January 26 Edition.
Well Trump has happened and he seems to be even worse that we could have all imagined. His inaugural speech made it clear that Australia is largely on its own and also made it clear the world is likely to be very different for the next few years.
I think the largest immediate risk to Australia is the commencement of a trade-war with China in which we are likely to be badly damaged. Additionally, in a flurry of executive orders, he has done all the dangerous and stupid things we all feared. (Blocking family planning services, ordering a great big wall and so on!)
I hope we can sensibly re-think our place in the world.
This seems sensible to me.
Adam Gartrell
Published: January 21, 2017 - 12:15AM
We shouldn't panic but nor can we relax.
In this uncertain and unpredictable new age of President Trump Australian policymakers and diplomats will have to work harder than ever before to maintain the US alliance, analysts at the Australian National University say.
Politicians must also intensify their efforts to champion the importance of the US-Australia relationship to a sceptical public, according to a new policy paper from Rory Medcalf and the National Security College.
While Australia is well-regarded in Washington - and has already forged important connections with major figures in the new administration - the country will need to find new and creative ways to reach and influence decision-makers in the Trump era, moving beyond the usual diplomatic and defence channels.
"We need to keep increasing our traction within Congress, among business leaders, key US agencies and a wide array of opinion shapers," the paper says.
"We need creative approaches on top of traditional diplomacy – it is not a job for government alone."
Australia will also need to be seen to do more "heavy lifting" in the alliance to address Trump's concern that countries are free riding on US power. That could mean Australia may be expected to do more in terms of providing facilities to support US military activities in Asia and globally.
Here is a direct link to the paper:
As for America’s fate – this says it all…
By Lawrence Summers January 16 at 10:55 AM
Lawrence Summers is a professor at and past president of Harvard University. He was treasury secretary from 1999 to 2001 and an economic adviser to President Obama from 2009 through 2010.
An ironic contradiction is likely to define the global economic community’s convocation in Davos this week as it awaits Donald Trump’s inauguration. There has not been so much anxiety about U.S. global leadership or about the sustainability of market-oriented democracy at any time in the past half-century. Yet with markets not only failing to swoon as predicted, but actually rallying strongly after both the Brexit vote and Trump’s victory, the animal spirits of business are running hot.
Many chief executives are coming to believe that, whatever the president-elect’s infirmities, the strongly pro-business attitude of his administration, combined with Republican control of Congress, will lead to a new era of support for business, along with much lower taxes and regulatory burdens. This in turn, it is argued, will drive major increases in investment and hiring, setting off a virtuous circle of economic growth and rising confidence.
While it has to be admitted that such a scenario looks more plausible today than it did on Election Day, I believe that it is very much odds-off. More likely is that the current run of happy markets and favorable sentiment will be seen, with the benefit of hindsight, as a sugar high. John Maynard Keynes was right to emphasize the great importance of animal spirits, but other economists have also been right to emphasize that it is political and economic fundamentals that dominate in the medium and long terms. History is replete with examples of populist authoritarian policies that produced short-run benefits but poor long-run outcomes.
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As I said a few weeks ago – we are not even in sight of Kansas anymore! The last line of the article cited above says it all: “ If ever there were a time to hope for the best but plan for the worst, it is now.”
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Here are a few other things I have noticed.
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Trump Material.
Donald Trump, it seems, embraces the old dictum: Make no small plans. Already, he has published an agenda for his first 100 days in office, recalling Franklin D. Roosevelt’s launching of the New Deal. Not surprisingly, near the top of Trump’s to-do list is a pledge to double economic growth from its recent desultory rate of 2 percent a year to 4 percent — through massive tax cuts, the relaxation of government regulations and measures that curtail imports.
A huge contradiction sits at the core of his economic agenda. He wants faster economic growth (who doesn’t?), but his proposed policies would also elevate economic uncertainty — and uncertainty hurts growth. If the president proposes deep tax cuts, what will Congress enact? Who will benefit, who won’t? The same uncertainty applies to regulatory cutbacks and anti-import policies. Until the outlook clarifies, businesses and households postpone some spending. Growth suffers.
Of course, there’s always some uncertainty. What makes this different is the breadth of Trump’s proposals. He advocates wholesale upheavals of existing policies.
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Clancy Yeates
Published: January 16, 2017 - 12:00AM
Chief executive pay has become a powerful symbol of the widening gap between the winners and losers created by globalisation, and boards must put more focus on justifying the bonuses they pay executives amid a backlash against free-market policies.
That is the view of the chairman of the Australian Institute of Company Directors, Elizabeth Proust, one of the Australian business leaders attending the powerful World Economic Forum's Davos summit in Switzerland this week.
The annual meeting of the global economic and political elite, in a town in the Swiss Alps, takes place against a backdrop of growing inequality in many countries, seen as a key driver for anti-establishment political shocks including Brexit and Donald Trump's win.
Ms Proust, one of several Australian business leaders to attend the meeting, said a key focal point for the meeting would probably be the backlash against globalisation, a theme that may have further to run in 2017.
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Jessica Irvine
Published: January 16, 2017 - 12:00AM
As you read this, about 3000 members of the global business and political elite are winging their way – some by helicopter, some by private jet – to the snow-covered ski resort of Davos, in Switzerland.
There they will stay, in hotels or private chalets, to attend the four-day annual meeting of the World Economic Forum, commencing Tuesday.
They will have paid upwards of $US50,000 for annual membership of the elite forum – closer to half a million dollars for a premium corporate membership.
They are chief executives, investors, bankers, consultants, central bankers, politicians and celebrities. Pop songstress Shakira will follow in the footsteps of previous attendee Bono to be recognised for her work promoting early childhood learning in Columbia. Matt Damon will launch a new clean water campaign with Stella Artois. Jamie Oliver will spruik his food revolution.
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Jan 15, 2017, 8:23 PM
Populism spread like wildfire across the world in 2016, and the trend looks set to continue in 2017.
But where are those threats the most prominent?
Sterne and Rama brought together research from analysts for major economies across the world and ranked the strength of populist movements in those economies.
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Updated yesterday at 11:50am
The International Monetary Fund has predicted that Donald Trump's plans for big spending increases and tax cuts in the United States are likely to spur a wave of economic growth.
But the IMF also warned that uncertainties over Mr Trump's bullish policies carry major risks that could result in global spill-overs if US interest rates rise to steeply to cool a hot economy.
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Michael Pascoe
Published: January 20, 2017 - 7:09AM
On April 6, 1917, the United States officially entered World War 1. Just six weeks short of 100 years later, Donald Trump is being sworn in as President of the United States. And thus ends the "American Century".
You can quibble about when the American Century began – the United States' economic, political and cultural dominance is generally given a mid-20th century start. That short-changes the US. Britain's "Imperial Century" finished with World War I, the period that saw America challenge Europe's economic might, so there's no point leaving a gap in the timeline.
Yes, there was a false start to the American Century. Woodrow Wilson conceived and pushed the founding of the League of Nations, but couldn't carry the nation to actually join the thing. The man who narrowly won the 1916 election with the slogan "He kept us out of the war" only to go to war five months later, had to accept a return to isolationism.
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Paul McGeough
Published: January 21, 2017 - 4:46PM
Washington: Donald Trump being Donald Trump and politics being politics, much of what he promised for inclusion on his Day One to-do list, either will be executed by an order to be signed by Trump on Monday or will be acknowledged as an important, with a view to being addressed in the coming days, weeks or months.
Remember the urgency of building the Mexican border wall, ending the "war on coal", repealing Obamacare and branding China a currency manipulator – and by implication initiating whatever action such a declaration might require?
Without going into detail, Trump aides claim that as many as 200 draft executive orders are ready for the new President's signature and will be dribbled out in the coming two weeks, with the view to creating the sense of a Trump tsunami at work.
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National Budget Issues.
Amy Remeikis
Published: January 16, 2017 - 7:14AM
Don't worry – 2017 will be better than you think.
At least according to Deloitte, which has released the first of its "Voice of Asia" series with the message that despite Brexit and Trump, and less than optimistic forecasts from the IMF, Asia looks like leading the way in global growth – with Australia well placed to reap flow-on benefits.
Chris Richardson of Deloitte Access Economics recognised the risks "revolving around the potentially volatile mix of President-elect Trump, trades and tariffs" but said "too many forecasters are too negative of Australia's 2017 outlook".
He said the global economy was "finally normalising after a decade of shocks", world trade was lifting, with benefits for Asia and India and China, considered the continent's "mega economies" were "increasingly being powered by consumer booms, acting as a stabilising force in their economies and for the regions".
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January 17, 20179:32am
Colin Brinsden, AAP Economics Correspondent Australian Associated Press
* ECONOMY
The economy posted its worst performance since the global financial crisis in the September quarter 2016. While economists expect the economy to avoid two consecutive quarters of negative growth and a technical recession, it is a threat hanging over the nation until the next set of national accounts figures in early March. At an annual rate of 1.8 per cent it is running well below a long-run average of just under three per cent, which will keep pressure on the jobless rate. The government does not expect a three per cent growth rate until 2018/19.
* LABOUR MARKET
The jobless rate unexpectedly rose to 5.7 per cent in November, ending a steady decline over the year. Employment growth has been fairly flat over the second half year, highlighted by a switch to part-time hirings rather than full-time. This has resulted in wages growth slowing to a record low and keeping only just ahead of inflation. Benign wage growth and rising unemployment will remain drag on the federal budget.
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Jessica Sier
Published: January 19, 2017 - 3:29PM
An assumption of ever-lasting favourable conditions when picking stocks would raises alarm bells for fund managers, but for some reason an ever-booming property market doesn't attract quite the same concern.
Using their stock picking techniques, Auscap Asset Management has determined the downside risks involved in property are too great to invest, especially when correlated over time with household income.
Australian residential property prices have experienced annual growth of 7.4 per cent and have not been exposed to a broad decline since 1991, prompting a view by many that buying houses is a relatively low-risk prospect.
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Joel Negin
Published: January 19, 2017 - 7:30PM
The new federal Minister for Health, Greg Hunt, comes into the role with a large set of challenges – mostly driven by increasing costs and increasing demand for services.
At the same time, on health and health care, Labor has dominated the never-ending rhetorical campaign. Bill Shorten and his team focus relentlessly on Medicare and the Coalition has been on the back foot with regard to the health portfolio for many months.
The arrival of a new minister provides an opportunity for the Coalition government to develop a clear message on how to improve the health and well-being of Australians and support our health system.
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Health Budget Issues.
- The Australian
- 12:00AM January 17, 2017
Sarah Martin
Doctors are calling for the country’s incoming health minister to reset the government’s relationship with the sector by ending a controversial freeze on Medicare payments.
With Malcolm Turnbull expected to announce a new health minister either today or tomorrow, doctor groups say lifting the freeze would restore faith with the sector and ease the path for future reform.
The Prime Minister is considering a limited reshuffle, with Cabinet Secretary Arthur Sinodinos or Industry Minister Greg Hunt most likely to take on the portfolio.
Australian Medical Association president Michael Gannon said whoever took on the politically sensitive portfolio needed to implement reforms once reviews established by former minister Sussan Ley were completed, including one examining payments made under the Medicare Benefit Schedule.
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- Updated Jan 16 2017 at 9:12 PM
A review of the pharmacy sector's payment structures and location rules threatens to unravel amid conflict of interest claims, creating another new headache for the incoming health minister.
The Pharmacy Guild of Australia says a government-appointed review panel's independence has been compromised because it commissioned work by Deloitte Access Economics at the same time as the firm contributed to a submission by Chemist Warehouse.
"This conflict seriously undermines the independence of the review and makes it virtually impossible for it to make untainted recommendations, particularly in regard to location rules," the guild's national president, George Tambassis said.
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Kate Aubusson
Published: January 18, 2017 - 8:14AM
Patient advocacy groups should be forced to declare their commercial funding, with a growing body of evidence raising serious concerns over conflicts of interests, Australian experts say.
Health consumer groups have become powerful global players in healthcare, capable of promoting certain interventions, steering research funding and shaping public debate from a public platform of altruism.
Yet the sources and the amounts of funding they receive from pharmaceutical companies and other interest groups is largely hidden.
There is an urgent need for patient advocacy groups to undergo the same level of scrutiny as pharma companies and medical institutions, Dr Ray Moynihan at Bond University and Professor Lisa Bero at the University of Sydney wrote in JAMA Internal Medicine, published on Wednesday.
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Michael Koziol, Political reporter
Published: January 18, 2017 - 10:49AM
Turnbull government frontbencher Greg Hunt will take on the key cabinet portfolio of health in a limited reshuffle announced by Prime Minister Malcolm Turnbull on Wednesday that will also bring about minor changes to the outer ministry.
Mr Hunt, who led the dismantling of the so-called carbon tax as environment minister in the Abbott government and was industry minister after the election, replaces Sussan Ley, who resigned last week following a travel expenses scandal.
The Prime Minister also announced NSW senator and cabinet secretary Arthur Sinodinos, who has served as the acting health minister since Ms Ley stepped aside from the role 10 days ago, will replace Mr Hunt in the industry portfolio.
Ms Ley held the health, sports and aged care portfolios.
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January 18, 2017 2.05pm AEDT
Greg Hunt has been appointed to the health ministry after the resignation of Sussan Ley last week. AAP/Lukas Coch
Author
- Jim Gillespie
Deputy Director, Menzies Centre for Health Policy & Associate Professor in Health Policy, University of Sydney
Greg Hunt was today announced as federal health (and sport) minister following Sussan Ley’s expenses scandal and subsequent resignation. Hunt will be the third minister to hold this portfolio since the Coalition was elected in 2013. Successful health ministers need well-honed political skills, a lot of patience and even more backbone for the very public battles needed for real change.
So far, the Coalition has not covered itself with glory in the health portfolio. Ley took over in 2014 from the hapless Peter Dutton – whose main achievement was to unite almost all sectors of health against his plans for co-payments for GP visits.
The freeze on GP payments was inherited from the Gillard government, but now seems to be a permanent part of primary care policy. The pressure on GP earnings creates strong incentives to introduce or increase co-payments. The result will be continued pressure in the sensitive area of bulk-billing rates.
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- The Australian
- 12:00AM January 19, 2017
Sean Parnell
Greg Hunt has vowed to be a “Minister for GPs” but has declined to comment on the controversial Medicare freeze, blamed for financial squeezing on doctors and patients.
At Frankston Hospital in his electorate yesterday, Mr Hunt said he had already heard from Australian Medical Association president Michael Gannon that GPs felt undervalued. He wanted to reassure them: “I want to be their Health Minister.”
Asked if he was open to lifting the freeze on Medicare rebate indexation, Mr Hunt said he would continue speaking to stakeholders “and then once the swearing-in has been completed, I will have more to say ... about particular policy directions”.
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Adam Gartrell
Published: January 22, 2017 - 12:15AM
Doctors believe the Turnbull government could be contemplating another increase in the Medicare levy.
The Australian Medical Association has used its pre-budget submission to plead with the government to return any extra revenue raised by the tax to health rather than using it to fix the deepening deficit.
"It is equally important to understand that any increase in the Medicare Levy does not absolve governments from the critical need to continue to reinvest in Australia's health, including lifting the MBS freeze," the peak group says in its submission to the government ahead of the May 9 budget.
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Adam Gartrell and Heath Aston
Published: January 20, 2017 - 5:39PM
The costs and sustainability of the National Disability Insurance Scheme will come under scrutiny after the Turnbull government announced the shape of a major review into its future.
Treasurer Scott Morrison said the Productivity Commission inquiry would help shape the final design of the $22 billion scheme - Australia's biggest social policy program since Medicare - which is due to be fully operational and available to nearly 500,000 people by 2019.
Under an original agreement between the federal and state governments the review was always scheduled to occur in 2017 but the release of its terms of reference come amid warnings the cost of the scheme could blow out by billions of dollars a year.
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Superannuation Issues.
John Collett
Published: January 18, 2017 - 10:40AM
Changes to the age pension assets test that took effect from January 1 have seen about 200,000 better-off retirees receiving smaller pension payments.
A further 100,000 have lost their pension altogether.
Those facing changes to their pension received confirmation letters from Centrelink during December, but there are still things that many retirees can do to claw back some of the pension.
"Some of my clients have been shocked by the size of the pension cuts, from receiving over $10,000 a year to being left with only a few thousand dollars has really hit them hard," says Jonathan Philpot, a partner at HLB Mann Judd Wealth Management NSW.
"Most of my clients will now need to increase their withdrawals from their pension accounts in order to meet their living costs," he says.
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Health Insurance Issues.
Yahoo7 News on January 15, 2017, 8:12 pm
We're being warned 2017 could precipitate the end of private health insurance, as cover becomes too expensive for thousands of Australians.
As part of a vicious cycle to cover falling profits, insurers plan to lobby the government to increase premiums again.
Last year 9000 Australians abandoned their private health cover.
For the first time in 15 years that coverage has gone backwards.
"Probably a bit too expensive for me, out of my price range," one member of the public told 7 News.
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- The Australian
- 12:00AM January 16, 2017
Natural therapies have become the fifth most-common claim on health insurance extras cover, with an unrivalled growth rate of almost 1900 per cent over the past 20 years.
The rise in popularity for more unconventional interventions comes amid ongoing doubts over their clinical effectiveness and the broader impact of rising costs in the health sector.
Australian Prudential Regulation Authority data shows that natural therapies such as massage and yoga had the fifth-highest number of services covered in the September quarter, behind dental, physiotherapy, optical and chiropractic services.
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4:41pm January 16, 2017
By AAP
Australian families could soon be forking out an extra $200 for private health cover as insurers lobby the federal government for their annual premium hike.
It's that time of year again when private health insurers apply to the health minister, justifying their reasons for higher premiums.
And when the increases kick in from April 1, the average family is expected to be footing an annual health insurance bill of around $4100, according to insurance comparison website iSelect.
"Many Australians are reaching a tipping point," iSelect spokeswoman Laura Crowden said.
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- The Australian
- 12:00AM January 17, 2017
Sarah-Jane Tasker
Australian healthcare investors are set for an interesting reporting season next month with analysts predicting few positive surprises.
The focus on the sector has been heightened in the past week with the resignation of Health Minister Sussan Ley and the removal of two-high profile chiefs — Peter Gregg at Primary Health Care and Gilman Wong at Sirtex.
Morgan Stanley analyst Sean Laaman said there was little room for upside surprises in healthcare this reporting season.
The market will be focused on Primary Health Care’s results, which will still be delivered by Mr Gregg, who will remain in the top role until his replacement is found. Mr Gregg, who has led a transformation of the company, stepped down from Primary after being hit with a court summons on allegations he broke the law by falsifying documents during his time at Leighton Holdings.
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The acting health minister, Arthur Sinodinos, is expected to approve a 5% increase to premiums next month
Monday 16 January 2017 17.01 AEDT Last modified on Monday 16 January 2017 17.26 AEDT
The federal government is expected to approve a 5% increase in private health insurance premiums next month but industry watchdogs and consumer advocates fear it will push more to drop their policies or forgo essentials in order to pay for them.
On Monday the federal government’s deadline closed for submissions from private health insurers seeking to increase their premiums.
Under federal legislation any increase must first be approved by the health minister, who can refuse if it appears contrary to public interest. Providers will be notified of the decision in mid-February before any changes take effect on 1 April.
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by Mina Martin 17 Jan 2017
Australians are spending more but getting less cover from their private health insurance as insurers deal with rising premium costs, it has been reported.
According to the latest figures from the Australian Prudential Regulation Authority, there has been a 6% decline in payouts for dental, chiropractic, physiotherapy, and optical extras, Herald Sun reported.
Laura Crowden, iSelect Health spokeswoman, said reducing benefits in new policies is a way in which some private health insurers regulate rising costs.
Premiums have increased by 18% over the past three years, and are set for another increase on April 01.
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Esther Han
Published: January 19, 2017 - 12:15AM
Consumer advocates are urging young Australians not to let "fear-laden" health insurance advertisements pressure them into taking out private health cover.
As the federal government reviews health funds' requests to raise premiums, Choice has warned young Australians of the problems with poor-value "junk" policies, low extras payout rates and the increasing number of complaints to the industry ombudsman.
"Faced with so many issues, it's hard to see how insurers could reasonably expect consumers to pay another 5 per cent premium price hike this year and why many younger consumers would take out cover at all," Choice's Matt Levey said.
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I look forward to comments on all this!
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David.
