How the mighty fall

The recent collapse of the Rudd government has been nothing short of extraordinary. To seriously think that a first term federal government could be kicked out after only one term is amazing. Now Labor MPs are supposed to be plotting the replacement of Rudd by Gillard:

SENIOR Labor MPs says the leadership is Julia Gillard's for the taking before the election - if she wants it.

Prime Minister Kevin Rudd's control of the party has entered a treacherous phase, with Cabinet ministers and backbenchers canvassing the idea of changing leaders before this year's federal election.

As Ms Gillard was forced yesterday to publicly deny she wanted the top job, Labor MPs described Mr Rudd as a "leader under fire" and said his prime ministership was "terminal".

Senior Labor sources said Ms Gillard has always had the numbers to seize the leadership, but not necessarily the will to challenge for the top job.

Kevin Rudd's problem is that he doesn't really believe in anything. Successful prime ministers such as Hawke and Howard came to office with a reformist agenda which they started  in their first term. The voters then reelected them to carry out their policies. Rudd's big policy was supposed to be the ETS which he has abandoned. If he really believed in it he should have held a double dissolution. There's no reason to believe a future Gillard government would have more fortitude.

National emergency declared

This is just outrageous. The mining companies are mounting an advertising campaign against the Rudd governments' mining tax so what do they do? Use the national emergency powers to bypass their own rules tnd attack the miners:

WAYNE Swan is preparing to escalate his pitched battle with the mining industry over the resource super-profits tax, obtaining a special exemption under national emergency powers to waive the government's own advertising rules for a campaign against the miners.

The exemption granted this week to the Treasurer by Special Minister of State Joe Ludwig will allow the government to rush out an advertising campaign to counter a mining industry blitz against the new 40 per cent super profits tax....

Mr Swan on May 10 sought permission from Senator Ludwig, in his role as Cabinet Secretary, to mount a tax reform advertising campaign.

How many millions will they spend? We have a federal government which has no respect for the Australian people.

Achievements of the Rudd Government

I received the e-mail below the other day:

Achievements (sic) of the Rudd Government  (Nothing we don’t already know - but it is interesting to see it all put together in summary.)

A friend asked me the other day, "But what has the Rudd government actually achieved?" I said, rather sarcastically, "Quite a few things”“Like 'Sorry' to the stolen generation; ratified the ‘Kyoto’ protocol, and he organised the 'best and brightest summit' (wow).” But my friendthen asked me again ,"but has anything really been achieved?”  That got me thinking about it and prompted me to do some research, which led to the compilation of the following list. Here's what I came up with:

1  Said ‘Sorry’ several times, for a range of things.

2  Ratified the ‘Kyoto’ protocol, as it was about to expire without a successor.

3  Organised ‘best and brightest summit’ - if anything useful came out of that, I missed it.

4  Set up ‘fuel watch’, a costly fiasco, since totally abandoned.

5  Set up ‘grocery watch’ ,another costly fiasco, also since totally abandoned.
 

Interest rates going up again

During the 1990's I worked at Centrelink and saw the devastation high interest rates caused families. It looks like we are in for a repeat:

MORTGAGE rates are predicted to hit a horror 10 per cent within the next two years as the Reserve Bank hikes rates to prevent runaway inflation.

Leading economists say soaring commodity prices and rapidly rising employment are stoking dangerous inflationary pressures that the RBA is determined to stamp out.

As a result, economists at Macquarie Bank and Commsec, the Commonwealth Bank's investment arm, have both forecast the cash rate will hit "pre-crisis highs" of 7.25 per cent by 2012 if the economy continues to perform so strongly.

Since banks have expanded their profit margins during the financial crisis, that translates to variable mortgage rates of 10.1 per cent - the highest since 1996.

The worst hit are going to be families who were on modest incomes but took advantage of the Rudd government's home grants. Also maybe if the government hadn't been handling money out as if it were candy inflation wouldn't be such a problem.  

Australian and Alabamian red necks

Our Prime Minister has gotten himself into hot water over his response to Robin Williams comments.

Furious Alabama residents have hit out at Australian Prime Minister Kevin Rudd and demanded he issue an apology for his "redneck" comment.

US media organisations, including the New York Times and FOX News, picked up Rudd's remarks, which followed US comedian Robin Williams joking "Australians are basically English rednecks".

Alabama newspaper, the Birmingham News, ran an "Australia vs Alabama" headline on the most prominent section of its website and asked readers to comment.

No nukes, no dams

The Rudd government tells us we must reduce our CO2 emissions but refuses to consider nuclear energy. It wants to increase substantially our population but refuses to seriously consider turning the north to a food bowl by allowing dams:

A RESEARCH report that found there was insufficient water to make northern Australia a food bowl for the nation did not consider building dams because it was against Labor policy. The Northern Australia Land and Water Taskforce relied heavily on the work done by the CSIRO's Northern Australia Sustainable Yields project, whose scientists were told not to worry about investigating dams.

The CSIRO's Richard Cresswell said: "At the time of the study, all jurisdictions (the West Australian, Queensland and NT governments) had a no-dams policy, and therefore we did not investigate the opportunities for dams in the north.

"We weren't asked not to investigate them, but we were told it wasn't necessary to investigate them," Dr Cresswell said.

During the course of the project, the West Australian government changed from Labor to a Liberal-Nationals alliance, "and the prospect of putting dams on some of the rivers was put back on the table", Dr Cresswell said.

The Coalition yesterday accused the Rudd government of stacking the taskforce and effectively creating the agricultural equivalent of the wartime Brisbane line......

We have made another do nothing State Premier Prime Minister.

Rudd's Christmas gift: higher taxes

The Howard government was able to provide income tax cuts virtually every year after the budget went into surplus. Thanks Rudd's big government we will be getting tax increases instead:

ACROSS-THE-BOARD income tax cuts are off Labor's agenda as the Henry review looks instead to ease the burden on individual taxpayers by simplifying returns and reducing churn in the tax and family payment systems.

The compromise at the heart of the report now in the hands of Wayne Swan marks the first occasion that a major tax reform will not be accompanied by tax cuts for all.

The budget cannot afford them for at least six years.

Don't let anyone tell you leaving the tax  brackets unchanged isn't a tax increase either, bracket creep will mean we  will all end up paying more.

Questions to my Labor voting libertarian readers, missing Howard yet?

Rudd Censors the Internet

The tests may have been a complete fraud but thats not going to stop the government.  We will soon be joining those great free nations China and North Korea with mandatory internet censorship. There's no need for it and its an attack on our basic freedoms. The government is using the old excuse of protecting our children. Well, that's the parents responsibility. Any parent can install a net filter, in fact the Howard government purchased a license to one and made it freely available. The Rudd government let the license lapse.

This is a chance for the Liberals to stick to their principles of freedom and responsibility. I know some like Alex Hawke and Jamie Briggs feel as I do. The Australian Liberal Students are against it too. The question is what will Tony Abbott do? Will he revert to a ban it for our own good conservative, or will he fight the nanny state?

An income tax holiday

The cost of Mr Rudd's stimulus package is expected to be $97 billion over four years. What could be achieved if a tax cut was offered instead. How about a one year tax holiday:

If the Rudd government had implemented a one-off income tax cut the average Australian taxpayer would have received a one-off tax cut of more than $8,200 in 2008-09, according to new research released today.

The total size of the Rudd government's fiscal policy decisions taken during 2008-09 is expected to be $97 billion over four years. If the government instead gave a one-off personal income tax cut equal in size to this, the average individual Australian taxpayer would have paid $8,228 less in tax last year.

Alternatively, for about the same total cost, the government could have cut income tax to zero for everyone, except the richest three per cent of taxpayers....

Off course there's one big problem with such a plan. The government wouldn't be able to pork barrel  marginal seats.

The IPA paper is here.

How to improve the Public Service

Prime Minister Rudd has commissioned a review into improving the quality of staff in the Public Service. A commendable goal but as a person who has had years of experience in both the public and private sector I can tell him how for free.

Its very simple. Abolish the Public Service. Most of the administrative tasks can be done by the private sector, so put it out to competitive tender. Centrelink, the ATO etc the lot. Privitize the agencies either in whole or in part. Thats what private companies do who regularly outsource share registeries, call centres etc. Lets have some real competition.

Chinese liberal blasts Kevin Rudd

Chinia's Professor Xu Xaonian gets stuck into our Prime Minister Lu Kewin and his policies.

KEVIN Rudd has been accused by a leading Chinese economist of being "either short of economic knowledge or misleading his readers" in his famous essay attacking neoliberalism.

In a scathing assessment, Xu Xaonian, economics professor at China Europe International Business School in Shanghai, lambasts the essay, now translated and published in China, as "shallow and crude".

Dr Xu says "Lu Kewen" - Mr Rudd's Chinese name - made a "big, big mistake" in forming his "confident opinions" based on "the observation that the crisis came as a result of neoliberalism and the absence of supervision".

Dr Xu, one of China's leading liberal economists, has savaged the Rudd essay in the weekly Chinese newspaper The Economic Observer after the Prime Minister's work was translated and reprinted in China's leading business magazine, Caijing.

Dr Xu, who has a doctorate from the University of California and was formerly managing director of the country's biggest investment bank, says it is not time to resurrect Keynesianism, as Mr Rudd proposes.

"Instead, it's time to announce Keynesianism's failure, time to announce the emperor Lord Keynes has no clothes."

He says the Prime Minister "has used electioneering-style tactics to brand neoliberalism as dogmatic, to paint a clownish portrait of it, seeking to pioneer popular antipathy to this artificial enemy, casting a moral verdict without seeming to care about truth or logic".

It would be interesting to know what the professor thinks of President Obama policies.

Joe's response to Swan

Joe Hockey managed to produce the following response to Treasurer's Swan's budget in record time. Worth seeing.

Rudd's military build up

If this is true then Mr Rudd is to be commended for taking Australia's defense seriously. But 12 submarines !?? We have enough trouble trying to crew six.

KEVIN Rudd is set to announce Australia's biggest military build-up since World War II, led by a multi-billion-dollar investment in maritime defence, including 100 new F-35 fighters, a doubling of the submarine fleet, and powerful new surface warships......

Senior government sources say Mr Rudd has insisted that defence spending remain largely insulated from the Government's budget difficulties, but the Defence Department will still have to find at least $15 billion of internal savings over the next decade to help pay for the $100 billion-plus long-term equipment plan.

Mr Rudd said yesterday the delivery of the white paper was proving "acutely challenging as we work to defend ourselves from the global economic storm".

"It is the most difficult environment to frame the Australian budget in modern economic history. It is also the most difficult environment to frame our long-term defence planning in modern economic history as well," he told the Australia-Israel Chamber of Commerce. "Nevertheless the Government will not resile even in the difficult times from the requirement for long-term coherence of our defence planning for the long-term security of our nation. This is core business for government. That is why we have forged ahead in our preparation of the defence white paper because national security needs do not disappear because of the global recession. If anything, those needs become more acute.".....

Our very own sub prime crisis

We will be paying for Kevin Rudd's stimulus in the most horrible way:

Meanwhile, the first-home buyer end of the market has been booming.

But economists fear this flurry of activity at the lower end has inflated prices to unsustainable levels.

In Sydney, the average property already costs nine times the average household income, while the UK and US reached a peak of only seven times average income before their markets crashed.

According to Professor Keen, the First Home Owner Grant has cost the government about $200million, but has inflated property prices by close to $3billion.

"This is all illusionary wealth that could disappear very quickly," he said.

"The additional $2.8billion or so has come from increased mortgage debt taken on by those most vulnerable to a serious economic downturn at a time when we can see very clearly that the global recession is coming our way."

The Government may well extend the first-homebuyer grant beyond its planned end-date of June 30, which Professor Keen says will end up pumping the market to even higher levels.

The University of Western Sydney professor said he had sold his Sydney house because he feared a property crash, but his gloomy view on the market has been backed by other experts.

Gerard Minack, chief economist at Morgan Stanley, said property prices were likely to fall by 20 per cent in some cities, while the value of houses on coastal strips such as the NSW mid-north coast and the Gold Coast could halve.....

"Traditionally what has hurt people has not been rising interest rates but rising unemployment. I don't care what rate you're paying, if you have a mortgage five times your income and you lose your job, you're toast."

In the 1990's I worked for Centrelink and remember how high interest rates destroyed families. Looks like we could be seeing a repeat. I'm going to use any stimulus handout to reduce my mortgage and hope I can hang on to my job for the next few years. On the brightside there should be some nice affordable Queensland properties coming on the market .

I'm a neo-liberal and I'm proud

Malcolm Turnbull published an essay in the Australian yesterday were he tore into Mr Rudd's attack on the free enterprise system. It far to long to quote but I encourage everyone to read it. It inspired me to start a small Facebook protest. The " I'm a neo-liberal and I'm proud" event:

Are you tired of Prime Ministers and Presidents blaming the worlds financial ills on free markets and their supporters? I sure am!

So lets take a stand, the 8th May will be the great free market economist Friedrich Hayek's birthday. On that day lets all put:

"I'M NEO-LIBERAL AND I'M PROUD!

in our Facebook cause line. (what are you doing right now). Lets get out of the closet and show our true colors!

So on the 8th May come out of the closet and tell the world I'M NEO-LIBERAL AND I'M PROUD!

Bonded to reality

Right, this is really useful, Mr Rudd wants Pacific Brands to pay back money the government gave them:

THE Federal Government will try to retrieve taxpayers' money given to Pacific Brands in view of the company's decision to slash 1850 jobs, Prime Minister Kevin Rudd said on Friday.

Public outrage over the sackings, to be carried out over the next 18 months, is increasing as Pacific Brands prepares to send its manufacturing operations out of Australia.

Also we have the traditional union response to job lose, boycotts and industrial action.

CFMEU national secretary John Sutton plans to propose a boycott of King Gee, Hard Yakka and Can't Tear 'Em brands when the union's national executive meets next week.

Sorry but I don't think its going to help. This is the reality:

The company is heavily into doubt and has to restructure to survive. The alternative is bankruptcy. However I do have one question ; why were they given the money in the first place?

Stocks down, inflation up

We have received phase one of Mr Rudd's economic stimulus and the results are coming in, the stock market is sinking and inflation is up:

At the 4.15pm (AEDT) close, the share market was at a five-year low, wiping $27 billion off the market, it's lowest close since December 2003. The All Ordinaries shed 93.1 points, or 2.82 per cent to 3203.8.

This morning, a measurement of price rises in recent months put the inflation rate back above the level the Reserve Bank (RBA) aims for to prevent the economy overheating. The survey blamed petrol price rises for a 0.7 per cent rise which took the yearly rate to 3.1 per cent.

With phase two starting up we have lots of exciting economic news to look forward too.

Big, Big Deficits

Gateway Pundit points out the graph below. The Obama budget will lead to a deficit four times larger the Bush's:




Meanwhile Mr Rudd has left us with an extra $4500 of spending per head, Andrew Bolt asks:

How on earth are we going to pay all that back, with unemployment rising and growth falling?

Easy answer, with inflation and higher taxes.

Thank you Mr Rudd

For saving the Liberal Party. Since the Prime Minister's essay in The Monthly and his 42 Billion dollar stimulus package we have had Malcolm Turnbull leading Liberals to complete opposition of the package and Peter Costello and Tony Abbott in the media tearing into Rudd. The difference between the two parties is now clear. Its between Rudd and his socialist Whitlamite agenda and the Coalition rapidly moving towards limited government and tax cuts. Thats exactly the direction the Libs should be going. Now can they please come out in opposition to internet censorship, limit or better still oppose ETS, and stand up against workplace restrictions so we can really have a party of liberty.

Costello hits back

Peter Costello responds to Rudd's stimulus package. He is devastating .