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It would be hard to imagine more unwinding of the coherence and polity of the US than we have seen in the last week or two. The country appears to be imploding right now and their President is encouraging the collapse. What an awful scenario that we see evolving…
In the UK it is hard to know what is happening with COVID-19 as to whether they are winning or losing. With that it is clear Brazil is loosing awfully!
In Australia the pandemic appears to be under control for now. We only have to wonder after the demos if that will still be the case. 2-3 weeks. We are sure at some risk. Other wise we have moved into recession – how bad and how long still to be determined.
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Major Issues.
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https://www.afr.com/markets/currencies/rbnz-puts-its-credibility-on-the-line-20200531-p54y3a
RBNZ puts its credibility on the line
Policy divergence between the RBA and the RBNZ is set to weigh on otherwise resurgent Trans-Tasman relations in the year ahead.
Grant Wilson Contributor
May 31, 2020 – 2.26pm
While New Zealand’s response to COVID-19 has been rightly feted, the Reserve Bank of New Zealand’s most recent decision warrants much more scrutiny than it has received.
Extending the Large Scale Asset Purchase (LSAP) programme on May 13 was unnecessary and untimely. The decision may also herald a shift into activism, where the institutional distinction between monetary and fiscal policy is degraded.
The RBNZ did a great job in March and April. We count eight significant decisions that were taken in rapid time and to good effect. The preparations made for unconventional monetary policy, which extend back as far as May 2018, clearly played a constructive role.
The May 13 decision was different. Here the RBNZ expanded the ceiling on LSAP from $NZ33 billion to $NZ60 billion ($30 billion to $56 billion) over the next 12 months.
This was unnecessary. The job was done already.
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Rio Tinto launches indigenous heritage review after blast
Peter Ker Resources reporter
May 31, 2020 – 4.30pm
Rio Tinto will ask traditional landowners how it can improve its approach to cultural heritage, under a review launched in the wake of last week's Juukan Gorge controversy.
Rio has apologised for destroying 46,000 year old rock shelters of cultural significance to the Puutu Kunti Kurrama and Pinikura (PKKP) people, who are the traditional owners of land near Rio's Brockman iron ore mines in Western Australia.
Rio was under the impression it had secured approval from the PKKP as well as legal approvals for the blasting, which occurred on the weekend of May 23.
The PKKP have since made it clear they wanted the shelters to be preserved, and "vehemently'' rejected Rio's assertion that they were unaware of the PKKP's desire for the shelters to be preserved.
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On anniversary of Tiananmen, time for Australia to open its heart again
Nathan Ruser
Researcher at the Australian Strategic Policy Institute.
June 3, 2020 — 12.00am
Hong Kong as we know it is being extinguished under the boot of Chinese authorities determined to bring the territory under ideological control. Australia has opened its heart and border to people newly suffering under oppressive government crackdowns in the past, after Tiananmen, and from South Vietnam.
It’s time for Australia to activate a similar humane migration policy to support Hong Kong residents and welcome the brave, young and smart Hong Kong residents who can no longer live in the husk of their city.
Every June 4, tens of thousands of Hong Kong residents gather to remember the day, almost 31 years ago, when military tanks rolled down the streets of Beijing, with soldiers in tow, shooting indiscriminately into crowds of people asking the government for reform. Last year, organisers estimate that over 100,000 people attended the event. This week, the June 4 vigil is banned.
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Australia 'in recession', worse to come in June: Treasurer
Matthew Cranston Economics correspondent
Jun 3, 2020 – 11.36am
Treasurer Josh Frydenberg has confirmed Australia is in its first recession in 29 years after official figures showed the economy contracted 0.3 per cent in the March quarter because of the coronavirus pandemic shutdown.
The Treasurer agreed the country was in recession today on the basis of Treasury advice "about where the June quarter is expected to be"; a recession is defined as two consecutive quarters of negative economic growth.
But the treasurer said the fact the economy had contracted only 0.3 per cent, which was slightly better than the 0.4 per cent expected, showed our "remarkable resilience".
"Clearly, with this once in a century pandemic, the impact on the economy has been very severe, the impact in the June quarter will be even more severe," Mr Frydenberg told reporters on Wednesday.
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Super funds will be 'biggest political donors in Australia': Andrew Bragg
By Jennifer Duke and David Crowe
June 4, 2020 — 12.00am
Senator Andrew Bragg wants to force industry superannuation funds to disclose how much money they give to trade unions, claiming more than $30 million a year will be paid from retirement profits into union coffers by 2030.
The Liberal senator slammed the relationship between unions and super funds in his book Bad Egg: How to Fix Super, referring to Australian Electoral Commission data showing industry funds paid $10.45 million to unions in 2017, up from $3.22 million in 2006.
Using the previous annual growth rate of 9 per cent, he estimated $31.4 million could be paid to unions by super funds in 2030, noting the AEC data only captures payments made to unions affiliated with the Australian Labor Party.
Labor's financial services spokesman Stephen Jones said claims made in Mr Bragg's book were already dismissed as "spurious" by the Financial Services Royal Commission.
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Sharemarkets are ignoring the chaos in America's streets, and its economy
Stephen Bartholomeusz
Senior business columnist
If there’s been a disconnect between sharemarkets and the broader economic environment over the past 10 weeks, then that dissonance between the real world and investors has now become extreme.
The US market has gained almost 38 per cent since its March 23 low and is now only 9 per cent below its record levels in February, before real awareness of the coronavirus outbreak hit. The Australian market is "only" up a bit over 28 per cent over that period.
That surge on Wall Street has come despite a litany of developments that, individually, might have been expected to rattle investors and send them to the sidelines.
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https://www.afr.com/markets/currencies/the-mighty-us-dollar-is-having-a-wobble-20200604-p54zl9
The mighty US dollar is having a wobble
The US dollar has fallen to its lowest level on a trade-weighted basis since March. It might be time for the US to rein in the infinite stimulus.
Marcus Ashworth
Jun 4, 2020 – 3.32pm
The mighty US Dollar is having a wobble, falling to its lowest level on a trade-weighted basis since March. It's a sign the economic effects of the crisis are waning around the world. Perhaps it's time for the US to rein in the unlimited economic stimulus, or at least keep some in reserve to fight specific fires rather than just ensuring market liquidity.
The Federal Reserve has saved the financial world with its unrelenting monetary packages, pumping in $US3 trillion ($4.3 trillion) in the past three months. It has met the soaring global demand for dollars, the haven currency in a crisis, and propped up the US economy and a large swath of the developing world exposed to dollar borrowing. With oil prices regaining their footing, the immediate danger of an emerging markets collapse has passed.
The Fed has also done the job at home. The Nasdaq is within a squeak of its all-time peak, the S&P 500 is within 10 per cent of its record high and corporate bond yields have fallen sharply. The mission to restore confidence in financial valuations is surely complete.
The flip side of this is that with interest rates at zero, the federal deficit soaring and US bond yields barely above the rest of the developed world, there's not much incentive for investors to be parked in dollars. Washington's dispute with Beijing won't be helping, and neither will the civil unrest of recent days and the prospect of mass unemployment.
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Foreign deals set to face tougher security checks
By David Crowe
June 4, 2020 — 10.30pm
A new security test would be imposed on all foreign investments that threaten the national interest in a federal government plan to fix legal gaps that leave critical assets exposed to overseas control.
The test would toughen powers to block foreign takeovers and investments in technology, energy, communications, ports and other sectors considered crucial to national security.
Stronger compliance laws would also give regulators more power to investigate companies that flouted the law or broke conditions on deals, with penalties that could force them to sell the assets.
Treasurer Josh Frydenberg will announce the planned changes on Friday with a warning about the "emerging risks" to Australian assets and the need for laws to be passed by Parliament this year to erect the new hurdles.
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GDP figures show without a latte, there's no economic stimulation
By Shane Wright
June 3, 2020 — 3.15pm
A lack of lattes will always trump a mountain of loo paper.
The March quarter national accounts should, finally, confirm to analysts and politicians (of all stripes) that the Australian economy is built on the shoulders of consumers spending their cash on services.
Without shoppers heading to suburban cafes, cinemas, getting a massage or taking a whale-watching trip off one of our world-class tourist locations, the economy comes to a halt.
Household consumption dropped by 1.1 per cent through the first three months of the year. It was the single largest fall since 1986, the year Wa Wa Nee gave us the song Stimulation.
The only thing that stimulated shoppers through the quarter was the chance to find a 48-pack of toilet paper or an untapped aisle of pasta.
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'All over red rover': Top unis drive biggest overhaul in 30 years
By Jordan Baker and Anna Patty
June 5, 2020 — 11.55pm
Australia's top universities are gearing up for the sector's biggest overhaul in decades, with the risks posed to research by plunging overseas student income driving them to consider industry-wide reforms such as mergers and specialist universities.
But the sector's smaller players are already pushing back, saying changes could hurt regional cities and universities.
In an admission major changes were needed, the Group of Eight this week commissioned hundreds of academics to come up with ideas for a reform blueprint to offer the government. "Everything is on the table," said Go8 chief executive Vicki Thomson.
It comes as NSW agreed to guarantee $750 million in loans to help the state's universities recover from the COVID crisis, but said they would be conditional on universities making their operations more sustainable.
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'No basis in fact': Australian Tourism Minister slams China's travel warning
By Jennifer Duke
June 6, 2020 — 11.23am
Trade and Tourism Minister Simon Birmingham has slammed the Chinese government's instructions to citizens not visit Australia due to increasing racism as "having no basis in fact".
China's Ministry of Culture and Tourism on Saturday morning advised the public not to travel to Australia due to "an alarming increase" in racial discrimination and violence towards Chinese people in relation to the coronavirus pandemic.
Mr Birmingham has rejected these comments outright, saying Australia was "the most successful multicultural and migrant society in the world".
"The Chinese Australian community is a significant and valued contributor to that success story," he said. China is the biggest single source of international tourists to Australia.
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'Incomprehensible': How Rio Tinto reduced 46,000 years of history to rubble
By Emma Young and Nick Toscano
June 6, 2020
On Friday, May 15, the traditional owners of Juukan Gorge in Western Australia's Hamersley Range put in a request with Rio Tinto: could they access the site of two 46,000-year-old rock shelters for their upcoming NAIDOC Week celebrations?
The answer that came back from the mining giant was no. The site, Rio told them, was laden with explosives and about to be destroyed to make way for a major expansion of an iron ore mine nearby.
The Puutu Kunti Kurrama and Pinikura (PKKP) Aboriginal Corporation – whose lands cover 10,000 square kilometres of the Pilbara – say they were left in disbelief. At once they implored Rio to call off the blasting or at least protect the shelters. They phoned the WA government, then appealed to the federal government. It seemed little could be done.
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Voice, treaty, truth: Why an indigenous agreement is vital for Australia
Three years ago, on May 26, 2017, about 250 Aboriginal and Torres Strait Islander people “from all points of the southern sky’’ gathered on the red dust of Mutitjulu, in the shadow of Uluru, to call for meaningful reform to the Australian state. Their call for change came after 18 months of deliberation and dialogue at regional forums held across the country, and was expressed as the Uluru Statement from the Heart.
The statement is a powerful testament to Aboriginal and Torres Strait Islander peoples’ aspirations. Grounded in their inherent rights as the “first sovereign nations of the Australian continent”, it outlines three proposals to empower indigenous peoples so they can take “a rightful place in our own country”. Characterising the proposals as “Voice, Treaty, Truth”, the delegates called for a First Nations voice to be put in the Constitution with the power to advise the Australian parliament on laws that affect indigenous peoples, and a Makarrata Commission to oversee a process of treaty making and truth-telling.
Makarrata is a Yolngu word of the people from northeast Arnhem Land that means “a coming together after a struggle”. It has been used since the late 1970s to refer to a negotiated agreement between Aboriginal and Torres Strait Islander peoples and the Australian state that recognises each party’s authority and place in the nation. In the Uluru statement, the delegates left no doubt about their support for a treaty, explaining that: “Makarrata is the culmination of our agenda … It captures our aspirations for a fair and truthful relationship with the people of Australia and a better future for our children based on justice and self-determination.”
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The uncivil war killing liberalism in the West
The polarisation of American life, the withdrawal of liberal and conservative Americans from one another, has generated a poisonous distillation on both sides.
— Ross Douthat, The New York Times, Tuesday
Many Western democracies have succumbed to the malaise, the US most disastrously, with Australia still conspicuous as a holdout. The malaise is the erosion of the political centre — the once great middle-class suburban stability, anchor of family life, aspiration and widely shared cultural norms.
Beneath the hollowing-out of the political middle ground lies a deeper and destructive phenomenon: the crisis of Western liberalism, evident to a greater or lesser extent today in most democracies.
The story of the past century has been the titanic struggle between three ideologies — liberalism, communism and fascism. Since World War II the Western narrative has been dominated by the victory of liberalism and its legacy — steady economic prosperity, a negotiated distribution of benefits, functioning democratic systems and societies where incentives for harmony outweighed the quest for disintegration.
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Dealing with fallout from the recession we had to enact
This is not a normal recession — it’s an act of parliament.
A lot of analysis of the March quarter national accounts, including by the government, seems to be based on the idea that we’re in a normal, cyclical recession. We’re not.
It’s true there will be two consecutive quarters of negative GDP, so it’s technically a recession, but it’s not normal and it’s not the cycle.
Even calling it a recession at all is false: more precisely, it’s the closure of parts of the economy by the government for health reasons, with partial compensation.
You might think it doesn’t matter what you call it, that it’s just semantics and, anyway, it had to happen.
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Foreign investment changes are part of a global shift and not aimed at China
This is what Scott Morrison means by greater national sovereignty. Australia’s transformed foreign investment policy affirms the world has changed. The days of Davos-inspired deregulation and free-flowing capital are gone.
The new policy, driven by Josh Frydenberg, recognises foreign investment is now about strategic advantage, not just economic returns. The revolution in policy is the legacy of China Inc and its tactics that have driven a gradual tightening in policy for several years, leading to the Frydenberg security firewall.
This sharply increases the power and discretion of the Treasurer in foreign investment. This will be its enduring impact. It seeks a new balance between sovereign protection and investment flows. It repudiates the demands of national security hawks for the government to cancel previous approvals for Chinese investment in infrastructure.
Frydenberg looked at this option and said “no” — it would have devastated investment confidence in Australia. The key to the policy is a new security test with a $0 threshold, which means all foreign investment proposals, public or private, relating to sensitive security businesses must be screened by the Foreign Investment Review Board and, in effect, be approved by the Treasurer.
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https://www.afr.com/wealth/personal-finance/the-stocks-to-watch-in-the-covid-19-era-20200602-p54ysu
The stocks to watch in the COVID-19 era
Can the stocks that have risen the fastest after the start of COVID maintain the momentum? Stewart Oldfield outlines what to keep an eye on, especially during the upcoming reporting season.
Stewart Oldfield Contributor
Jun 6, 2020 – 12.00am
Stocks promising high revenue growth, led by information technology (IT) companies, have been the big sharemarket winners as we head towards our first pandemic-tainted reporting season. But although some investors have profited from buying on the way up and are optimistic, others say they can no longer ignore the size of the valuation gap for so-called value stocks more leveraged to an economic recovery.
It was a tough day for growth stocks on Friday with CSL down about three per cent and Appen down roughly five per cent as its chairman and CEO both said they had sold shares.
Experienced market watchers such as independent investment strategist Giselle Roux say there are ample reasons for caution when it comes to highly-prized growth stocks claiming the world has not changed for them.
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Bushfire Crisis And Climate Policy
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No articles in this section
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Coronavirus And Impacts.
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ANZ to stricken SMEs: 'Wind it up and walk away'
James Frost Financial Services Writer
Jun 1, 2020 – 12.00am
ANZ Bank is urging business owners not to stick their heads in the sand during the coronavirus crisis, and warning those who know they won’t recover to take action now, while they can still realise some value from stricken businesses.
“For some business owners, the smartest thing for them to do is to wind it up now, and walk away with some equity,” said ANZ's head of retail and business banking, Mark Hand.
Many small to medium enterprises have been given a six-month reprieve by banks propping up their businesses by loan deferrals, and the government via wage subsidies. But senior bankers recognise that ultimately, many will never recover.
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Research in jeopardy as foreign Phds stay home
Robert Bolton Education editor
Jun 1, 2020 – 3.51pm
The country's reputation for scientific research will be damaged as international students, who make up 57 per cent of the university research workforce, are unable to get to Australia or are encouraged to go home.
Frank Larkins, who reported yesterday that universities were facing asset sales and mergers as COVID-19 smashed enrolments, said business and governments increasingly relied on higher education to be the backbone of the scientific workforce.
There were 41,574 students enrolled in scientific Phd and Masters degrees in 2018 (latest available) of which 23,066 were from overseas.
These students were not just doing research for their own benefit but doing the heavy lifting on long running basic and applied research for government and industry.
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Blood donations to be tested in hunt for hidden coronavirus cases
By Aisha Dow
June 1, 2020 — 11.45pm
Blood taken for donation and pathology tests will be used to try to measure the nation’s rate of hidden coronavirus infections, with thousands of cases potentially missing from the official tally.
The strategy is part of a new national COVID-19 surveillance plan and will see blood samples from across the nation tested for coronavirus antibodies.
Meanwhile, mass testing using throat and nose swabs to detect current infections will continue to focus on those most at risk, with priority given to those with a fever or acute respiratory illness, contacts of confirmed cases and people with links to outbreaks.
Professor Kristine Macartney, director of the National Centre for Immunisation Research and Surveillance, said targeted testing had been key to the nation’s success to date. But she also warned against any complacency.
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June 2, 11.14am
WHO warns virus has not peaked yet
AAP
The emergencies chief of the World Health Organisation said Central and South America are currently witnessing the most intense transmission of the coronavirus worldwide, but it's difficult to predict when the epidemic might peak there.
In the last 24 hours, Dr Michael Ryan said five of the 10 countries reporting the highest number of cases are in the Americas: the US, Brazil, Peru, Chile and Mexico.
He said that while the growth of COVID-19 was not exponential in all those countries, officials were seeing a progressive increase in cases and that hospitals were starting to strain under the pressure.
"We're particularly concerned about places like Haiti because of the inherent weaknesses in the system," Dr Ryan said at a press briefing on Monday (Tuesday AEST).
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'Panic index' shows Australians were the world's best panic buyers
By Shane Wright
Australia outperformed the world dealing with the coronavirus pandemic - and the nation's consumers out-shopped their international counterparts when it came to panic buying.
New research by two University of New South Wales academics into coronavirus-related panic shopping shows that Australian consumers were the quickest in the world to raid supermarket aisles in search of toilet paper and canned soup.
Mike Keane and Tim Neal from the university's school of business used Google search data from 54 countries, covering January to late April, to pinpoint the scope and intensity of panic buying in response to the coronavirus outbreak.
Consumers in almost every nation stockpiled goods as governments shut down key parts of their economies. These included internal and external travel bans such as Australia's decision to close the borders to non-nationals travelling from China on February 1.
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Universities on the brink of ‘ground zero’
Education Minister Dan Tehan will stare down universities pleading for urgent government support, as vice-chancellors warn that Australia’s research capacity will be devastated if they don’t secure additional funding.
Ahead of talks between Mr Tehan and Universities Australia on Wednesday, University of Sydney vice-chancellor Michael Spence said the nation’s research system was at “ground zero” because of the loss of fees from foreign students.
While the Morrison government is considering further support for the construction, arts and childcare sectors, Mr Tehan has instead urged universities to fix their business models.
New modelling released by Universities Australia shows the sector is facing a $16bn drop in revenue over the next three years.
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https://www.afr.com/policy/economy/the-virus-recession-we-had-to-have-20200603-p54z6e
The virus recession we had to have
Matthew Cranston Economics correspondent
Jun 3, 2020 – 7.15pm
Treasurer Josh Frydenberg declared Australia was in recession after an almost 29-year run of economic growth ended on Wednesday with a March quarter contraction.
But he is optimistic that a further lifting of COVID-19 restrictions, growing consumer confidence and steady government stimulus will hasten the pace of recovery.
Treasurer Josh Frydenberg said the economy has been resilient compared with other countries.
The economy contracted 0.3 per cent in the March quarter bringing the annual growth rate down to 1.4 per cent largely because of the coronavirus shutdowns.
"Clearly, with this once-in-a-century pandemic, the impact on the economy has been very severe, the impact in the June quarter will be even more severe," Mr Frydenberg warned.
But Treasury's worst-case scenario of the recession, self-imposed to avoid a massive health crisis, has clearly been avoided Mr Frydenberg said.
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Australia has to climb the economic mountain again
The nation has proved to be remarkably resilient in the face of a once in a century global hit.
Josh Frydenberg Contributor
Jun 3, 2020 – 7.20pm
Less than 100 days ago, our nation was on the edge of an economic cliff.
The number of coronavirus cases was increasing by 20 per cent a day. Treasury was contemplating a collapse in GDP of more than 20 per cent in the June quarter. It was an economist’s version of Armageddon.
In response to this one-in-100-year global event, we put in place a series of health measures that have hit the economy hard.
These were tough decisions but these were decisions we had to take. Saving lives was our priority and that has been the result.
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Melbourne Uni says COVID-19 will cost $1b, urges staff to take pay cut
By Adam Carey
June 4, 2020 — 5.48pm
The University of Melbourne expects to lose $1 billion in revenue from international students over the next three years with staff being asked to hand back an agreed pay rise to help make up the shortfall.
Vice-chancellor Duncan Maskell revealed how badly the prestigious university has been hit by the COVID-19 crisis in an appeal to staff on Thursday, when he urged them to agree to a 2.2 per cent pay cut.
“The best estimate is that this would mean that between 200 and 300 jobs across the university would not have to be lost,” Professor Maskell told staff, who are set to vote on a proposed variation to their enterprise bargaining agreement next week.
The staff covered by the agreement received the pay rise last month but are being asked to forgo the increase until May 2021.
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Coronavirus: Universities graduating from pandemic with a heck of debt
The nation’s most prestigious universities have binged on debt in the lead-up to the coronavirus crisis, almost doubling their level of borrowings in the past five years to $2.8bn in a building spree to cater for international students and replace ageing infrastructure.
Ratings agencies and economists are warning that the cost of debt was increasing for the sector as the COVID-19 pandemic halted the lucrative international student market and left smaller institutions struggling to slash costs.
Monash University has the highest level of debt of the Group of Eight institutions, with borrowings surging from $281m in 2014 to $804m last year, according to its annual report released on Tuesday. The University of NSW has also recorded a rapid increase in borrowings, from $39m in 2014 to $371m.
The University of Queensland, according to its annual report, has borrowed $91m more in that period, taking its total borrowings to $209m.
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Virus lockdown pushes already weak economy into recession
Ross Gittins
Economics Editor
June 5, 2020 — 4.00pm
If you needed the news that the economy contracted in the March quarter or Treasurer Josh Frydenberg’s official admission that, because Treasury expects the present quarter to be much worse, we are now in recession, go to the bottom of the class. Sorry, but you just don’t get it.
To anyone who can tell which side is up, what characterises a recession is not what happens to gross domestic product in two successive quarters or even half a dozen, it’s what happens to employment.
The role of the economy is to provide 13 million Australians with their livelihoods. When it falters in that role, that’s what we really care about. We call it a recession, and it’s why just hearing that word should frighten the pants off you. It means hundreds of thousands – maybe millions – of families will be in hardship, anxiety and fear about the future, which could go on for months and months.
Thousands flocked to Centrelink as up to 80,000 hospitality jobs have been lost.
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Bursting the foreign student bubble set to hobble Australian research
By Adam Carey, Anna Prytz and Madeleine Heffernan
June 5, 2020 — 11.45pm
The loss of billions of dollars in international student revenue could have major consequences for research at Australian universities.
Australian National University vice-chancellor Brian Schmidt said the university sector had become increasingly reliant on fees from foreign students to fund research and development, unlike other countries where tuition fees largely covered teaching costs.
International students' fees accounted for 26 per cent of university revenue in 2018, up from 10 per cent in 2000.
“Here, they’re very financially intertwined and so this has been a big shock for us and if the international student market changes – and I think there are reasons to believe it will change – it has flow-on effects for us,” he said.
Australia’s universities will suffer a combined $16 billion downturn from the loss of overseas student revenue due to COVID-19 in the four years between 2020 and 2023, according to modelling published this week by Universities Australia.
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Royal Commissions And The Like.
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There are no entries in this section.
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National Budget Issues.
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Porter concedes robodebt scheme unlawful, doesn't rule out further damages
By Anthony Galloway and Rob Harris
Updated May 31, 2020 — 4.51pmfirst published at 11.28am
Taxpayers could end up forking out more than $1 billion to the victims of the bungled "robodebt" scheme after Attorney-General Christian Porter conceded the Commonwealth may have to pay damages to the hundreds of thousands of people who were hit with debt notices based on flawed calculations.
But the Morrison government is refusing to apologise to those caught up in its controversial scheme while it faces a legal stoush and has suggested that other government debt-recovery schemes had also been unlawful.
A class action over the scheme, which relied on income tax assessments made by the ATO that turned out to be inaccurate, will go ahead despite the government announcing late on Friday it would repay $721 million to 373,000 people.
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Robodebt: ‘Taking out the trash’ a cynical move
The late Friday afternoon release of the Robodebt news by the government was the nadir of political spin. A cold and ruthless calculation.
It is a well worn tactic in political circles to “take out the trash” late on a Friday afternoon. In the hope that the evening news won’t pivot and carry the story, but even if it does Friday evening news is the lowest rating night of the week.
The further hope is that Saturday newspapers won’t carry the story prominently, because unlike daily papers which often pivot late, Saturday newspaper production is a more longitudinal affair, with splashes and spreads sometimes laid out well in advance.
By Sunday the political strategists calculate that the news they dropped late on the Friday arvo is “old news”, and hence won’t hit the front pages of those newspapers either.
All very clever.
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https://www.afr.com/politics/federal/virus-cases-rise-by-10-20200601-p54y7p
The most expensive pizza they'll ever eat
Liz Main
Almost two-thirds of superannuation money withdrawn early during the coronavirus crisis has been frittered the money away on alcohol, take away food and clothes, according to research by AlphaBeta, which is part of Accenture, and credit bureau illion.
A further 11 per cent of the retirement savings was spent on gambling.
“There’s a group of people out there living very large on pizza and beer courtesy of tax-free super. These are the most expensive pizzas they will ever eat,” said Simon Bligh, chief executive of illion.
The researchers found 14 per cent of the money was used to repay personal debt, including credit cards, buy-now pay-later schemes and other bills.
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House values fall in Sydney and Melbourne through May
By Shane Wright
June 1, 2020 — 10.17am
Sydney and Melbourne property markets have led the first drop in national dwelling values since the middle of last year as the efforts to prevent the spread of the coronavirus hit buyers and sellers.
Dwelling value nationally dropped by 0.4 per cent in May, the first fall since June last year, according to CoreLogic.
CoreLogic on Monday reported house values in Sydney fell by 0.6 per cent last month while in Melbourne they dropped by 1.1 per cent.
The value of units in both cities also dropped, down by 0.1 per cent in Sydney and by 0.6 per cent in Melbourne.
Nationally, dwelling values were down by 0.4 per cent although there were some outliers including Canberra, where they lifted by 0.5 per cent, in Hobart by 0.8 per cent.
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Go below zero: RBA urged to take rates negative for economic boost
By Shane Wright
June 2, 2020 — 12.00am
One of the nation's most senior economists has called on the Reserve Bank to consider negative interest rates to drive down the Australian dollar and encourage local businesses to invest their savings in money-making investments.
Despite signs the Sydney and Melbourne property markets are withstanding the coronavirus pandemic shutdown, Westpac chief economist Bill Evans said the RBA board should use its Tuesday meeting to consider taking the official cost of money into negative territory.
As recently as last week, RBA governor Philip Lowe said it was highly unlikely the bank would follow the lead of countries such as Sweden, Denmark and Japan in taking official rates below zero. New Zealand's central bank is also increasingly likely to consider negative rates.
The RBA, which is expected to hold official rates at a record-low 0.25 per cent this month, is predicting the economy to contract by up to 10 per cent in the June quarter, unemployment to remain elevated for the next two years and inflation to stay subdued even longer.
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Arts fund: the show must go on
Films, theatre productions and music festivals will be eligible for upfront cash injections under a plan the Morrison government is considering to revive the hard-hit arts sector.
The Australian has established that a coronavirus relief fund is the key option Arts Minister Paul Fletcher is considering as the federal government moves to restart the industry, which has been under serious strain after the pandemic shut theatres and closed productions.
Mr Fletcher had considered a subsidy to underwrite performances, as theatres are likely to remain partly filled because of social-distancing rules, according to Coalition sources who had been briefed on the discussions.
The pandemic has left major cultural institutions in dire financial situations. Sydney performance space Carriageworks called in administrators last month and other companies face sizeable losses after months of closure.
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No negative interest rates here please, Dr Lowe
Stephen Bartholomeusz
Senior business columnist
June 2, 2020 — 11.52am
There’s increasing speculation that the Reserve Bank might lower the cash rate into negative territory even though the RBA governor, Philip Lowe, has consistently said it is "extraordinarily unlikely." Hopefully Lowe and the RBA will hold that line.
The latest to weigh in on the prospect of a negative cash rate were Westpac chief economist Bill Evans and his counterpart at RBC Capital, Su-Lin Ong, both of whom said this week they see a likelihood of negative rates within the next 12 months.
In the UK the Bank of England raised £3.8 billion ($7 billion) from an issue of three-year bonds with a negative yield of 0.003 per cent last month. New Zealand is toying with the notion of issuing bonds with a negative rate and there is speculation the US Federal Reserve, with a federal funds rate that is effectively zero, may also push it into negative territory.
There have even been reports that banks here are amending loan contracts and preparing their systems just in case the RBA has a change of mind.
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New ABS retail trade data released
Patrick Commins 4 June, 2020 | 11.25am
Retail sales plunged a record 18 per cent in April, while Australia’s trade surplus fell 16 per cent to $8.8bn for the month, new data from the Australian Bureau of Statistics shows.
The 17.7 per cent drop in spending was only marginally lower than the 17.9 per cent preliminary estimate released late last month, and confirms the end of panic buying in March which charged the biggest ever boost to turnover in that month.
The international trade in goods and services figures showed a step back in iron ore exports after a big increase in the prior month as China reopened it economy. Services exports fell 13 per cent and service imports 42 per cent as Australia’s borders were closed through the month.
National accounts figures released yesterday showed the early impact of the health crisis drove a 0.3 per cent contraction in the economy over the first three months of the year, putting Australia on course for two consecutive quarters of negative growth – the technical definition of a recession.
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Coronavirus crisis projected to add $620bn to Australia’s net debt, PBO says
Australia’s legacy of the COVID-19 crisis will be additional net debt of up to $620bn by the end of this decade, while the budget deficit will peak at nearly $200bn in the next financial year and will remain in deficit through to 2030, according to new Parliamentary Budget Office projections.
The PBO estimates are based on the Reserve Bank of Australia’s three economic scenarios outlined last month in its Statement on Monetary Policy.
“Our analysis shows that the impact of COVID-19 may result in Commonwealth government net debt in 2029-30 being between 11 and 18 per cent of GDP ($500bn to $620bn) higher than it would have been otherwise,” the PBO reports reads.
“At last December’s Mid-Year Economic and Fiscal Outlook, net debt was projected to fall to 1.8 per cent of GDP by 2029-30.”
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https://www.afr.com/policy/economy/the-big-climb-out-of-the-dreaded-r-word-20200603-p54z8e
The big climb out of the dreaded recession hole
As the economy strives to find its way out of the recession, the government needs to make every dollar count.
John Kehoe Senior writer
Jun 6, 2020 – 12.00am
When Josh Frydenberg was asked point-blank this week if Australia was in recession for the first time in 29 years, the media-savvy Treasurer tactfully avoided saying the dreaded "R" word.
But he was still definitive in admitting the inevitable after the economy shrank 0.3 per cent in the three months to March 31.
“The answer to that is 'yes', and that is on the basis of the advice I have from the Treasury department about where the June quarter is expected to be," Frydenberg said.
The last time Australia experienced recession was in 1991, when Labor's Bob Hawke and Paul Keating were leading the country, Bryan Adam's (Everything I Do) I Do It for You was top of the music charts and Hawthorn was on its way to claim the AFL premiership.
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https://www.afr.com/policy/economy/virus-blows-out-debt-by-more-than-500b-20200605-p54zrp
Virus blows out debt by more than $500b
John Kehoe Senior writer
Jun 5, 2020 – 11.19am
The federal budget will sink to a record deficit approaching $200 billion next financial year and net debt will blow out by an extra $500 billion by the end of the decade because of the COVID-19 impact, parliament's independent budget watchdog says.
The economy will be permanently smaller as a result of the virus, due to lower prices and wages being an enduring legacy of the economic crisis.
The weaker level of nominal gross domestic product over the long-term will forever reduce the amount of income tax revenue and goods and services tax (GST) payments to the states and territories.
Personal income tax is forecast to be about $47 billion lower in 2020-21 than the $240 billion previously forecast.
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https://www.afr.com/politics/federal/markets-shrug-off-500b-debt-load-20200605-p54zwl
Markets shrug off $500b debt load
Jun 5, 2020 – 5.46pm
Markets shrugged off forecasts the coronavirus will add $500 billion to government debt this decade - they pushed the Australian dollar past US70¢ and extended the fastest bull market in ASX history.
As Prime Minister Scott Morrison signalled he will rein in some emergency coronavirus expenditure and instead aim to get people back to paid work, the S&P/ASX 200 finished the week 4.2 per cent higher and 32 per cent above its March low.
A faster-than-anticipated economic reopening two months after businesses were forced to shut down has the government recalibrating its fiscal stimulus that was originally predicated on a six-month business "hibernation".
Of the $150 billion slated for stimulus spending, at this stage $92 billion is poised to flow after the June 30 financial year ends, with the bulk of the payments and tax breaks due to expire by late September.
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Health Issues.
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International Issues.
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In days of discord, a president fans the flames
As America is reeling from 100,000 pandemic deaths, 40 million unemployed and cities erupting in flames of rioting, Donald Trump's bellicose leadership is winning few friends.
Peter Baker
May 31, 2020 – 2.30pm
With a nation on edge, ravaged by disease, hammered by economic collapse, divided over lockdowns and even face masks and now convulsed once again by race, President Donald Trump's first instinct has been to look for someone to fight.
Over the past week, America has reeled from 100,000 pandemic deaths, 40 million people out of work and cities in flames over a brutal police killing of a subdued black man in Minneapolis, Minnesota.
But Trump was on the attack against China, the World Health Organisation, Big Tech, former president Barack Obama, a cable television host and the mayor of a riot-torn city.
While other presidents seek to cool the situation in tinderbox moments such as this, Trump plays with matches.
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'The world is watching': Australians in LA protest over death of George Floyd
By Michaela Whitbourn and Rachael Dexter
May 31, 2020 — 6.15pm
The protest started peacefully, Leah Martin-Brown said, before rioting and looting triggered the lockdown of a city.
The 28-year-old musician from Burleigh Heads on the Gold Coast has been living in LA for almost seven years and felt compelled to lend her voice to the Black Lives Matter protest over the death last Monday of handcuffed African American man George Floyd at the hands of Minneapolis police.
Reporter covering Minnesota protests sparked by George Floyd death.
Organisers asked protesters to sit across an LA intersection "for as long as George Floyd was made to [lie down] with the officer's knee on his neck," Ms Martin-Brown said.
"There's an endemic racism problem here in America. George Floyd isn't the first innocent unarmed black man to get killed in the last [few] months," she said.
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https://www.nytimes.com/2020/05/30/opinion/sunday/coronavirus-globalization.html
How We Broke the World
Greed and globalization set us up for disaster.
Opinion Columnist
If recent weeks have shown us anything, it’s that the world is not just flat. It’s fragile.
And we’re the ones who made it that way with our own hands. Just look around. Over the past 20 years, we’ve been steadily removing man-made and natural buffers, redundancies, regulations and norms that provide resilience and protection when big systems — be they ecological, geopolitical or financial — get stressed. We’ve been recklessly removing these buffers out of an obsession with short-term efficiency and growth, or without thinking at all.
At the same time, we’ve been behaving in extreme ways — pushing against, and breaching, common-sense political, financial and planetary boundaries.
And, all the while, we’ve taken the world technologically from connected to interconnected to interdependent — by removing more friction and installing more grease in global markets, telecommunications systems, the internet and travel. In doing so, we’ve made globalization faster, deeper, cheaper and tighter than ever before. Who knew that there were regular direct flights from Wuhan, China, to America?
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Donald Trump and the spectre of a race-based US election
America now faces the spectre of a long summer of unrest, with a president stoking the polarisation.
Edward Luce Columnist
Jun 1, 2020 – 9.40am
The novelist William Faulkner said: “The past is not dead. It is not even past.” The past 72 hours of burning US cities triggered parallels with 1968 — a year of urban white flight that ended with the election of Richard Nixon.
He won on a law-and-order platform that appealed implicitly to white anxiety.
Donald Trump does not deal in implicit language. In response to protests in Minneapolis after the police suffocation last week of George Floyd, a 46-year-old black man, Mr Trump tweeted: “When the looting starts, the shooting starts”. The line was used by George Wallace, the segregationist third-party candidate in 1968.
Republicans launched the “southern strategy” to win over resentful white Democrats after the civil rights revolution. Mr Trump’s 2016 campaign was the apotheosis of that approach.
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US cities fear more destruction as protesters rage
Brendan O'Brien and Carlos Barria
Jun 1, 2020 – 9.12am
Minneapolis | Major US cities feared another night of violent protests over the death of George Floyd in police custody, cleaning up streets strewn with broken glass and burned out cars as curfews failed to stop confrontations between activists and law enforcement.
What began as peaceful demonstrations over the death of Floyd, who died as a white Minneapolis police officer knelt on his neck, have become a wave of outrage sweeping a politically and racially divided nation. Protesters have flooding streets after weeks of lockdowns during the coronavirus pandemic that threw millions out of work and hit minority communities especially hard.
As demonstrators broke windows and set fires, police fired rubber bullets and tear gas to disperse crowds in many cities. In some cases, bystanders and members of the media were targeted.
In one video from Minneapolis, a National Guard Humvee rolls down a residential street followed by what appear to be police officers wearing tactical gear. One officer orders residents to go inside, then yells "light 'em up" before shooting projectiles at a group of people on their front porch. The city's curfew does not apply to residents outside on their private property.
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Trump fans flames of resentment and hatred
Tom Switzer
June 1, 2020 — 12.15am
For several decades, America has been a deeply divided nation, but it has grown more so in the Trump era. It’s not just that hostility from those in one political party towards those in the other has risen. Divisions between urban and rural America, between those with university degrees and those without, have also widened.
As the crisis in Minneapolis and other cities demonstrates, race also remains a significant fault line. Of course, the immediate spark for the protests and subsequent riots was the truly horrifying footage of last week’s encounter between African-American man George Floyd and the Minneapolis police: an officer is seen pressing his knee on Floyd’s neck while his pleas for help are ignored before he dies.
Within days, the video precipitated nationwide demonstrations against police brutality. The protests have been turned into wanton violence and destruction in the twin cities and elsewhere. The law has to be allowed to run its course and already all four policemen have been fired and one charged with murder and manslaughter.
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Chaos and dissent may not work for Trump this time
A burning, divided and angry America swept Donald Trump into the White House almost four years ago. It won't be so easy this time.
Jacob Greber United States correspondent
Jun 1, 2020 – 1.44pm
Washington | A burning, divided and angry America swept Donald Trump into the White House almost four years ago and many believe today’s chaos will help keep him there in November's elections.
But that is too simplistic a reading of what’s unfolding.
On the surface, the lawlessness, looting and violence that has erupted across major US cities provides Trump with all the fodder he needs to prosecute a tough-guy argument and blame Democrats for enabling criminal behaviour.
“LAW & ORDER” Trump spat out on Twitter late on Sunday (Monday AEST) as cities such as Washington, Los Angeles and Minneapolis prepared for yet another night of bruising conflict.
“Get tough Democrat Mayors and Governors. These people are ANARCHISTS. Call in our National Guard NOW,” he wrote earlier in the day. “The World is watching and laughing at you and Sleepy Joe [Biden]. Is this what America wants? NO!!!”.
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'I am your President of law and order', declares Donald Trump
Jacob Greber United States correspondent
Updated Jun 2, 2020 – 10.02am, first published at 9.15am
Washington | Donald Trump invoked a 213-year-old "insurrection" law to deploy the US military and "dominate" streets as riots erupted across America for a seventh straight night.
In a dramatic split-screen made-for-television moment, Mr Trump issued his orders for a "law and order" escalation from the Rose Garden at the very moment police beyond the White House fence began firing tear gas and flash grenades to disperse hundreds of people protesting the slaying of African-American man George Floyd by police.
US President Donald Trump urged state governors to crack down on protests over racial inequality that have engulfed the nation's major cities, as officials extended curfews in hopes of preventing a seventh night of looting and vandalism.
"We will end it now," Mr Trump said of the riots and protests that have gripped the nation as he vowed to send the National Guard into states regardless of whether or not local leaders wanted them.
"I am your president of law and order," Mr Trump said.
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https://www.afr.com/world/north-america/donald-trump-race-and-the-arc-of-history-20200602-p54yll
Donald Trump, race and the arc of history
On the surface, the current unrest and violence look like a disaster for the US President. Yet one lesson of the past is that chaos often drives voters to the right.
Gideon Rachman Columnist
Updated Jun 2, 2020 – 9.41am, first published at 9.27am
Calculations about how the killing of George Floyd will affect the 2020 US presidential election will seem coldly rational — even offensive — to the thousands of protesters who have taken to the streets of America.
They, and many others, are haunted by the appalling footage of his dying moments, as he choked to death under a policeman’s knee. The protesters know that the US has a history of racial violence that goes back centuries.
Even two terms in office for Barack Obama, the first ever African-American president, did not lead to the profound changes in race relations that many had hoped for.
The Black Lives Matter movement was actually founded during the Obama presidency — after the acquittal in 2013 of George Zimmerman, who was accused of the murder of Trayvon Martin, an unarmed black teenager. It gathered further momentum in 2014 — still during the Obama presidency — after the deaths of two more African-Americans, Eric Garner and Michael Brown, at the hands of the police.
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The US is tearing itself apart because its political system has failed
Peter Hartcher
June 1, 2020 — 11.45pm
China's authoritarian system has been promoting itself as superior to American democracy for more than a decade. The global financial crisis devastated the US economy while China emerged largely unscathed, and Beijing's propaganda machine seized on the contrast: "The 'China model' has created miracles, opened a unique path of development and superseded belief in a superior 'America model,' marking its demise," proclaimed the People's Daily in 2009.
It was around the same time a notable pro-democracy think tank in the US, Freedom House, declared a "democratic recession". In its latest annual pulse-taking, published in March, it found that the recession of democracy worldwide was entering its 14th consecutive year.
Twice as many countries suffered declines in freedom as enjoyed improvements, Freedom House reported. It counts the US among the countries in democratic decline. Freedom in America had declined in the last 10 years by 8 points on its 100-point scale.
Police try to push protesters back in Washington DC on the sixth day of protests over the death of George Floyd, a black man killed by police in Minneapolis.
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Look at racial economic disparities to understand the riots, economists say
By Eli Rosenberg and Andrew Van Dam
June 2, 2020 — 10.59am
In the Minneapolis area, where protests have turned violent in the wake of the police killing of George Floyd, the median income for black households is less than half of white ones - $US38,200 ($56,235) compared to $US85,000.
In Washington DC, where protesters set fire to American flags and a church near the White House, the percentage of out-of-work black residents outpaces white residents at a rate of about 6 to 1.
African American households have struggled more economically than the median household nationwide, even when unemployment was at single-digit historic lows. Now, months into the coronavirus pandemic that has rendered 40 million people jobless, African Americans have lost jobs at higher rates in many communities.
A recent Washington Post-Ipsos poll found that blacks reported being furloughed and laid off at higher rates than whites, underlining the disproportionate toll of the pandemic on African American communities. And this is all happening at time when black Americans are also dying of COVID-19 at much higher rates than whites, according to the Centers for Disease Control and Prevention.
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What is Antifa and why does Donald Trump want to blame it for the violence in the US?
By Mark Bray
June 2, 2020 — 10.06am
Did the tragic video of the police killing of George Floyd in Minneapolis throw you into a fit of rage? Of sadness and despair? Did it make you want to burn down a police station?
Whether it did or (more likely) did not, you might be among the many who sympathise with the outburst of anger behind the overturning of police cruisers and the smashing of storefronts in cities across the country in the wake of Floyd's death, even if you disagree with property destruction. Though "violent" protest tactics are generally unpopular, they command attention and force us to ask: How did we get here?
President Donald Trump declared himself "your president of law and order" and warned the US military would roll in to stop riots across the US.
President Donald Trump, US Attorney-General William Barr and their allies have a simple and convenient answer: "It's ANTIFA and the Radical Left," as Trump tweeted on Saturday. "In many places," Barr explained, "it appears the violence is planned, organised and driven by anarchic . . . and far left extremist groups using Antifa-like tactics." "Domestic extremists," Senator Marco Rubio tweeted, are "taking advantage of protest to further their own unrelated agenda." After another night of destruction that included the burning of the former slave market called the Market House in Fayetteville, North Carolina, Trump upped the stakes on Sunday by declaring that "the United States of America will be designating ANTIFA as a Terrorist Organisation."
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https://www.skynews.com.au/details/_6160964521001
World is watching the ‘end of an empire’
US Studies Centre Non-Resident Fellow James Brown says it feels like “watching the end of an empire” as President Donald Trump fights a battle on twin fronts: COVID-19 and internal anarchy over the fatal arrest of unarmed black man George Floyd. “We’ve seen 100,000 deaths in America, we’ve seen political disunity, we’ve seen chaotic press conferences and comments from the commander and chief, and now we’re seeing violence, looting and fires in 75 major cities across the US,” Mr Brown said. His remarks came directly after Mr Trump declared himself the “president of law and order” during an address at the White House where he threatened to deploy the US military to “quickly solve the problem” of violent protests if a city or state failed to take necessary defensive actions. “Today, I have strongly recommended to every governor to deploy the National Guard in sufficient numbers that we dominate the streets. Mayors and governors must establish an overwhelming presence until the violence is quelled,” Mr Trump said. “If a city or state refuses to take the actions necessary to defend the life and property of their residents, then I will deploy the United States military and quickly solve the problem for them.” Protests have entered their seventh consecutive day, with dozens of cities enforcing curfews in an attempt to end the upheaval. Mr Brown said normally a leader would call for calm rather than threaten to escalate violence. “We will know very quickly whether the president’s strategy works. He is coming in hard, he is militarising the response,” he said. Image: AP
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'A terrifying performance': Donald Trump is close to inciting civil war
Paul Krugman
Nobel prize winning economist
June 3, 2020 — 12.00am
Last year Bob Kroll, the head of the Minneapolis police union, appeared at a Trump rally, where he thanked the President for ending Barack Obama's "oppression of police" and letting cops "put the handcuffs on criminals instead of us".
The events of the past week, in which the death of George Floyd in Minneapolis police custody led to demonstrations against police brutality, and these demonstrations were met by more police brutality – including unprecedented violence against the news media – have made it clear what Kroll meant by taking the handcuffs off. And Donald Trump, far from trying to calm the nation, is pouring gasoline on the fire; he seems very close to trying to incite a civil war.
US President Donald Trump has suggested the military may be deployed in order to calm the protests across the nation.
I don't think it's an exaggeration to say that America as we know it is on the brink.
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George W. Bush calls out racial injustices, celebrates protesters
By Colby Itkowitz
June 3, 2020 — 9.35am
Austin: Former president George W. Bush addressed the nationwide protests in a statement on Tuesday, commending the Americans demonstrating against racial injustice and criticising those who try to silence them.
"It is a strength when protesters, protected by responsible law enforcement, march for a better future," Bush said.
Describing himself as "anguished" by the death of George Floyd, who died more than a week ago after being suffocated under the knee of a white police officer, urged white Americans to seek ways to support, listen and understand black Americans who still face "disturbing bigotry and exploitation."
The nation's 43rd president's statement does not mention President Donald Trump, but his call for compassion and unity presents a stark contrast to the current president's more inflammatory rhetoric.
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A perfect storm is exposing Donald Trump and US frailties
The most powerful nation on Earth is being brought undone from within by its pent-up governance and moral failures. The crisis has multiple triggers — abuse of police power, entrenched disadvantage of black Americans, mounting anger in American hearts, cultural schisms across the nation and political polarisation driven by Donald Trump’s populism and Democrat progressivism.
The intolerable killing of George Floyd has erupted into something far larger. On display now is a conflict between two contradictory visions: resentment at the injustice, racism and despair embedded in the American project, and Trump’s resort to the executive “dominance” against lawlessness, casting himself as “your President of law and order” to defend the public by threatened military deployment.
The fourth year of the Trump presidency has turned into a nightmare that has shaken the lives, livelihoods and confidence of all Americans. COVID-19 was the perfect storm that exposed US frailties. Trump’s response was appalling; more than 100,000 Americans have died, the economy plunged into a downturn with unemployment heading to 20 per cent, consigning millions of households and businesses to misery. But the bottom 50 per cent — and that includes most African-Americans — are the most damaged.
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George Floyd US protests: Virus, unemployment, riots — US at a tipping point
· The Wall Street Journal
When does a country reach a tipping point — a point when the citizenry concludes that things are simply spinning out of control, and that something different is required?
The question arises, obviously, as protests and looting spread across America in the wake of the brutal police killing of a black man — shocking scenes that have come atop a once-in-a-century pandemic and a Depression-like economic slide.
In a moment of crisis, it’s hard to tell when such events will simply fade away in a return to the status quo, and when they will produce lasting change in political and social structures.
Yet a look back at recent history suggests that it is precisely at moments like this, when shocks pile on in succession from different directions, that Americans can choose a new course.
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US protests: Dictators smell blood in the water
The world’s strongmen are seizing gleefully on the death of George Floyd and the riots that followed, hoping to delegitimise America’s rule-of-law system at home and sap its credibility abroad.
Recep Erdogan of Turkey, last seen stamping out his political opposition and forcibly displacing Kurds in Syria, tweeted that “The racist and fascist approach that led to the death of George Floyd in the US city of Minneapolis as a result of torture has not only deeply saddened all of us, but it has also become one of the most painful manifestations of the unjust order we stand against across the world.”
Taking a break from genocidal threats against Israel, Iran’s Ayatollah Khamenei retweeted something that said: “If you’re dark-skinned walking in the US, you can’t be sure you’ll be alive in the next few minutes.”
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General Mattis blasts Trump in message that defends protesters
Dan Lamothe
Jun 4, 2020 – 9.30am
Former US defence secretary Jim Mattis excoriated President Donald Trump on Wednesday (Thursday AEST), accusing the nation's chief executive of deliberately trying to divide Americans, taking exception to his threats of military force on American streets, and praising those demanding justice following the police killing of George Floyd.
"Donald Trump is the first president in my lifetime who does not try to unite the American people – does not even pretend to try. Instead, he tries to divide us," Mattis wrote in a statement published by the Atlantic.
"We are witnessing the consequences of three years of this deliberate effort. We are witnessing the consequences of three years without mature leadership," he continued.
"We can unite without him, drawing on the strengths inherent in our civil society. This will not be easy, as the past few days have shown, but we owe it to our fellow citizens; to past generations that bled to defend our promise; and to our children."
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https://www.afr.com/markets/currencies/we-may-be-entering-a-post-dollar-world-20200603-p54yzw
We may be entering a post-dollar world
Continued erosion of trust in America politically could have an impact on the dominance of the US banking system and the supremacy of its currency.
Rana Foroohar Contributor
Jun 4, 2020 – 6.08am
Unfettered globalisation is over. That is not a controversial statement at this point for obvious reasons, from the post-COVID-19 retrenchment of complex international supply chains to the decoupling of the US and China. It’s hard to imagine a reset to the 1990s neoliberal mindset, even if Joe Biden wins the US presidential elections, or if the EU experiences a moment of renewed cohesion in response to the pandemic.
The world is more likely to become tripolar – or at least bipolar – with more regionalisation in trade, migration and even capital flows in the future. There are all sorts of reasons for this, some disturbing (rising nationalism) and others benign (a desire for more resilient and inclusive local economies).
That begs a question that has been seen as controversial – are we entering a post-dollar world? It might seem a straw-man question, given that more than 60 per cent of the world’s currency reserves are in dollars, which are also used for the vast majority of global commerce. The US Federal Reserve’s recent bolstering of dollar markets outside of the US, as a response to the coronavirus crisis, has given a further boost to global dollar dominance.
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It's hard not to see the end days of an empire, but America's friends must hope it finds a better path
By James Brown
June 4, 2020 — 12.00am
In war, urban military operations are exceedingly difficult. At home, during times of peace, they can be appallingly tragic. In 1967 a national guardsman deployed to help Detroit police maintain law and order feared a sniper was active locally and fired a heavy-calibre machine gun through an apartment window, killing a four-year-old girl and seriously injuring her aunt.
During the 1992 Los Angeles riots, a police sergeant approaching a house said “cover me” to an accompanying marine corporal and was surprised when the marine ordered his section to lay down sustained covering fire. As US history has shown, large-scale domestic military deployments are a blunt instrument: better at sandbagging flood levies than deftly managing lawful protesters and unlawful looters.
This week US President Donald Trump threatened to use the Insurrection Act to federalise the national guard and deploy it to shut down the protests and widespread lawlessness that has broken out across at least 23 states since George Floyd was killed while under police arrest in Minneapolis.
In a conference call, Trump told state governors they were weak, while his Secretary of Defence spoke of the need to “dominate the battlespace”. Overnight the Pentagon flew 1600 soldiers from the Army’s 82nd Airborne Division, 10th Mountain Division, and 1st Infantry Division to staging points in Washington DC while masked and uniformed national guardsmen took up positions on the steps of the Lincoln Memorial.
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Lest we forget China’s bloody day of shame at Tiananmen Square
On this day in 1989, the Chinese military brutally crushed unarmed crowds of Chinese students who had, since April that year, been calling for political reforms and greater civil liberties. Ever since, the Chinese Communist Party has tried to airbrush the incident out of history and to discourage mention of it even in foreign media.
There are several reasons why we should refuse to forget it.
That was the date on which the hardline authoritarians in China defeated the last of the more liberal-minded senior political figures. That defeat has had fateful consequences. They are writ large in the extreme authoritarianism and personality cult of Xi Jinping. Deng Xiaoping had been refusing to embrace serious reforms for a decade by then, starting with his suppression of the Democracy Wall in 1979. But the violence in 1989 was a watershed event.
The Orwellian surveillance and repression we see in China under Xi are the antithesis of what the young students in Tiananmen Square were calling for in early 1989: a more open, accountable, human-rights respecting, “democratic” government.
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https://www.afr.com/world/north-america/trump-is-obese-but-healthy-his-doctor-says-20200604-p54zcw
Trump is obese, but 'healthy': his doctor says
Jordan Fabian
Jun 4, 2020 – 9.16am
President Donald Trump is healthy, his doctor said in a report on his medical condition that showed he remains obese as measured by his body-mass index.
"Based on my history, examination and consultations, the data indicates the President remains healthy," the White House physician, Sean Conley, said in a June 3 memo released to reporters.
He said that Trump completed his third physical as President in April. Conley said Trump weighs 244 pounds (111 kg), one pound more than his last physical, and is 6 feet, three inches tall (190 cm) -- a combination that places him just over the threshold for obesity, according to the National Heart, Lung and Blood Institute.
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Light touch cost us many lives, Swedish scientist concedes
· The Times
The scientist behind Sweden’s light-touch coronavirus strategy has conceded that it led to “too many” deaths, in the first admission that the choice not to impose a general lockdown could have been a mistake.
While its neighbours shut schools, restaurants and all but essential shops in early March, Sweden was the only rich European country to take a less coercive approach.
Until now it has pursued a policy of “mitigation”, permitting most schools, bars, nightclubs and virtually all other businesses to remain open, and initially allowing gatherings of up to 500 people.
Its death rate per capita has climbed to among the highest in the world, behind only Belgium, Britain, Spain and Italy. Sweden has registered 4542 COVID-19 deaths, four times as many as Denmark, Norway and Finland combined.
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https://www.afr.com/world/north-america/a-divided-us-is-diminished-and-distracted-20200602-p54yr9
A divided US is diminished and distracted
US soft power was already dwindling under Donald Trump, but the latest wave of police violence may be drying up the country's reserves.
Colum Lynch and Robbie Gramer
Jun 5, 2020 – 12.00am
A world that once looked to the United States to champion democracy and human rights watched with dismay and alarm as police departments across the nation unleashed violent crackdowns on anti-police protesters, targeting looters, demonstrators, and journalists alike, even as President Donald Trump criticised state governors for their “weak” response.
Meanwhile, from Canada to New Zealand, tens of thousands of people gathered around the world to protest the killing of an African American man, George Floyd, who was suffocated on May 25 in Minneapolis by a white police officer who kneeled on his neck. The officer has since been charged with murder.
Floyd’s death last week touched off US demonstrations that swiftly turned into riots in more than 100 American cities. But memorials also sprouted up in cities around the globe, from a candlelight vigil in Mashhad, Iran, to a mural painted on the remains of the Berlin Wall bearing Floyd’s likeness along with his dying plea: “I can’t breathe.”
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When police attack news crews, I fear something is broken in America
By Robert Penfold
June 4, 2020 — 3.23pm
The rise of violence against reporters, many of them my friends and co-workers during this tumultuous time in the US, is not only alarming but for me surprising.
Until now we understood that when we worked on the front line of these dangerous events, wearing the word "press" or a media pass on a cord around our neck usually provided at least some protection from the swinging batons or the rubber bullets.
The very reason I was issued with a media pass – as it stated on the form when I applied for it – is that when the heat is on I can "cross police and/or fire lines in the course of your news gathering".
Until now, the police did not allow us to cross that line just to make us the target of their anger. But that is what has happened so many times in America during the past 10 days.
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Horror week of US protests could not come at a worse time for Donald Trump
This was a terrible week for Donald Trump. In fact it’s been a terrible three months for the US president.
We are less than halfway through 2020, but already this year is shaping up to be – by some way – the worst of his presidency and his prospects for re-election have taken a hit.
Trump has been dealt a series of blows that were not of his making – the coronavirus pandemic, the resulting economic collapse and now the worst race protests and civil unrest since the 1960s.
But in each of these historic crises Trump’s leadership has been caught short and widely criticised – a fact which is now being reflected in the polls and which is triggering growing alarm inside the Trump campaign.
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https://www.afr.com/world/north-america/the-disunited-states-of-america-20200605-p54ztz
Donald Trump looks to be in real political trouble
America is in chaos, torn apart by a president who is incapable of showing empathy out of fear of being seen as weak. But it's dealing with entrenched problems that pre-date Donald Trump.
Jacob Greber United States correspondent
Jun 5, 2020 – 4.01pm
Civil War, presidential assassinations, Ku Klux Klan marches, General Douglas MacArthur ordering tanks and troops down Pennsylvania Avenue to quell a rebellion, and devastating race riots in the late 1960s. The downtown streets of Washington, DC have seen it all.
As tumultuous as this week’s protests and the looting mayhem that have dogged them may appear on the live news feeds, such scenes are nothing new in America.
This week may even mark a long-yearned for turning point for African Americans and their fight for equality and justice. But you wouldn’t bet on it.
Once again the world is seeing the United States during dark times, struggling to address its most entrenched problems – the treatment of young black men by police is merely the most immediate and ugly.
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The 39 most outrageous lines from Donald Trump's Friday 'press conference'
Analysis by Chris Cillizza, CNN Editor-at-large
Updated 1929 GMT (0329 HKT) June 5, 2020
(CNN)Just before 9 a.m. Eastern time on Friday, President Donald Trump tweeted that he would be holding a "News Conference" to talk about the "Jobs Numbers!"
He talked about the jobs numbers, all right, as well as how he might buy an RV and drive it around the country and how he is very physically fit. One thing he didn't do in the rambling 45-plus minute event was take any questions from reporters. Which makes what he did not a news conference at all, but a speech.
Nonetheless, I went through the transcript of Trump's remarks and pulled out the lines you really should see. They're below.
1. "We were very strong. We had the greatest economy in the history of our country, we had the greatest economy in the history of the world."
This is not true. No matter how many times he says it. And away we go!
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https://www.afr.com/politics/federal/global-deaths-head-towards-400-000-20200606-p5502p
5.51am – Jun 6, 2020
Second wave risks rise in US: Morgan Stanley
Timothy Moore
The accelerated reopening of the US economy may come with a high cost: a new wave of COVID-19 cases and deaths.
In its latest note, Morgan Stanley expressed its concerns:
"In the United States, the trend and scope of new virus cases continues to be worse than other western countries.
"The reproduction number in the US remains slightly over 1, an indication that spread remains on-going. The peak is significantly flatter and wider than other countries and our total predicted infections has risen to 2.3M (versus ~2.1M last week and ~1.4M just a month ago).
"We are becoming increasingly concerned that the US will not be able to drive the virus to the low levels in other countries and this risks an earlier second wave compared to other Western Nations."
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https://www.afr.com/policy/economy/may-s-jobs-report-stunner-real-deal-or-head-fake-20200606-p5502v
May's jobs report stunner: real deal or head fake?
Lindsay Dunsmuir
Jun 6, 2020 – 6.42am
Washington | The US economy unexpectedly added jobs in May, surprising economists and analysts who had forecast millions more losing their livelihoods, and raising hopes of a faster economic recovery than expected.
More than 2.5 million people were newly employed last month, the Labor Department reported on Friday (Saturday AEST), but that follows a record drop of more than 20 million in April.
The unemployment rate fell to roughly 13 per cent compared to almost 15 per cent in the prior month.
Much of the rise in jobs was centred on hardest-hit industries in food services and drinking places, which added 1.4 million jobs and accounted for about half of the employment gains. The leisure and hospitality sector overall added 1.2 million jobs.
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America has been here before but this time it is weak
The US has been rocked by the worst race riots since 1968. The main difference is that its great institutions – president, Congress, the courts – were stronger back then.
Andrew Clark Senior writer
Jun 5, 2020 – 3.25pm
Back in March, as America went into its COVID-19 shutdown, Politico published a long article featuring the thoughts of the Great and the Good about the contagion’s likely impact.
The majority were positive. It presaged, they averred, “a decline in polarisation”, “a new kind of patriotism”, innovative “reform”, science-based thinking, and so on.
After two months, and amid a rising COVID-19 death toll, the same magazine published a sort of mea culpa and speculated the contagion could make Americans “even more selfish and short term”.
A few weeks later, America is in crisis – torn apart by demonstrations against racism, riots, looting and burning buildings; an explosion of anger over police brutality; and a political system put under severe strain by a dysfunctional presidency. Shutdown-generated unemployment is soaring and the economy is contracting sharply amid grieving over a death toll of more than 108,000 and 1.9 million infections from the pestilence.
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https://www.smh.com.au/national/let-s-not-copy-a-broken-empire-20200605-p55014.html
Let's not copy a broken empire
Political and international editor for The Sydney Morning Herald
June 6, 2020 — 12.01am
What's the difference between the problem of black disadvantage here and in America? It's not the intensity of the suffering, but the size of the minority. In some key measures, Australia's Indigenous people are actually worse off than American blacks.
"As obscene as the incarceration rate is in the US, ours is worse," says Noel Pearson, a lawyer and longtime leader in the Indigenous rights movement. The rates of disadvantage, child protection, juvenile detention are all as bad or worse than America's.
How about the overarching measure of your
wellbeing – how long you can expect to live?
Native Americans can expect lives about two years shorter than white Americans.
Black Americans live four fewer years than white. The longevity deficit for
Indigenous Australians is double that – around eight years.
So it's not that Australian blacks suffer any
less. It's about how many there are: "We are obviously a very, very small
minority," says Pearson. "We couldn't mount the resistance you see in
the US."
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China warns tourists to stay away from Australia due to racist attacks
Michael Smith China correspondent
Jun 6, 2020 – 11.58am
Shanghai | China has warned its citizens not to travel to Australia due to a "significant" increase in racist attacks since the coronavirus outbreak.
The travel warning by China's Ministry of Culture and Tourism was issued late Friday and published widely in Chinese newspapers on Saturday.
"Recently, due to the impact of the COVID-19 epidemic there is a significant increase in discriminatory and violent action against Chinese and Asians in Australia," the ministry said in a statement.
"The Ministry of Culture and Tourism would like to remind Chinese tourists to enhance their safety awareness and do not travel to Australia."
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https://www.afr.com/world/asia/what-does-xi-want-20200602-p54yqn
What does Xi want?
Hongkongers defied a ban on the annual vigil commemorating the massacre of student protesters in Beijing's Tiananmen Square in 1989. Getty Images
Michael Smith China correspondent
Jun 6, 2020 – 12.00am
The flickering candles that lit up Hong Kong's Victoria Park on Thursday night were a small act of defiance by tens of thousands of the city's residents.
For the first time in three decades, police had banned the annual vigil commemorating the massacre of student protesters in Beijing's Tiananmen Square in 1989.
They came anyway, ignoring warnings they were breaching a ban on large public gatherings due to the coronavirus. Despite the heavy police presence, the authorities did not turn people away and the evening was peaceful.
It could be the last time that Beijing tolerates the only public recognition of its most sensitive anniversary on Chinese soil, as the Communist Party prepares to introduce national security laws to stamp its authority on the city.
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I look forward to comments on all this!
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David.
