Apr 04

Weeping Window II Refugees welcome II Finland happiest II Two cities II Cobalt II Debt & Inequality II

Welcome to the March BLOG

Contents: Weeping Window II Refugees welcome II Finland happiest II Trump II Two cities II Cobalt II Debt & inequality II 

Having sung in this cathedral in Hereford, it seemed appropriate to promote the image below. The photograph of The Weeping Window conjures up visions of Romeo and Juliet and Rapunzel,  the installation actually comprises several thousand handmade ceramic poppies.  It is a touring tribute to Britain’s first world war dead.  Very beautiful and meaningful.  The artist is Paul Cummins with designer Tom Piper.

Source:  The Guardian Weekly 230318, Matt Cardy, Getty Images,  the images are sourced from The Ross Gazette and Hereford Cathedral School. (“There’s a place for us” – music by Leonard Bernstein, lyrics by Stephen Sondheim)

 
 

Sicily welcomes refugees…

Since 2014, “Sutera in central Sicily, has augmented its dwindling population with dozens of asylum seekers.  The school has been reborn; the butcher and grocer are happy; the birth rate has rocketed.”   From the 1970s to the 1990s Sutera increasingly lost its citizens due to mass unemployment. 

As reported by Lorenzo Tondo, “Deborah, 26, a Nigerian victim of trafficking is one of 50 asylum seekers now living in the town.”Deborah was raped by traffickers in Libya. Her daughter Sophia was born in Sutera and she is now a year old.  Thanks to children from Ethiopia, Pakistan and Nigeria,  the school is now safe from closure.   Two neighbouring towns are now following suit – Mazzarino and Milena.  Today the locals say the true salvation of Sutera  is the refugees.  (Sources Images: Typical Sicily, Pinterest)

Another positive story …

Finland has overtaken Norway to become the happiest nation on Earth according to the UN.  The top four places on the 2018 World Happiness Report are Nordic with Denmark and Iceland following.  The Nordic countries scored highly on income, health, social support, freedom, trust and generosity.   Considered the best governed, the safest and most stable, Finland today has a population of 5.5 million.  Pictured : a village inside the polar circle – DesignGrapher.com & ‘Rainbow’ Pixabay free images – Finland.

Finland is sandwiched between Norway, Sweden and Russia, see map.

 

 

Trump again – Gary Young, a journalist writing for The Guardian Weekly (23.03.18, Comment&Debate, p20) had this to say on the Trump presidency “Witnessing Trump’s presidency unravel so spectacularly provokes a perverse joy.  The venality is so baroque, the vulgarity so ostentatious,  the inconsistencies so stark,  the incompetence so epic and the lies so brazen, it leaves you speechless.”

This after President Trump unceremoniously fired his Secretary of State,  Rex Tillerson and the previous week Deputy FBI Director Andrew McCabe was sacked two days before he would have qualified for a full pension.  McCabe said he was targeted because he is a potential witness in the investigation into collusion between members of the Trump election campaign and the Kremlin (Julian Borger, International News, p7).    

Meanwhile the European Union has proposed a levy of 3% tax on the revenues of big technology companies –  think FAANG– Facebook, Amazon, Apple, Netflix and Google,  those who  operate in Europe but have little or no physical presence there.  The proposal requires unanimity among the EU member states to be adopted.  Australia should do the same.  Source: The Economist, March 24, 2018 (p8).

Comparing two cities – Copenhagen, Denmark and Kinshasa, Congo

Copenhagen (remember our Happiest Nations),  in 2015 had a population of 1.3 million and yet it is projected in 2050 to have precisely the same – 1.3 million. 

Declining birth rates, ageing populations and good infrastructure allows many cities to focus on the environment. Copenhagen’s lord mayor, Frank Jensen,  said “today our harbour is so clean we can swim in the water,  62% of Copenhageners ride their bike to work or school.”  It’s a green and liveable city.  Copenhagen wants to be the first carbon neutral capital city by 2025.

Now look at Kinshasa in the Democratic Republic of Congo.  Population in 2015 – 12 million and projected population by 2100,  83 million that is nearly a 900% increase.  If we compare to 2050 as we have with Copenhagen, the expected population is still projected at 75 million. Kinshasa is dysfunctional, ringed by vast shanty towns of informal settlements.  Its infrastructure is nonexistent or collapsing.  Source: Praag.org  – Kinshasa, ringed by shanty towns.  

According to the World Bank,  what is happening in Africa is that small scale informal trading is not adding enough economic benefit.  But investment in Africa is happening via China, note their investment since 2010.  

 

 

China’s investment is linked to its Belt & Road initiative. The two legs of the new Silk Road, however, are not single routes but rather consist of a network of links connecting different parts of China to the world.

The ‘Belt’ aims to link the western parts of China through six economic corridors to Central Asia, Russia, Europe, the Mediterranean and the Persian Gulf, and Southeast Asia, South Asia and the Indian Ocean.

Meanwhile, the ‘Road’ – somewhat confusingly – is a sea route designed to link China’s coastal parts to Europe and Africa through the South China Sea and the Indian Ocean in one route, and through the South Pacific in another route.

Altogether the Belt and Road initiative covers 65 countries, 4.4 billion people and over a third of the world’s GDP.

Source: Star Graphics & China Business Review

Cobalt demand up

Today an electric vehicle uses about 10kg of cobalt and more than half of the world’s cobalt reserves and production are in one dangerously unstable country, the Democratic Republic of Congo.  (Pic – 2 little boys (aged 7) working in a cobalt mine)

Eighty percent of the cobalt sulphates and oxides that make the all important cathodes for lithium-ion batteries are refined in China.  The remaining 20% is processed in Finland.  But the raw materials come from a mine in Congo which is majority owned by China Molybdenum.   GEM, a Chinese battery maker has said it would acquire a third of the cobalt shipped by Glencore between 2018 to 2020.  That’s equivalent to half the world’s production going to China.  Cobalt has risen from $26,500 a tonne in 2016 to above $90,000 a tonne today.  Production in Congo is set to increase but investment may be deterred by the recent 5-fold increase in royalties on mining cobalt.  Source:  Goblin Metals, The Economist March 24th, 2018 p63,  image:  Collective Evolution.

DEBT

I wondered when this subject would next rear its head and at last Professor Tony Makin (Economics) at Griffith University has dared to speak the unspeakable – “our unsparing outlays are unsustainable”.

In 2013 we were correctly informed that the budget deficit had to be addressed as a matter of urgency.  But despite the rhetoric, little has been done to reduce federal spending. Labor queried the Foreign Secretary’s expenses bill of $1.2 million in 2017 but nothing came of it.

Australia’s net public debt is about 19 per cent of GDP.  The interest on our public debt is about $13.4 billion.  “Each percentage point rise in interest rates adds another $3.7 billion to the annual interest bill, more than the government spends on housing.”

“Public debt will keep growing until we reach surplus predicted by Treasury to be 2021.  The Coalition has gone silent on deficits,” said Professor Makin.  “There is no doubt our company tax rates are not competitive.”  China and Ireland – classed as two miracle economies prospered on the back of tax breaks that discriminated in favour of foreign investment.

The company tax rate is 12.5% in Ireland and 17% in Hong Kong and Singapore.  Personal tax cuts mooted down the track are simply not affordable.  While promoting further company tax cuts, Professor Makin also suggests “these should be accompanied by cuts to government spending.” Apart from middle class welfare (and we will say something about that shortly),  “there are billions spent on assistance to agriculture, mining, manufacturing and construction.  Industry assistance only benefits some businesses [but] at the economy’s expense.” 

Take a look at Australia’s government debt clock – $621 billion and rising. http://www.australiandebtclock.com.au/

Source: Commentary, The Australian April 3, 2018 p12.

CUT FROM THE POOR TO GIVE TO THE RICH

Yes that is how Australia was described by Anglicare’s Executive Director Kasy Chambers.  The organisation commissioned a research paper and report into tax benefits in late March, and what they found was shocking. 

A staggering $68 billion in taxpayers dollars is spent keeping the wealthiest households wealthy… every year.  That is greater than the cost of Newstart (at $11 billion) or the entire Aged pension program ($44 billion).

Here is a list of the tax benefits paid to the top 20% wealthy Australians:

  • Capital gains tax concessions and exemptions
  • Superannuation concessions and tax breaks
  • Private education tax exemptions
  • Private health care tax exemptions
  • Negative gearing
  • Discretionary trusts

Yep that’s $37 a week taken from every worker in Australia not to mention the foregone tax revenue $68 billion every year.  Something’s got to give.

Source:  The Cost of Privilege, Anglicare Australia and percapita.

End of Blog quote :  Modern slaves are not in chains,  they are in debt.

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