The State of the Federal ALP Government as described by Clarke and Dawe

As a casual observer of Australian politics I can’t help feeling tired and fed up with the current performance of the ALP at the federal and state levels. This video by Clarke and Dawe had accurately described what’s happening in the Labor government. This is a government that lost its agenda setting ability and is either in denial or lacked ideas to reverse its current position.

I had so much hopes for Australia when the ALP (Australian Labor Party) went through a disciplined and focused campaign to defeat the second longest serving Prime Minister – John Howard and took office. At the start, Rudd looked like a capable PM, financial conservative guy with foreign affairs expertise with Gillard looking liked a capable, strong deputy PM and taking on industrial relations and education portfolio amongst other things. Things looked pretty good and I thought Australia was entering into a golden age of economic and social policy progress. My admiration went to their latest level when a centre-left ALP managed to keep the Australian economy in shape through the darkest times of the 2008 GFC (global financial crisis) by riding on the China boom.

But since then everything seem to fall apart and I had my dose of reality check. This government was unable to defend their policies has gradually lost its support for its programmes and overall support despite a negative and uninspiring opposition. Australians were increasingly more worried for their future despite a blooming economy. The ALP’s internal discipline faltered, the great opportunity to push through difficult reforms despite a federal-state ALP government never came, education review led to more questions about Australia’s research future, national infrastructure investment did not fly, home insulation programme was canned, the mining super profit tax was watered down, climate change agenda captured by  the Coalition, refugee issue remained a question mark.

As a Sinophile, I was most disappointed by the dearth of leadership and ideas to engage China in a meaningful and with the forward looking vision to prepare the country for the rise of a new global power and the new opportunities beyond natural resources. Instead I saw policies and behaviours that reflected tints of yellow peril. United States is without a doubt still a global superpower and an important ally, but Australia has to prepare for the new reality.

If the federal ALP government wants to retain the confidence of the Australian public, they better get their act together and stopped repeating that these are difficult times for any government. Stop the denial and take it on the chin! Guess what? That’s why the Australian public voted them into government in the first place.

8 Jun 2010 – Politics, Philosophy and Economics Daily Linkages

Politics

• Robert Kaplan | The Geography of Chinese Power: How far can Beijing reach on land and at sea? (.pdf) (Foreign Affairs)
• Q & A with Robert Kaplan with further discussion on the US, China, India naval development and China potential military development trajectory
• In China, the party always starts at the top

Philosophy

• Joergen Oerstrien Moeller| Encourages an update of what we knew of globalisation (Globalisation 2.0)

Economy

• Robert Reich| US employment figure points towards a double-dipped recession
• Labour conditions in China in the manufacturing sector set for greater improvement

Liberalism in the global context, relations with global powers and due process adherence: Malcolm Fraser at the Lowy Institute

This week at the Lowy Institute’s Distinguished Speaker Series, former Australian Prime Minister Malcolm Fraser shared candour and shrewd insights into meaning of liberalism in the global context, small countries’ relations with super powers and the importance of  due processes adherence .

Click here to listen to his presentation entitled “Liberalism and Australian foreign policy“.

Public Talk on Obama Administration’s First 100 Days Organised by National Library Board Singapore, Singapore Institute of International Affairs and School of Thought

The Singapore Institute of International Affairs is organising a free public talk on the first 100 days on President Obama’s administration on Saturday, 23 May 2009 at The Pod, Level 16, National Library. This event is especially tailored for youths aged 13–25.

Join Dr Dawn Dekle, Dean of the Centre for Leadership at S.P. Jain Center of Management, as she explains the contexts, backgrounds and issues facing the Obama Administration.

Due to limited seating availability, registration is required.

This event is co-organised by the National Library Board Singapore and School of Thought.

For more informatiom, please visit The Obama Administration’s First 100 Days (SIIA) link.

Facing up to the truth about the global financial crisis: The Current Situation, Potential Consequences and the Path to Recovery

Picture credit:António Lopes

The sub-prime mortgage crisis which erupted in the US back in 2007 has now besieged the global financial system, with no definite end in sight. During the April 2009 presentation at the Lowy Institute, the Asian Development Bank’s economists highlighted that this recession’s timing is unprecedented – hitting both developed and developing economics. This situation has made it harder to stage a recovery.

In order to break the current economic vicious spiral, Hernando de Soto (Institute for Liberty and Democracy, Peru) advocates the urgent need to ascertain and come clean about the extent of the remaining toxic assets (financial derivatives). He also warned of the impending social unrest and the loss of the developing economies’ confidence in the global financial system. This could happen if the US doesn’t apply its economic policy prescriptions for crisis-wracked developing economics to its own institutions.

The main source of the current financial woe is the uncertainty surrounding the toxic assets. It has been two years since the sub-prime mortgage crisis, yet these toxic assets still exist somewhere in the financial institutions’ balance sheets. The same questions still remain, “How much (toxic assets) still exist, and who owns them?”. This unknown has allowed fears to flow from Wall Street to Main Street and crippled the real economy.

Meantime, Secretary Geithner has set aside 1 trillion dollars to purchase these toxic assets. From the start of the crisis, 60 trillion dollars of real losses have already occurred in relation to the assets in question. The market’s irrational behaviour is clearly due to the lack of independent assessment of these toxic assets. Governments and the financial institutions needs to face up to the truth without further delay, collect the data and clearly identify the bad assets’ owners and ascertain their true value.

Some institutions may collapse as a result of these tests but those who have brought us to this state of affairs will have to face up to their deeds.

There will be grave challenges for global financial systems if developed economies like the US do not take the bitter pill and introduce stronger corporate governance, as advocated by the IMF during the 1997 Asian Financial Crisis. These challenges include:

a) Developing economics increased suspicion of the global financial model and its real benefits

During the recent G20 London Summit, UK Prime Minister Gordon Brown declared that “the Washington Consensus is over”. Developing economics that have suspected all along that they were not getting a fair deal from currently financial model will conclude that they are “getting more of the same”. The US Treasury and the Federal Reserve have to take this opportunity to deliver on promises of stricter governance and higher regulatory standards to control financial institutions.

b) Greater risk of social unrest after repeated and excessive publicly funded bailouts

Billions of dollars in public funding have been spent to prop up these ailing institutions and companies in the name of national economic stability (“Too large to fail“). At the same time, there are homeless, unemployed and impoverished people out on the streets who are questioning the lack of support for their situation. If these corporate bailouts do not work and indirectly keep those responsible for this crisis in their positions, many poor and disfranchised people will have had their legitimate needs unmet, and very possibly be a source of social unrest as they protest against the injustice and ineffectualness of these corporate bailouts.

In this global financial crisis, we have to stop fear in its tracks and recognise the losses before we can move on to the path of socio-economic stability and recovery.

This is a repost of an article piece first published for the Singapore Institute of International Affairs Global Citizen’s Blog.

The US and the World: Beyond the Financial Crisis – A public lecture by Robert Kimmitt (former Treasury Deputy Secretary) in Singapore

Former US Treasury Deputy Secretary under George W. Bush’s administration, Robert Kimmitt is presenting a public lecture entitled “The US and the World: Beyond the Financial Crisis” in Singapore.

Date: Wednesday, 1 April 2009

Time: 5.15pm – 6.30pm

Location: Auditorium, Level 3
Block B, Faculty of Law, NUS Bukit Timah Campus

Synopsis
The world faces difficult months, and perhaps years, before the current economic and financial crisis fully subsides. But, even as the crisis is addressed, preparation must also be undertaken to ensure that the world that emerges is better able to spur market opportunities and avert future crises. Issues of particular note are the balance between prudential regulation and market discipline; global financial architecture; and commitment to free trade and open investment as guiding principles of a healthy global economy. Singapore, the United States, and other key participants in the G-20, Financial Stability Forum, APEC, and other processes need to ensure these important long-term topics are interwoven with on-going crisis management discussions and decisions.

See event flyer for details.

Update of my fav podcast feeds: Business, Humour, Social Commentary and News

Since the economic downturn I have almost stopped buying CDs and moved onto podcasts for my aural stimulation. An audio diet laced with humour, news, business and commentary. Here is a list of my absolute must-hear feeds:

1. Hamish & Andy – My fav commute-time comedy duo from Melbourne. Give these guys a try and I reckon you will become a fan too.

2. American Public Media’s Marketplace. Great way to get an summary of Wall Street overnight performance and news.

3. NPR’s Planet Money. How to make sense of all these news from the Wall Street to the White House.

4. Robert Reich’s Commentary. Prof Robert Reich teaches public policy in Berkeley and served as Labour Secretary during the Clinton administration

5. The Story is about “people whose lives are intersecting with significant issues in the news.” The programs has previous discussed about how older people coped when their unemployment benefits ran out (foreclosures), how our past can come back and haunt us via Facebook (Facebook), and how good people can be lured and trapped in money laundering (white collar crimes).

6. BBC’s World Business Daily. An audio documentary of the world of business.

7. ABC’s 7.30 report (video). A snapshot of current issues affecting Australia.

8. London School of Economics and Political Science (LSE) public lectures and events. Perfect if you enjoy a detailed discussion of the world around us.

9. Sky News Business Report. My 25mins update on the Australian economy and AUD performance.

10. The Gruen Transfer (free video vodcast) by Wil Anderson (now back for Season 2)! The Gruen Transfer is about the science of advertising served with a dead wit and humour.

Does anyone know of an informational podcast feed from Singapore? It’s really difficult to find a Singapore business or social commentary podcast. I would really listen to a Singapore Mandarin podcast after MM Lee is now reminding us the importance of speaking Mandarin.

The Era of Obamanomics – Food for Thought

Obama’s call for the rich to pay more to ease the burden on the middle and lower classes is the opposite of the philosophy established by Ronald Reagan. Robert Reich says Reagan’s approach didn’t exactly work out as planned and now replaced by Obamanomics.

Extract

Reaganomics:Lower taxes on the wealthy will made them work harder and invest more, and the benefits trickle down to everyone else.

Rarely in economic history has a theory been more tested in the real world and proven so wrong. Nothing trickled down. After the Reagan tax cuts, the median wage slowed, adjusted for inflation. After George W. Bush’s tax cuts for the wealthy, the median wage actually dropped.

Meanwhile, most of the income went to the top. In 1980, just before the Reagan revolution, the richest 1 percent took home 9 percent of total national income. But by 2007, the richest 1 percent was taking home 22 percent.

Obamanomics: Increase taxes on the top, and it will use these proceeds to raise the living standards of average Americans by giving them lower taxes, better schools, and more affordable health insurance.

Source: Introducing the era of Obamanomics by Robert Reich and Bill Radke (America Public Media Marketplace)

When the invisible hand of the market fails, try China’s ‘two hands’ approach

Berno: The Obama Administration maintains a very difficult hybrid stance towards restoring faith in the US financial industry without much success. America has long championed faith in the hands of the free market. However, the Federal Reserve was repeatedly forced to prop up crippling financial institutions like Citigroup and AIG from collapse with massive public funds injection without outright public ownership (ie nationalisation).

The article below takes a step back and examines the China Government’s direct and forceful approach to support their economy when the invisible hand of markets gives up.

“The visible hand of Beijing might look excessive to people in the West, but many Chinese are pleased to see the government intervene and feel it will win time for China to ride out the global crisis. Elsewhere around the world banks are unwilling to lend and the U.S. Federal Reserve has had to bypass commercial banks to lend directly to corporations. Beijing just needs to send out a few directives and the banks do their bidding — Chinese banks posted a record 1.62 trillion yuan in new loans in January, already one-third of the total extended in 2008. “

Continue reading “When the invisible hand fails, try China’s ‘two hands’“.(Forbes)

The Beginner’s Guide to Origins of the Credit Crisis

How did the credit crisis orginate? Check out the videos below and find out how defaulted mortages took Wall Street down and affected the rest of us.

In the beginning … responsible people wanted a home loan and it was prime…

Turning point … bankers and investors wanted more…