Pascoe on the economic situation

Joe Hockey's 'please explain' moment

Michael Pascoe really puts the boot into "Hockeynomics", with an analysis that will warm the heart of Labor:

The Hockeynomics contradictions were front and centre on Friday. You can either be appalled by the forecast rise in unemployment and give the impression you would reduce it, or you can be appalled by the larger deficit and give the impression you would reduce it – but you can't do both at the same time.

If you accept that the economy will grow more slowly this financial year, that there's a bit of a gap in the transition from the resources construction boom to the rest of the economy lifting its game, the very good news in Friday's economic statement was that the deficit is indeed being allowed to grow. After heading in opposite directions over the past year, fiscal and monetary policy are now aligned, both providing stimulus for a year when growth will be softer.

Just as the politics overshadowed the most important economics in the May budget, the higher deficit and unemployment rate grabbed the economic statement's headlines – they're the two simple issues that dominate the political screaming match.

Lost was the admission that the record fiscal contraction was even worse than published in May. The budget papers estimated 2012-13's public final demand (net state and federal government spending) would shrink by 0.5 per cent. The economic statement says it actually contracted by 1.5 per cent. The budget intended to keep public final demand flat this year. After the revised shortfall in revenue, the government is letting the “automatic stabilisers” do their stuff and public final demand is forecast to rise by 0.75 per cent this year and by 0.5 per cent next year before efforts to reduce the deficit kick in.

The new deficit forecast of $30.1 billion represents 1.9 per cent of gross domestic product, compared with the May prediction of an $18 billion deficit worth 1.1 per cent. Any business doing it tough should be grateful for that extra 0.8 percentage points, given that the economy is only expected to grow by 2.5 per cent. Yes, if a lunatic took control and immediately cut spending by $30 billion to balance the budget, GDP would theoretically grow by just 0.6 per cent at best – and actually by considerably less due to knock-on impact.
So if the forecast 6.25 per cent unemployment rate is displeasing, there's no point demanding an immediately smaller deficit.

Tony Abbott: "Everyone knows I'm a crook negotiator and I promise I won't try it again."

Abbott Won't Lead Minority Government

Kind of an odd way for Tony Abbott to kick off an election campaign, isn't it?, given that a hung parliament is certainly not out of the question given current polling.  Does he mean he would not join with a nut or two from Katter's party to form a minority government?  Probably not, is my guess.  

I also just saw Abbott on Sunrise.  He looked tired and a bit lethargic already, after about 15 hours of the  campaign.   He might be attempting to copy Kevin Rudds "no sleep is necessary" approach to life, but it doesn't suit him.

Update:  here's a shot from Sunrise, which is typical of how he looked during the interview:

 "Tired and worried" written all over it, if you ask me...

First election visual comment...

Nice view

The cheapo Samsung Tab 2 was never sold for great specifications on its camera, but it does make taking panorama shots easy, and it was a lovely afternoon at Mt Cootha today:

(Clicking it should enlarge it.)

I think there was an election called while I was in the sun.  This calls for some more photo app play... 

Taming the possum

(There's a new, smaller, shy possum visiting us now.)   

Europe was built on...milk

Nature has a lengthy, fascinating article up about archaeology and milk.  Apart from being a potential reality check for 10 year olds dreaming of that job after watching Indiana Jones movies, it explains  the importance of how (some) humans developed the ability to digest lactose, then spread out to Europe.  Here are some highlights:

During the most recent ice age, milk was essentially a toxin to adults because — unlike children — they could not produce the lactase enzyme required to break down lactose, the main sugar in milk. But as farming started to replace hunting and gathering in the Middle East around 11,000 years ago, cattle herders learned how to reduce lactose in dairy products to tolerable levels by fermenting milk to make cheese or yogurt. Several thousand years later, a genetic mutation spread through Europe that gave people the ability to produce lactase — and drink milk — throughout their lives. That adaptation opened up a rich new source of nutrition that could have sustained communities when harvests failed.

This two-step milk revolution may have been a prime factor in allowing bands of farmers and herders from the south to sweep through Europe and displace the hunter-gatherer cultures that had lived there for millennia. “They spread really rapidly into northern Europe from an archaeological point of view,” says Mark Thomas, a population geneticist at University College London. That wave of emigration left an enduring imprint on Europe, where, unlike in many regions of the world, most people can now tolerate milk. “It could be that a large proportion of Europeans are descended from the first lactase-persistent dairy farmers in Europe,” says Thomas.

This figure sounds surprisingly low:

Only 35% of the human population can digest lactose beyond the age of about seven or eight (ref. 2).

The effect of the genetic mutation which I happily share was possibly profound:

Most people who retain the ability to digest milk can trace their ancestry to Europe, where the trait seems to be linked to a single nucleotide in which the DNA base cytosine changed to thymine in a genomic region not far from the lactase gene. There are other pockets of lactase persistence in West Africa (see Nature 444, 994–996; 2006), the Middle East and south Asia that seem to be linked to separate mutations³ (see 'Lactase hotspots').

The single-nucleotide switch in Europe happened relatively recently. Thomas and his colleagues estimated the timing by looking at genetic variations in modern populations and running computer simulations of how the related genetic mutation might have spread through ancient populations⁴. They proposed that the trait of lactase persistence, dubbed the LP allele, emerged about 7,500 years ago in the broad, fertile plains of Hungary.

Once the LP allele appeared, it offered a major selective advantage. In a 2004 study⁵, researchers estimated that people with the mutation would have produced up to 19% more fertile offspring than those who lacked it. The researchers called that degree of selection “among the strongest yet seen for any gene in the genome”

Compounded over several hundred generations, that advantage could help a population to take over a continent. But only if “the population has a supply of fresh milk and is dairying”, says Thomas. “It's gene–culture co-evolution. They feed off of each other.”

I suggest everyone have a strawberry shake in honour of this research.  Unless you're lactose intolerant, of course...

Hydrogen and solar

Here's a comment I made for another blog, but I wanted it here so I have the links:

I have speculated for some time that using some capacity of solar thermal to split water into hydrogen might be helpful (although I gather it's not efficient to then use the hydrogen to heat the salts on a cloudy day.)  I see just now that a new technique is proposed for hydrogen production using solar thermal.  Unfortunately, moving hydrogen around is not so easy, I think, but using it in house scale fuel cells might be one way of helping with intermittent direct supply from the grid. 

Sunny Greenland

It's been warm in Greenland recently:

The Danish Meteorological Institute is reporting that on Tuesday, July 30, the mercury rose to 25.9 C (78.6 F) at a station in Greenland, the highest temperature measured in the Arctic country since records began in 1958.

The balmy reading was logged at the observing station Maniitsoq / Sugar Loaf, which is on Greenland’s southwest coast, the DMI reports. It exceeded the 25.5 C (77.9 F) reading taken at  Kangerlussuaq on July 27, 1990, in the same general area. Mantiitsoq is Greenland’s sixth-largest town, with a 2010 population of 2,784.

Mantiisoq doesn't look too bad, for a small town in Greenland.

If only Treasury had been worrying about the right things, like stagflation....

Well, the ABC collective (the Australian, Bolt and Catallaxy, for those who have forgotten) gets a boost today by Sinclair Davidson doing a summary of about 2 years of Catallaxy posts (well, except for the ones mentioning what will be mentioned below) in a long column at the Australian which, of course, is also extracted at some length at Andrew Bolt's blog.

Davidson is very big on "holding people to account".   He's forever making shock jock style calls for judges, parole boards, economists, politicians to be sacked or somehow publicly pilloried for matters about which he appears to have no particular experience or knowledge of how decisions were made.   (Mind you, it would not be surprising if the Victorian parole board is about the get a legitimate bollocking by someone - Callinan - who has a better idea of how the system works.)   His libertarian inspired views on economics contain the embarrassing and poisonous stain of Randian thought (he put up a video of a long talk to small government types he gave in New Zealand recently where, in response to a question at the end about use of language in economic debate, he confessed to personally thinking in terms of "moochers and looters".)    

Yet despite his fondness for punishment, he's the economist who, two years ago, started a column with this:

High inflation combined with a sluggish, or stagnant, economy is described as 'stagflation'. The last time the world saw anything like this was in the 1970s.

It is the consequence of pursuing Keynesian economic policy. It should come as no surprise that the return of Keynesianism during and after the Global Financial Crisis could see the return of stagflation.

 He turned up on (surprise!) Andrew Bolt with the same warning.

Look, I know its tough medicine, but Paul Krugman on inflation and the anti-Keynesians seems to have been right for, what, a decade or more now? 

Well, Sinclair should take his punishment and given himself a severe sacking.   

No wonder I need glasses...

Your eyes are half a billion years old

A browser recommendation

I have formerly recommended the Mercury browser for the iPad, because it has the equivalent of a scroll bar down the side, which helps overcome one of the most tedious aspects of most touch screen browsers - getting to the bottom of a long, long thread quickly without a lot of frenetic finger flicking.

Now that I mainly use a Samsung tablet, I haven't found the equivalent.  Until now.

The Maxthon browser not only lets you get to the top or bottom of a large site quickly, its method of flicking back quickly to a link you've just come from is the fastest and most pleasing thing I've seen in a tablet browser.  I think it might load a new site you are going to marginally slower than, say, Chrome; but this is more than compensated for by the way you are instantaneously back from whence you came.

I have only been using it a short time, but it has my endorsement already.   Maxthon (available for both Android and Apple too, I see.)

Hi everyone...have a look at my...

Some time ago, I noted English media reports about the spectacularly odd medical exhibitionist program Embarrassing Bodies.  When I wrote it, I didn't realise it was being shown late night on one of our networks. Since then, I have seen brief bits from it, but last night I got my longest burst of it while half browsing the internet.

This show causes me something close to the cognitive meltdown that awaited poor old HAL. First of all, you could say that the bedside manner of the doctors is exemplary, and (if last night's show is any guide) the patients appear pretty ordinary, normal folk off to get some free medical advice (and, I would hope, treatment.)  The medical explanations of their problems are often accompanied by clear and understandable graphics, and you can appreciate an educational aspect of the show.

But on the other hand, the show can be summarised like this (from last night's episode): "hey world, have a look in close up at my hairy butt while the doctor puts on a glove and tries to work out why I have poos so big they hurt me". Or - "Mum, Dad, everyone I know down my street - did you know I've been finding sex painful since childbirth, and the scar tissue near my vagina will be on telly tonight."

On the third hand, you can say that excessive prudery about nudity is cultural and a bit silly really, and everyone on the show has a (kind of) commendable maturity about it. But honestly, mere nudity is a bit different from having your vagina or testicles examined on TV. There's rarely any doubt about whose genitals are up on the screen too - there are plenty of long shots showing both faces and those bits on display.  And besides just the physical aspect - there is a difference between being open and not embarrassed about a bodily function with a doctor in his or her rooms, and the same on international television. 

How do these patients warn people they know that if they don't want to learn more than they care to know about them, they should not watch an upcoming episode? Do the producers kindly provide a standard warning email/telephone service that seeks to prevent parents/co-workers/neighbours from having nightmares (or, at least, strange conversations around the watercooler the next morning)?  "So, Raj, I didn't realise you actually shave down four inches below your neck so we wouldn't know your body is ape-like hairy."  (Yes, another story from last night's episode.)
 
And why do normal looking and sounding people go on the show at all? Is the NHS so hopeless that they can't get decent treatment except while naked on international television?   And, as I noted in my last bit of writing about the show, what is it about the British that have swung from having Mary Whitehouse as a prominent figure, to being the nation most willing to talk about their genitals and what they do with them on TV?  It's a blessing she's dead; shows like this and the other British series I think I mentioned before about the cheery souls being tested for VD at the clinic would have had her on medication.

The show is both (sort of) good, and so weird I can't stay with it for more than 20 minutes.

How to cyber defeat an enemy?

Don't touch that flash drive—you have no idea where it's been.

This Slate article starts:

If you found a pretty little USB stick on the ground, would you plug it in to see what’s there? No? OK, what do you think your parents, neighbors, and co-workers would do?

When the U.S. Department of Homeland Security ran a similar test in 2011, they discovered that 60 percent of those who found flash drives planted outside of government and contractor buildings plugged them right into their networked computers. Even worse, when the drives were outfitted with an official logo, the number jumped to 90 percent.

Well, maybe those people weren’t properly trained in cyber security, you might say. (Insert joke about incompetent government workers.) Alas, a recent study divulged that 78 percent of IT security professionals confessed to experimenting with unidentified flash drives. Of those surveyed, more than 68 percent had been personally responsible for a security breach at work or home, often as a result of the orphaned drives.

Gee.  Sounds like all you need to do to cyber defeat an enemy is to have agents with sacks full of virus infected USB drives discretely dropping them around government buildings.   And just around the neighbourhood generally, perhaps.

Or maybe you could use a drone to disperse them from the air....

Infrastructure confusion

Infrastructure: No longer a no-brainer | Club Troppo

Yesterday I was quoting Tim Colebatch saying Australia's level of infrastructure spending had long been too low; now someone is arguing our spending is now too high.

No wonder I find this topic confusing.

All I know is that, given the amount of money on tents both sides of politics seem to be intent on spending, my idea of a yurt led recovery no longer seems implausible.

Life in the bridge

I've always wanted to see what the residences inside the Indooroopilly Bridge looked like, and now it seems I will have a chance....

Germs recommended

I seem to have missed a 2011 story about this: Social amoebae travel with a posse, have amazingly complicated social lives

More detail: 

...scientists had discovered a single-celled organism that is a primitive farmer. The organism, a social amoeba called Dictyostelium discoideum, picks up edible bacteria, carries them to new locations and harvests them like crops.

And last night on SBS, the documentary "Pain, Pus and Poison" about how a treatment for syphilis was found, as well as the interesting story of how penicillin was rushed into production in World War II was great, if often gory, viewing.

Slate must be trolling for comments

Kids and dogs: If you’re having a baby, do not get a puppy. - Slate Magazine

Last week, it was inviting a flame war between Apple and Android users (that was kinda fun to read, actually.)  This week, it's an odd column by a women who says you shouldn't get a dog if you want kids, because you'll completely ignore the former when you have the latter.  Actually, both she, and her dog, sound a tad neurotic.

Never mind that billions of Earthlings find dogs and little kids make for a happy household. (Probably a healthier one too.)

Trolling for comments is the only explanation.

Infrastructure talk

Build it, and a stronger economy will follow

Well, that's interesting.  Tim Colebatch talks up infrastructure, and says that spending on it has been too low for about 30 years now.   He also notes that although the Coalition claims that they will make cost benefit analysis of projects a priority, they are already announcing funding for things which probably wouldn't pass that criteria.

But the column also makes mention of things which raise my doubts about how valid cost benefit analysis can sometimes be.  For example, cities used to be very keen on building urban railway lines well before there were people living along them.  Sure, everyone benefits from that maybe 80 years later, but you can't model that well at the time you're building it, can you?

Funnily enough, I see that Henry Ergas is said to have expertise at infrastructure economics.  I wouldn't trust him to have a valid opinion on things like my plan for a yurt led recovery for the Australian economy.*

*  A joke, Joyce.  Yurts aren't "infrastructure".

Just back from Rio, I guess

Sorry, the latest app on the tablet continues to amuse me with its easy method of mild ridicule.  

  

Update: A message across the innerwebs: IT: she seems very resistant to the charms of this blog. How far do I have to go in photoshopping type stuff to get her to visit?

A fan speaks...