THE BIG DIVIDE

by Jeremy Lee
The Australian has, surprisingly, been running a series of articles on the widening "big divide" between rich and poor in Australia. It has produced the predictable and varying viewpoints of writers, from the economic-rationalist approach of Alan Woods, who thinks we're all relatively better off, to those who believe "taxing the rich to help the poor" will solve a crisis which at least they acknowledge exists.

Robert Gottliebsen, writing in The Australian (20/6/2000) acknowledges that income redistribution through taxation is not going to work in a high-tax country like Australia, and advocates: ".....The answer to the problem lies in making an all-out drive to improve the I.T. skills of those who are falling to the bottom of the income levels ...."
Gottliebsen makes a lot of sense in some areas. But what if he, with the other commentators from the different camps of orthodoxy, have an incorrect analysis of the problem?

It was C.H. Douglas who said that a problem correctly stated is half-solved. The corollary is that a problem incorrectly stated is insoluble. The huge number of funding crises facing government and people alike have their origins in a simple mathematical equation attending the creation of money systems. If all money is created and put into circulation through loans which, together with interest-charges, must be costed into prices, the result must of necessity be an aggregate price system in any economy which cannot be liquidated by aggregate purchasing power. This is the basic financial proposal of Social Credit.

Much credence must be given to this analysis, which was set out in the early part of last century, by the fact that the results of failing to correct the problem - an accountancy problem - were forecast with startling accuracy by Social Credit's founder, C.H. Douglas. It therefore does not matter what type of tax or trade policy we adopt, or whether the money-supply is increased at a fast or slow rate, or whether interest rates go up or down, or whether the welfare state expands or contracts; none of these have any bearing on the disparity between prices and incomes caused by trying to kick-start the productive and distribution systems with debt-and-interest finance.

To conceive that this proposition is worth analysing is to step outside the bounds of acceptable orthodoxy. But if we don't, it is inevitable that the range of critical issues facing humanity will continue to degenerate to the point of no return. Looking round us, in terms of human history, such a moment cannot be far off.

DEBT AND TRADE-DEFICITS GROW

Australia's net foreign debt has now reached $255 billion - approximately $13,400 for each Australian, or $53,600 for the average family of four. It is over 40% of G.D.P. The net foreign debt has increased by $25 billion in nine months; and this by a Government that, prior to gaining office, ran a "debt-bus" round Australia condemning the Keating Government's record on the foreign debt as part of its election campaign!

During the March quarter the Trade Deficit blew out again, to $8 billion - a mere $88 million a day through the three-month period. The first signs of the second quarter this year show imports rising dramatically. May's figures show that imports grew by $2.4 billion. The Australian Financial Review (20/6/00) reported: " .... Over the last 12 months, imports will have grown nearly 16 percent in seasonally adjusted terms. Australians have spent nearly $108 billion on imported goods in the year to May, up 10 percent on the preceding 12 months ....."
America's figures are just as ominous. Latest figures show the Trade Deficit will top $US400 billion ($A668 billion) this year.

LAST WORDS ON THE G.S.T

WHO PAID FOR THE CHANGE?

As pointed out in last week's On Target, the main pressure for the G.S.T. has come from the Business Council of Australia. A combination of the I.M.F. and 'Big Business' changed "never, ever" into "for the time being" and finally into "the tax reform Australia had to have". But how are backbenchers and parties brought into line for a change the majority of people clearly don't want?

Under the heading COMPANY DONATIONS HEAVILY FAVOUR LIBS The Australian Financial Review (22/6/2000) reported:
"Australian companies donated $29 million to political parties in the three years from 1995-96 to 1997-98, with Westpac Banking Corp the largest donor, a new report reveals. " The research report, from the Centre for Corporate Law and Securities Regulation at the University of Melbourne, shows that 64 percent of this money was donated to the Liberal Party and 23 percent to the Australian Labor Party. The big political spenders came from the finance and banking sector, which gave almost $3 million to political parties. More than $17 million was given by public companies, 63 percent of which went to the Liberal Party and 15.5 percent to the A.L.P. Lobby groups gave more than $11 million to the Liberal Party and almost $9 million to the A.L.P. ...."

The question arises whether shareholders in public companies and banks which made such large donations were consulted. If not, who made the decisions? Or were they simply considered "profitable business investments"? The A.F.R. went on:
" ....Dr. Stapledon said one of the main issues revealed by the report was that the provisions for disclosing corporate donations were unsatisfactory. This was because they did not cover all types of donations and allowed shareholders' funds from public companies to be donated without sufficiently accessible information available for company shareholders. The report recommends that shareholder approval of political donation policies of public companies should be required and that political donations should be disclosed in companies' annual reports ...."

Somehow, we don't imagine the major political parties jumping to introduce legislation along the lines suggested by the report! Incidentally, we wonder whether G.S.T. will be payable on such donations in the future? The donations quoted were over the period in which John Howard had a change of mind.

FURTHER DAIRY RESEARCH

The more one looks at dairy deregulation, the more suspect the whole thing becomes. Dr. John Kingston, the Independent State Member for Maryborough in Queensland, has done further detailed research. The figures he gives show how far we have slid in the second half of the 20th Century"
"...In 1950 we had 20,554 dairy farmers in Queensland. In 1999 - 1,595. In 1950 we had 963,000 dairy cows: In 1998 - 203,000. Annual production has gone from 1,278 million litres in 1950 to 822 million in 1998. In 1997, Queensland dairy production was valued at $700 million and dairy farmers employed about 10,000 additional workers.... Australia exports about $2 billion in dairy products..."

Dr. Kingston pointed out that in Queensland, 85 percent of dairy farmers did not want deregulation; in N.S.W. 83 percent had voted against; and in W.A. 66 percent were also opposed. His figures raise enormous questions: are we really prepared to sacrifice the industries in three States, relying on a couple of co-operatives in Victoria to supply the whole continent? Daily, if this mad idea goes ahead, giant tankers will cart milk thousands of miles to communities which once relied on local production. Transport or petrol strikes will leave whole States without milk. And what of the extra pollution, as giant diesel tankers plough up our highways? This aspect, you'd think, would raise an outcry among environmentalists. But not a murmur.

THE GENETICALLY-MODIFIED (POLITICAL) BATTLE CONTINUES

Latest research from the U.K. shows that modified genes are now moving from plants to insects. The Guardian Weekly (1-7/6/2000) reported:
" .... A four-year study by Professor Hans-Hinrich Kaatz found that the alien gene used to modify oil-seed rape had transferred to bacteria living in the guts of bees. His research poses serious questions for the biotech industry .... The research, which has yet to be published and has not been reviewed by fellow-scientists, suggests that all types of bacteria may become contaminated by genes used in genetically modified organisms, including bacteria that live inside the human digestive system. If this happened, it could affect the bacteria's role in helping the human body fight disease, aid digestion and facilitate blood clotting. .....
"The Agriculture Minister, Nick Brown, said: 'If this is true, then it could be very serious.'
"Dr. Mae-Wan Ho, a geneticist at Britain's Open University, said: 'These findings are very worrying and provide the first real evidence of what many have feared. Everybody is keen to exploit GM technology, but nobody is looking at the risk of horizontal gene transfer.' 'One of the biggest concerns is if the antibiotic-resistant gene used in some genetically-modified crops crossed over to bacteria. 'If this happened it would leave us unable to treat major illnesses like meningitis and E-coli', he said ...."

Meanwhile the labelling battle continues.
Health ministers in Australia and New Zealand meet in Wellington on July 28th to make final decisions on labelling of G.M. foodstuffs. Hanging over them is a letter Prime Minister Howard has written to each, trying to water down effective labelling. This is part of a battle between major multinationals such as Monsanto, Aventis, DuPont, Novartis and Dow, which have invested billions in the Genetically-Modified industry, and the growing number of consumers in North America, Europe and Asia who insist on the right to know what they're eating. All sorts of deceptive proposals are being put forward, including one that any food with less that 1 percent G.M. ingredients should not be labelled. The big boys know this could never be policed - particularly with the out-of-control cross over-of genetically-modified seeds to other varieties.

WEST PAPUA THE NEXT TIMOR?

Peter Hartcher, in The Australian Financial Review (Weekend, 10-12/6/2000) pointed out that the explosive situation in West Papua might prove Prime Minister Howard's next Timor. He suggested that any stand-off with Indonesia over the issue would be even more tense. He quoted one expert on the region:
" ....'Conservative elements within the Jakarta elite remain resentful of Australia's actions in Timor and are convinced that a more sinister conspiracy informs Australia's long-term agenda,' reports a team of Australian experts led by Professor Richard Robison of Murdoch University. "They describe 'suspicion, if not paranoia, in influential Indonesian military institutions including intelligence agencies concerning Australian designs on parts of the eastern archipelago'."

President Wahid has publicly commented that he perceives Australia has been fostering the West Papuan Freedom Movement. Apparently, there was a smattering of Australians involved in the Congress recently held in Jayapura. So what will be Australia's attitude of an Indonesian military wave of repression is directed at West Papuans, as it was against the East Timorese? Are we going to wash our hands of the bloodshed, as we did for so long in East Timor, contenting ourselves with the inevitable wave of refugees that would result?
Whatever else is said, Australia may yet bitterly rue its lack of defence in the events ahead.

THE DEMOCRATIC REPUBLIC OF THE CONGO

NATO BOMBING ILLEGAL

DATES FOR YOUR DIARY

West Australia's State Weekend: Saturday/Sunday, August 5th-6th.

South Australia's State Weekend: Saturday/Sunday, August 19th-20th.

DAVID OLDFIELD'S SPEECH

Below is DAVID OLDFIELD'S SPEECH to the N.S.W. Parliament two days ago. Even if you do not support One Nation or David Oldfield, this is a speech worthy of five minutes of your time, because the issues raised are fundamental to the running of the rural sector and to the proper function of government in running an economy for the benefit of all Australians, not just their mates. This speech is a tour de force of the economic mismanagement of our times.

Extract from Hansard, Wednesday, June 21st, 2000: The Hon. D. E. OLDFIELD [5.40 p.m.]: David.Oldfield@parliament.nsw.gov.au

Dairy farmers, hard-working Australians, are about to suffer huge losses due to the callous and unrepresentative actions of the economic rationalist Federal Government. This Coalition, inspired by the actions of its Labor predecessors, is a government that takes no notice of, and has no concern for, the suffering of Australians. Their agenda, as always, is that which benefits foreign interests.

This country is being put through tremendous pain by politicians more intent on playing the world stage than looking after the interests of Australians. One Nation's longstanding policy has been to totally oppose deregulation of the dairy industry - we are the only ones with that platform. The others just pay lip service to a less and less convinced rural sector. Just as I have asked questions in this House, my colleague Pauline Hanson's One Nation Senator, Len Harris, has shown his support of dairy farmers, and has vehemently opposed dairy deregulation.

In recent times the Federal Coalition of Liberal plus Labor plus National have wrecked just about every rural industry they could get their grubby hands on. Just look at their miserable track record. Our sugar industry has suffered due to deregulation, yet no-one is paying any less for a Mars bar or soft drink. This Federal Government damaged our pork industry with cheap pork imports from Canada and Denmark, which further profited due to the inadequate labelling laws that allowed the appearance that those imports were Australian made. Further, this Federal Government devastated our citrus industry with subsidised oranges from California, causing Australian farmers to root out good, productive trees, and has allowed concentrate from Brazil to destroy juicing orange producers - millions of trees burned and ploughed into the ground, and still more problems with labelling laws.

This Federal Government has jeopardised Australia's disease-free status by allowing imports of salmon from Canada and chicken from Thailand. This Federal Government's devastating policies have damaged our fresh fruit and vegetable industries through the import of a disgusting $764 million of overseas fruit and vegetables in 1999 alone. The question throughout rural Australia is simply, "Who's next?"

Out of allegiance to the World Trade Organisation and its predecessor G.A.T.T. [General Agreement on Tariffs and Trade], our treacherous leaders and their bureaucrats have worshipped at the altar of free trade and world parity pricing - Australian industries, jobs and families have payed the price of their homage, while multinationals pillage this country of its profits and flee without paying a cent in tax. They have been only too willing to sacrifice Australia's farmers and workers in support of their free trade ideology. We need leaders prepared to be leaders, to stand up for the interest of Australians and not bow down to the machinations of the international merchants and their - profit-before-people - approach to raping our country.

Our treacherous Federal members of Parliament, in cahoots with some farming leaders, have been saying for 10 years that deregulation of the dairy industry is inevitable, and that it is being forced on us by market forces. Who is it that rules this country, the financial and commercial markets dictated by foreigners, or the elected leaders who are supposed to represent the needs of ordinary Australians?

What will abandoning the Dairy Market Support scheme, coupled with the Federally bullied and forced dairy deregulation, achieve? The price to consumers will go up by between 11¢ and 20¢ per litre. The retail milk price already has risen from about $1.16 per litre to $1.38 per litre today, due to partial deregulation over the past two years. The price that farmers receive for their milk at the farm gate will go down from about 52¢ per litre to various estimates between 28¢ and 37¢ per litre. Over one-third of dairy farmers will go out of business, leaving many of them lost and emotionally scarred, after years of hard work and with nothing to show for their commitment and diligence.

Supermarkets will increase their profits. Soon we will see Woolworths and Coles own-brand milk, and those multinational profits will disappear overseas, once again without a cent having been paid in tax in this country. The processors and manufacturers will increase their profits at the cost of family farms. Who in the end will own the farms that are left? Many country towns depending on dairy farmers will face even further pressure. Many will not effectively survive. What will become of those rural Australians?

To remain in the industry, dairy farmers will have to get bigger. Many will be forced to increase their borrowing from banks, which will then continue to squeeze the lifeblood out of them. The banks have a terrible record in rural Australia. Farmers in wheat, sheet, cattle, et cetera over the past 20 years followed the "get big or get out" advice. In the end, many just got further into debt, and they lost farms that had been in their families for over 100 years. Already, many farmers have laid off employees, and family members have been forced to work hard in a way most city people would not understand - all in an effort just to hold on, not move ahead. Who is to blame for this mess? Where did it begin?

The problems began when John Kerin and Simon Crean were Ministers in the Hawke-Keating Federal governments. Mr. Crean followed the advice of callous Canberra bureaucrats and committed the dairy industry to deregulation by putting a sunset clause in the Dairy Market Support scheme so that it finished on 30 June 2000. When the Coalition came to power in Canberra in March 1996, did they reverse this deadly pursuit of the free trade, so-called - level playing field - agenda? No! We can only hope those responsible rot for their treachery!

The expressed intention of the Kerin plan was to make the dairy industry more export-oriented. It was legislated to last only six years, from 1986 to 1992. Under the Kerin plan, "within a few years co-operative company amalgamations and proprietary company takeovers saw significant reductions in the number of dairy companies in Australia". The Keating Labor Government decided to continue the policy of gradually reducing assistance, and it demanded deregulation of the fluid milk sector by 1999. The Crean plan began in July 1992 under the Dairy Produce (Amendment) Act 1992 and the Dairy Produce Levy (Amendment) Act 1992, which phased down market support payments for exports of dairy products from 22 percent of defined average world export prices in 1992-93, to 10 percent in 1999-2000 .

The Dairy Produce (World Trade Organisation Amendments) Act 1994 provided for the termination of market support payments because the Federal Keating Labor Government considered it necessary if Australia was to ratify the final act embodying the results of the Uruguay round of G.A.T.T. multilateral trade negotiations which included four main elements of agricultural reform.

On 28 September 1999 the Howard Government announced it was considering phasing out the Dairy Market Support scheme, and it wanted a structural adjustment package subject to all States and Territories agreeing to deregulate. I support the first three-quarters of the motion of this State Labor Government as passed in the Legislative Assembly on 31 May. I call on the Federal Government to legislate for a national floor price for milk to enable dairy farmers to remain viable and to ensure not only the survival of many country towns but also the opportunity for prosperity.

Without fair support and an acknowledgment of this industry's right to exist, it, like so many other industries, will virtually cease to exist or fall into foreign hands. Neither result will serve the interests of this nation's people. We must not continue to volunteer as sacrifices for free trade. The rest of the world laughs as our leaders sign the death warrants for our own home-grown and successful industries. The free trade treachery has been carried on by Federal and State Governments on both sides of politics, with such a betrayal made possible by farming organisation leaders accepting free trade ideology as inevitable and hence failing to mount suitable opposition.

It is galling now to see Labor blaming members of the National Party and the State Government blaming the Federal Government when members of the Liberal, Labor and National parties have all had a hand in the imminent destruction of the dairy industry. The dairy industry has just been the next industry on the list of those that have already been assaulted. The whole rural sector is now sitting and waiting, wondering when it will be its turn.

It is incumbent on all those who call themselves representatives to say enough is enough. Australian rural industries must no longer be defiled by the actions of our governments. Stop talking and start making a difference. The eyes of rural Australia are upon all governments and those eyes are finally starting to see the whole picture.
The Olympics will come and go. However, Australian industry and our way of life must not be viewed in the same way.

WHO LOVES YOU?

Wow, this does make one think....

There once was a man named George Thomas, a pastor in a small New England town. One Easter morning he came to the Church carrying a rusty, bent, old bird cage, and set it by the pulpit. Eyebrows were raised and, as if in response, Pastor Thomas began to speak...
"I was walking through town yesterday when I saw a young boy coming toward me swinging this bird cage. On the bottom of the cage were three little wild birds, shivering with cold and fright. I stopped the lad and asked, "What you got there son?" "Just some old birds," came the reply. "What are you gonna do with them?" I asked. "Take 'em home and have fun with 'em," he answered. "I'm gonna tease 'em and pull out their feathers to make 'em fight. I'm gonna have a real good time." "But you'll get tired of those birds sooner or later. What will you do?" "Oh, I got some cats," said the little boy. "They like birds. I'll take 'em to them." The pastor was silent for a moment. "How much do you want for those birds, son?" "Huh??!!! Why, you don't want them birds, mister. They're just plain old field birds. They don't sing - they ain't even pretty!" "How much?" the pastor asked again. The boy sized up the pastor as if he were crazy and said, "$10?" The pastor reached in his pocket and took out a ten dollar bill. He placed it in the boy's hand. In a flash, the boy was gone. The pastor picked up the cage and gently carried it to the end of the alley where there was a tree and a grassy spot. Setting the cage down, he opened the door, and by softly tapping the bars persuaded the birds out, setting them free.

Well that explained the empty bird cage on the pulpit, and then the pastor began to tell this story..... One day Satan and Jesus were having a conversation. Satan had just come from the Garden of Eden, and he was gloating and boasting. "Yes, sir, I just caught the world full of people down there. Set me a trap, used bait I knew they couldn't resist. Got 'em all!" "What are you going to do with them?" Jesus asked. Satan replied, "Oh, I'm gonna have fun! I'm gonna teach them how to marry and divorce each other, how to hate and abuse each other, how to drink and smoke and curse. I'm gonna teach them how to invent guns and bombs and kill each other. I'm really gonna have fun!" "And what will you do when you get done with them?" Jesus asked. "Oh, I'll kill 'em," Satan glared proudly. "How much do you want for them?" Jesus asked. "Oh, you don't want those people. They ain't no good. Why, you'll take them and they'll just hate you. They'll spit on you, curse you and kill you!! You don't want those people!!" "How much?" He asked again. Satan looked at Jesus and sneered, "All your tears, and your blood." "Jesus said "DONE!" Then he paid the price.

The pastor picked up the cage, he opened the door and he walked from the pulpit.