December 12, 2019 Edition.
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Not much has changed in Trump land as the Impeachment process grinds on and there seems to be increasing concern how this process may be increasing Trump’s chance of re-election as the nation polarises. President Trump went to the NATO Summit in London and caused chaos as usual. We now are awaiting what will happen with the planned new Dec. 15 tariffs.
In the UK the election happens today – so the results may bring clarity as to what next!
In OZ the bushfires continue to rage and we have the politicians off till early February, 2020. Hardly a great look! What pollies that are about are being totally absurd asking what is everybody worried about it would seem. They are out of touch clowns - the lot of them!
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Major Issues.
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Australia's uneasy balancing act with China just gets harder
Plenty of former prime ministers are giving Scott Morrison advice on China but the difficulties of managing the relationship are only becoming more obvious.
Dec 1, 2019 — 7.55pm
There’s no shortage of ex-prime ministers roaming and ready to give Scott Morrison some free advice on the Australia-China relationship – among other things, of course.
Malcolm Turnbull, Tony Abbott, Kevin Rudd and Paul Keating have recently suggested a range of targets – including one another’s handling of various issues when in power – to blame for the current state of deterioration.
But little will be of much assistance to the Morrison government for its turn in managing the contradictory pressures on Australia now part of engaging with its most important trading partner. Too much has already changed – and that divergence will only continue.
Whatever the veracity of the self-identified Chinese spy, Wang Liqiang, or the claims of the now deceased Bo “Nick” Zhao that he was offered $1 million to run in the federal seat of Chisholm, for example, the tone of the national conversation on China has hardened considerably.
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Harmonious workplaces will deliver prosperity for all
An adversarial industrial relations system is far from the proven international best practice that encourages cooperation, not conflict.
Christian Porter
Dec 2, 2019 — 12.00am
When announcing the review of Australia’s industrial relations (IR) system, the Prime Minister observed that in many successful Australian workplaces there was a shared understanding that the success of the enterprise also involved success for employees.
Like him, I am keen to see that collaborative common effort become the norm across the Australian economy. In businesses large and small, shared values and objectives are an essential driver of innovation, continuous improvement and ultimately improved productivity performance.
Job creation
Successfully deployed, the impact on the business can be substantial. And the more widespread it becomes, the more Australians will benefit.
Productive workplaces employ more people. Job creation is the primary objective of the Morrison government.
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Biggest blunders of 2019: Drumstick Awards for Dubious Distinction
Even with the economy limping along and politicians firing shots, corporate Australia managed to deliver a few right-royal stuff-ups.
Dec 2, 2019 — 9.05am
How good is corporate Australia? While Australian business leaders juggled sagging economic growth, global trade tensions and falling interest rates, politicians threw barbs at business with unnerving regularity.
Prime Minister Scott Morrison, riding high after his shock election win, accused the banks of profiteering when they failed to fully pass on interest rate cuts.
Energy Minister Angus Taylor waved his Big Stick policy at the energy companies, vaguely threatening nationalisation.
Treasurer Josh Frydenberg told businesses of all stripes to focus less on paying dividends to their investors and more on investing in big projects. Throughout all this – and without the slightest trace of irony – all politicians attacked business for not doing enough to change the national debate.
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Sydney and Melbourne house values surge on lower interest rates
By Shane Wright
December 2, 2019 — 10.03am
The Sydney and Melbourne property markets have driven the biggest monthly lift in national house prices in 16 years as falling interest rates and a shortage of supply combine to drive up values.
CoreLogic's monthly measure of values showed dwelling values across the nation's capitals jumped by 1.7 per cent in November, the biggest monthly lift since 2003.
The increase was driven by the nation's two largest property markets.
House values in Sydney alone increased by 3.1 per cent, taking the median house value to $956,249. It was a $37,900 increase through the month, with values now up by 4 per cent this year.
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CoreLogic data reveals national housing market back in positive growth territory
December 2, 2019
The national housing market is back in positive annual growth territory for the first time since April 2018 as the market growth accelerates, property researcher CoreLogic’s November values data has shown.
Consistent improvement in the two major east coast capitals has helped spur forward the market since the downturn bottomed in June, with the property value index growing 4.7 per cent to November 30.
Sydney prices grew 2.7 per cent through November, outpacing Melbourne for the first time since June, with the latter reporting a rise of 2.2 per cent.
The 2.7 per cent rise in Sydney prices was the fastest since October 1988, when prices rose by 3.5 per cent, and beats May 2015, when they rose 2.6 per cent.
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Environment is prime worry for the first time: poll
By Matt Wade
December 2, 2019 — 12.00am
The environment has for the first time surpassed healthcare, cost of living and the economy to be the number one concern for Australians.
The Ipsos Issues Monitor, which asks a representative sample of Australians to select the three top issues facing the nation, found 32.1 per cent rated the state of the environment among their biggest worries in November - the highest share in the decade-long history of the survey.
The result follows devastating spring bushfires in NSW and Queensland and worsening drought conditions in many regional areas. These events have been widely attributed to climate change caused by global warming.
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‘Tipping point’ approaches for climate and economy
We are approaching the point where believing scientists on climate change is a much bigger deal than it was before, and bigger than investors and businesses are prepared for.
The current business and political orthodoxy, including the Coalition government and the Business Council of Australia, is that the science is correct and humans have caused dangerous global warming, and that we should meet our Paris commitments in order to prevent disaster, which we are doing.
Except that the scientific consensus is shifting towards requiring much more than Paris. In fact it looks like the scientists have been wrong, way too complacent and as a result, the emissions reductions to which everybody has signed up now look inadequate.
It means that a difficult choice may soon have to be made: continue to say you believe the science, which will require a very expensive and very disruptive transformation of the economy, or start saying you reject the scientists, that you’re only prepared to accept what they were saying before, not what they’re saying now.
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Manufacturing further economic decline
Diversify: it’s common investment advice, the economists’ version of not putting all your eggs in the one basket.
Yet as a country we’re not heeding it. Our standard of living increasingly hinges on commodities — now two-thirds of our exports — whose prices in the long run are destined to fall. The recent boom that has temporarily so enriched us is unusual and unlikely to last as population growth — and China’s economy — inevitably slows. In fact, commodity prices are down by 50 per cent across the century to 2007, according to Reserve Bank analysis.
Meanwhile our manufacturing sector has shrivelled to 7 per cent of the workforce, far below comparable nations. The number of manufacturing jobs collapsed by 30 per cent to 729,000 across the decade to 2016. It is likely to have tumbled further since.
A Commonwealth Bank indicator of advanced manufacturing released on Monday — based on a survey of output, orders, employment, input inventories and delivery times — revealed the lowest reading since its inception.
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Falling productivity numbers cloud economic recovery
Dec 2, 2019 — 7.43pm
The weakest productivity numbers in at least 25 years have unsettled the outlook for an economic recovery, a pick-up in wage growth and a string of budget surpluses predicted by the Morrison government and the Reserve Bank of Australia.
Former Productivity Commission chairman Gary Banks said that while he was cautious about the poor productivity reading, it "caps off what has been consistently weak productivity performance" in Australia and the serious need for structural reform to lift economic output.
"Trying to stimulate demand through monetary and fiscal measures won’t cut it, I’m afraid, and these pose risks of their own," Mr Banks said. "The causes of [economic weakness] require regulatory and other reforms to enhance the supply side of the economy."
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Test of Morrison's anti-influence laws will be whether we see arrests and deportations
Peter Hartcher
Political and international editor for The Sydney Morning Herald
December 3, 2019 — 12.00am
The Morrison government finally is putting some teeth into the gummy mouth of Australia's foreign interference laws. The authoritarian great power, China, was mocking the laws that the Parliament passed a year and a half ago.
For example. Four foreign goons were stalking one of the laws' co-creators, John Garnaut, while he was trying to enjoy lunch with his wife in the middle of Melbourne's Federation Square in January, as related in Good Weekend.
The serial harassment of Garnaut, a former Beijing correspondent for this newspaper who went on to advise Malcolm Turnbull on Chinese government intrusions, is just one of many examples.
Many much more serious efforts to "take over" our political system, in the words of the former ASIO chief Duncan Lewis, are under way. The Chinese Communist Party is an authoritarian political project that will continue to expand its covert and coercive power in Australia unless and until it meets resistance.
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Home ownership no longer sure path to wealth
By Alex Joiner
December 3, 2019 — 10.59am
The property market is back. Home prices in Sydney and Melbourne are re-bounding sharply in response to the Reserve Bank of Australia’s (RBA) recent cuts in interest rates and the financial regulator's defacto easing of borrowing restrictions.
Assuming a benign economic environment, buyers are likely to continue to be drawn back into the market. However, make no mistake, the traditional big property price gains of the past cannot last.
For new entrants into the market, home ownership will not generate the same amount of wealth in coming decades as it has previously.
Finding other means to create wealth has become more critical and suggests that superannuation will play a more prominent role. This is particularly true when returns will be lower than those experienced historically across other types of investments traditionally used to build wealth.
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Australians respect religion despite ‘divisive’ effect, says poll
Almost 80 per cent of Australians believe respecting religion is “important in a multicultural society”, with a new poll showing more than one in two backed faith-based perspectives being permitted in public debate “even when others find them offensive”.
A YouGov Galaxy survey of more than 1000 Australians, commissioned by the Centre of Independent Studies, also revealed 64 per cent of respondents did not support organisations being allowed to refuse employment on religious grounds.
The CIS policy paper, Respect and Division: How Australians View Religion, found “religious tolerance is vital for a well-functioning pluralistic, secular democracy”.
Authors Monica Wilkie and Robert Forsyth said the “ability to tolerate even undesirable ideas ensures harmony. The results reveal Australians are viewing religion as mostly an individual right to belief but are sceptical of religious organisations.”
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Jamieson Coote Bonds warns of risky corporate debt plays
One of the nation’s top bond fund managers has warned investors to carefully consider the fixed income component of their asset allocation strategies amid market volatility and the current rush into corporate debt opportunities, which it says can be “quite high risk”.
Jamieson Coote Bonds, which is chaired by former Future Fund chief executive Mark Burgess, currently has $4bn of assets under management for institutional and retail investors.
JCB is pitching to the latter on the benefits of including defensive assets such as sovereign bonds into balanced portfolios to reduce risk but also maintain income.
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Hong Kong affects back end of Australian wealth management
Of imminent concern is the cyber integrity of the financial infrastructure upon which almost every Australian-domiciled investor relies.
Dec 4, 2019 — 12.00am
Turmoil in Hong Kong affects not only those with direct southern Chinese exposures but many other Australian investment communities who have back office, custodial and transactional accounts directly or indirectly stored on servers physically hubbed in the city.
Regional, international and even Australian-domiciled but regionally transactional financial conglomerates remain unofficially heavily engaged and interdependent with Hong Kong, as well as Singapore, for Australian clients. Examples include international custody accounts for trading, exchange traded funds, foreign exchange, fund managers, private banks, prime broking and insurance services, all of which use financial intermediaries that depend on server, cloud and technology infrastructure hosted near Australia.
With the threat of cyber warfare with the People’s Republic of China on the rise and now accepted as a clear and present danger, all Australian investment communities should take pause and question how the current agitation affects us at face value but also by association.
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Many threats to our values: Home Affairs
Foreign interference, a lack of trust in government and globalisation are threatening Australian values, the Home Affairs department says.
Finbar O'Mallon
Australian Associated Press December 4, 2019 9:46am
Foreign interference, mistrust in government and globalisation are undermining Australia, says the government department overseeing national security.
The Home Affairs Department also says fake news and the use of social media platforms to recruit wannabe terrorists were eroding Australia's social cohesion.
In a lengthy submission to a parliamentary inquiry on nationhood, the department lays out other threats facing Australia and its shared values.
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High Court torpedoes class actions
Dec 4, 2019 — 10.53am
The High Court has driven a stake through the class actions industry by declaring a key part of its business model – common fund orders – invalid.
In a decision handed down in Canberra on Wednesday, the court upheld by a 5-2 majority challenges by BMW and Westpac to court rules that have been used by litigation funders and plaintiff lawyers to build a critical mass of claimants.
"Considerations of text, context and purpose all point to the conclusion that it is not appropriate or necessary to ensure that justice is done in a representative proceeding for a court to promote the prosecution of the proceeding by the making of a common fund order," the court said in a statement
Section 33ZF of the Federal Court Act and section 183 of the Civil Procedure Act (NSW) both provide that in a representative proceeding, the court may make any order "that the court thinks appropriate or necessary to ensure that justice is done".
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New car sales slide 9.8pc in November
Dec 4, 2019 — 12.00pm
New vehicle sales in Australia tumbled by 9.8 per cent in November compared with the same month a year ago, with a rebound in house prices failing to arrest a decline which has now extended for 20 months in a row.
The Federal Chamber of Automotive Industries revealed on Wednesday that new vehicle sales had declined in every state and territory in November, even though car dealers and brands had been trying hard to lift the industry out of its downward slide with special deals and incentives.
Total new vehicle sales dropped by 9.8 per cent to 84,708 in November. FCAI chief executive Tony Weber said it was the twentieth consecutive month of declining sales compared to the previous corresponding month, in what was a very ''tough market''.
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RBNZ slugs big banks with $NZ20b capital
Dec 5, 2019 — 10.07am
Wellington | The Reserve Bank of New Zealand has confirmed it will require Australia’s major banks lift their ‘tier 1’ capital ratios to 16 per cent of risk-weighted loans, which will require an extra $NZ20 billion to be held in New Zealand to protect its economy from a banking crisis.
But RBNZ has made several concessions, including giving banks two extra years to get to the new requirement and broadening the instruments that qualify as high-quality capital, in response to an intense year of lobbying by the major banks which argued the demands were too onerous.
Banks will now have seven years, rather than a five year period initially proposed, to build the additional capital, which is likely to be done by retaining more earnings in their New Zealand subsidiaries, reducing the amount of profit repatriated back to Australia.
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GDP data delivers investors a profit warning
Having pushed shares near record highs, investors have been given a reminder of just how fragile the real economy is.
Dec 4, 2019 — 10.00pm
Treasurer Josh Frydenberg was determined to put a positive spin on Australia’s national accounts, declaring the economy is “back in the black and back on track”.
But for corporate Australia, “stuck in slow with nowhere to go” might be a more accurate description.
Sluggish overall economic growth, falling business investment and GFC-level private consumption data should be a warning to investors that have pushed the ASX to near record highs.
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Lambie made a leap of faith on medevac and runs an obvious risk
By David Crowe
December 5, 2019 — 12.17am
Scott Morrison convinced Jacqui Lambie to help him repeal the medevac laws during a meeting on Tuesday that required her to make a leap of faith.
Lambie wanted a pathway for refugees to leave Nauru and Manus Island and gained an assurance on this in the Prime Minister's office.
There've been fiery and emotional scenes in the Senate after Jacqui Lambie revealed she'd done a deal with the government to repeal medevac.
Everything turns on the strength of that assurance. The fate of around 400 asylum seekers now turns on whether that meeting will intensify the search for another country, most likely New Zealand, to give them a home.
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The paradox of thrift: Why Frydenberg's tax cuts aren't helping the economy
By Shane Wright
December 4, 2019 — 6.15pm
Ahead of the government's tax cuts becoming law, Josh Frydenberg was pretty confident what they would be worth and what they would achieve.
"The tax cuts are equivalent to two 25 basis rate point cuts. So they're not insignificant. It's billions of dollars into the economy," he said.
"They will add to household consumption, they'll add to the disposable income of households and it will be good for economic activity."
The reality, five months on, is something else.
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The RBA is in a bind: its rates lever isn't doing the trick and it has no history to draw on
John Hewson
Columnist and former Liberal opposition leader
December 5, 2019 — 12.00am
A most unfortunate image of the Reserve Bank has its governor sitting at the top of Martin Place with his Monetary Policy Machine. It has two knobs. The one on the right turns the official interest rate up or down by, say, 25 basis points. The knob on the left can then be turned to achieve the desired adjustment to inflation, and subsequently economic growth, and unemployment.
What’s worse, much of the media coverage and the attendant political debate suggests an expectation that the effects of these knob adjustments can be pretty instantaneous.
If only this were true, and if only economic management could be so simple. While in politics “it’s the economy, stupid”, it is more stupid to suggest economic management is simple, especially given today’s global uncertainties. The RBA cannot “fine tune” as the imagery suggests. Tragically, it has often spoken and acted as if it can. To some extent, it still does.
Recall its discussions of what became an obsession with anti-inflation control in the 1990s, through to the aftermath of the global financial crisis, and now with its objective to raise inflation to its target range. It is most instructive that in recent days RBA governor Philip Lowe has been at pains, in two key speeches – "Some Echoes of Melville" (in honour of Sir Leslie Melville, one of the founders of Australia's central banking system, and "Unconventional Monetary Policy" – to explain his recent actions, essentially an attempt to recast the debate.
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Trade surplus drops by a third to $4.5bn
· Australian Associated Press
Australia's trade surplus dropped by a third in October to $4.502 billion, from a downwardly revised $6.847 billion a month earlier.
Exports fell by a seasonally adjusted three per cent, according to the Australian Bureau of Statistics, dragged lower by declines in resources including metal ores and minerals; and coal, coke and briquettes.
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Retail sales stagnate in October as shoppers stay home
Monthly retail sales stagnated in October, official data showed, after growing by 0.2 per cent in the prior month and a day after the national accounts showed households’ thriftiness dragging on the country’s economic growth in the September quarter.
Thursday’s seasonally adjusted data from the Australian Bureau of Statistics will intensify concerns that a lack of spending will cruel even a gentle recovery after a sharp economic deceleration through the 2018-19 financial year.
Analysts had noted that the increasing popularity of last weekend’s Black Friday sales event may cause shoppers to delay consumption. Still, the consensus forecast had been for a 0.3 per cent lift in retail trade in October.
“The disappointing retail sales outcome is yet another sign that consumers are under pressure,” NAB economist Kaixin Owyong said.
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Does NZ really need protection for a one-in-200 year event?
New Zealand is pushing ahead with its big capital hike, but Australia's big four have won important concessions.
Dec 5, 2019 — 11.54am
Having not held the Bledisloe Cup since 2002, Australians have come to realise just how hard it is to beat the Kiwis. The best you can hope is to win a game here and there.
That’s exactly what’s played out in the battle between Australia’s big four banks and the Reserve Bank of New Zealand over the latter’s plan to dramatically lift the level of capital that must be held by the Aussie banks, who make about 90 per cent of all loans in the Kiwi market.
RBNZ governor Adrian Orr has held firm on his plan to increase the level of tier 1 capital required to be held by the big four from 7 per cent to 16 per cent, a level that will require an extra $NZ20 billion to be held in New Zealand.
This is designed to protect the New Zealand economy from a one-in-a-200 year calamity. It’s also designed to buy New Zealand a bit more insulation from any potential disasters in Australia; Orr’s quite reasonable fear is that without higher capital requirements, a calamity in Australia could see the Kiwi market starved of capital.
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The public service shake-up isn't over
Dec 6, 2019 — 7.50am
The federal public service is set for a further shake-up on top of Thursday's upheaval when the number of departments was cut from 18 to 14 and five departmental secretaries were given their marching orders.
Prime Minister Scott Morrison will demand cultural changes next week as part of his response to a review led by businessman David Thodey and commissioned by Malcolm Turnbull.
In August, Mr Morrison rejected the review as too wishy-washy and sent it back with the demand its recommendations be more robust. It is expected to recommend a leaner and more responsive bureaucracy with practices more aligned to those of the private sector.
Putting his stamp on the public sector not only involves the realignment of departments but is forcing the sector to be more open and relevant to the people it serves.
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What the past two decades of politics can teach you
When it comes to big reforms in politics, take what is on offer because it will be decades, if ever, before you get another chance.
Dec 5, 2019 — 7.00pm
If you are somebody who worries about climate change and believes Australia should be a republic, it has been a rough few days.
Conversely, for those happy with global warming and the British monarch being Australia's head of state, it's been a period of quiet and reflective joy.
Tuesday last week marked the 20th anniversary of the failure of the republic referendum.
Monday this week made it 10 years since the Greens, the Coalition, Nick Xenophon and Steve Fielding voted to defeat Kevin Rudd's Carbon Pollution Reduction Scheme in the Senate and end any chance of a consensus on energy and climate policy.
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Cash is king: Investing guru says it's time to sell your shares
By Vildana Hajric
December 6, 2019 — 7.05am
Dennis Gartman, who's closing down his daily newsletter, had some parting advice for investors: sell.
The famed investor, who called it quits on his namesake The Gartman Letter last week after 30 years, said Donald Trump's multiple trade wars and other threats mean it's time to raise cash.
"People should be taking a lot of profits and getting far less involved with stocks than they have over the course of the past two or three years," he said in a phone interview. While declining to say if equities have topped, Gartman recommended investors keep 60 per cent or more of their assets in cash.
Trade is a big concern for Gartman, who has been a critic of the administration's protectionist policies. He says the skirmishes harm the economy and send a terrible signal to importers and exporters.
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'All our eggs in one basket': Tax experts call for major reform
By Shane Wright
December 5, 2019 — 9.00pm
The Morrison government is being pressed by the business sector and tax experts to revamp the tax system as new figures show Australia leads the world in its reliance on personal and company income tax.
Figures released by the OECD on Thursday show that although Australia is a relatively lightly taxed nation, its tax mix is heavily skewed towards the profits of firms and incomes of ordinary workers.
Company tax as a share of GDP – 5.3 per cent – is the highest in the developed world. As a share of total tax revenue, Australia is ranked third behind only Chile and Mexico, with a rate double the global average.
Australia garners 40.3 per cent of its revenue from income tax. Only Denmark, at 52.9 per cent, has a higher proportion. The figures do not take into account the tax cuts delivered to low- and middle-income earners this year.
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The great dividing rage of Australian politics
David Crowe
Chief political correspondent
December 6, 2019 — 12.00am
The failure of Labor policy on climate change a decade ago this week has led to a bitter but predictable argument over the blame for an upheaval that shapes Australian politics to this day. The rise and fall of Australian leaders, the success and failure of political parties, the progress and setbacks on climate change policy – all can be traced to the decisions in the Senate to veto the Carbon Pollution Reduction Scheme in December 2009.
The vote followed the fall of Malcolm Turnbull as leader of the Liberals, the rise of Tony Abbott on a mission to kill a price on carbon, the struggle by Kevin Rudd as prime minister to secure a deal and the crucial decision of the Greens to reject a workable scheme in the confidence – fatally misguided – they would gain a better solution over time.
Parliament staged a flashback when Penny Wong, the Labor leader in the Senate, moved a motion to praise the CPRS and condemn those who blocked the bill. When the vote came, it was eerily similar to the one a decade earlier. Labor sat on one side of the chamber. The Liberals, Nationals and Greens sat on the other.
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Get lean: Scott Morrison wields the axe on bureaucracy
Five Mandarins have been axed in a move to implement a "lean and mean" bureaucracy.
December 6, 2019
Scott Morrison has ordered the biggest shake-up of the public service in more than 30 years, axing four departments and five mandarins in a move to implement a “lean and mean” bureaucracy.
Delivering on a pledge to cut red tape and streamline government services, the Prime Minister will cut the number of departments from 18 to 14 as of February 1 to “bust bureaucratic congestion”.
Mr Morrison, who is also Minister for the Public Service, said Australians should be able to access “simple and reliable services, designed around their needs”.
The creation of four super departments is the most significant restructure of the public service since Bob Hawke reduced the number of departments from 28 to 18 and abolished the public service board soon after the 1987 election.
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RBA Lowe's one-two punch to Frydenberg
The Reserve Bank of Australia has picked a fight with the federal government to cover up its own failings on the jobless rate and inflation.
Christopher Joye Columnist
Dec 6, 2019 — 10.40am
As this column feared, the government is losing control of its otherwise impressive fiscal policy legacy as the Reserve Bank of Australia seeks to deflect blame for its failure to hit its legislated inflation and employment targets.
This is emerging as one of the key tests of Treasurer Josh Frydenberg’s political career: does he possess the fortitude and decision-making fidelity that have become hallmarks of Scott Morrison’s astonishing success?
The latest round of efforts to pressure the government to drop its budget surplus, and bail monetary policy out, started with RBA governor Phil Lowe’s speech on quantitative easing, in which he laid the foundations for a sustained attack on Morrison and Frydenberg’s parsimony.
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'I'm no Skase': Inside Mayfair's investment pitch
Dec 6, 2019 — 1.19pm
Interest rates are at rock bottom. Investment risks are sky high. Trust in our banks and our financial advisers is broken.
Across the country, retirees don’t know what to do with the hundreds of thousands of dollars they’ve spent a lifetime amassing.
Fear not boomer. Sharp suited marketing maven James Mawhinney is here to help.
“You have my assurances, it’s not Christopher Skase you’re talking with,” Mawhinney tells an audience member seated at the front of his seminar last week.
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Subprime loans lure yield-hungry investors
Dec 7, 2019 — 12.00am
Subprime mortgage funds are luring tens of thousands of yield-starved retail investors and advertising their “term accounts” like safe bank deposits.
Ultra-low interest rates are driving mum and dad investors into subprime mortgage trusts operated by non-bank lender La Trobe Financial and other fund managers.
Melbourne-based La Trobe Financial, owned by the world's largest alternative asset manager, Blackstone, is marketing a 2.9 per cent “90-day notice account”, a 5.05 per cent “12-month term account” and 6.3 per cent “4-year term high yield investment account”.
La Trobe's "Products + Rates to generate some serious interest" webpage looks very similar to term deposits and notice saver accounts operated by banks, which are virtually risk-free and government-guaranteed up to $250,000.
https://www.afr.com/work-and-careers/education/five-ways-to-fix-the-education-system-20191204-p53gy3
Five ways to fix the education system
Dec 7, 2019 — 12.01am
Australia is on the edge of an education precipice. After nearly two decades of soaring spending on schools, the country's children are worse off in maths, science and reading.
For a wealthy, developed economy, the PISA results were a screaming wake-up call. From being "above OECD average" for the previous two decades, the country has fallen to "average" in the latest results.
Its 15-year-old maths students are 3½ years behind their equivalents in Communist Party-dominated China. And they're three years behind 15-year-olds in the heartland of capitalism, Singapore.
They're even a year behind where their own parents were in maths twenty years ago.
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What the public service shake-up really means
Scott Morrison's purge crystallises a trend to the sidelining of the public service as a front-line provider of policy advice. It reflects the fact that policy is now largely driven by ministers.
Dec 6, 2019 — 4.30pm
Shortly after the federal election, I had a conversation with a figure at the very centre of the government. As we raked over where the election had left the political conversation, I noted the Prime Minister’s repeated emphasis on getting on with delivering services to Australians in his public statements.
Did this suggest that a politician so driven by marketing memes had detected a weariness with the ideological wars of politics among disconnected voters, and recognised political self-interest in shaping both the government’s message, and its agenda, around the basics of government service delivery? Did this mean the government might abandon some of its ideological warfare against institutions?
“Don’t be ridiculous,” this person snorted. “If anything, this government is more ideologically driven than Abbott. They want to win the culture wars they see in education, in the public service, in all of our institutions, and they’ll come for the ABC too, of course. There will be a big cleanout at the top of the public service, but Morrison will wait for a while to do that. They believe the left has been winning the war for the last twenty years and are determined to turn the tables. Morrison will just be craftier about the way he goes about it.”
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Morrison wants election energy for 2020, but big picture still vague
By David Crowe
December 7, 2019 — 12.00am
The way Scott Morrison wanted to end this year in Parliament was made clear in the tactics on Thursday, when Liberals and Nationals used question time to talk of their own confidence and their belief in "resilient" Australians.
The Prime Minister and his government were determined to be positive on all fronts and to contrast this with Labor complaints. Morrison had good reason to be positive about his prospects after he prevailed on border protection and lifted the spirits of the Coalition after the self-inflicted wounds of the past fortnight.
But he departed Parliament with some of his agenda thrown back in his face and some of his ministers and backbenchers dragging him down. Energy Minister Angus Taylor, Indigenous Australians Minister Ken Wyatt, Liberal backbencher Gladys Liu and Nationals backbencher George Christensen are all sources of trouble – not just this week but beyond.
As Coalition staffers gathered to let their hair down at the traditional Christmas drinks in the Prime Minister's Courtyard on Wednesday night, Morrison thanked his aides, press secretaries and his ministers - many of them serving the drinks - for their efforts in delivering victory in May.
Fire? What fire? It's business as usual in Morrison's Canberra bubble
Political and international editor for The Sydney Morning Herald
December 7, 2019 — 12.00am
Subtitles are supposed to help you make sense of what you're seeing but can't quite understand. Like a foreign language film. But if you saw the subtitles to Federal Parliament's final question time of 2019, the flow of text only made it more incomprehensible.
The politicians talked about a great many things. But if you watched it on TV, the subtitles were about only one.
As Labor cycled through its list of grievances against the government, and the government rehashed its self-congratulatory talking points, the news crawl across the bottom of the screen announced a non-stop series of fire alerts.
Did the two worlds connect? At no point in an hour-and-a-quarter did the politicians discuss the most obvious and pressing concern for most of the people they represent.
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Sorry, Scott, the economy can't grow much without higher wages
Economics Editor
December 7, 2019 — 12.15am
I usually pooh-pooh all alleged recessions that have to be qualified with an adjective. With recessions, it’s the whole economy or nothing. But I’ll make an exception for the "household recession" – which tells you why this week’s news of continuing weakness in the economy provides no support for Scott Morrison’s refusal to stimulate it.
Households are only part of the economy, of course, but they’re the part that matters above all others. Why? Because they contain all the people. And because all the other parts – the corporate sector, the public sector and the "external" sector of exports and imports – exist solely to serve we the people.
The economy’s "national accounts", issued this week by the Australian Bureau of Statistics, showed weak growth for the fifth quarter in a row, with real gross domestic product growing by just 0.3 per cent in the September quarter of last year, 0.2 per cent in the December quarter, 0.5 per in March quarter this year, 0.6 per cent in the June quarter and now a disappointing 0.4 per cent for this September quarter.
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'We've still got months ahead': Bushfires exceed the area of Sydney
Three emergency-level bushfires joined up in the Hawkesbury region of NSW on Friday, forming a blaze far exceeding the area of greater Sydney, as state emergency services warned that dangerous fire conditions will persist for "months".
More than 100 fires, 74 of them uncontained, were burning across NSW on Friday afternoon, forming a near-continuous line along the coast between the Queensland and southern borders.
Emergency warnings were issued for nine of those fires, including the 250,000-hectare blaze at Gospers Mountain that began joining up with a 50,000-hectare fire near Wollombi and a 10,000-hectare blaze near Paddock Run.
NSW Rural Fire Services commissioner Shane Fitzsimmons said the fire at Gospers Mountain would itself encompass the entire greater Sydney region.
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Royal Commissions And The Like.
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Westpac execs driven by 'status, money, power'
Dec 3, 2019 — 12.00am
The compliance manager removed by Westpac Banking Corp after reporting 29 million legal breaches to AUSTRAC has accused the bank of lacking an ethical culture and being more focused on building personal fiefdoms than protecting the public.
Amanda Wood, Westpac’s former money laundering reporting and anti-bribery and corruption officer, said the upper echelons of the bank weren’t initially worried about the missing millions of money transfers – some which may have been used to buy child pornography – because they believed it was a technical breach that wouldn’t attract a big fine.
"The initial response was not really about 'how do we fix this?'" she said in her first, and what she said will be her only, interview since the scandal broke. "The response was at least partially about: 'how we get ourselves out of this? How do we deflect attention from it?'"
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National Budget Issues.
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RBA's Lowe should rescue a PM lost in the Canberra bubble
Ross Gittins
Economics Editor
December 2, 2019 — 12.15am
Dr Philip Lowe, governor of the Reserve Bank, is one of the smartest economists in the land. You don’t get a PhD from the Massachusetts Institute of Technology unless you’re super-sharp. But the question now is whether he has the courage to stand up to a wilful Prime Minister whose confidence far exceeds his comprehension.
Scott Morrison, as we know, is refusing to do what Lowe – with the support of the international agencies and most of our economists – has been begging him to do: use his budget to come to the rescue of monetary policy and its ever-feebler efforts to stop the economy slowing almost to stalling-speed.
Morrison is desperate to deliver a budget surplus. So desperate he’s convinced himself that failing to do so would cost him more political support than would allowing the economy to continue failing to lift voters’ living standards, and be so weak that a shock from abroad could push us into recession.
How any politician could come to such a self-harming conclusion is hard to fathom. Perhaps it’s that the 28 years since our last severe recession have robbed the latest generation of Liberal pollies of their economic nous.
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Households save gains from lower rates, taxes
Dec 4, 2019 — 5.44pm
Households have increased their savings at the fastest rate since the cash hoarding during the 2008 global financial crisis, as consumers save – not spend – most of the Morrison government's tax rebates for low-to-middle income earners.
The household savings rate rose 2.1 percentage points in the September quarter to 4.8 per cent, following personal income tax refunds and the June and July interest rate cuts by the Reserve Bank of Australia.
In dollar terms, household savings surged to $14 billion, up from less than $8 billion in the June quarter.
Although the savings rate is still well below the 9 per cent recorded during the financial crisis, the rate of increase is similar to the 2 percentage point jump between September 2007 and December 2008, according to analysis by Deloitte Access Economics.
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Health Issues.
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Mothers of twins being led to caesarean births
Doctors are blaming a lack of experience among obstetricians as one factor behind a massive drop-off in the number of twins being delivered in normal births.
The proportion of twins born by caesarean section in Victoria increased from 24 per cent in 1983 to 71 per cent in 2015, according to an article published on Monday in the Medical Journal of Australia.
Researchers from Monash University and Monash Health, Mercy Hospital for Women, and Safer Care Victoria analysed data from all twin births in Victoria between 1983 and 2015. The research found a large proportion of C-section births were elective caesareans, with twin pregnancy as the sole reason for that delivery method.
“Given high-level evidence that routine caesarean delivery of twins does not benefit mothers or babies, and the recent suggestion that vaginal birth may actually be preferable, the mode of birth in uncomplicated twin pregnancies should be considered carefully,” the study said.
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Drinking up to four coffees a day has health benefits, finds study
Padraig Collins
Dec 4, 2019 — 7.46am
Drinking up to four coffees a day can reduce the risk of type 2 diabetes and high blood pressure, according to a study.
However, the benefit is lost if more than four cups of coffee are consumed.
Researchers from the universities of Navarre in Spain and Catania in Italy found an "association between coffee consumption and a decreased risk of type 2 diabetes" and that "long-term coffee consumption is associated with a decreased risk of hypertension".
The study suggests a moderate consumption of both caffeinated and decaffeinated coffee may be associated with a reduced risk of metabolic syndrome.
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Saving private health 2: Making private health insurance viable
3 Dec 2019
The Australian private hospital insurance system is unsustainable in its present form. The system faces a death spiral – younger and healthier consumers get a bad deal, so they’re dropping their insurance, which means premiums need to rise, so even more young and healthy people drop out, and the cycle continues.
This youth exodus means the recent moderation of premium increases is likely to end, and premiums will probably return to increasing at 5 per cent or more each year. By 2030 private health insurance is likely to cover less than 40 per cent of the population.
Private health insurers are strangled by red tape. The government requires that insurers charge everyone in each state – young and old, sick and healthy – the same insurance premium, under the ‘community rating’ principle. Insurers’ incentives are blunted by regulation. If an insurer bargains hard with hospitals, acts to keep members healthy, or innovates to reduce treatment costs it loses much of the benefit to other insurers through a process called risk equalisation.
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'Cannot be trusted ... causing harm': Top medical journal takes on big pharma
By Liam Mannix
December 4, 2019 — 12.01am
A leading medical journal is launching a global campaign to separate medicine from big pharma, linking industry influence to the pelvic mesh scandal that injured hundreds of women.
The BMJ says doctors are being unduly influenced by industry-sponsored education events and industry-funded trials for major drugs.
Those trials cannot be trusted, the journal's editor and a team of global healthcare leaders write in a scathing editorial published on Wednesday.
The "endemic financial entanglement with industry is distorting the production and use of healthcare evidence, causing harm to individuals and waste for health systems", they write.
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Here's a prescription to save health insurance from its death spiral
Jessica Irvine
Economics writer
December 5, 2019 — 12.00am
My phone call last week went something like this ... “Hello [insert name of health insurer I’ve been faithfully paying premiums to for about two decades], it’s me: Jess.”
“What is the minimum level of coverage I can maintain and avoid paying the Medicare Levy Surcharge?”
The answer? A $790 saving on my annual premium and a downgrade to my hospital cover to remove cataract surgery, hip replacements and a grab bag of other procedures that, as a healthy 38-year-old CrossFit enthusiast and recent first-time marathoner, I've decided I can risk losing.
I’ll keep my extras cover, though, because a review of my claim history over the past year shows I get more back than I pay.
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BUPA boss Hisham El-Ansary must be an optimist
Updated Dec 6, 2019 — 2.50pm, first published at Dec 4, 2019 — 5.32pm
Hisham El-Ansary is an optimist. Just as well, because the 54-year-old, newly appointed boss of BUPA Australia is battling big issues in the company's aged care business - including a royal commission - and waves of customers dropping private health insurance.
It's a big challenge to rectify BUPA's aged care business, which has had 13 homes sanctioned by The Aged Care Quality and Safety Commission since mid-2018 for failing to meet many of the 42 prescribed standards, including shocking incidents such as the abuse of residents.
Seven BUPA homes remain in this sin bin, where they're denied the government funding which is the lifeblood of the aged care industry, and can't take new residents until the reasons for the sanctions have been addressed.
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Australian medical research cash splash
The federal government has tipped in $437 million from the National Health and Medical Research Council to 495 medical projects.
Christine McGinn
Australian Associated Press December 7, 20198:13am
Almost 500 projects will share in the National Health and Medical Research Council cash pool, Health Minister Greg Hunt announced on Saturday.
"This investment in health and medical research will place Australia at the leading edge of research in areas like genomics and will support the search for cures and treatments including for rare cancers," Mr Hunt said in a statement.
There is $68 million tipped for cancer research while more than $74 million will go towards grants to support clinical trials and studies, among the spend.
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Smallest health insurance rise since 2001
Federal Health Minister Greg Hunt says in 2020 Australians will face the smallest rise in heath insurance premiums in 19 years.
Colin Brinsden
Australian Associated Press December 7, 20191:29pm
From April 1 next year the average premium change will be 2.92 per cent, significantly lower than the 3.8 per cent inflation rate for medical and hospital services this year.
Mr Hunt said reforms delivered by the Morrison government to private health insurance is making it simpler to understand and more affordable for Australians.
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Private health premiums to rise in 2020
2:12PM December 7, 2019
Private health insurance premiums will rise by a relatively low average of 2.92 per cent in early 2020, the federal government has announced.
Health Minister Greg Hunt said on Saturday that he had approved price rises to take effect in April 2020. The 2.92 per cent would be the lowest average premium increase in 19 years.
Mr Hunt sent the insurers back to the drawing board on calculating their level of premium increases last month when the average figure presented by insurers was deemed too high.
The minister had been insistent he wanted price rises to stay under 3 per cent.
Last year’s premium increase was 3.25 per cent, significantly lower than the recent trend.
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International Issues.
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Can the West defeat home-grown radicalism?
Dec 2, 2019 — 12.00am
Stoke-on-Trent, England | London Bridge attacker Usman Khan was a 28-year-old native of Stoke-on-Trent. It’s famous for producing durable ceramics like Wedgewood and Portmeirion. But if it’s also producing terrorists, is there something broken, either in the town, or with the system?
Has a town like Stoke, whose best economic years may well be behind it, managed to create a cohesive, integrated community? A community that can address any feelings of personal resentment or grievance that might arise in troubled individuals? These feelings can easily plug into simplistic Islamist narratives, and power up into radicalism and terrorism.
And has the British state forged the right formula for dealing with these rogue individuals? Has it found the sweet spot that combines effective intelligence penetration and strong law enforcement with well-resourced mental health and social care, decent educational and employment opportunities, and inclusive narratives?
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US economy's decoupling from the world no longer a fringe idea
America needs a coherent strategy to compete in a world with ascendant state capitalism, writes the FT's Rana Foroohar.
Updated Dec 2, 2019 — 9.54am, first published at 9.49am
Anyone who still doubts that the US is economically decoupling from the rest of the world should take a look at a proposal the commerce department put forward last week. This would allow its secretary Wilbur Ross to prevent imports of any new technology deemed a “national security threat”.
The broad language could apply not only to Huawei chips or Chinese dot-coms, but to European hardware, software and data services, too, if they are deemed to be linked to a “foreign adversary”.
Such a link is very possible now Europe is being pulled into China’s technology orbit via the 5G standards and technologies that make up part of the Belt and Road Initiative. I spoke recently to a senior executive at a strategically important US technology company who told me it is becoming legally tricky for him even to speak to his counterparts in Europe, because of the various restrictions that the Trump administration has put in place.
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Events that will shape Donald Trump’s future
While Americans enjoyed Thanksgiving, the world still turned in ways that were good, bad and unsettled if not ugly. All three events could affect Donald Trump’s re-election prospects as they play out in the coming year.
First, the good news: the US President signed a pair of congressional bills that support Hong Kong’s cry of freedom. The signature showed that America is unified behind the autonomy that China guaranteed the territory in its treaty with Britain in 1997. Hong Kongers responded by waving American flags in the street in a reminder that the US still represents the hope of liberty to millions around the world.
China huffed and puffed, with a foreign ministry factotum calling it “serious interference in China’s internal affairs and a serious violation of international law”.
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Iran convulsed by worst unrest in 40 years
Farnaz Fassihi and Rick Gladstone
Dec 2, 2019 — 3.01pm
New York | Iran is experiencing its deadliest political unrest since the Islamic Revolution 40 years ago, with at least 180 people killed - and possibly hundreds more - as angry protests have been smothered in a government crackdown of unbridled force.
It began two weeks ago with an abrupt increase of at least 50 per cent in gasoline prices. Within 72 hours, outraged demonstrators in cities large and small were calling for an end to the Islamic Republic's government and the downfall of its leaders.
In many places, security forces responded by opening fire on unarmed protesters, largely unemployed or low-income young men between the ages of 19 and 26, according to witness accounts and videos. In the south-west city of Mahshahr alone, witnesses and medical personnel said, Revolutionary Guard members surrounded, shot and killed 40 to 100 demonstrators - mostly unarmed young men - in a marsh where they had sought refuge.
"The recent use of lethal force against people throughout the country is unprecedented, even for the Islamic Republic and its record of violence," said Omid Memarian, deputy director at the Centre for Human Rights in Iran, a New York-based group.
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The division in Canberra over China
Tensions are rising in Canberra over China policy between "two tribes" – the hawkish national security agencies and the more moderate DFAT and economic departments.
Dec 2, 2019 — 12.00am
When the new chief economist at the Department of Foreign Affairs and Trade, Jenny Gordon, recently addressed public servants, she inadvertently laid bare a power struggle over a critical issue facing the Morrison government: how to manage Australia’s relationship with China.
Tensions are rising over China policy between what a senior bureaucrat calls the "two tribes" – the hawkish national security agencies and, on the other hand, the more moderate DFAT and economic departments such as Treasury.
Some diplomats and economists fret they are being sidelined in favour of national security officials influencing the Morrison government’s decisions on China.
Last week’s revelations about China allegedly trying to insert a spy into a seat in the federal Parliament – the latest allegation about Beijing’s political influence operations in Australia – may cause a rethink on that sentiment.
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Dumb and dumber. Trump doesn't understand currency wars, either
Any implication that Argentina or Brazil are deliberately weakening its currency for competitive advantage is beyond absurdity, writes John Authers.
John Authers
Dec 3, 2019 — 9.45am
What a difference a decade makes. Back in September 2010, Guido Mantega, Brazil's then-finance minister, was complaining bitterly about "currency wars", and claiming the Federal Reserve's ultra-loose monetary policy of the time was unfairly hurting his economy.
"We're in the midst of an international currency war, a general weakening of currency," he said then. "This threatens us because it takes away our competitiveness."
Fast forward to December 2019, and we have President Donald Trump's latest furious denunciation of exactly the same thing - only this time, he says that Brazil (as well as Argentina) is being unfair. In his latest tweet heard around the world, he said: "Brazil and Argentina have been presiding over a massive devaluation of their currencies. which is not good for our farmers."
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Trump's weird tariff move has just shown why Australia is vulnerable
Stephen Bartholomeusz
Senior business columnist
The Tariff Man has struck again, this time blindsiding and unnerving allies and markets with "Trumped-up" accusations of currency manipulation.
In yet another of his market-shaking tweets on Monday, Donald Trump announced he would "restore" tariffs on Brazilian and Argentinian steel and aluminium exports to the US.
"Brazil and Argentina have been presiding over a massive devaluation of their currencies, which is not good for our farmers. Therefore, effective immediately, I will restore the tariffs on all steel and aluminium that is shipped into the US from those countries," he tweeted.
In fact neither Brazil nor Argentina have been subjected to the tariffs that Trump imposed, on "national security" grounds, on a range of countries including close allies such as Canada, in March last year. Instead they agreed to quotas that limited their exports to the US.
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Three future economic shocks that could rattle the next decade
By Tom Stevenson
December 3, 2019 — 10.35am
I don't want to get bogged down in a theoretical argument about whether the next decade starts at the end of this month or in a year's time. Technically, I suspect it's 12 months hence, but I don't expect that to stand in the way of a deluge of "the world in 2030" prognostications between now and the new year. We love a round number and the fact is that, for most people, the 2020s start here.
It is also the 50th anniversary next year of the publication of a book which had a profound impact on me, Alvin Toffler's Future Shock. In 1970, the American futurologist caused a big splash with his predictions about the psychological disorientation he expected to be caused by an unprecedented period of rapid technological change.
He defined Future Shock as the personal perception of "too much change in too short a period of time", coined the term "information overload" and sold six million copies of his book. Like all futurology, it got the details a bit wrong, but Toffler understood the general direction of travel. He realised that rapid change is stressful for a species whose brains developed in a world that didn't alter much for millennia at a time until the advent of what he called the industrial and post-industrial eras.
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China announces retaliation for US action on Hong Kong
By Kirsty Needham
December 3, 2019 — 6.28am
Beijing: China will impose unspecified sanctions on US-based human rights groups in retaliation for the United States passing legislation that will scrutinise Hong Kong’s human rights record each year and could lead to trade sanctions.
Director of the Chinese Foreign Ministry’s information department, Hua Chunying, named the National Endowment for Democracy and Human Rights Watch among five groups to be targeted by Beijing.
A trade deal between China and the US has stalled after the US passed legislation backing protesters in Hong Kong.
“These NGOs have supported anti-China plotters who messed up Hong Kong through various means, aiding and abetting them in extreme violent criminal acts and inciting 'Hong Kong independence' separatist activities,” Hua said.
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Russia-China’s new world order in energy pipeline
· The Wall Street Journal
Russia’s most significant energy project since the collapse of the Soviet Union will open on Tuesday in a $US55bn partnership with China that will influence global politics, trade and energy markets.
The 2900km Power of Siberia pipeline will begin delivering Russian natural gas to China, signalling a new era of co-operation between two powers that have separately challenged the U S.
After years of rivalry and suspicion between Beijing and Moscow, the project comes as China fights a trade war with Washington and Russia’s relations with the West grow colder.
“China and Russia joining forces sends a message that there are alternatives to the US-led global order,” said Erica Downs, a Columbia University fellow and former CIA energy analyst.
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Days of cheque-book growth are over in Xi's China
Don't be fooled by Beijng's fake GDP numbers. The credit-fuelled Chinese economy is bust.
Dec 3, 2019 — 7.30pm
Despite what Paul Keating says, concerns about the condition of the Chinese economy, and the potential impact this may have on Australia's security, are not based on hysteria.
The Chinese economy has changed for the worse since Xi Jinping took over in late 2012. This is not entirely his fault: the easy fruit has been plucked by past leaders and he inherited the hard part. But more centralisation was never the answer.
Throwing around big ideas like Belt and Road and Made in China 2025 might sound visionary. But such talk and money guarantees nothing. China hasn’t found some new way around market discipline.
The situation worsened following China’s "chequebook" investment panic during the global crisis. The China credit/investment surge might have outpaced the West — and even helped us — but it added to problems that have been building for years.
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'Yes, you have bribery': Constitutional scholars front impeachment hearing
By Matthew Knott
December 5, 2019 — 6.55am
Washington: Donald Trump's efforts to pressure Ukraine to investigate his potential 2020 rival Joe Biden constituted bribery and his misconduct was worse than any other president in US history, constitutional experts have testified to Congress.
The House Judiciary Committee, which is responsible for drafting articles of impeachment, began hearings on Wednesday (Thursday Australian time) with evidence from four scholars on whether Trump's behaviour fits the standard for impeachment outlined in the US constitution.
Three constitutional law experts called by Democrats testified Trump's actions concerning Ukraine represented impeachable offences as the House Judiciary Committee began proceedings expected to end in charges against the president.
The constitution says that a president can be impeached and removed from office for committing "treason, bribery, or other high crimes and misdemeanours".
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Why the global trading system is about to grind to a halt
The WTO is breaking down and if there's no US-China trade deal in the next two weeks, there may not be one until after America's 2020 presidential elections.
Jacob Greber United States Correspondent
Dec 6, 2019 — 3.31pm
Washington | In less than a week, a key piece of the global trading system that has helped undergird the staggering prosperity and poverty-alleviation of the past quarter-century will grind to an ignominious halt.
America's refusal under the Trump administration to approve of new appointments to the World Trade Organisation's powerful appellate body has been a few years in the making.
But the point has now been reached when the Geneva-based organisation's ability to alter, overturn or uphold WTO rulings is being squeezed to death.
About 14 appeals are now before the body, including three filed by the US in the last 15 months.
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How Britain's broken heartland will vote
On a rail trip through some of the UK's most marginal seats, our Europe correspondent finds a kingdom that's far from united.
Dec 6, 2019 — 3.19pm
Britain is on the cusp of an election, on December 12, in which mere handfuls of votes could set the country on one of two, or even three, radically different courses. The country's political trajectory hangs in the balance.
If a couple of dozen seats, often on margins of less than 500 votes, fall Prime Minister Boris Johnson’s way, the Conservatives will potentially be able to deliver stable, majority government and set a course, for better or worse, to Brexit.
If he falls just short, a divided and fractious Parliament could further prolong the country’s political paralysis. If, more improbably, he falls a long way short, a minority government led by Labour’s firebrand socialist Jeremy Corbyn could kick off turbulent second referendums on Brexit and Scottish independence and even a vote on Irish reunification.
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China's narrow path to the future
Can Xi Jinping make the risky leap to a more sophisticated capitalist economy?
Dec 7, 2019 — 12.00am
President Xi Jinping may be able to meet the interim trade demands of a harried US President, but can he also satisfy the needs of his Communist Party and the Chinese people?
China's slowing economy, the growing Western resistance to its trade policies, and now the defiance of Hong Kong's middle-class millennials and voters together cast a shadow over the Communist Party's dream of an enduring social bargain: Western-style prosperity in exchange for popular acceptance of the party's continued political monopoly.
From this distance, there seems a certain symmetry to the leadership roles of Deng Xiaoping and Xi Jinping. Just as Deng remained as paramount leader to take political responsibility for the risky transition to a market economy, Xi has been freed of the term limits imposed on his predecessors to both lead a major attack on corruption and oversee the second, more difficult phase of China's economic miracle: its ascent to a high-income status.
Of the 100 middle-income economies in 1960, only 13 were high-income economies by 2008. The rest had failed to traverse the so-called middle-income trap.
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I look forward to comments on all this!
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David.
