Friday, August 23, 2002
Ken Parish is cross with Ali Baktiari. Apparently, 'the primary
responsibility for the plight of detained children of bogus refugees lies
with their parents.' Ken also finds it heart-warming to see Honest Johnny
sinking the slipper into 'bleeding heart' refugee advocates.

I'll give Ken this much: unlike Blogistan's hard right, he knows a bit
about refugees. He knows, for instance, that the world today produces
'a seemingly permanent worldwide refugee and displaced population of around
35 million people'.

That's a bigger point than Ken makes of it, in my opinion. The rich world
is showing no sign of addressing a flood of human misery twice the size of
Australia's mostly blessed population. Which is a bit rough, as the rich
world has a little something to do with why a lot of these people are on
the move (or languishing in unsanitary soul-destroying refugee camps in
countries that themselves can hardly afford to look after them).

I haven't the time to fashion a thesis on the topic (I'm busier than a
Democrat's ISP at the moment), but I'll try to support that point as I come
back to the Baktiaris.

As I understand it, Ali and his family came to Australia from Quetta, in
Pakistan. Even if the family is not Afghan, even if not Hazari (and we do
not know they are not) - even if they are Pakistani - they are

(a) from Quetta, which is in Balochistan, which has been a simmering ethnic
war zone for decades;

(b) from Pakistan, a country more likely than any other to find itself at
the pointy end of nuclear missiles; and

(c) from Pakistan, a country so close to being a failed state as makes no
difference. Every time Pakistan manages to get itself a democratically
elected government, a military despot takes over, as one has taken over now
(he overthrew Prime Minister Nawaz Sharif in October 1999, and the other
day he officially arrogated unto himself the discretion to sack National
Assembly and regional governors at will). Nawaz Sharif's mortal sin had
apparently been to try to avoid a perpetual war-footing by withdrawing
troops from the Kashmir border. Naturally, not everyone in the military
elite likes the idea of the decline in budget allocations and status that
attends overly long bouts of peace.

But there's nothing special about the '99 coup. It happens all the time in
poor benighted Pakistan. To quote M. V. Kamath :

"The first prime Minister, Liaquat Ali Khan was murdered in 1951. The next
Prime Minister Khawaja Naziamuddin (Oct 1951 - Apr 1953) was sacked. The
third Prime Minister, Mohammad Ali Bogra (Apr 1953 - Aug 1955) was forced
to resign as was the fourth Prime Minister Chodhury Mohammad Ali (Aug 1955
- Sep 1956), the fifth prime minister, Suhrawardy (Sept 1956 to Oct 1957)
and the sixth Prime Minister I I Chundrigar whose reign lasted hardly three
months! The seventh Prime Minister Firoz Khan Noon lasted ten months when
the first army coup took place under Gen. Sikandar Mirza.

There was a succession of generals, one following the other in coups. From
October 1958 to August 1988, for a period of 30 years, the army ruled the
roost. Mirza was succeeded by Ayub Khan who was succeeded by Yahya Khan.
Zulfikar Ali Bhutto came in between (Dec 1971 - July 1977) and then he too,
was overthrown by Gen. Zia Ul Haq, who ruled from July 1977 to Aug 1988
when he was killed in an air crash, many say a crash which was pre-planned.
Those that followed him, Benazir Bhutto, M K Junejo, Nawaz Sharif (during
his first term) and B S Mazari were all sacked."

Kamath's concluding note to this section makes for pungent reading:

"Coups and sacking have been standard practice in Pakistan. They have
become predictable. After Kargil when the Pakistan army received a bloody
nose from Indian jawans, one should have expected yet another army coup.
And it has now taken place. The Americans will fret and fume, but the U S
Government, especially the defence department has lived comfortably with
past military leaders and it can be trusted to repeat the performance. The
crocodile tears of the US Government, at the collapse of democracy of
Pakistan are pure theatre. It is not that the US Government did not know of what was
happening. The military coup and the discussions among the Pakistani Army's
corps commanders that preceded the coup, should both have been anticipated.
In fact the nature of discussions had been relayed to Nawaz Sharif by the
Quetta Corps Commander Tariq Parvez who happens to be the first cousin of
Federal Minister of Communications Nadir Parvez. When Gen. Musharraf came
to know of it, he forced Tariq Parvez to retire. Another corps commander,
Gen. Saleem Haider was replaced. Nawaz Sharif sent his brother who was the
Chief Minister of Punjab to Washington to alert the US State Department.
But it did not help. The US Government is comfortable with military dictators,
not elected Prime Ministers."

And that's not the only evidence that 'the US Government is comfortable
with military dictators, not elected Prime Ministers'. In the Bangladesh
war of '71, "the Nixon/Kissinger-US government sided with their
personally-fashioned creature, the Pakistani military and its political fellow-travelers, who committed genocide against their own people. It must be remembered
that all the Bengali leader, Suhrawaddy, was guilty of was wanting to assume the
power that had been voted to him in an election which his party had won."

Then, in August 1976, Henry Kissinger (read Christopher Hitchens' book
about this bloke if you wanna know more ... ) finds out popular (and duly
elected) social democrat Prime Minister Zulfikar Ali Bhutto is thinking
about instigating a nuclear programme, on the grounds that Pakistan is
short of electrical power and strategic parity with its mighty neighbour,
which had recently exploded a 'peaceful' nuclear device. So Henry tells
Bhutto that if he goes ahead with this, he's for it. He does and he is.
A few months later General Zia ul Haq, quietly goaded on by the US and
openly supported by US-funded fundamentalist zealot parties (the ones the
US was to fund further in order to give the Soviet Union a bloody nose, and
then summarily found guilty of harbouring al Qaeda), overthrows and
judicially murders Bhutto!

So what I wanna know is why is escaping a country benighted by poverty,
internecine warfare, nuclear threat, and externally orchestrated attacks
on its every attempt to run itself democratically not the act of a bona
fide refugee? If I were Ali, and if I discerned no likelihood that the
rest of the world might help Pakistan (if only be leaving it the hell alone),
I'd want my family out of there, too. Because I love my family. If I were
Ali, I'd probably conclude that the possibility of escape to a western
country is so important to the future of my children that even a year or two
in a desert rat-cage is a price worth paying. Obviously, if he thought otherwise,
he wouldn't do it, would he?

Oh, and before anyone pipes up; no, I don't think conditions at a Woomera
or a Curtin must be okay just because they're preferable to something else.
They are not okay. And to impose them on kids throughout crucial stages of
their emotional and intellectual development is nothing short of obscene.

As for Ruddock's triumphal claim that it works (ie that it stops others
coming), two points come to mind (a) demonstrable and concerted naval
interdiction might be the more decisive factor, and (b) lots of things
would work (we could, as one nice chap suggested on the radio some time
back machine-gun them on the beaches, for instance). Where we draw the
line as to what we're prepared to do to get our way is The Test Of

I don't care what other countries do as much as I care what we do. And I
reckon we're flunking our test.

Big Time.

Thursday, August 22, 2002
It is obvious that the worthies at the New York Times start their day with a peek at Blogorrhoea (and why not? 'Tis therapy indeed for all that yukky American can-do optimism). Anyway, the Times is on the case, and finally some wise voices are being heard.

In support of my dismalism of yesterday, the below item was spotted in today's Times by Doug Henwood (see suggested sites at left). Jim Devine has been saying this sorta stuff for a good while now, and perhaps the most dwell-worthy aspect of this is that Jim's view (as long-held as it has hitherto gone unheeded) is suddenly popping up in the most mainstream of mainstream organs. This in the same week the revered rag gives mention to Doug's interview with erstwhile World Bank chief economist Joe Stiglitz, in which the latter sensationally opines the IMF may have outlasted whatever efficacy it ever had (other than the sterling service it has afforded US foreign policy, natch).

Something profound may be afoot!

It's been obvious for weeks that the US establishment is fundamentally torn on matters strategic (maybe too noble an adjective for Bush's 'War On Terror' on current evidence), and now - wonder of wonders - we're watching Homo Armanirolexicus publicly asking itself if its economic theory is worth a plugged kopek (which, naturally, was itself worth a lot more before that crack Harvard suitstaffel popped into Moscow to weave their magic).

Anyway, congratulations to Doug and Jim, who prove that if you say the correct things long enough, even the New York Times will eventually come knocking. I just hope it's still early enough for me to say better late than never ...

New York Times - August 22, 2002

George W.'s Worst Fear: A W-Shaped Recession

WASHINGTON, Aug. 21 - When the economy entered an unmistakable slump
last year, economists quickly began a lively and jargon-filled debate
about whether a recovery would be U-shaped (mild and slow) or
V-shaped (sharp and quick).


James Devine, a professor of economics at Loyola Marymount University
in Los Angeles, is among those who believe that a W-shaped recession
is likely. He publicly raised the prospect of a "Dubya recession"
last May.

"I haven't changed my mind," Professor Devine said, musing that he
ought to stake out a copyright claim for a "Dubya Recession" in case
it really does come to pass.

Mr. Devine contends that the American economy still faces what he
said were the same "three bears" as before: high debt among
businesses, high consumer debt and a very high external debt in the
national balance of payments ...

Wednesday, August 21, 2002
You'd be forgiven for thinking there must be something very different about Australia's economy. Best in the world, we are. Just ask Honest Johnny or Peerless Pete. The Europeans are too nice to their uppity workers. The Yanks are run by a mob of flagrant fratboy filchers. Japan is run by sinister corporatist cronies. Those irrsponsible Argentinians lived large ere cometh the repo man. And New Zealand's stuffed because they undid all Roger's fine work. Only in Australia is the porridge just right.

The Us, for instance, is plagued by unprecedented residential and business debt, a real estate bubble and a scarlet current account the size of, well a Really Big Thing.

Bronzed ubermenschen that we are, such folly is not for us. We do seem to have been giving the card the odd nudge of late, I'll admit. What, with a record $37 billion in 1999/2000. That was an abberation, though, as we cleverly realised in 2000 that the fabled new economy was looking rather old, and in 2000/2001 we responsibly pulled our heads in, borrowing a mere $21 billion. Were obviously seeing a big bounce coming soon (for markets are efficient as expectations are rational), because we've just gone another $30 billion in 2001/2002. That's the three biggest numbers on record by a fair way, but so what? That's only part of the story. Just take a look at how business is faring ...

When Honest Johnny finally got his mits on the reins in 1996, the finance sector owed a net $80 billion overseas. By last Christmas, that had more than trebled to a net $251 billion. The amount the sector has lent out for housing has more than doubled: an average house in the state capitals cost about four years' wages in 1990; it now costs more than eight years' wages.

The sector has been lending at one per cent safety margin, and when rates went up half that in a month back in June, half suburbia wet its bed. Sure, Howard's pre-election pork orgy had fetched 'em a free $14000, but no-one had told 'em that's peanuts next to how much got whacked onto the price, and no-one told 'em that just because banks were offering loans at one-per-cent margin meant that rates might not go up by a lot more than that over the uncertain quarter century they'd just signed off on (ah, the joys of living in a libertarian age: when else could a bloke get away with completing a sentence with consecutive contradictory prepositions?). The central bank philosopher kings seem bent on another hike, but are probably waiting for all those fresh-faced young couples to have a nice expensive child before laying it on 'em (or perhaps they just don't know whether the train coming at 'em is marked 'deflation' or 'inflation').

That's assuming the one marked 'stagflation' won't be coming this way again, of course ...

Anyway, on this account, we're about 3/4 of a percentage point (that's 75 basis points in suitese) from a tide of bankruptcies (which are already at record rates, btw) and a sprawl of negative equity.

Perhaps the foreign debt picture is more edifying ...

In 1980 the net foreign debt incurred by an Australian economy not yet versed in the magical ways of neoliberal rectitude was A$8 billion. But that was then. In their six years at the helm, the Howard Government got it down from the whopping A$193 billion 'new' Labor had left 'em to a much tidier, er, A$332 billion. So much for the Coalition's 'debt truck' election stunt, eh?

High growth, the way economists count such things, perhaps - but by way of structural dependence on foreign borrowing, to be repaid with a currency that depends for its value on our capacity to sell ever more commodities to ever sicker economies. Nice one, lads!

Which brings us to our current account ...

As professional dissentoid economist Peter Brain points out (and apologies for misplacing the citation), "Australia's trade deficit in elaborately transformed manufactures (ETMs such as machinery, computers, cars, processed foods, paper, chemicals and the like) is now the major problem with Australia's current account deficit and this will put a speed limit on growth and job creation over the next decade."

Although exports of ETMs have risen from a low base, that rate of increase is declining while imports continue to expand. In 1999, Australia's trade deficit in ETMs was a huge $9.5 billion, well in excess of the current account trade deficit of that year of $5.1 billion. On Brain's projections, the situation will show little improvement for a decade as in 2009 the trade deficit of ETMs will still be at $9.6
billion with the current account trade deficit at $5.1 billion.

Writing in The Age a month later, under the headline, `Borrowing puts Australia on road to a meltdown’, Dr Brain elaborated.

For the past 20 years, he said, Australia has run one of the world’s
highest current account deficits, periodically more than 6 per cent of
gross domestic product, borrowing heavily overseas to bridge the gap
between what we earn from exports and what we spend on imports…

"The neglect of manufacturing in this country is inexplicable. Put
simply, Australia has a savings problem because of the neglect of the
manufacturing sector. No-one seems to have noticed that the 13 per cent
share of the Australian manufacturing sector in total output is 5-7 per
cent below comparable overseas countries. This equals the current and
long-term Australian savings/current account deficit gap."

So we're not better than those with whom we like to compare ourselves. Not all the numbers are as good as they're made out to be for a start, but the real problem is structural. It'd take many years of extremely unlikely policy shifts to put this lot to rights. We are but lemmings, a little sickly and somewhat back in the queue, perhaps - but well on track ...

political economic and cultural observations in the register of dismal dilettantism

06/30/2002 - 07/07/2002 / 07/14/2002 - 07/21/2002 / 07/21/2002 - 07/28/2002 / 08/04/2002 - 08/11/2002 / 08/11/2002 - 08/18/2002 / 08/18/2002 - 08/25/2002 / 08/25/2002 - 09/01/2002 / 09/01/2002 - 09/08/2002 / 09/08/2002 - 09/15/2002 / 09/15/2002 - 09/22/2002 / 09/22/2002 - 09/29/2002 / 10/13/2002 - 10/20/2002 / 10/20/2002 - 10/27/2002 / 10/27/2002 - 11/03/2002 / 11/03/2002 - 11/10/2002 / 11/24/2002 - 12/01/2002 / 12/01/2002 - 12/08/2002 / 12/08/2002 - 12/15/2002 / 12/15/2002 - 12/22/2002 / 12/22/2002 - 12/29/2002 / 12/29/2002 - 01/05/2003 / 01/05/2003 - 01/12/2003 / 01/26/2003 - 02/02/2003 / 02/02/2003 - 02/09/2003 / 02/09/2003 - 02/16/2003 / 02/16/2003 - 02/23/2003 / 02/23/2003 - 03/02/2003 / 03/02/2003 - 03/09/2003 / 03/09/2003 - 03/16/2003 / 03/16/2003 - 03/23/2003 / 03/23/2003 - 03/30/2003 / 03/30/2003 - 04/06/2003 / 04/06/2003 - 04/13/2003 / 04/13/2003 - 04/20/2003 / 04/20/2003 - 04/27/2003 / 04/27/2003 - 05/04/2003 / 05/04/2003 - 05/11/2003 / 05/18/2003 - 05/25/2003 / 05/25/2003 - 06/01/2003 / 06/01/2003 - 06/08/2003 / 06/08/2003 - 06/15/2003 / 06/15/2003 - 06/22/2003 / 06/22/2003 - 06/29/2003 / 06/29/2003 - 07/06/2003 / 07/06/2003 - 07/13/2003 / 07/13/2003 - 07/20/2003 / 07/20/2003 - 07/27/2003 / 07/27/2003 - 08/03/2003 / 08/03/2003 - 08/10/2003 / 08/10/2003 - 08/17/2003 / 08/17/2003 - 08/24/2003 / 08/31/2003 - 09/07/2003 / 09/07/2003 - 09/14/2003 / 09/14/2003 - 09/21/2003 / 09/21/2003 - 09/28/2003 / 10/05/2003 - 10/12/2003 / 10/12/2003 - 10/19/2003 / 10/26/2003 - 11/02/2003 / 11/09/2003 - 11/16/2003 / 11/16/2003 - 11/23/2003 / 11/30/2003 - 12/07/2003 / 12/21/2003 - 12/28/2003 / 12/28/2003 - 01/04/2004 / 01/04/2004 - 01/11/2004 / 01/11/2004 - 01/18/2004 / 01/18/2004 - 01/25/2004 / 01/25/2004 - 02/01/2004 / 02/01/2004 - 02/08/2004 / 02/08/2004 - 02/15/2004 / 02/15/2004 - 02/22/2004 / 02/29/2004 - 03/07/2004 / 03/14/2004 - 03/21/2004 / 03/28/2004 - 04/04/2004 / 06/27/2004 - 07/04/2004 / 07/11/2004 - 07/18/2004 / 07/25/2004 - 08/01/2004 / 08/08/2004 - 08/15/2004 / 08/22/2004 - 08/29/2004 / 08/29/2004 - 09/05/2004 / 09/12/2004 - 09/19/2004 / 09/19/2004 - 09/26/2004 / 09/26/2004 - 10/03/2004 / 10/03/2004 - 10/10/2004 / 10/10/2004 - 10/17/2004 / 10/24/2004 - 10/31/2004 / 10/31/2004 - 11/07/2004 / 11/07/2004 - 11/14/2004 / 11/14/2004 - 11/21/2004 / 11/21/2004 - 11/28/2004 / 01/30/2005 - 02/06/2005 / 03/27/2005 - 04/03/2005 /

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