in Tuesday’s federal budget will be spent on care for the elderly and how much might end up lining the pockets of the more unscrupulous aged-care providers.

The Morrison government used the budget to respond to the final report of the aged-care royal commission, which mapped out a five-year path to reform for many aspects of the sector. The response cleared up many questions about how aged care will be delivered in coming years, but left many hanging. We take a look at some of those questions.

I need support to stay in my own home, but there’s a big waiting list for home-care packages. Does this budget help me?

A qualified yes. The budget is spending up big on care in the home, committing $6.5bn to fund 80,000 additional home-care packages over the next two years. It is the largest ever investment in home care.

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National Budget Issues.

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https://www.afr.com/politics/federal/will-the-budget-be-a-requiem-for-economic-responsibility-20210506-p57pgc

Will the budget be a requiem for economic responsibility?

If Josh Frydenberg eschews more pump-priming and makes tough fiscal choices to help drive investment and productivity, Tuesday night could be the Treasurer’s finest hour.

Stephen Anthony Contributor

May 9, 2021 – 1.42pm

The federal budget on Tuesday night will be a requiem to the one-time robustness of Australia’s medium-term macroeconomic frameworks, both fiscal and monetary.

It is sobering to think that just 18 months ago Treasurer Josh Frydenberg was on the brink of delivering a budget surplus. Reserve Bank of Australia governor Philip Lowe had ruled out using unorthodox monetary policy. C’est la vie.

Both the Treasurer and RBA governor can be congratulated for helping the national economy ward off much of the adversity associated with the coronavirus tragedy. It also seems their policy mix has created a mini-boom on the other side. But there is a long-term price to be paid for all the necessary remedial action.

Policy is continuing to fuel the 30-year, tax concession-fuelled boom in east coast residential real estate. This has combined with the unprecedented global monetary expansion of the US and other majors (ex-China) to support stockmarket reflation and resurgence.

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https://www.afr.com/politics/federal/fadden-s-horror-1951-budget-is-a-lesson-in-sacrifice-20210506-p57pg7

Fadden’s ‘horror’ 1951 budget is a lesson in sacrifice

The past is a foreign country. But the chief lesson of the 1951 budget is that prioritising short-term economic and political imperatives can ultimately require drastic corrective action.

May 9, 2021 – 5.53pm

The past is a foreign country, and Australia is a very different place compared to 70 years ago. But the story of the “horror” 1951 federal budget is relevant to the macroeconomic policy challenges Australia faces after the Great Pandemic. The chief lesson is that prioritising short-term economic and political imperatives can, bit by bit, get out of control and ultimately require drastic corrective action.

Elected in 1949 on a free enterprise, anti-central-planning platform, the Menzies government lifted the wartime controls on the economy that the Chifley Labor government had maintained long after hostilities ceased, amid fears of a repeat boom-bust cycle catapulting the country into another depression.

The Menzian ambition to end austerity and govern amid prosperity led it to depreciate and undervalue the currency to fire up commodity exports in a country that then rode on the sheep’s back rather than on truckloads of iron ore. But when this collided with the Korean War wool boom, Sir Arthur Fadden moved to pull back the runaway economy and dampen inflationary pressures.

As editor-in-chief Michael Stutchbury’s account on the features pages sets out, Treasurer Fadden’s punitive one-third hiking of the tax burden on households and businesses attracted the editorial ire of the fledgling Financial Review. Less than two months into its existence, Australia’s first national newspaper put a stake in the ground for private enterprise, which it feared was set to be supplanted as the engine of growth by tax-funded public sector “development”.

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https://www.afr.com/policy/health-and-education/why-the-budget-won-t-deal-with-universities-existential-threats-20210505-p57p1a

Why the budget won’t deal with universities’ existential threats

Andrew Norton Professor in the practice of higher education policy

May 10, 2021 – 12.02am

Decisions about opening Australia’s borders to international students matter more for higher education than anything likely to be in Tuesday’s budget.

But the 2021-22 budget is still important for students, research and the survival of some higher education providers.

In one early announcement, Education Minister Alan Tudge promised help for private higher education providers hit by falling international student numbers.

Regulatory charges will be paused again and 5000 additional domestic student places funded for undergraduate certificate and graduate certificate courses.

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https://www.smh.com.au/business/the-economy/years-of-neglect-won-t-make-it-easy-to-get-wages-up-20210509-p57q6v.html

Years of neglect won’t make it easy to get wages up

Ross Gittins

Economics Editor

May 10, 2021 — 5.00am

In Tuesday night’s budget, it will be important to note its assumptions about when our international borders will be back to functioning normally. Not because they’re sure to be right, but because our borders will have a big impact on Scott Morrison’s new strategy of getting unemployment down to get wages – and thus living standards – up.

As the Commonwealth Bank’s Gareth Aird has reminded us, fancy calculations about how low unemployment has to fall before labour shortages force employers to bid up wages, rest on the (usually reasonable) assumption that our borders will be working the way they always have.

If our borders are temporarily closed to immigration and overseas students, however, the point where skill shortages emerge may arrive a lot earlier than the fancy calculations suggest. What’s more, it’s become clearer that the day where our border conditions return to normal may be a lot further into the future than we’d first hoped.

It will be interesting to search the budget papers for signs that these complications don’t come as news to the economic managers, but have been built into the new strategy’s design.

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https://www.afr.com/politics/federal/a-fiscal-revolution-in-a-zero-interest-rate-world-20210510-p57qkc

A fiscal revolution in a zero interest rate world

Josh Frydenberg has delivered a Labor-like budget that the Opposition could only dream of presiding over.

John Kehoe Economics editor

May 11, 2021 – 7.31pm

This big-spending budget exposes a revolution in macroeconomic policy management that turns the old fiscal rules upside down and rewrites the play book in a near-zero interest rate world.

The justifications for a more activist fiscal policy are economic and political, a convenient confluence for a government facing an election in the next 12 months.

In a changing of the guard, economic power has decisively shifted from the RBA’s Martin Place headquarters in Sydney to the Treasury and Parliament in Canberra.

With official interest rates anchored at 0.1 per cent and monetary policy virtually exhausted, a Liberal Treasurer has acted on the advice of Treasury and the RBA that the budget must continue doing the heavy lifting – even after the major COVID-19 economic shock has passed.

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https://www.afr.com/politics/federal/casual-approach-to-the-deficit-leaves-australia-hostage-to-fortune-20210510-p57ql0

Australia is now a hostage to fortune

Australia has gone straight back to its recurring bad habit: the permanent spending of any temporary budgetary gain. It just assumes everything will keep going the government’s way.

May 11, 2021 – 9.10pm

Australia under the Morrison government and Treasurer Josh Frydenberg has pulled off an astonishing recovery from the pandemic.

Last year’s emergency spending put a $311 billion backstop under the economy, and the Reserve Bank slashed interest rates to practically zero.

The reward has been the sharpest of V-shaped rebounds. GDP growth is now forecast to be 4.2 per cent in 2021-22, up from the December estimate of 3.5 per cent. The ASX is at record highs. So is the NAB business confidence forecast. And so is the gusher of an iron ore price which is touching $US230 a tonne – against a price assumption in the budget of $US55 by March 2022.

Some of the budget deficit pressure has been relieved too. Forecast tax receipts over the next four years are up by $84.5 billion on the revenue expected in December, driven by rising iron ore prices and rapidly recovering employment.

The October budget, just seven months ago, forecast deficits of $480 billion over the four-year forward estimates, now down to $342 billion, with the forecast $213 billion deficit for this 2020-2021 year cut to a slightly less eye-watering $162 billion.

Unlike the US and the UK, the government is not raising tax rates to try to cover the damage. The 23.9 per cent tax take to GDP ceiling is still in place.

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https://www.smh.com.au/politics/federal/missed-it-by-that-much-good-effort-at-marketing-misses-the-main-chance-20210507-p57pyr.html

Missed it by that much: good effort at marketing misses the main chance

By Ross Gittins

May 11, 2021 — 7.31pm

This is the lick-and-a-promise budget. The budget that proves it is possible to be half pregnant. Which makes it the couldabeen budget. Scott Morrison and Josh Frydenberg had the makings of a champion of budgets, but their courage failed them.

It’s not a bad budget. Most of the things it does are good things to do. Its goal of driving unemployment much lower is exactly right. Its approach of increasing rather than cutting government spending is correct, as is its strategy of fixing the economy to fix the budget.

But having fixed on the right strategy Morrison, reluctant to be seen as Labor lite, has failed in its execution. Economists call this “product differentiation”; others just call it marketing.

Some are calling this a big-spending budget. It isn’t. Frydenberg has kept his promise that it would be no “spendathon”. As a pre-election vote-buying budget it hardly rates. Its “new and additional tax cut” for middle-income earners of up to $1080 a year turns out to be not a tax cut but the absence of a tax increase.

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https://www.smh.com.au/business/companies/good-science-into-products-cochlear-csl-celebrate-patents-win-in-budget-20210512-p57r36.html

‘Good science into products’: Cochlear, CSL celebrate patents win in budget

By Emma Koehn

May 12, 2021 — 10.32am

Biotech heavyweights Cochlear and CSL are celebrating a long-fought win for concessions that would see income from Australian patents for biotechnology products taxed at a lower rate.

Tuesday’s budget papers unveiled plans for a ‘patent box’, a policy to make income earned from Australian-developed and registered patents taxed at a concessional rate of 17 per cent from July next year, almost half the 30 per cent corporate tax rate.

It’s a measure the biotechnology sector has lobbied for over the past decade, with chief executives including Cochlear’s Dig Howitt long arguing that introducing a patent incentives scheme would stop intellectual property developed in Australia from moving offshore to more countries with more attractive tax settings.

Mr Howitt welcomed news of the scheme, saying the flow-on effects of keeping home-grown IP onshore were significant.

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https://www.smh.com.au/politics/federal/generations-of-budget-deficits-warnings-debt-will-never-end-without-tax-retirement-overhaul-20210512-p57r8g.html

‘Generations of budget deficits’: Warnings debt will never end without tax, retirement overhaul

By Shane Wright

May 13, 2021 — 5.00am

Australia faces “generations” of deficits following the 2021-22 federal budget, with economists warning that without far-reaching policy reform the country could be left mired in debt that will weigh on taxpayers forever.

Macroeconomics chief economist Stephen Anthony said the budget would never recover from the spending splurge unleashed by the coronavirus pandemic, with the government unwilling to engage in real reforms that would not only cover ongoing deficits but also help boost wages to ordinary workers.

Treasurer Josh Frydenberg has forecast a deficit of $106.6 billion in 2021-22 after a record shortfall of $161 billion this financial year. By 2024-25, the deficit is still expected to be around $57 billion.

But longer-term forecasts in the budget show the deficit ongoing well into the next decade. By 2031-32, the deficit is forecast to be 1.3 per cent of GDP, or about $42 billion.

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https://www.afr.com/politics/federal/why-the-budget-spendathon-makes-me-nervous-20210512-p57rdb

Why the budget spendathon makes me nervous

Governments are at their worst when having to hand money out fast. Witness pink batts, the early days of NBN and, dare I mention, sports rorts.

Tom Burton Government editor

May 13, 2021 – 2.42pm

The federal budget’s historic return to big government presents both a major opportunity and challenge for bureaucratic leaders to demonstrate the importance and value of the public sector in modern Australia.

After years of concern about the public sector crowding out business investment and the building up of long-term public liabilities, the need to support the response and recovery to COVID-19 has seen the federal government open the purse strings to nearly $600 billion of spending in the coming financial year.

For context, that’s nearly double in nominal dollars what the then Rudd government committed in its response to the 2008 financial crisis and around 30 per cent of projected GDP.

Crudely, government is being called on to carry nearly one-third of the economic load over the next 12 months, an enormous responsibility to get right.

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https://www.smh.com.au/politics/federal/albanese-promises-10-billion-fund-to-cut-housing-costs-for-workers-20210513-p57rs6.html

Albanese promises $10 billion fund to cut housing costs for workers

By David Crowe

May 13, 2021 — 7.32pm

Labor has promised a $10 billion fund to cut housing costs for workers in a response to the federal budget that seeks to galvanise voter concerns about soaring house prices and rising rents.

Opposition Leader Anthony Albanese also pledged more incentives for employers to hire 10,000 apprentices in fields like renewable energy, accusing the federal government of doing too little to help younger Australians.

Opposition leader Anthony Albanese is delivering Labor's response to the 2021 federal budget in Parliament.

He also challenged Prime Minister Scott Morrison to do more to protect women from sexual harassment, saying a Labor government would pass laws to place a “positive duty” on employers to eliminate sex discrimination, harassment and victimisation.

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https://www.afr.com/politics/federal/wild-ride-as-frydenberg-revolutionises-the-budget-rules-20210513-p57rpc

Wild ride as Frydenberg revolutionises the budget rules

This week’s free-spending budget marks a seismic moment in Australian politics – opening up dangerous traps for Labor and the Coalition.

Jacob Greber and Andrew Tillett

May 15, 2021 – 12.00am

For the best part of the past quarter century, the fortunes of Australian treasurers have flourished or died by the iron ore price.

As this week’s budget demonstrated for anyone who had forgotten: revenue from China for the steel-making dirt and the rivers of federal taxes it generates is still the great wildcard of Australia’s political economy.

It giveth and taketh away irrespective of the brilliance, or otherwise, of the individuals who manage the budget.

But it also creates traps. It can give treasurers false confidence or excessive pessimism. The country suffers under both delusions.

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https://www.afr.com/politics/federal/warning-off-budget-funds-could-undermine-credit-rating-20210514-p57rzw

Warning ‘off-budget’ spending could hit AAA rating

Andrew Tillett and John Kehoe

May 14, 2021 – 5.32pm

A leading credit rating agency has warned Labor’s plans to inject up to $45 billion into special investment funds for housing, the energy grid and manufacturing could weigh on Australia’s AAA rating.

While the so-called “off-budget” spending has the political advantage of appearing to be fiscally responsible by not increasing the deficit, the investments would still be counted as debt by credit agency S&P Global Ratings.

Labor is exploring using more off-budget measures to pay for its policies, while Opposition Leader Anthony Albanese also flagged policies to help people buy their own homes as he seeks to make soaring house prices a key campaign theme.

The centrepiece of Mr Albanese’s budget reply speech on Thursday night was the creation of a $10 billion fund to help build 30,000 low-cost houses, including those for front-line workers locked out of inner-city suburbs near where they work, and for emergency accommodation for partners and children fleeing domestic violence.

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https://www.afr.com/politics/federal/australians-are-stuck-in-a-gilded-cage-until-the-election-20210513-p57rkt

Australians are stuck in a gilded cage until the election

The budget represented one of the most spectacular, and opportunistic, volte-faces in political ideology in at least the past 30 years.

Laura Tingle Columnist

May 14, 2021 – 4.21pm

Josh Frydenberg’s third budget speech had barely been delivered in the House of Representatives on Tuesday night when the focus of the budget coverage seemed to become overwhelmed by the COVID-19 vaccine rollout and what it meant for when borders would open and the economic outlook.

Given that the budget represented one of the most spectacular, and opportunistic, volte-faces in political ideology in at least the past 30 years, the government may have been quietly grateful for this.

The debt-and-deficit parsimony that has driven the Coalition’s often ideological cuts to government spending, and which drove the Coalition’s relentless political attack on Labor, has been put into the cupboard.

It has been stashed away in deference to a new-found homage to, dare one say, “jobs and growth”, even as the spending still flowing through the economy from last year’s emergency measures is set to deliver a better jobs outcome than existed in the pre-pandemic, and debt and deficit, era.

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https://www.smh.com.au/politics/federal/libs-excise-fiscal-rectitude-from-their-political-arsenal-20210514-p57s4q.html

Libs excise fiscal rectitude from their political arsenal

Peter Hartcher

Political and international editor

May 15, 2021 — 5.30am

An economist who once worked for the federal Treasury, Stephen Anthony, describes the Morrison government’s federal budget this week as “a requiem”. But whose funeral is it?

Responsible government financial management, for starters. The Liberals who contemptuously dismiss this budget as “Whitlamesque” do Gough a grave injustice. As a proportion of the economy, the debt and deficit in this Josh Frydenberg budget is vastly bigger than anything Whitlam committed.

The new term of abuse for fiscal wantonness could be “Frydenbergian”. Or “Morrisonian”, depending on who wants to take responsibility.

Whitlam’s biggest deficit was equivalent to 1.8 per cent of Australia’s economy, or GDP. This year’s will be equal to 5 per cent of GDP, according to the budget papers. More than double.

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https://www.smh.com.au/politics/federal/costello-warns-government-not-to-spend-too-much-following-record-deficit-20210514-p57s1b.html

Costello warns government not to spend too much following record deficit

By Jennifer Duke and Rob Harris

May 14, 2021 — 11.30pm

Peter Costello has warned Treasurer Josh Frydenberg that record federal government spending cannot continue and there needs to be structural reform to both grow the economy and repair the budget.

The former treasurer’s advice at the traditional post-budget Higgins 200 breakfast in Melbourne on Friday follows the forecasting of a $106.6 billion deficit in 2021-22 after a record $161 billion shortfall this financial year.

The 2021-22 budget outcome is in stark contrast to the federal government’s pre-coronavirus view that deficits were unsustainable and the budget would be “back in the black” by now. It has instead unveiled a $74.6 billion spending plan aimed at getting the nation’s economy surging post-pandemic, on top of the huge outlays it made during the crisis to save jobs. By 2024-25, the deficit is expected to be about $57 billion.

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Health Issues.

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https://www.smh.com.au/national/queensland/queensland-nurse-to-patient-ratios-saved-lives-research-finds-20210511-p57qxw.html

Queensland nurse-to-patient ratios saved lives, research finds

By Stuart Layt

May 12, 2021 — 8.30am

Scientific research has backed up the effectiveness of nurse-to-patient ratios introduced by the Queensland government, showing they demonstrably prevented re-admissions, shortened hospital stays, and reduced costs.

The state government introduced the measure in 2016, ensuring a minimum number of nurses-to-patients was to be maintained across Queensland hospitals.

The government asked experts from the University of Pennsylvania to conduct a real-time assessment of the scheme to make sure it was having a favourable effect.

The University of Pennsylvania collaborated with researchers from Queensland University of Technology’s School of Nursing for the study, and they have now officially published the results of the review.

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https://www.smh.com.au/national/desperately-disappointing-setback-for-ovarian-cancer-screening-hopes-20210512-p57reg.html

‘Desperately disappointing’ setback for ovarian cancer screening hopes

By Kate Aubusson

May 13, 2021 — 8.30am

Long-awaited results of a major ovarian cancer study three decades in the making found screening women detected the disease before they developed symptoms but didn’t save lives.

The findings are a devastating blow for ovarian cancer researchers, patients and their supporters who had hoped the trial involving more than 200,000 women would lead to early diagnosis and ultimately national screening programs that would prevent thousands of ovarian cancer deaths every year.

But they were adamant that new highly effective early detection tests would be discovered, and significant advances in treatments since the trial ended had improved the lives - and potentially the outcomes - for women with the insidious disease.

“It’s desperately disappointing,” said Professor Ian Jacobs, vice chancellor at UNSW and gynaecological oncologist who spearheaded the UK Collaborative Trial of Ovarian Cancer Screening (UKCTOCS) since its preliminary days more than 30 years ago.

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International Issues.

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https://www.afr.com/companies/energy/us-declares-state-of-emergency-to-keep-fuel-flowing-after-cyber-attack-20210510-p57qho

US declares state of emergency to keep fuel flowing after cyber attack

Myles McCormick, Derek Brower, Lauren Fedor and Hannah Murphy

May 10, 2021 – 1.26pm

New York/Washington/San Francisco | The US government declared a state of emergency on Sunday (Monday AEST) in a bid to keep fuel supply lines open as fears of shortages rose following the shutdown of an essential pipeline.

The move lifted various limits on the transport of fuels by road to ease the fallout from the continuing closure of the Colonial pipeline, which carries almost half the fuel consumed on the US east coast, following a ransomware cyber attack on Friday.

“This Declaration addresses the emergency conditions creating a need for immediate transportation of gasoline, diesel, jet fuel and other refined petroleum products and provides necessary relief,” the Department of Transportation said.

The order came as the government scrambled to deal with the repercussions from the closure of Colonial, the biggest refined products pipeline in the US, which transports 2.5million barrels of fuel a day from refineries on the Gulf Coast to markets such as Atlanta, Washington and New York.

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https://www.afr.com/world/asia/chinese-newspaper-suggests-long-range-missile-strikes-on-australia-20210509-p57q87

Chinese newspaper suggests ‘long-range’ strikes on Australia

Michael Smith China correspondent

Updated May 9, 2021 – 2.17pm, first published at 1.50pm

The editor of a Chinese newspaper says Beijing should consider launching long-range strikes on Australian military facilities if Canberra were to join a US-backed conflict in the Taiwan Strait.

While the comments published at the weekend do not reflect the Chinese government’s official position, they are the latest sign of the intensifying hostilities between Canberra and Beijing that have alarmed diplomats and investors.

Hu Xijin, the notoriously hawkish editor of the Global Times tabloid, published an editorial on Saturday calling on China to establish a plan for “retaliatory punishment” against Australia if it provided military support to Taiwan.

“The plan should include long-range strikes on the military facilities and relevant key facilities on Australian soil if it really sends its troops to China’s offshore areas and combats against the PLA [People’s Liberation Army],” Mr Hu wrote.

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https://www.smh.com.au/business/the-economy/the-world-is-partying-hard-on-free-money-but-beware-the-hangover-20210510-p57qgn.html

The world is partying hard on free money, but beware the hangover

Peter Hartcher

Political and international editor

May 11, 2021 — 5.30am

Australia saw its first sale of a diamond for a million dollars last month. A week later art auctions set record high prices for 16 artists. One of those, $3.1 million for Arthur Streeton’s Grand Canal, also happened to set a record for the highest bid made by internet.

That week took the total value of Australia’s fine art auctions so far this year to 37 per cent more than for the same period in the last pre-COVID year, 2019. “The market has been exceptionally strong around the world in all categories for eight months now,” the director of one of the auction houses, Merryn Schriever of Bonhams Australia, told The Financial Review.

And we know that Australia’s real estate market is ridiculously overheated, but it’s not alone. Last year, while the world economy shrank by 3 per cent, house prices increased by an average 5 per cent across the 16 developed countries measured by the Federal Reserve Bank of Dallas. In the midst of a pandemic.

In New Zealand, house prices soared by 21 per cent in the year to the end of February, prompting Prime Minister Jacinda Ardern to call it a “dangerous housing bubble”. Her government announced the end of tax deductibility for mortgage interest by investors and told the Reserve Bank of NZ it had to start worrying about real estate prices in setting interest rates.

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https://www.theaustralian.com.au/world/the-times/putin-sounds-a-warning-to-the-west-at-victory-day-parade/news-story/77be1b6b25994aad6e0998cfa4e7e2b5

Putin sounds a warning to the West at victory day parade

President Putin pledged that Russia would defend its national interests “firmly” as he oversaw a military parade on Red Square yesterday to commemorate the 76th anniversary of the Soviet Union’s victory over Nazi Germany.

The parade came amid rising tensions with the United States and other NATO member states over a host of issues including alleged Kremlin cyberhacking and Russia’s military build-up on Ukraine’s borders.

The two sides have engaged in tit-for-tat diplomatic expulsions in recent weeks.

Yars intercontinental ballistic missile launchers, tanks, armoured personnel carriers and other military hardware rolled past the Kremlin’s walls during a parade involving 12,000 Russian troops, with Putin, 68, watching from a stand that also seated Soviet war veterans.

Above Red Square, Su-35 fighter jets accompanied a TU-160 strategic nuclear bomber in a dramatic flyover. At the end of the parade, Su-25s soared high above the city, trailing exhaust fumes in the white, blue and red colours of the Russian flag.

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https://www.smh.com.au/world/middle-east/palestinian-rockets-target-tel-aviv-setting-off-sirens-20210512-p57r0v.html

Netanyahu says Palestinian militants to pay ‘very heavy’ price for rocket attacks

By Nidal al-Mughrabi and Jeffrey Heller

Updated May 12, 2021 — 12.42pmfirst published at 4.11am

Gaza/Jerusalem: Israeli Prime Minister Benjamin Netanyahu warned that Palestinian militants would pay a “very heavy” price after three Israelis died from rocket attacks on Tel Aviv, in the latest round of violence to roil the region.

Israel carried out multiple air strikes in the Palestinian territory of Gaza raising the death toll of Palestinians to 32.

The rockets fired from Gaza reached the outskirts of Jerusalem on Monday during a holiday in Israel commemorating its capture of East Jerusalem in a 1967 war.

“We are at the height of a weighty campaign,” Netanyahu said in televised remarks alongside his defence minister and military chief.

“Hamas and Islamic Jihad paid ... and will pay a very heavy price for their belligerence ... their blood is forfeit.”

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https://www.theaustralian.com.au/world/chinas-population-growth-rate-the-slowest-in-decades/news-story/eb08e945c6cc6b9bd7b66211c0e0cb61

China’s population growth rate the slowest in decades

China’s population has grown at its slowest pace in decades, reaching 1.41 billion, census results showed on Tuesday.

The growth of 5.4 per cent since the last census in 2010 ­reflects fears of a looming demographic crisis amid an ageing ­society and slowing birthrates, with a sharp drop in the number of working-age citizens in the world’s second-biggest economy.

The growth rate was the slowest since the 1960s. Beijing changed family planning rules in 2016 to allow families to have two children amid fears grew about China’s fast-ageing population and shrinking workforce — but it is yet to produce the expected baby boom to help offset the country’s ageing population.

“The adjustment of China’s fertility policy has achieved positive results,” said Ning Jizhe, an official from the National Bureau of Statistics.

But he added that the “ageing of the population imposed continued pressure on the long-term balanced development of the population in the coming period”.

The number of people aged between 15 and 59 dropped ­nearly 7 per cent, while those aged over 60 was up more than 5 per cent.

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https://www.theaustralian.com.au/business/the-wall-street-journal/chinas-census-highlights-its-looming-population-problem/news-story/fc07a83ed295621e6311f689b366e9fe

China’s census highlights its looming population problem

China said its population hit 1.41 billion in 2020, eking out a tiny rise from the previous year, underlining how the world’s most populous nation is going to have to face its demographic challenges sooner than expected.

The number — up from the 1.40 billion official data showed for 2019 — indicated that China’s population has only gone up by 72 million since the last census, in 2010.

In a news conference after the release, Ning Jizhe, head of the National Bureau of Statistics, said there were 12 million births last year, which would represent an 18% drop from the 14.65 million the year before, a trend that is likely to increase pressure on Beijing to ease remaining birth restrictions. It was the fourth straight year of declining births after a rise in 2016, the first year after China ended the three-decade-old one-child policy.

Mr. Ning said China’s fertility rate — the average number of babies a woman will have over her lifetime — dropped to 1.3 last year, which he acknowledged as a low level. By comparison, the U.S. — also in a fertility slump — last week reported a total fertility rate of 1.64 last year.

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https://www.afr.com/world/north-america/us-consumer-price-index-rises-0-8pc-in-april-from-march-20210513-p57rex

US inflation leaps in April, surprising analysts

Reade Pickert

May 13, 2021 – 2.54am

Washington | US consumer prices climbed in April by the most since 2009, topping forecasts and intensifying the already-heated debate about how long inflationary pressures will last.

The consumer price index increased 0.8 per cent from the prior month, reflecting gains in nearly every major category and a sign burgeoning demand is giving companies latitude to pass on higher costs.

Excluding the volatile food and energy components, the so-called core CPI rose 0.9 per cent from March, the most since 1982, according to Labor Department data on Wednesday (Thursday AEST).

The gain in the overall CPI was twice as much as the highest projection in a Bloomberg survey of economists. Similar to last week’s monthly jobs report, forecasters are struggling to get a handle on the rapidly reopening economy.

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https://www.smh.com.au/world/middle-east/is-this-the-big-one-the-next-intifada-could-be-fuelled-over-tiktok-20210512-p57r5m.html

‘Is this the big one?’: The next intifada could be fuelled over TikTok

By Thomas L. Friedman

May 12, 2021 — 4.47pm

New York: Let’s see, what happens when TikTok meets Palestinian grievances about right-wing Israeli land grabs in Arab neighbourhoods in Jerusalem? And then you add the holiest Muslim night of prayer in Jerusalem into the mix? Then toss in the most emotional Israeli holiday in Jerusalem? And a power play by Hamas to assume leadership of the Palestinian cause? And, finally, a political vacuum in which the Palestinian Authority is incapable of holding new elections and Israel is so divided it can’t stop having elections?

What happens is the explosion of violence around Jerusalem on Monday that quickly spread to the Gaza front, and has people asking: Is this the big one? Is this the start of the next Palestinian uprising?

The Israeli government, the surrounding Arab nations and the Palestinian Authority all desperately want the answer to be “no” – Israel because it would find little support from a left-leaning White House, let alone the rest of the world, for a big crackdown on Palestinians; the Arab governments because most of them want to do business with Israeli tech-makers, not get mired defending Palestinian rock-throwers; and the Palestinian leadership because it would expose just how little it controls the Palestinian street anymore.

But unlike the intifadas that began in 1987 and 2000, when Israel had someone to call to try to turn it off, there is no Palestinian on the other end of the phone – or, if there is, he’s a 15-year-old on his smartphone, swiping inspiration from TikTok, the video app often used by young Palestinians to challenge and encourage one another to confront Israelis.

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https://www.smh.com.au/world/north-america/republican-party-cancels-liz-cheney-in-sacrifice-for-trump-s-approval-20210513-p57rf0.html

Republican Party ‘cancels’ Liz Cheney in sacrifice for Trump’s approval

By Matthew Knott

May 13, 2021 — 6.05am

Washington: The Republican Party has now made it official. You can still hold a leadership position in the party if you believe that Donald Trump fomented the January 6 Capitol insurrection with his lies about election fraud. You just have to keep quiet about it.

By removing Liz Cheney from her position as the third most senior Republican in the House of Representatives, a party that loves to rail against left-wing “cancel culture” has now cancelled one of its own.

The decision had nothing to do with ideology or policy. The daughter of former vice-president Dick Cheney has impeccable conservative credentials: Heritage Action, a leading right-wing think tank outreach group, has awarded Cheney a lifetime rating of 80 per cent. She’s a low tax-supporting foreign policy hawk with traditional views on issues like abortion and same-sex marriage.

She’s also got an independent streak and is unafraid to speak her mind.

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https://www.smh.com.au/business/the-economy/the-genie-s-out-of-the-bottle-inflation-is-here-what-now-20210514-p57rvy.html

‘The genie’s out of the bottle’: Inflation is here. What now?

By Neil Irwin

May 14, 2021 — 10.04am

The central fact of the US economy in mid-2021 is that demand for all sorts of goods and services has surged. But supplies are coming back slowly, with the economy acting like a creaky machine that was turned off for a year and has some rusty parts.

The result, as underlined in new government data this week, is shortages and price inflation across many parts of the economy. That is putting the Biden administration and the Federal Reserve in a jam that is only partly of their own making.

Higher prices and the other problems that result from an economy that reboots itself are frustrating but should be temporary. Still, the longer that the surges in prices continue and the more parts of the economy that they encompass, the greater the chances that Americans’ psychology about prices and inflation could shift in ways that become self-sustaining.

For the past few decades, companies have resisted raising prices or paying higher wages because they felt that doing so would cost them too much business. That put a damper on inflation across the economy. The question is whether current circumstances are evolving in a way that could change that.

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https://www.smh.com.au/world/middle-east/never-mind-who-started-it-it-s-clear-who-benefits-from-the-violence-in-gaza-and-israel-right-now-20210513-p57rp0.html

Never mind who started it, it’s clear who benefits from the violence in Gaza and Israel right now

By Gwynne Dyer

May 13, 2021 — 4.05pm

“Objective allies” generally don’t even talk to each other. They don’t have common values, their ultimate goals may be completely incompatible, they often hate each other. But they share some intermediate goal, and are clever enough to realise they can both get what they want by acting together in certain ways.

Sometimes those ways may even involve shooting at each other, but if acting that way brings a result that serves their various purposes, they are still objective allies. So Benjamin Netanyahu, still prime minister of Israel despite his parlous political position, and Hamas, the Islamist Palestinian organisation that controls the Gaza Strip, are objective allies.

Right now the missiles are flying and people are dying in both the Gaza Strip and Israel, and as usual it’s hard to say who or what started it. Was it the Israeli air strikes that hit 150 targets in Gaza and killed around 30 people including nine children on Tuesday? Or the Hamas fighters who launched 130 of their homemade missiles at Israeli towns earlier in the day and killed three Israelis?

Or the Israeli police who fired stun grenades Monday night at Palestinian demonstrators taking shelter in the al-Aqsa mosque on what Israelis call Temple Mount? Or the Palestinian protesters who threw rocks and other missiles at the police every night during the last week of Ramadan? Or the founders of Hamas in 1987, or the authors of the Balfour Declaration in 1917?

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https://www.smh.com.au/world/europe/progressive-politics-is-facing-extinction-tony-blair-20210512-p57rek.html

Progressive politics is facing extinction: Tony Blair

By Bevan Shields

Updated May 13, 2021 — 11.25amfirst published at 7.12am

London: Progressive politics is facing extinction, former British prime minister Tony Blair has warned in a stinging critique of the far-left and its “voter-repellent” approach to culture, gender, race and identity.

Blair, one of just three Labour leaders to ever win general elections in the United Kingdom, also said his crisis-plagued party needed “total deconstruction and reconstruction” - remarks which sparked fresh speculation that the 68-year-old might be mulling a comeback.

In an essay for the left-leaning magazine New Statesman, Blair said there were only flickers of a progressive agenda with deep majority support around the globe and predicted the problem would worsen without an urgent change of strategy.

“Political parties have no divine right to exist and progressive parties of the centre and centre-left are facing marginalisation, even extinction, across the Western world,” he said.

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https://www.smh.com.au/world/north-america/republican-party-cancels-liz-cheney-in-sacrifice-for-trump-s-approval-20210513-p57rf0.html

Republican Party ‘cancels’ Liz Cheney in sacrifice for Trump’s approval

By Matthew Knott

Updated May 13, 2021 — 11.49amfirst published at 6.05am

Washington: The Republican Party has now made it official. You can still hold a leadership position in the party if you believe that Donald Trump fomented the January 6 Capitol insurrection with his lies about election fraud. You just have to keep quiet about it.

By removing Liz Cheney from her position as the third most senior Republican in the House of Representatives, a party that loves to rail against left-wing “cancel culture” has now cancelled one of its own.

The decision had nothing to do with ideology or policy. The daughter of former vice-president Dick Cheney has impeccable conservative credentials: Heritage Action, a leading right-wing think tank outreach group, has awarded Cheney a lifetime rating of 80 per cent. She’s a low tax-supporting foreign policy hawk with traditional views on issues like abortion and same-sex marriage.

She’s also got an independent streak and is unafraid to speak her mind.

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https://www.afr.com/world/north-america/biden-spends-his-way-to-us-decline-20210513-p57rhc

Biden spends his way to US decline

The US is spending more than it did on World War II and risks turning itself into a failed welfare state like France.

Bret Stephens

May 14, 2021 – 10.49am

Years ago, Alexis Tsipras, the party leader of Greece’s Coalition of the Radical Left, surprised me with a question. “Here in the United States,” the soon-to-be prime minister asked me over breakfast in New York, “why do you not have this phenomenon of passing money under the table?”

The subject was health care. Greece has a public health care system that, in theory, guarantees its citizens access to necessary medical care.

Practice, however, is another matter. Patients in Greek public hospitals, Tsipras explained, would first have to slip a doctor “an envelope with a certain amount of money” before they could expect to get treatment. The government, he added, underpaid its doctors and then looked the other way as they topped up their income with bribes.

Take a close look at any country or locality in which the government offers allegedly free or highly subsidised goods and you’ll usually discover that there’s a catch.

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https://www.afr.com/world/north-america/america-has-your-back-payne-tells-allies-fronting-up-to-china-20210514-p57s0s

US has your back on China, Payne tells allies

Jacob Greber and Andrew Tillett

May 14, 2021 – 4.46pm

Australia is urging other like-minded countries to stand up to China’s bullying and economic coercion, as Foreign Minister Marise Payne applauded the Biden administration for supporting allies facing the heat.

Standing in Washington alongside Secretary of State Anthony Blinken, who declared for the first time in public on Friday (AEST) that the US would “not leave Australia alone”, Senator Payne said it was vital that allies did all they could to back one another.

“I hope that the support Australia has received from the United States gives confidence to others,” she said. “It doesn’t matter where the challenges to your sovereignty come from.”

The remarks by Senator Payne, who has held several top-level meetings with Biden officials for the first time since the new President was inaugurated in January, came as Australia joined the US, Japanese and French navies for war games in the East China Sea.

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https://www.theaustralian.com.au/business/the-wall-street-journal/in-donald-trumps-purgatory/news-story/2e0f9e245e4216e3de0a9facf7c003cd

In Donald Trump’s purgatory

The editorial board of the Wall Street Journal

House Republicans ousted Liz Cheney from their leadership on Wednesday night, but the GOP’s Donald Trump problem continues. They cannot win without his voters, but they also will struggle to win if the former president dominates the party and insists on re-fighting the 2020 election for the next four years.

Cheney was purged on a voice vote that was so overwhelming that no one even asked for a recorded tally. Her offence was challenging — too vocally for GOP comfort — Trump’s claims that the 2020 election was stolen and that the attempt to overturn the Electoral College vote on January was constitutional and warranted.

Many Republicans privately agree with Cheney on both points, but they don’t want to get into a public fight with Trump.

They want House of Representative leaders to focus on resisting the Biden agenda, and they think Cheney’s insistence on publicly rebutting Trump’s falsehoods was a distraction. She can now say what she wants as a backbencher.

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I look forward to comments on all this!

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David.

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