We all know that economically that things are very bleak,but do we need a leader constantly re-inforcing notions of pessimism which only make people tighten their spending?

Every time interests rates fall,Kevin and other economic commentators should be encouraging people to use half of the windfall to buy Australian products if possible.The message should be hammered home that if you want to keep your job,spend a bit more.

The RBA could also use a bit of bribery by indicating that rates won't fall since the desired effect is not being achieved.

Neither the Govt or the RBA is really engaging the people and getting their message through.Spending more will not solve the mess,but it will lessen the serverity of the downturn and give people time to find alternatives and perhaps solutions to their economic woes.

It is time to get creative and innovative.Bring on the infrastructure projects now!

Are you asking that he lie?
Are you truly asking the reserve bank to get involved in politics?
Infrastructure is on its way.
Parliament has not sat yet he has laws to obey.
The blokes personal rating is so good I wonder how many agree with you?

Arjay... Krudd is pecking around like a mother hen, incapable of dealing with the challenges he is there to resolve.

The problem is Howard would have seen this coming and would have had a series of real strategies to address the problems, Krudd and Swann-song have just created additional problems, like the run on the non-guaranteed super-funds to guaranteed bank deposits and squandering the resiliance in the budget surplus on a pre-Xmas binge for the labor voters.

Cheap tricks and Circus sand will not fix these problems, we need a real government back and a real Prime-Minister, instead of a poster-boy for constipation.

As usual Belly leaps to the defence of another lost cause.. I suppose the unions have got to do what they can to preserve their investment but those telecom engineers don't look like pulling the party line, more showing the 'spoiler' attitude which lurks within the heart of each of them.

Arjay

For any given person, the connection between spending more and significantly lessening the chances of losing their job is very small indeed. It makes no sense for Rudd to expect people to spend more if their jobs are at risk. Any sensible person would do just the opposite.

As for bringing on infrastructure projects; they need to be the right projects that will take us away from the stupid pursuit of never-ending growth and directly towards … yep …. sustainability.

It is just downright stupid to bring on projects that prop up the same old paradigm that has contributed greatly to the current economic downturn.

And it is outrageous in the extreme to maintain record high immigration during this time of economic hardship.

KRudd should be finding ways to turn the end of boom times into an all-out effort to wean this nation off of the growth spiral and onto a foundation of a stable population and steady-state economy.

Ludwig ,you cannot turn on the sustainability switch instantly.Too many people's livelyhoods are now in peril.

We should be all looking at important issues like mortgage agreements.Many have clauses that allows the Banks to call in a loan at a moments notice even though you are servicing the loan.In a severe downturn,house prices plummet.People can loose their houses and still be in debt to the Bank.During the Great Depression of 1930 the Govt brought in legislation to stop this practise.

Belly,if you had a child suffering from cancer,would you constantly tell him/her how bad things will get or would you give him/her hope and seek solutions?

“Ludwig, you cannot turn on the sustainability switch instantly…””

Of course we can’t Arjay. We’ve got to approach it reasonably gently…but with urgency.

"We should be all looking at important issues like mortgage agreements..."

There are a lot of financial measures that can be taken to ease the pain, by way of redistributing some incoming wealth from those who are doing very well to those who are battling. I think that Rudd needs to be quite socialistic about this.

Getting banks to not foreclose on mortgages by introducing a moratorium on payments if you lose your job could be one measure.

Now back to the sustainability bit (:>)….

Isn’t it absurd to fast-track projects that just feed the growth spiral? I mean, things like new roads, desal plants, hospitals, etc….all of which is in effect building infrastructure and services in order to provide the same level of service for a rapidly increasing immigration rate and boosted birthrate, without really providing any gain for the current populace…..other than to undo some of the losses imposed on us by increasing population pressure.

Isn’t it just a tad crazy for KRudd (and Bligh, Brumby, and all the other bozos) to be crying ‘jobs jobs jobs’ while we have an enormous influx of new residents requiring jobs? Why on earth isn’t this influx curtailed quick-smart, given that jobs are so damn important?

Why can’t a good portion of fast-tracked projects be things that are geared towards renewable energy, greater energy efficiency and other real sustainability measures?

Arjay, I appreciate that your concerns are concentrated in the short term, while mine are concentrated in a somewhat longer timeframe. You see them as requiring conflicting approaches. I don’t.

Perhaps there is an argument here for a government owned bank. We even had one of those under previous Coalition governments.

[Remember when we had public assets like an airline, a telecommunications system, energy utilities (which in some regional areas are now owned by foreign companies). Publicly owned assets used to be an essential part of our social democracy.]

The pre-Christmas bonus was short-sighted of Rudd - millions of dollars of public funding for a short-term spending spree. Money taken away from critical infrastructure. I have no problem with pensioners and carers receiving a bonus which was long overdue but the rest of these funds would be better spent on infrastructure. Businesses don't create jobs on the basis of short-term windfalls such as over Christmas and the stimulus package did nothing for long term sustainable employment.

Only a few months before Rudd was telling us not to spend because of the risk of inflation, not two months down the track we were being told to spend. What a mad system we have designed for ourselves.

Ludwig is right. You cannot sustain our current immigration levels while at the same time ensuring job security.

I know some of you won't agree, but if times do get really tough there are plenty of jobs that could be created that are not getting done now. It would mean more government paid jobs but in the long term the only way our economy could be protected from the worst effects of the financial crisis.

Afterall the anti-government brigades were more than happy accept government funds to shore up the private sector in the way of subsidies, deposit guarantees and bank bailouts (US) so what is the difference if we utilise some of those government funds to create employment?

Sometimes I fee genuinely sorry for Mr Rudd, just the seemingly desperate need to be looked up too, then I look at some of the really stupid things he does and embarrassing guff ups he is in O/seas and I just resent him.

He needs help not a job running a country, I just wish we'd have Mr Costello around.

Peter Costello is the last person we need at the moment. He was part of the financial paradigm that got us into this mess in the first place. This to me is part of Rudd's problem. He's not making enough of a break from the old way of thinking.

I agree totally with all that Ludwig and Pelican have said. I agree with Pelican that a government-owned bank is an essential first step in keeping a check on the private banks. We also need a return to the legislation that kept the banks in line as a service provider, rather than the speculatory free-for-all they've morphed into since.

I don't see spending for the sake of it as the answer. As Ludwig points out, it has to be targeted spending that will help put us on a more sustainable footing. Untied tax cuts, bonuses and bailout money only encourage the continuance of indiscriminate, wasteful and carbon intensive spending. We have an opportunity to use this financial meltdown as the catalyst to create a new economy based on new energy sources, which as well as providing employment will help avert the looming catastrophe of climate change.

I agree with Ludwig that ecomomic growth based purely on population increase is false economy. Apart from our humanitarian obligations, immigration needs to be reduced and jobs for existing Australians made a priority.

The government also needs to ensure it exercises a strong controlling influence in the industries it assists, and is not seen purely as a milking horse to prop up failing private enterprises in hard times, only to be treated with contempt once profit levels return. Taxpayers must see a return for the largess they're providing to bail out private industry.

The numbers of people looking for security in government employment have jumped enormously. As soon as the good times are perceived to be heading their way again though, many will ditch their lifeline in favour of once again cashing in on private profit. We need some sort of loyalty contract so that the taxpayer investment in these jobs is returned in full.

What twaddle Bronwin, the financial problems are based on a US lefty government, encouraging banks to extend housing loans to people who were likely to be unable to repay those loans unless their economy kept booming along.

Our problems are the US problems, passed to us third hand, through China. We are only doing as well as we are now, because of the excellent condition of the economy passed to KRudd, & co.

I don't blame KRudd & his mates for the problems, but their response, so far, has smacked of a couple of apprentice fitters, left in charge of the engineering department. Even more frightening is that Obama is talking the same talk.

I agree we must find some way of plugging the huge pipe line, spittong tens of thousands of people into Oz. All too often, many of these people are not suitable to take a place in the Oz economy.

In the first great migration wave we had thousands of cannon fodder type jobs, requiring virtually no skills, not even english, where migrants could earn their keep, & progress to happy lives. These people had a dream, wanted it all, & worked their buts off to get it.

Well we've exported those jobs to Asia now, they no longer exist. Todays migrants have to fit into a much more sohpisticated work place, one that many of them are totally unsuited for.

Too many of todays migrants have all ready exceeded their wildest dreams with public housing, & the dole. They can't imagine being better off, & no one works for what they can't imagine

The social problems we saw at "the shire" will be childs play in 10 years time, if we don't stop this flood.

The problem is far deeper than the loans swindle in the US.Too much credit has inflated housing world wide.It starts with the Central banks of the world setting the debt trap.It is also the Corporates having too much influence in Govt.It has been corruption on an enormous scale.The money supply in the US has increased by 70% since Oct 08.If this continues then we are in for hyper-inflation and the collapse of the US $.Printing more money just amplifies the inevitable.

The the US should issue a new currency owned by the people rather than the Fed Res and back it with gold and silver.I don't think that Obama has the insight or the will to do what is necessary.

We need smaller Govt and less regulation.Laws and regulation do not stop people from being dishonest.Perhaps a Govt owned Bank would be stable influence but will be run efficiently?

We need smaller Govt and less regulation.Laws and regulation do not stop people from being dishonest.

Exactly, with fewer civil bureaucrats living off the real wealth creating sector.

As Margaret Thatcher said "The larger the slice taken by government, the smaller the cake available for everyone."

Perhaps a Govt owned Bank would be stable influence but will be run efficiently?

I think that is what we have already, although, I like separation of Powers ...

Bronwyn,

The Democrats started it with offering loans to people that couldn't afford them, and the people that took the loans shouldn't have as they couldn't afford it. Then bankers sold these dud loans to other banks around the world and it all folded in.

There is probably more to it but that is the basic as I know it, nothing to do with the conservative decade.

Still we all just want it better... Mr Rudd and Mr Obama are not nearly experienced enough for this...

“We need smaller Govt and less regulation.”

Arjay and Col, how do you figure that?

Surely we need better regulation, with the necessary government muscle to enforce it. Whether that actually means a smaller or larger government and more or less overall regulation is beside the point.

Surely the most important thing is to devise the right sort of regulation and enforcement regime that keeps the potentially dishonest honest!

This is MUCH more important that cutting down the size of the bureaucracy.

Hasbeen

"What twaddle Bronwin, the financial problems are based on a US lefty government, encouraging banks to extend housing loans to people who were likely to be unable to repay those loans unless their economy kept booming along."

'Twaddle'? Well, glad to see it's got you digging so deep, Hasbeen.

To start with, your 'lefty' government description is incorrect. The government policies you're referring to were based on neoliberal philosophies - embraced far more enthusiastically by right leaning than by left leaning governments.

Poor US Government policy, particularly its extreme deregulation of the finance industry, has definitely contributed to the current meltdown, but is not in itself the cause of the collapse. It was the financial industry's predatory lending, and the rebundling and deceitful offloading of the resultant high-risk mortgages, that precipitated the unravelling.

It's very convenient to blame the victim. Those with vested interests in maintaining the status quo have made sure the finger has been pointed to those at the bottom of the heap. And people like you fall for that line and perpetuate the lie instead of looking for the truth behind what really happened.

Many loan recipients were conned with the promise they could sell their home and make a profit before the loans reset to unaffordable rates a few years down the track. Many others weren't even told that the loans would automatically reset to rates they would have no way of paying. Either way, they were deliberately lured into the housing market and conned into believing rising house prices would deliver for them.

The banks knew these loans would come unstuck. Why else would they go to all the trouble of rebundling and onselling them? We can all say these people were gullible. Of course they were, but the lending institutions in question knowingly preyed on that naivety, as greed and misplaced faith in their out-of-control risk taking completely clouded their better judgement.

Hasbeen (cont.)

Ludwig is correct, we need better regulation to ensure that these and other dodgy lending practices are never again allowed to flourish and end up bringing the system down. The extent to which these suspect mortgages have infiltrated the Australian financial system is still coming to light and no one really knows yet how badly our economy will suffer.

Returning to more of the same neoliberal financial free-for-all is not the answer, nor is relying on the mining industry to dig us out of this mess. Government money needs to be pumped into creating renewable, non-polluting and job rich resource bases. We have an abundance of solar energy, more than enough to meet all our energy needs, and the government is still allowing investment and expertise in this area to drift offshore. If the Howard Government had shown the foresight to act on this, as it should have when it first came to power, we would be in a much better position to weather both the financial and the climate change storms we're now facing.

As I said before, we need new thinking, not more of what got us into this mess.

Perhaps you could enlighten us with your ideas, Hasbeen, seeing as you’ve dismissed mine as ‘twaddle’. So far, all you’ve managed is a thinly disguised racist rant against unskilled immigrants. Not only is this sort of ‘scapegoating’ divisive and unhelpful, in this case it’s plain wrong. The vast bulk of the current immigration stream is ‘skilled’ migration, and many too from the far smaller humanitarian intake are well educated and have professional and trade qualifications. The problem with high immigration, as pointed out by Ludwig, is not that it’s unskilled, but that it adds to resource pressure more generally and to competition more specifically for what is currently a diminishing job pool.

Like Ludwig, I’d already stated that immigration needed winding back, so really, Has been, what have you got to add to the debate?

My dear Bronwyn, your selective memory is showing.

The whole system of low start loans was a darling of the left. Clinton pushed it very hard, in the US, & no lesser icon of our left, Tom Burns, introduced it in Queensland.

Now I don't think old Tom could be accused of being a neoliberal. He was roundly criticised, when some of the less prudent late starters, in these schemes got into trouble, quite unfairly I thought. He helped many more than were hurt.

These schemes have helped tens of thousands into home ownership, & are not at all bad, at times of rapid growth, & high inflation. It all starts to become a worry, when the governments, who are using inflation, in this way, then start to make war on inflation.

So now perhaps Brobwyn, you see why I accused you of talking twaddle. This particular problem was brought on us by entirely different policies than our mate Costello would, & did advocate. You can't blame the Howard government for all things bad. Well, come to think of it, you can, & do, but you are wrong, just as wrong as KRudds handling of the "financial crisis" so far.

I agree with Ludwig that there is a real danger of "make work" infrastructure projects being built in areas with displaced mining workers, rather than really needed work in different parts of the state. The last thing we need is Yes Minister type hospitals, where no recurring budges is available.

I do agree with you that there are many failings in the US financial system, & that these have driven a bad government policy into a worse result than was necessary, but the blame goes back to Clinton, not Costello.

Ludwig ,I view the economy like sport.You have a set of rules and a good referee to implement them.Too many rules and regulations destroys the excitement and the spectacle.Let the game flow freely and penalise heavily those who infringe the rules.

No such penalities have happened with our world game of economics.The rules are not even defined.World economics is in a state of chaos.There are no rules of fairness let alone a referee to adjudicate them.

In NSW we have never had more regulation and rules which limit our freedoms,yet we are more impotent,disorganised,violent than ever before in our recent history.

We need simple fair rules and people with the courage,wisdom and will to make it happen.This includes people at every level of society.In an ideal world Barack and Kevin are just figure heads waiting for the people to clarify what is really important.

The reality is that the central banks and large corporates determine policy.No amount of regulation will change that.We need a change of rules which make the interaction of capital and labour fairer.The first step is to rid ourselves of the international central banking system.This includes the IMF,World Bank,Bank of England,US Fed Res,etc.It is they who have set the debt trap and brought the planet to it's knees.

Col, Hasbeen, Meredith, you're letting ideology get in the way of analysis, though I concede Hasbeen has a point in relation to the Clinton-led loans policies.

Howard would've been no more responsible than Rudd in dealing with this crisis.
You say he had brilliant economic policies - I say, he'd be doing similar things to Rudd.

Howard was also prone to throwing cash at things to look popular.
To refresh your memories - who was it that pledged $500,000 for the Apes of bloody Borneo during the last election? I'll give you a clue - it wasn't Rudd.

I forget who said it, but I remember a quote from one commentator "the Howard government died vomiting cash from every orifice to interest groups it thought could be bribed for support."

So please. Spare me the Howard worship. The man presided over a mineral boom the likes of which the country and the world has never seen. He did an okay job of the economy, but he wasn't the brilliant economic manager he's made out to be.

Hell, look at the interest rates when he was treasurer under Fraser. They were at odds with the rates when he was PM. He's the only treasurer who presided over double digit inflation, double digit unemployment and double digit interest rates simultaneously (June '83).

Granted, they were different times. As is now.

Howard as PM had it lucky. I'm not saying he's incompetent (regarding economics), I'm saying he and Rudd are awfully similar and your comparisons are invalid.

There are many reasons for this crisis - one is indeed the home loan policies instituted by Clinton.
This was to encourage loans so more people from lower income backgrounds could afford houses.
That's part of the picture. Another consideration is the reckless spending by the recent US administration.
You can't have low taxes, and high spending. It's common sense. Yet this supposedly fiscally conservative US administration has indulged in spending on a scale never been seen before.
So before you point the fingers entirely at Clinton, acknowledge the recent financial policy idiocy.

18% odd interest under Mr Keating.

A massive overflow of money after Mr Costello, who was treasurer not Mr Howard

Hasbeen

"The whole system of low start loans was a darling of the left. Clinton pushed it very hard, in the US, & no lesser icon of our left, Tom Burns, introduced it in Queensland."

I know you love to blame the 'Left' for all the world's ills, Hasbeen, but you're wrong to do it here and, at the risk of being pedantic, I'll continue to remind you of that fact.

The subprime loans debacle can't be sheeted home to one government. Many legislative changes made along the way under several presidencies contributed. It began with changes introduced in the 60's and 70's under Johnson and Carter. Changes under Reagan and George W Bush impacted and, yes, so did those under Clinton.

Clinton's presidency pushed for an end to the racially discriminatory 'Redlining' and for home loans to be spread to lower income earners. But Clinton was NOT responsible for the predatory practices that lending institutions adopted to achieve his aims. His objectives were not unreasonable and were quite laudably aimed towards achieving greater fairness of opportunity for all. The bridge-too-far taken by the institutions in question was very much down to their own greed and stupidity. Government regulation or lack of it of course played a part, but it did not in itself precipitate the collapse.

Even if Clinton was solely responsible, he was never a true 'Lefty'. He could far more accurately be described as a Centrist than a Leftist. And certainly on economic policy, which is what you're linking him to, he was well to the Right. He championed neoliberal economic rationalist thinking which is much more aligned to the Right than to the Left. That's very much part of the reason why many on the Left would never consider voting for Hillary Clinton, especially in light of competition from someone like Obama.

Whatever Tom Burns did or didn't do in Australia is irrelevant to this debate. The regulatory framework here is much more effectual and the situation would never have got out of control to the extent it did in the US.

Hasbeen "The whole system of low start loans was a darling of the left. Clinton pushed it very hard, in the US, & no lesser icon of our left, Tom Burns, introduced it in Queensland."

And do not forget it was the Labor Left who introduced it into Victoria but by the mid 1990s the mortgagees were whining like stuck pigs because they owned homes which were worth less than the mortgages and with interest rates having gone through the roof, were locked into paying unaffordable repayments for loans they could not liquidate by selling the property, because it would have left them with a residual liability after the sale.

Of course, if you need any other clues to how clueless the left is in matters of finance, just look at Fat Joan Kirner and her sock puppet treasurer, Jolly (by name but not nature) and the

1 Pyramid debacle – refinanced by taxing petrol
2 Tri-continental debacle – which cost $1,000 for every man woman and child in Victoria
3 State bank and other Asset Fire Sales to dig the state (newly tagged as “the rust bucket state”) out of the pooh and the downgrade in credit rating which ensued.

I am dreading what we will find out when the incumbent lefty cretins are forced to come clean and the rorts and scams suddenly pop out from under the rocks…
I think it will be time to find a new state in which to live and leave the under-funded burden back with the flotsam and jetsam who benefitted from the socialist largesse (because I certainly have not).

As far as "blaming the left",

who else to blame…?

Like Meredith observed with the state of federal fiscal management and surplus, under Howard/Costello versus the preceding Hawke/Keating : Keating/Dawkins deficits,

showed perfectly liberal prudence replacing lefty shambolick profligacy

and now we are back with the ‘spend-it-as-fast-as-you-can’ kids again.

TRTL you put your points well, however you waste your time.
Some just do not want to hear the truth.
Rudd has firm support from most and that much is clear.
The lefty brand Col throws around is not wasted, every one is left of our Col Rouge.

It is not just a matter of left verses right.It is all about a balance of power.When any group or organisation gets too much power, the other groups suffer.While the left in it's good intentions often fail because they they don't get the best performance from people,[ie bloated bureaucracies and wasting taxes].The far right with their selfish intentions become like the lazy left.They too want a free ride.

We can see these attributes of this humanity in all our families and ourselves."Let he who is without sin cast the first stone."

No,I'm not religious but there is a lot of wisdom in Jesus' teachings.Jesus was probably just an ordinary soul and that makes him far more powerful than the supernatural being many adore,who could escape into another dimension and not deal with our mortal realities.

At the moment we all need the courage to defeat what enslaves us.It is the debt trap that steals both time to be with family and realise self worth.Both here and the US our Govts are putting us in more debt.It is the workers who will ultimately pay the price.

Christ on a kebab, how can you so selectively pick and choose? Was the Fraser government so very long ago?

Inflation of 11%, unemployment of 10% and a cash rate averaging 12% AT THE SAME TIME! Nobody under Labor managed that trick.

Look, true to centrist form I more or less agree with Arjay's last post. Give either side too much power and you screw yourself. Rudd ain't brilliant, but neither was Howard. At least Rudd didn't feel the need to insult presidential candidates (those who ended up winning, at that) or deceive people regarding boat-people.

Economically, I don't see much difference between Howard and Rudd at all, though I find Rudd's social policies marginally less noxious (I say marginally because the proposed internet filter really pisses me off, but I don't think it'll ever eventuate).

Governments of either persuasion always feel the need to 'do' something, whether it's needed or not.
The bigger the crisis, the more they feel they must 'do' something, or else they fear that the public will cotton on that they're not so very needed.

Howard would feel the need to throw cash at things now as well.
What other response could he make that wouldn't be seen as sitting on his hands? The rest of the world is throwing money at the problem, Howard couldn't stand by without doing the same. Do you really believe Howard would stand apart as a politician unlike the governments from pretty much 'every' other western nation?

Sell it to Howard's blessed apes of Borneo, 'cause I ain't buyin' it.

The difference between Howard and Rudd is that John is a realist and far more disciplined,while Kevin is a bureaucratic pragmatist who is disciplined by the system.
The present crisis needs discipline and creativity.Kevin misses out on two qualities.

For a conservative Mr Howard was as good as ya get...
The last election was sad, happened to Sir Winston Churchill too...

Mr Rudd, he's not steady and able to stand his ground... my gut says Mrs Gillard(sp) will stab stab stab him the moment she can, he won't see it coming, but what ever.

TRTL, Mr Fraser was a crap PM, I agree..

Well the Brits don't see a problem with partial nationalisation of the banks. The governments won't run the banks but there will be some stringent guidelines and protections.

As Brown stated, this is the time for some creative thinking outside the square and not being afraid to depart from the tired old dogmas.

http://www.msnbc.msn.com/id/27078582/

We tend to get too tied up in left and right politics or Keynesian versus Monetarist style debates rather than taking a pragmatic re-think about what might actually work.

We have to get away from the idea that we are faced with only two broad choices ie. either unfettered and unregulated free market capitalism or communism/socialism. Within a social democracy we do need some creative thinkers who can get away from the stringent dogmas we have imposed on ourselves and adopt a view more along the lines of "Third Way" thinking.

http://en.wikipedia.org/wiki/Third_Way_(centrism)

Whether Rudd has the spark or gumption to go up against the anti-regulation brigade and the extremists within the free market movement is yet to be determined.

Belly “The lefty brand Col throws around is not wasted, every one is left of our Col Rouge.”

Show where anything in my post is wrong.

The problem is, the left cannot handle the history of their incompetence nor the misery it has created.

I recall a dearest Margaret Quote

"Socialists have always spent much of their time seeking new titles for their beliefs, because the old versions so quickly become outdated and discredited."

TRTL “Howard would feel the need to throw cash at things now as well.”

Do you think?

I think that is pure speculation and what the liberals would do in a crisis would be far more constructive than what labor is doing in this crisis.

The successive Howard governments are the team which had the vision and skill to turn around the mess left after Keatings incompetence,

Doubtless, based on the events of that history, their credentials and capacities suggest they would deal more adroitly with this current crisis than how Krudd & Co is stuffing it up.

But don’t blame me, I voted for the talent, not the sanctimonious “mee-too” smarm.

Meredith “For a conservative Mr Howard was as good as ya get...
The last election was sad, happened to Sir Winston Churchill too...”

That is true with one exception, Churchill nearly wrecked the UK economy by putting it back on the gold standard, Howard’s economic performance was far better than Churchills

Pelican “As Brown stated, this is the time for some creative thinking outside the square and not being afraid to depart from the tired old dogmas.”

Bearing in mind Brown was UK Chancellor of Exchequer (Treasurer) for the decade before he replaced Blair, I think it safe to say

“He was more part of the problem than part of the solution”

The “tired old dogmas" are those of "socialism” (aka big government) and that is what the world does need to depart from, the UK in particular.

"We tend to get too tied up in left and right politics or Keynesian versus Monetarist style debates rather than taking a pragmatic re-think about what might actually work.

We have to get away from the idea that we are faced with only two broad choices ie. either unfettered and unregulated free market capitalism or communism/socialism. Within a social democracy we do need some creative thinkers who can get away from the stringent dogmas we have imposed on ourselves and adopt a view more along the lines of "Third Way" thinking."

Pelican,

I agree totally with this sentiment. The old dogmas are just hooks upon which the lazy hoist themselves. There is no originality there whatsoever and no hope of improvement. It's a barren wasteland.

I subscribe to the view that's been put by Thomas Friedman as the flat-earth model of development. This is no more than a realisation that the world is moving from one where society operates in a narrow, deep, cloistered, siloed etc way to one where standards become shallower but where opportunities are much greater. That is, a flattening of the playing field. Unlike the flattening that may be done by socialists however, this flattening comes with compensation: the enabling of many more people. In effect, a redistribution of the opportunity for individual industry.

So, for example, if we as a global society are really going to mitigate CO2 emissions, the only way to do it is to encourage many more people to get involved in the project. This means not having regulations that lock people out of making a contribution. It means exporting ideas to places like China and India and eliminating the hegemonies that have caused the problem to build up in the first place.

ahhgggg Sir Winston not perfect?

ouch that hurt, lol. :P

Bronwyn
Costello got us out of the last mess ALP left us in. It took ten years. Its taken ALP one year to blow it. All that surplus is gone already.

Kevins just pledged to deliver almost THREE BILLION dollars over the next five years to our Muslim neighours.
Thats nice for sure but were we asked. Another thing we dont ever get a follow up report on whats been done with the Australians tax funds. Its just given!.

Under the circumstances we should have put that into factories and plants to reopen the employment in the regional areas which would improve but not solve many animal welfare isues as well.

BTW Kevin Rudd has just cut BACK big time on migrants coming here.

No I am with Col and M on this one.

Wait another 18 months till people really start to suffer.

Of course ALP will borrow and try to keep welfare running the country and that when we might see some interesting policy changes.

. What a pity people just wanted a change from Howard. Well they will get their wish thats for sure.

Costello would make a good PM

I agree Julie will run for the job down the track.

RobP

I broadly agree with the sentiments expressed by you and Pelican, though I'm afraid Tony Blair's example doesn't give me a lot of faith in any 'Third Way'.

The only reason I've been using the labels Left and Right is to argue against Hasbeen's claim that it is the Left that has got us into this financial mess. I agree, attempting to use these terms to alone carry the debate is both lazy and unhelpful. Having said that, they are useful markers and will be with us to stay. No matter how you try and fight it, your stance on every issue places you somewhere along that Left Right continuum. It's a useful indicator, nothing more.

"This means not having regulations that lock people out of making a contribution."

I hear what you're saying, but equally, especially in the light of a largely complacent and apathetic population and considering the urgency of acting on climate change, if government doesn't regulate, many of the changes that are needed just won't happen. Unfortunately, many people won't do the right thing until they're made to. Ideally, regulation should be accompanied by example, support and incentive.

PALEIF

Costello had over ten years to move on climate change. He did nothing. Instead he handed out baby bonuses and told us all to procreate. How out of touch is that in a world beset by population pressures? Costello's answers in the current economic downturn would be very much along the lines of getting us all back to business as usual, which is completely unsustainable from a health and environmental standpoint, and would only result in another financial crash further down the track anyway.

"I hear what you're saying, but equally, especially in the light of a largely complacent and apathetic population and considering the urgency of acting on climate change, if government doesn't regulate, many of the changes that are needed just won't happen. Unfortunately, many people won't do the right thing until they're made to. Ideally, regulation should be accompanied by example, support and incentive."

Bronwyn,

I agree to the extent that regulation should be used when it works to get a good result. You're right of course, that many people in this country are apathetic and won't do anything without some stick or the threat of some. However, there are also many people, particularly in the developing world, who would benefit from a degree of carrot. That's possibly where regulations, or at least their flow-on effects, could be relaxed.

The important point is to look at how regulations work, learn from and fix past mistakes and nurture the systems that work well. It requires a continual weighing and examining of existing regulatory systems and new ideas.

Bronwyn,

I agree that Blair/Clinton/Brown are not good examples and all contributed in part to the system that led us to our current situation. The principle of the Third Way however is sound but I fear those who have been labelled as proponents are still guilty of thinking too much within the old way.

The type of Third Way thinking required is as you said "Ideally, regulation should be accompanied by example, support and incentive."

Current events demonstrate that unregulated capitalism does not work in the same way that communism doesn't work. I am old enough to remember when people strived to make money but it was with an air of "a little bit for me and a little bit for him" without the emphasis on outrageous profits at the expense of others all down the line.

The politics of greed is not pretty and unfortunately humans not only need incentives to achieve but some regulation to ensure that power and wealth is distributed more evenly and that reasonable lifestyles are not just enjoyed by the few. The modern trend of free market thinking does not provide those safeguards.

Pelican ,the laws and regulation were all there,however no one enforced them.The corruption is too broad and far reaching so only a few scape goats will be sacrificed to appease the masses.

Many now want to shrink into socialism.A Govt controlled economy has proven to be a disaster in the past.What has changed to ameliorate their excesses?You only have to look at NSW to see what an extrapolation of this philosophy will do for us nationally.

Arjay, your last post, wise words....

They blame the market and capitalism but it were the lax and stupid policies of the middle/left which caused the problems.

No self respecting right winger would dump money into providing home loans for people who could not meet the repaymentrs and then let them post hack the key when they could not finance their obligations...

As every leftie is quick to tells us, the right is just not like that.

Arjay

"Pelican ,the laws and regulation were all there,however no one enforced them."

The laws and regulations were most definitely not there. What planet have you been living on?

Thanks to years of relentless lobbying by US banks, not to mention huge political donations, regulation that had for decades ensured America's financial strength and stability has been systematically stripped away.

Laws preventing predatory lending, for example, still existed in several key US states as late as 2004. The banks didn't rest until they'd finally succeeded in having the last of them dismantled, which then gave them the freedom to exploit a whole new market of borrowers, and set in chain the events that have culminated in the current subprime debacle.

Many other long standing banking Acts have been incrementally relaxed over the years too as a result of persistent lobbying by the banks.

It was much more than poor enforcement of laws, as you claim. The laws were no longer there. And it's why people like Pelican, myself and millions of others are calling for a thorough re-regulation of the banking system.

Col,

A wise rightie also knows that we work to live, not live to work. Unless you actually like to live to work, that is. But any imbalance eventually reaches the point where it is unsustainable anyway.

All sides have merits and demerits - the left counterbalances the right in a complex relationship of good and bad energies, while the middle wants to live a balanced life. What's the matter with that? The relationship between right, middle and left is like the game of rock, scissors, paper I reckon. Each sometimes wins but not always. The right represents pragmatic upbuilding, the left fairness and idealism and the middle provides balance and solidity. The system, overall, is the perfect blend to provide everything that society needs.

If you think you're being hard done by, join the queue. I think all of us - left, right and middle - are in some way shape or form.

Think you might be being a bit harsh towards politics in relation to the GFC. Its not about politics its about the flow of money. The "supply chain" to industry, commerce, consumer products, insurance, everything, depends upon the funds being pumped through the pipeline. The finance industry is the heart that pumps the money, if that stops or even slows down everything gets sick. The choices for any government are few and stark. 1) Replace the fauly heart (government buys bank). 2)Repair the fauly valve (secure/guarantee funds on deposit) to encourage the heart (bank) to start lending (pumping)again, and/or 3)Increase demand within the pipeline by giving money to consumers and governmet investment in infrastructure (creates jobs, circulates money, increases spending or debt reduction)Unfortunately for the "Polies", they have to get the right balance based on Australia's specific circumstances. Not a task I would relish myself.

Arjay and Col
I am not advocating shrinking into socialism. I must seem to be picking on the Right because it is the Right that has the strongest influence in politics today.

If it was the Left I would equally be having a go at any mismanagement policies or corrupt practices. I am trying, but failing to avoid left/right politics and look at solutions that might be inclusive of ideas from both sides to avoid extremist dogma from either end of the politcal spectrum.

Arjay, I agree that the NSW government is a debacle but I don't see the NSW government as thinking from the left. The ALP in Australia hasn't been Left for sometime. I never thought I would see a time when a Labor government would be advocating the selling of public assets, particularly vital ones like utilities. Some in regional areas now in foreign ownership.

Spindoc,"The finance industry is the heart that pumps the blood."That is a very long bow.The finance industry is only the oil that lubricates the engine.It is only the medium of exchange.The finance industry in the past has fed off it's own expectations and created this mess.

It is the economy of tangible production that satisfies needs and wants of real people,is what really matters.

“Costello had over ten years to move on climate change. He did nothing. Instead he handed out baby bonuses and told us all to procreate. How out of touch is that in a world beset by population pressures? Costello's answers in the current economic downturn would be very much along the lines of getting us all back to business as usual, which is completely unsustainable from a health and environmental standpoint, and would only result in another financial crash further down the track anyway.”

You’ve got it Bronwyn. It is impossible to imagine who might be a worse PM than Costello!

“It was much more than poor enforcement of laws, as you claim. The laws were no longer there. And it's why people like Pelican, myself and millions of others are calling for a thorough re-regulation of the banking system.”

Yes, and a thorough reregulation of the connection between governments and banks and other all-powerful big-business entities. A complete ban on political donations would be a start.

I'm quite happy for you to change the analogy Arjay, change "heart" to "oil pump" and life blood to oil if it suits, but you can't mix metaphors, the medium with the mechanism, a pump is a pump and the medium (oil,money,lubricant)what flows through it. If the money don't flow that system won't go.

What do you mean by "tangible production" to meet "needs and wants of real people"? Is this another way of saying "demand creation"?

Great discussion everyone. and very civil for an OLO debate.

This is not a left/right debate, both are equally guilty. Where does this leave the great man himself, the great financial deregulator and seller of the CBA PJ Keating,for instance?

Arjay,
you are right. When money/credit/debt gets too far out of whack with production the economy will go bust eventually. Sound banking practice has always been based on a ratio of credit creation to deposits, and this rule has been grievously flaunted.

Regulation of credit creation for speculative purposes needs to be introduced. By that I mean gambling on stock market or real estate bubbles (and not venture capital or valid entrepreneurial activities) with money loaned from banks.

We don't need socialism, just proven banking practices. Kevin still has time to prove himself, altho I've no great faith in him, witness the $2billion to prop up the value of (largely) inner city office space. Turnbull nailed The Milky Bar Kid on this one.

I don't know that a gold standard could work anymore- maybe a realistic 'GDP Standard' would be workable.