The Wild West ... the outback ... The new world of the 1800s was a time of true liberty. People stood on their own merits. They won or they lost and they reaped the rewards or swallowed the consequences. There were no cubicle dwelling civil servants hell bent on saving you from yourself. No planning permits no licenses no permissions no heritage overlay no bylaw no regulators no inspectors. And guess what ... it worked

This site is set up to provide a forum for a number of like minded professional economists to post and comment on contemporary issues. There are a number of regular contributors whose bios are made available on the site. Most if not all of these contributors use a pseudonym for the simple reason that they are practicing economists who must take into consideration the commercial implications of posting their opinions.

While some may feel that this is a bit of a gutless approach it is the only way we can ensure free and open discussion without jeopardising our paycheques.

Monday, June 29, 2009

2020 Health Submission 2523 (Doc Holliday)

Another excerpt from Australia 2020 Nutjobs, Happy Clappers and Carpet Baggers


Is the solution to binge drinking in Australia to halt the development of any new liquor outlets and pubs? Or is the solution more individualistic: limiting the number of alcoholic beverages each person can purchase and consume from pubs and liquor outlets? Possibly by having a card system in place: similar to those used in public libraries, that monitor and possibly limit how much alcohol a person both purchase and consume from liquor outlets and pub venues?

Wrap Up

Binge drinking, it is argued, is an epidemic currently gripping Australia. If you haven’t succumbed to binge drinking, then your loved one has, or your neighbour hasn’t, then your neighbour’s loved one has …

It has not been established, to my mind, with any certainty that binge drinking today is any worse than it was yesteryear. Indeed, the evidence suggests that Australians, on average, are drinking less. The Australian Institute of Health and Welfare (Health Australia 2006), reported that in 2003 (the latest year for which cross-country data is available), Australians drank on average 9.8 litres of alcohol a year (the equivalent of 1.25 bottles of wine a week). This was the ninth lowest out of a sample of 22 countries. This is one-third less than what was consumed in 1973, and about the same as 1963. The long-term trend is a decline in alcohol consumption.

Yet some dear citizens have suggested that we need an alco-card to ration the alcohol we can purchase from the local bottleshop. Let us assume that such a project will cost $100 million to issue cards to all our dearest throughout Australia.

Clearly, under-age drinkers wouldn’t receive an alco-card, since they are automatically prohibited from purchasing alcohol. So clearly, the card applies to alcos older than 18 years. Should it apply to everyone? How do you tell if someone has a drinking problem — from the colour of their nose? What if you don’t have a drinking problem, are you still limited by a quota? Does the local priest need an alco-card if he is bulk purchasing wine for Holy Communion? Does the congregation have turn up with their cards? Did Jesus have an alco-card?

Certainly, a small community may get together to ban access to alcohol. But it is not clear that a member of the general public, fully sober and rational, should be penalised because they like a nice drop after work. And finally, who would enforce it? Prohibition didn’t work in the 1920s and I doubt it would today.

Back of the Envelope
  • Cost: $200 million including enforcement costs
  • Expected impact on average earnings: Unchanged
  • Expected impact on economic growth: Unchanged
  • Impact on incentives: Big incentive to set up illegal alcohol sales. Random alco-card checks
  • Impact on governement spending: Big increase in enforcement
  • Impact on taxation: $200 million
  • Winners: Green teas salesmen
  • Losers: Everyone else

2020 Helath Submission 1177 (Doc Holliday)

Another exerpt from Australia 2020 Nutjobs, Happy Clappers and Carpet Bagers


Supertooth and Good Food Friends are online school community projects that recognise chewing … [displaces] food… left trapped between teeth and inside pits and fissures … after every meal or snack

Wrap up

Tooth decay, it is argued, is the next most expensive chronic disease, after heart disease and type 2 diabetes. It is well known that, apart from fluoridation of water, chewing certain substances after a meal can effectively reduce tooth decay.

When you eat starchy foods, leftovers get into the pits and fissures and between your teeth. Chewing ‘hard’ after a meal displaces the lodged material. Moreover, it also promotes the production of saliva, which can also get into those hard to get places. Examples of hard food include foam strips impregnated of barium sulphate, non-cariogenic foods (such as nuts), and celery string.

Say what? It’s hard enough to hand out nuts at any school for fear of poisoning some allergic kiddie. And strips of barium sulphate? If kids don’t start tripping, their parents certainly will.

And you can’t seriously contemplate doing it at home either. Can you imagine introducing a reward system for your children: ‘son, if you do your violin lessons, I’ll give you celery string’. Why stop at celery string, why not feed them really small pebbles? ‘Crunch on these, son.’

But the emphasis o on education not handing out food. Poor bloody teachers are bombarded every day with requests by interest groups to gain access to the young kiddies. Our kids are certainly being educated, but not how to read and write.

If tooth decay is serious enough a health issue, most people would eventually learn of its importance and learn to floss a bit more.

Back of the envelope

  • Cost: $100 000 plus reduced literacy levels
  • Expected impact on average earnings: Unchanged
  • Expected impact on economic growth: Unchanged
  • Impact on incentives: No incentives for kiddies to do extra curricular work
  • Impact on government spending: Slight increase of $100,000
  • Impact on taxation: Slight increase of $100,000
  • Winners: Dentists and nut sellers
  • Losers: Kiddies no longer being able to read and write.

Tuesday, June 23, 2009

Whether to laugh or cry. (Roy Rodgers)

We’ve all heard about the economic stimulus. And we all know the basics …. Its a yea old school style reversion to the madness of Keynesian economics.

However, no amount of forewarning can prepare you for this …

I must admit that when I first encountered this site I laughed solid for a good 2 hours. Then I emailed it to my mates and got to experience the joy of listening to them go hysterical.

For maximum frivolity go to the community infrastructure page and check out the list of approved projects. Some of the highlights include

- Water bubbler program in Mosman — installation of water bubblers in various locations around Mosman, some (note not all) providing specific wheelchair access - $20,000.

- Dunny and signs - Nackeroo Lookout Area Upgrade, Timber Creek. Upgrade of the Nackeroo Lookout area, including the construction of ablution facilities, commissioning and installation of interpretive signage for tourists and signage on road and tracks to ensure environmental damage is limited. - $110,000

- Green dunny - Construction of an Eco-Friendly Public Toilet at Springdale Park - Construction of an eco-friendy, composting public toilet in Springdale Park at Barellan Point, $83,500

- Air conditioning - Community Hall Air-conditioning Installation, Bowen - Installation of split system air conditioning in McKenna Hall, Bowen. $100,000

To give you a point of reference National Builders Group is currently prepared to build you a single story house with two bedrooms, two bathrooms, one kitchen, a lounge, a dining room, a lockup garage and a theater room for $131,900. Included in that price is a margin for the builder.

There are over 500 pages of these projects. God knows how many council staff kitchens are being upgraded. And then there’s another list for “strategic projects”. This list is even more hilarious because here the numbers turn from thousands to millions.

I'm not sure when green dunnies and air conditioning became core economic infrastructure, but hey this is how were going to beat the recession (the one were not actually having).

Word of caution … after you stop laughing you will start crying.

Monday, June 15, 2009

2020 Health, Foreign Affairs and Sustainability (Roy Rodgers)

In case you've just happened across this blog site and are a bit confused about the 2020 carry on. Its all explained in an earlier blog on May 24.

As a refresher .... the posts are excerpts from a book that my compatriots and I started to draft regarding consulation and 2020. We never actually finished it, but we thought there was value in posting what sections we had drafted. Its also highly unlikely that anyone other than this blogs authors will ever bother to read our posts so we figured it couldn't hurt to throw them out into the blogosphere (or whatever its called).

If your still confused ................................

2020 Sustainability submission 856 (Roy Rodgers)



find isolated areas around the country, in this areas we would put our human waste straight into a deep bore hole. The theory is that the waste will move its way back into our water streams with the distance from the waste station to the natural water systems used to filter the water.

Wrap up

This submission belongs in the hey lets create an inland sea category; however it has a wicked little twist that makes it worthy of comment. The idea is short, succinct straight to the point. Basically 856 is proposing that we dig big holes in the desert and fill them up with poo.

Why you may ask? 856 (he/she, although to be honest my money is on 856 being male) provides the following justification. The idea is that we create massive pits of raw sewerage in central region of Australia. This sewerage would then filter through the indices of rock and soil, depositing little bits of poo as it goes, and hopefully by the time it encounters a water source, whether it be an aquifer or a river, it will be pristine and pure. Otherwise, there are going to be quite a few rural Australians complaining about the taste of their water and the discoloration it leaves on the washing

Of course there are a couple of minor issues with poisoning vast tracts of remote Australia. Any proper assessment must consider both the benefits and costs. Lets start with the benefits.

For starters percolating through indices of rock and soil is probably not the speediest way to treat sewage. As a method for generating additional sources of water its best suited to those that are prepared to wait a couple of thousand years. It is definitely not going to satisfy the needs of drought effected urban populations. Given that actual supply augmentation may not be a big bonus we have to extend our analysis to consider social and environmental benefits. It is obviously a big plus for anyone who enjoys poo skiing or poo sailing (depending on the size of the hole), although measuring the value of this benefit may be a challenge in and of itself. Another external benefit would be the possible food source it would create for any native animal with the gastronomical dexterity to deal with human waste.

What will it cost? In the absence of any robust analysis we can generate some indicative numbers. A recent estimation of the Melbourne to Gippsland pipe line for recycled water is approximately $2 billion. Given that this pipeline covers a relatively small area, is designed to transport water (which by its very nature is less bulky than sewage), and is able to use gravity and thus requires less pumping, we can safely say that creating a national network of infrastructure that moves sewage from the major urban centers (being at sea level) to massive inland pits (don’t forget the pits, we need some holes and they need to be quite large … actually they are going to be so big that they’ll constitute inland seas of poo) is going to cost in pure economic terms a SHIT load. And that is before we actually factor in external costs such as the anticipated obesity epidemic in desert dwelling goannas.

The back of the envelope

  • Cost: $shit load
  • Expected impact on average earnings: Hello poverty
  • Expected impact on economic growth: Australia to become the very first developed economy to regress to a level of economic activity that matchs that of pre-settlement
  • Impact on incentives: If the full cost is passed through to consumers in their water and sewerage charges there is a strong incentive to cease defecating
  • Impact on government spending: $shit load
  • Winners: Poo skiers and hungry goannas
  • Lossers: Australia and diabetic goannas

Saturday, June 13, 2009

2020 Health Submission 1267 (Doc Holliday)

Scepticism was used to protect a seventeenth century English mindset influenced by puritanical deist, Calvinistic beliefs that saw nature as evil. Any science oriented towards herbalism and vibrational medicines was attacked as SPAGYRIST ALCHEMY while mineral alchemy (turning base metals into gold) was elevated as the nobler pursuit, and consequently became mineral-technology-money economy. The foundation of material chemistry RETARDED biological science significantly by deferring all living sciences to physics. Biochemical research which includes genetics, bioengineering, is only decades old and its success due to chaos theory and investigations into hyperincusive anticipatory systems or radical recursion.’

The scientific method remains, probably, the only way by which we can arrive at a truthful understanding of the universe around us. The principle that every idea is only as good as its ability to predict, is a cornerstone of the scientific method. And we must protect it.

So it is very serious matter when one part of the scientific community (biological sciences, especially those focusing on alternative therapies), should levy against another (non-biological chemistry). It is not clear how deal with a conspiracy: do we launch a multibillion dollar (and clearly, the world largest) class action with the ACCC? Who do you sue? Were prices set or just people excluded from doing business?

How can there be a conspiracy? How could one branch of science come to deny another opportunities to inquire and investigate the universe around us? Will anyone initiate new research knowing that there is a risk of class action hanging over their head?

A conspiracy is very difficult to maintain over several hundred years between members who don’t know each other. A simpler explanation is that the culprit is the very non-conspiratorial invisible hand. The economy, like any complex organism, comprises a large number of individuals making intimate, personal decisions. The failure of alternative therapies to succeed in the market is because they were unable to stand up to scientific scrutiny and to demonstrate their economic effectiveness.

The extent to which alternative therapies based on biological chemistry will become widespread will depend upon how they can stand up to scrutiny in the laboratory and in the marketplace.

Back of the envelope
  • Cost: $20 Billion law suit
  • Expected impact on average earnings: None
  • Expected impact on economic growth: Negative
  • Impact on incentives: reduced independent research
  • Impact on government spending: $20 Billion defecit to fund
  • Impact on taxation: $20 Billion to fund defence fund
  • Winners: Lawyers
  • Losers: Rest of Australia

Sunday, June 7, 2009

Foreign affairs submission 7586 (Lone Ranger)

I was not going to add another submission today, but this was so bizarre that I could not help myself.

Support all breastfeeding initiatives worldwide to help alleviate poverty

Foreign aid (in emergency situations and otherwise) should not include provision of infant formula - this undermines mothers' breastfeeding confidence. Third world countries view provision of infant formula as condoning its use (when, in fact, it's usually unnecessary).

Implement the WHO Code. The International Code of Marketing of Breastmilk Substitutes was adopted by the World Health Assembly in 1981 as a "minimum requirement" to protect infant health and is to be implemented "in its entirety."

This is what we call a breast-driven approach to foreign relations. It is an exciting prospect that the new ambassador to Beijing would use his presentation of credentials to talk about breast feeding. Want to resolve the problems of the Middle East? Get their women to whip out their breasts more often and feed those kiddies. Stop worrying about global development issues – if only more women would breast feed, poverty would become history.

A lot of women in Africa breast feed. Guess what, all that breast milk has done stuff all to alleviate the poverty of the continent. Breast feeding will not solve problems arising from bad governance, lack of freedom and bad economics.

We certainly couldn’t accuse the author of this submission of overly complex arguments. Breast feeding is, doubtless, beneficial for babies. That said, there is still a role for formula. Once upon a time, if a new mother was not able produce milk, there were several choices – a wet nurse (for the wealthy only), gruel (not very nutritious) or death for the infant (and gruel was in most instances a death sentence anyway).

We highlight this submission because, yet again, here we have a dogmatic one-issue pontificator telling the third world what to do, to the detriment of the poor. Like DDT or GMOs, there are potential huge benefits associated with new products and technology for the world’s poor. It is both typical and patronising to have a do-gooder who has never known the pain of having a child die through want of milk or a milk substitute to write this stuff.

We note that this submission also argued that breast feeding was the answer to: enhancing productivity, population, sustainability, climate change and water, future directions for rural industries and rural communities and options for the future of indigenous Australia, to name a few. It probably cures malaria too.

Back of the envelope
  • Cost: not sure, but expect it to ne high for the developing world
  • Expected impact on average earnings: $0
  • Expected impact on economic growth: none
  • Impact on incentives: none
  • Impact on government spending: mercifully minimal
  • Impact on taxation: none
  • Winners: one-issue zealots
  • Losers: any woman who has problems breast feeding her young

Foreign affairs submission 2419 (Lone Ranger)

Another foreign policy excerpt from Carpet Baggers, Nutjobs and happy Clappers"

Proposal for the 2020 joint Summer Olympic Games and Universal Exposition at Uluru…..'Expo2020lympiad Uluru'

A Joint Summer Games Olympiad and Universal Exposition…..and at a custom-built site, city, at the foot of Uluru, a third millennium earth eco-friendly site comprising of 2,000 citizens from every nation on earth, a global city-state of some 400,000 to 600,000 persons in a brave, new world 20-year experiment in governance, economics, politics, society, and the environment.

This is the major event to end all major events. Alice Springs airport will need to be expanded to cope with the “hordes” of visitors expected for this extravaganza. And not just a one off event: - an entire city with no economic purpose, and potentially no water, in the middle of the desert!

If this sounds too good to be true – we can assure you that it is. There is a good reason why there is currently not even a township at the foot of Uluru – there is nothing there except a large rock. The history of the world is full of utopian dreamers building cities which, with no real economic purpose, sucking in huge resources before declining and being abandoned – ever been to Canberra? In any case, the indigenous owners, who presumably make a very nice living creaming funds off tourists to the site, may object to a city of 400-600,000 in their backyard.

The “brave, new world” isn’t the right description for us – we thought 1984 was closer to the mark. A “global city state” implies that it will be a sovereign entity. It is one thing to use the Olympic Games as an excuse to smarten up a dumpy part of town, but quite another to then use the Olympic Village as the starting point for a new country.

So in summary, we have here a major new city with no economic raison d’être and probably no water, literally thousands of miles away from the nearest large city. Not only that, but its residents, whose key basis for selection to live at this site would be their nationality, would potentially have nothing in common – not even a common language. Sounds like a recipe for a massive white elephant, which unfortunately would have to be footed by the Australian taxpayer. There have been some examples of cosmopolitan city states being incredibly successful – but this one, unfortunately, would be no Singapore.

The back of the envelope
  • Cost: $500 billion. Truthfully, we have no idea - just something with a lot of zeros
  • Expected impact on average earnings: negative $500 billion. Again, we have no idea – just something with at least as many zeros
  • Expected impact on economic growth: Unbelievably negative
  • Impact on incentives: None that are positive, unless there is some incentive in parcelling out our national territory to establish small basket case countries
  • Impact on government spending: Lots and lots
  • Winners: Olympic Village project managers
  • Losers: The people that dreamt this one up

Thursday, June 4, 2009

2020 Health Submission 179 (Doc Holliday)

An excerpt from the book that never was, “Carpet Baggers, Nutjobs and Happy Clappers.

‘We should change over to a public provided health care and only mandate private health care for those [earning] over [$]150,000 per annum.’

Health care policy is pretty screwed up as it is, and this proposal doesn’t make it any better. It’s not clear whether the suggestion is in relation to health insurance, general practice, hospitals, or all three.

The sole virtue of Medicare is that it provides care to those that could not afford private health insurance. But it does so very badly. By being free, it encourages a waste of health resources: some people over-use it, while others who need it get stuck on waiting lists. Moreover, it encourages bad lifestyles, as individuals do not face the financial consequences of their lifestyle choices. By reducing the scope for private health insurance, the public health system would resemble that of France’s, whose health system costs about 2.1 per cent of GDP more than Australia — or $20 billion per year

There is also a strange relationship between Medicare and private health insurance. If you want to purchase additional private health care services to those offered under Medicare, you have to pay for your entire health care cost again — not just the top up. There is no obvious reason why you should take out PHI. To make it attractive, governments must either subsidise private health care or deliver substandard quality of public health care.

It seems Australian governments are doing both.”Everyone is a loser, babe, and that’s the truth” goes a popular 70s song.

The only decent proposal for governments is to replace the current public–private health insurance paradigm with one in which everyone receives a Medicare grant to use towards purchasing insurance (supplied by a public or private provider) and medical services. Individuals can choose to purchase additional health insurance. Insurers and hospitals will compete for patient funds, thereby promoting competition and efficiency.

The back of the envelope

  • Cost: ~$20 billion:
  • Expected impact on average earnings: Reduced incomes in long term
  • Expected impact on economic growth: Reduction in growth
  • Impact on incentives: Major incetive for moral hazard
  • Impact on government spending: Big increase
  • Impact on taxation: Taxation increased by 2% of GDP
  • Winners: Public Health Administrators
  • Losers; Patients and taxpayers

Are crappy tea bags sticky? (Roy Rodgers)

An interesting question is whether the quality tea bags will be reinstated during recovery or wether tea bag quality will prove to be sticky? Is this simply an opportunity for the firm to achieve cost savings by riding on the coat tales of recessionary expectations (despite the fact we are now officialy not in recession).

You would think these non pecuniary benefits are a fairly good indicator of how sensative a firm or department is to the ebb and flow of the labour markets assoicated with its human capital. In the case of the Lone Ranger I think the firm in question may be acting a bit brashly given the counter cyclical nature of economics. It would not appear rational for a firm to reduce nonpecuniary benefits for economists during a period in which their skillls are in demand.

Lone you should jump on your horse ride into the head cheeses office and demand the reinstatement of quality teabags.

Wednesday, June 3, 2009

Global economic crisis finally hits home (Lone Ranger)

Well, the recession/depression/crisis has finally begun to hit. At work, not only have people lost their jobs and hours have been cut, but now I find that the old brand of teabags have been replaced by a, ahem, less pricey version which can best be described as sawdust with some token tea leaves in it. Will being some twinings from home from now on, methinks.