Kiwiblog

The Australian reports:

“I’m a very happy little vegemite being Prime Minister … being Foreign Minister of Australia,” he told ABC Central West today while on his way to Condobolin, west of Orange, to open a rotary-funded indigenous studies centre.

One can forgive Kevin for the slip-up, as regaining the top job must be at the top of his thoughts most of the time.

Recent polls have shown he would do much better against the Coalition than Julia Gillard. However she is genuinely liked by many of his colleagues and Rudd is not, so the decision is not as easy as it might otherwise be. But this latest poll is a shocker for Gillard:

Ms Gillard is now neck and neck with Mr Abbott as preferred prime minister among female voters, 39 per cent to 37 per cent, compared to 52 per cent to 33 per cent at the last election.

Abbott has always been considered a total turn-off for female voters. If he is only 2% behind amongst women, then his biggest weakness has been overcome.

Gillard is in trouble. And it is not Tony Abbott doing the damage, but almost certainly Kevin Rudd.

A poll has the coalition ahead 52% to 48%, and on radio John Pagani said that he had heard that Labor’s polling was not looking good in the all important marginal seats. So how has it happened?

Well first there was the leak to Laurie Oakes about the deal with Rudd for him to stay on until October, which Gillard walked away from. As only three people witnessed it, not hard to guess who put that out there.

Then came the leak that in Cabinet Gillard fought against Labor’s paid parental leave scheme. This has damaged her amongst “babyland”. Gillard also tried to limit pension increases – hell I am liking her more and more. But the public are not. And again no prizes for guessing the likely leaker.

And the latest leak also has Rudd all over it – a revelation that Gillard sometimes sent her bodyguard to meetings of the Cabinet national security committee. That one may be especially damaging.

And in case there is much doubt it is Rudd, Alexander Downer reveals that the former Liberal Government used to feed info to Rudd when he was a junior Labor MP, knowing Rudd would use it to undermine the Labor Foreign Affairs Spokesperson, as Rudd wanted his job.

Is it just me, or do Rudd and Chris Carter seem somewhat alike – both try and rat-fuck their leaders, because they had their travel perks and status taken away?

The Herald talks whaling:

The collapse of international whaling negotiations at Morocco is a chilling moment for the future of controlled whaling, let alone the prospect of a complete ban. The collapse is no less disturbing for the fact that it has always been as likely as not.

The International Whaling Commission proposal to the three nations that permit commercial whaling, Japan, Norway and Iceland, never satisfied either side. …

With all hope of a compromise now gone, the New Zealand Government will probably join Australia in its case against Japan at the International Court of Justice.

It is not a course that promises effective policing of the Southern Ocean even if the court can be persuaded the Antarctic is a whale sanctuary in international law. Even if a favourable ruling can be obtained, the case is likely to take years and leave the ocean open to unrestricted whaling in the interim.

Not even Greenpeace and other environmental lobbies at Agidir favoured court action over a negotiated compromise. Mr McCully went out of his way to praise their helpful approach to the negotiations, an approach that helps keep non-whaling governments and most of the public firmly behind the effort to end all whaling.

I suspect we will join the court case now.

The Dom Post looks at Allan Hubbard and the SFO:

The good people of Timaru seem stunned by news that highly regarded local businessman Allan Hubbard, and wife Jean, might have fallen foul of the law. Last Sunday, Commerce Minister Simon Power took the rare step of putting the couple themselves, Aorangi Securities and seven charitable trusts into what is known as statutory management. He said the objective was to “prevent fraud and reckless company management [and] to protect investors …”

The city’s newspaper, the Timaru Herald, said in an editorial last Monday that the Hubbards’ sin, in official eyes, seemed to be the unconventional way they did business. It went on: “If the allegations are unfounded, the officials involved will have humiliated one of the country’s most successful and generous businessmen for nothing. They will also have wasted a good deal of taxpayers’ money at a time when there is no shortage of directors of failed companies to chase.”

It is that latter point that so upsets Mr Hubbard’s supporters.

All those who broke the law should face consequences for that.

Little wonder that Mr Power, aside from rejigging the justice system, is upending securities law, too. He plans to have a new and independent Financial Markets Authority, consolidating the powers and functions of the Securities Commission, some of those of the Registrar of Companies and Government Actuary, and some of the NZX’s regulatory role, operating early next year.

He has also completely restructured the financial advisory industry, and now wants submissions on how to replace the Securities Act and Securities Markets Act, in a bid to strengthen the financial markets, and restore investor confidence. “The Government cannot and will not legislate for risk,” he said this week, “but we can build a regime that makes those risks more transparent.”

A unified regulator makes sense.

The Press farewells Kevin Rudd:

Even by Australia’s brutal political standards, the dumping of Kevin Rudd was spectacular. Sudden, decisive and risky, it cast out the man who had brought his party into power and governed until recently with substantial voter support.

That Rudd at the beginning of the week seemed secure in his job but by the end of the week had so little party support that he could not contest the challenge is testament to a ruthlessness in Labor. The party has shown not a shred of loyalty to the man who won it a landslide election after years in the wilderness, who had done little wrong in government, and who had shaky polls but no worse than John Howard at the same part of the election cycle.

Loyalty is two ways. If you run Government through a inner circle of just four people, you alienate your colleagues.

The ODT focuses on debt:

The economy, it is fair to say, is very gradually improving after the short-lived recession, although the position so far as internal and external debt is concerned remains grave.

New Zealand, fortunately, is nowhere near in as bad a way as Britain, whose economy is practically in ruins, and where after last week’s budget, every household will be worse off as the new government tries to rebuild.

A vast range of cuts has been imposed to try to reduce government spending and pay off the colossal debt load.

New Zealand has dealt with similar problems in budgets of the past two years, but beyond the immediate future the economy faces what may turn out to be a difficulty of very serious proportions: a lack of capital. …

The kind of public service job creation the Clark government indulged in has also proved to be a serious drag on the economy: since 2004 more than half of all new jobs were in public administration, health, and education.

Over the same period 40,000 jobs disappeared from agriculture, horticulture, forestry, manufacturing, and transport – what some have described as the “earning side ” of the economy, the tradeable sector.

The tradeable sector went into recession in 2005 and only came out of it in 2009.

Treasury forecasts show steady economic growth of about 3% a year and that is an extremely modest number.

Clearly, though, there will be no new “value-added” jobs unless and until the confidence of businesses to invest and to employ is restored and investors are willing to risk their money.

Our collective failure to do that will inevitably mean all taxpayers will face what the British and other European disaster economies are now confronting.

We need investment and business confidence.

Kevin Rudd’s Downfall – The best video clips are here

Someone did this quickly. One of the better ones.

In a few hours it will be Prime Minister Julia Gilliard. iPredict have her at 96% and the bookies at $1.20.

The numbers are flocking to Gilliard and there is now pressure on Rudd not to force a ballot. Even the Treasurer has gone to her side.

So how did Kevin Rudd go from almost the most popular Prime Minister in a generation, to being the only Prime Minister ever to be rolled in their first term of office?

An essay last Thursday by Alexander Downer has some answers:

Members of the Federal Parliament all know each other; not necessarily well, but at least a little. Over the past 20 years, few, if any, MPs have been less popular than Kevin Rudd. All politicians are at the very least a trifle vain. They like to be the centre of attention, to be in the media, to be ‘consulted’. There is barely an exception. All of them think they are a bit better than they really are. Nearly all of them are ambitious, many furiously so. But on all of those counts, no one in recorded Australian political history has ever exceeded Kevin Rudd.

And this very much includes his own Cabinet and Caucus. There was respect but never popularity.

What MPs didn’t like about Rudd, the backbencher, and Rudd, the shadow minister, was his conceit and vanity. On 9 September 2004, an Islamist fanatic tried to blow up the Australian embassy in Jakarta. I was in Victor Harbor that day when the ambassador rang me directly on my mobile to tell me the terrible news. I told my staff we ought to go immediately to Jakarta and to take the head of the AFP, DFAT officials and intelligence people as well. We needed a VIP plane to load our officials in Canberra, fly to Adelaide to pick me up and push on to Jakarta. We could be there before bedtime.

I told John Howard of my plans and he said I ought to also take the opposition spokesman for foreign affairs, who happened to be Kevin Rudd; this was, after all, during the election campaign. Indirectly, I let Rudd know he was invited. I drove to my office to prepare for my departure. There was a message to call Rudd. He was furious. The f***ing VIP plane wasn’t going via Brisbane to pick him up. It f***ing had to. He ordered me to change its f***ing flight schedule.

I explained two things to him. First, the plane was too small to add him and his staffer unless we offloaded the AFP Commissioner or the intelligence officer. I wasn’t prepared to do that. Secondly, to travel via Brisbane would add hours to the journey. Instead, we would pay for a commercial flight for him.

This was not met with grace. A fusillade of abuse, much of it with sexual references, ensued, and then a demand that I tell him the flight schedules from Brisbane to Jakarta. ‘I am not,’ I crudely said, ‘your f***ing travel agent. DFAT will help you.’

The point is clear: people at the embassy had died, we needed to get the Indonesians onto the case to establish who the culprits were, we had to show support to the embassy staff at this time of crisis. It wasn’t about me and it certainly wasn’t about the shadow minister for foreign affairs, Mr Kevin Rudd. But for the member for Griffith it was about one thing: himself.

This is an incredibly telling story. It fits very much into the essay by the leftish David Marr on Rudd.

Marr is probably right. The secret of what Rudd is all about lies in his childhood. That’s probably true of all of us. Something happened then which made him determined one day to be famous. He has succeeded — spectacularly. But like all people who seek fame for themselves at the expense of others, his fame will eat him up. Fame fed with substance can make a person great. Fame alone will destroy you.

It has taken an incredible three years for the Australian public to realise who their national leader really is. I sat with a Labor luminary having a late-night drink in June 2008. He turned to me and said: ‘Mate, one day the Australian public will grow to hate Kevin Rudd as much as I do.’ That day has arrived.

It is going to be a fascinating day. I am spending it with various Federal Liberal Party people. For them it may be mixed emotions. They will be celebrating the fall of Kevin Rudd. It is no mean thing to put enough pressure on a Government (mind you a lot was self inflicted) that they roll the Prime Minister.

The downside for my Liberal friends is that Gilliard is not Rudd. She will have a honeymoon, and that could well last past the election. On the other hand she has to deal with some nasty messes left behind by Rudd such as the resources super tax.

What a day to be in Canberra. The coup against Rudd has taken place at record speed. The moment I heard the NSW Right had gone to Gilliard, I figured it was all over.

Rudd about to hold a press conference, so we will hear soon.

Rudd has confirmed Julia Gilliard has challenged him and he has called a vote for 9 am tomorrow.

Rudd is fighting to stay on, but I know from experience that once a leadership challenge goes to a vote, the leader almost always loses as they are judged so wounded they can not win a general election.

If Gillard wins, she would be wise to not try and govern for a few months as PM, but say she has asked the GG for an immediate election, and asked Rudd to carry on as caretaker PM until the election. She can look democratic by claiming she has been elected Labor leader, but now wants the Australian public to elect her Prime Minister.

John Key has just announced that Kevin Rudd will visit on 29th of June for talks on progressing the single economic market for Australia and NZ.

The PMs always meet up annually, but what is unusual is that Rudd has been invited to address the House of Representatives – the first foreign leader to do so.

This seems quite a smart move to me – emphasises the special relationship between the two countries.

Will try and pop into the gallery to see this.

The Sunday Telegraph reports:

SENIOR Labor MPs says the leadership is Julia Gillard’s for the taking before the election – if she wants it.

Prime Minister Kevin Rudd’s control of the party has entered a treacherous phase, with Cabinet ministers and backbenchers canvassing the idea of changing leaders before this year’s federal election.

As Ms Gillard was forced yesterday to publicly deny she wanted the top job, Labor MPs described Mr Rudd as a “leader under fire” and said his prime ministership was “terminal”.

Rudd has never been that popular within his Caucus – respected but not popular. He appointed a Cabinet without going through faction heads. Personally this was a good thing to do, but it did create enemies.

I’ve just been reading the infamous Quarterly Essay on Rudd by David Marr. This is one one where he refers to the Chinese as trying to “rat fuck” Australia at the Copenhagen summit.

Marr points out that both Rudd and Gillard were seen as potential challengers to Kim Beazley, and that they met to decide who would challenge. Gillard actually had more MPs backing her, but Rudd refused to consider being her deputy, so she agreed to serve as his deputy.

She is unlikely to challenge, because she knows that will create more enemies for her. But there may come a point where for the good of the party, she is pressured into becoming Leader.

Senior Labor sources said Ms Gillard has always had the numbers to seize the leadership, but not necessarily the will to challenge for the top job.

“She would get it pretty easily right now, but I don’t think she wants it,” the source said.

I think she wants it, but on her terms. Labor are waiting for Tony Abbott to self destruct, but if he does not then they may panic and try to roll Rudd before the election.

However even then Gillard may prefer to let Labor lose, become Leader of the Opposition, and then try to become PM in her own right within three years.

Kevin Rudd is fighting for his political life with his u-turn on an ETS, and his proposed super mining tax both backfiring. A Nielsen poll just out has Labor at 47% on the two party preferred poll and the Coalition at 53%.

The super mining tax appealed to Labor. They thought everyone would support it, as only a dozen companies or so would be paying it. The tax would be a massive 40% of any profits above the risk free rate of return. Yes, how dare a company make a profit greater than what you can get by sticking your money in the bank.

But it has backfired massively. Western Australia especially has seen it as an attack on the entire state, plus (unlike NZ) many Australians know how important the mining sector is to Australia’s prosperity and have rejected the tax.

The Daily Telegraph reports:

KEVIN Rudd has downplayed reports he and his ministers treat staff like dogs as a near-record employee burnout of almost 60 per cent in just more than two years has been revealed.

Despite Mr Rudd pledging to tear up former prime minister John Howard’s hated WorkChoices, 262 ministerial staff – from a total of 444 positions – have departed since Labor came to office.

Three ministers have recorded staff turnover of more than 100 per cent, with Youth and Sport Minister Kate Ellis having 13 departures from a staff of 10. At least one was a part-time university student while several others left to have families.

The Prime Minister himself has lost 28 staff, with Government insiders describing his office as resembling a “transit lounge”.

Rudd is well known as being near impossible to work for. He dreams up crazy ideas and demands they are implemented within days, and has temper tantrums when they are not. His own colleagues resent his style, almost as much as his staff do.

But Mr Rudd said the high pressure of a political office meant it couldn’t be compared to the private sector.

“It’s a tough life. People often have to relocate, there are crazy hours, it’s very intense, people are on the phone wanting X, Y and Z done in a short period of time,” he told Fairfax radio today.

“But I go back to the simple fact: We are elected by the Australian people to do a job.”A staff working year is probably like a dog year, that is it’s probably worth seven years in normal life.

“So if folks stay with me for three or four years, that’s probably 28 or 30 years or more in actual time.”

This is spin. Jobs in Parliament are definitely tough with long hours and an ever changing array of issues. And MPs demands can be frustrating as travel and appointments often change at the last minute. This is why the turnover rate is higher than the normal 10% private sector.

However 60% over two years is very high for any Ministerial office, let alone the PMs Office. The PMs Office is sort of top of the food chain, and it has to be pretty bad for people to leave the office after just a year or two. Most people wait for an election.

Taking John Key’s office as a comparison, I think John has had only two staff leave in two years. One to go overseas and one to have a baby. So Rudd’s claim of a 60% departure rate being normal, is not the case.

Some former staff are privately seething at his management style, claiming he can fly off the handle at a moment’s notice.

Never good to have former staff slag you off. Most former staff of a PM stay ferociously loyal.

Brooklyn Group CEO Brian Russell also queried why Government advisers had left in droves.

`You shouldn’t be having 100 per cent turnover in any team. If you’ve got autocratic management, lack of direction – basic fundamentals – especially in a small group, people will leave,” he said.

Bingo.

AAP report:

Australian Prime Minister Kevin Rudd is in hot water with the governor of Alabama for his response to comedian Robin Williams’ “Australians are basically English rednecks” jibe.

Williams made the joke on the Dave Letterman TV talkshow in the US earlier in the week and Rudd, during a radio interview on Wednesday, hit back by recommending the comedian “spend a bit of time in Alabama before he frames comments about anyone being particularly redneck”.

Rudd has stuffed up quite majorly here.

First of all a Prime Minister doesn’t need to respond to a joke by Robin Williams on Letterman. You just look pompous and defesnive.

But secondly you don’t respond by insulting a state of another country. You’re not a comedian, you’re a head of government.

Rudd’s reference to Alabama and rednecks generated a terse response from Alabama governor Bob Riley.

“I’m not sure if Prime Minister Rudd has ever been to Alabama,” Alabama governor Bob Riley responded in a statement.

“If he has, he would know that Alabamians are decent, hard working, creative people.”

And to think Rudd used to be a diplomat.

The Herald reports:

Abbott has come up with a plan to tax big business – those earning more than A$5 million ($6.25 million) a year – to pay for a surprisingly generous compulsory leave scheme.

Under his proposal primary carers would be paid at their full rate of take-home pay up to a maximum income of A$150,000 a year ($187.5 million) for 26 weeks. Abbott estimates the scheme will cost about A$2.7 billion a year.

A rather desperate election bribe. First of all, taxing large businesses to pay for the entire costs is blatantly unfair. If it is deemed desirable to have paid maternity leave, then it should be funded by all taxpayers.

Secondly it is massive welfare for the rich. If you were on $40,000 you will get $20,000 maternity leave. If you were on $150,000 you will get $75,000.

Rudd’s scheme, due to be launched next January, pales by comparison. This scheme will pay the minimum wage of about A$544 a week to the primary carer for a maximum 18 weeks’ leave after the birth of a child.

It will cost an estimated A$260 million a year, paid out of consolidated revenue.

Rudd’s scheme seems far more sensible to me.

Not a good sign for Australia, if both parties are getting into a bidding war of spending money they don’t have.

The Herald reports:

This article in the National Times by a former departmental speech writer for the Rudd Government is a must read. Some extracts:

Around the same time a section meeting was called. Our boss arrived late, but in the best of moods. ”We’re under budget!” she announced proudly. The old-timers let out whoops of joy.

”What’s going on?” I asked someone quietly.

”We’re under budget,” they replied with a rare smile.

”Oh, so that’s good? You’ve saved money?”

”No, no,” her smile turned to ash as she gave me that pitying look I usually received when I asked a question. ”It means training.”

Our section was under-budget by hundreds of thousands of dollars, necessitating we blow all the unspent money before the end of the financial year. Unfortunately, ”training” did not mean I would finally get some training. ”Training” consisted of hastily booked, dubiously relevant conferences and courses, most of which were conveniently located a long way from Canberra.

Despite my short length of service, I was included in the spending free-for-all. I later found myself in a plush Sydney harbourside hotel with hundreds of dollars in unnecessary travel allowance – everything, including meals, flights and accommodation, was covered by the department. I was attending a conference on Web 2.0, a topic I was mildly interested in but which had nothing to do with my duties.

The rest of the office also enjoyed jetting around the country. Four staff members managed to book into the same four-day public relations event and, reportedly, a great time was had by all.

Unless one things NZ is magically immune from this, I wonder how much training happens here.

We were not the only ones wasting money. Associated with our section were those boffins who create public health campaigns, the ones that appear on television with increasing regularity: nights out turning into nightmares, measure your fat stomach, wash your hands – that kind of thing.

I was surprised to discover the minds behind these campaigns were not health professionals. They had backgrounds and degrees in marketing, communications and advertising, not medicine. Under their watch, the government became the No.1 spender on free-to-air television.

As was the case here with the last Government.

None of these events prepared me for what happened next. After remaining silent on the issue for many months, the Prime Minister suddenly took an interest in the nation’s health. I found out when a grim-faced boss herded us all together. ”The PM is going to make a health announcement and you have to organise it,” we were told.

”When’s it happening?”

”Monday.” (It was Friday afternoon.)

”When did we first learn about it?”

”Now.”

Rudd is infamous for dreaming up ideas and demanding they be implemented within days.

Young suits from the Prime Minister’s office stalked the wings of the announcement, roaring loudly into mobile phones. Their counterparts from the Health Minister’s office hovered in the background, looking miserable.

The Prime Minister’s office staff feared nobody and respected them less. The only time they shut up was when the Prime Minister himself was speaking. Any other speaker, including Roxon and the commission’s spokeswoman, could go to hell. One grabbed my pen from my hand and stormed off with it. I later asked for it back and was laughed at.

My colleagues were always fearful of the Minister’s office, but for the first time I was witnessing the force that terrified the MO staff themselves. Orders came down that all our ministers were to clear their calendars for the next six months – they were to become as visible to the media as possible. They were going on a consultation tour of the country.

Initially, there was little rhyme, reason or co-ordination to the process. A website was thrown up that looked ghastly when it first went live, so ghastly that the Prime Minister refused to promote it as had been planned. A team was banged together to run the site and to put up lots of pretty pictures of the government in consultation mode. The gossip was the Prime Minister’s attention had been caught by the Web 2.0 phenomenon, as had many Western leaders in the wake of Obama’s presidential campaign, and YourHealth.gov.au would be the first to jump on the bandwagon.

A Minister hears of something new and demands it be done – damn the cost.

Along with the tidal wave of events we suddenly had to organise, I was given a new duty: ensuring photographers were always present to capture our ministers nodding gravely as they consulted. There was no limit to the cost. Fortunate photographers around the country suddenly found themselves hired, whatever quote they supplied.

My last days at the department were a cavalcade of new staff, swept up from wherever they could be found amid the chaos generated by the YourHealth steam train. The entire project was developed backwards, necessitating constant adjustments. Money was thrown at local production companies to create sincere-looking website testimonials. Staff were ordered to use the site and vote on the polls to generate hits. I wandered through the disorganisation in a permanent state of bewilderment.

I can almost guarantee this is not the rare exception, but  quite frequent occurrence. It’s like when the PM suddenly decides a sound bite of carbon neutral sounds good, and they generate a workstream around it.

After four months, I walked away and did not bother telling anyone why.

I care about health dollars, although not enough to initially refuse that crazy job. Thanks to an ongoing medical condition, I’ve had need of the health system on occasion. My immediate family contains two doctors and three nurses. I’m anecdotally familiar with the state of our public hospitals and mental health system.

A few months before the department hired me, I spent eight agonising hours in emergency waiting for treatment for a chronic case of food poisoning. I was eventually diagnosed, pumped full of morphine, rehydrated intravenously and strapped to a bed in the emergency ward to recover overnight.

The next time I spend eight hours waiting in emergency, I will be thinking of unused speeches, cancelled events and weeks of wasted organisation and research. I will be thinking of expensive television advertising campaigns and T-shirts and golf balls with little slogans. I will be thinking of websites and a consultation process driven by photography. I will be thinking of ”training”.

Or we can believe the PSA and Labour that there is no savings to be made in Government.

The Herald reports:

Kevin Rudd would like to see the drinking age in Australia raised from 18 to 21 years.

The Prime Minister said he would prefer an increase, given a recent series of tragic accidents involving P-plate drivers.

Since the start of the year 12 teenagers have been killed in cars driven by P-plate drivers in New South Wales and Victoria.

In one crash that killed five teenagers in Melbourne the 19-year-old driver had a blood alcohol level almost four times the legal limit.

I love the logic here. Because some young Australians break the very serious laws about drink driving, Kevin Rudd thinks the solution is to lower the drinking age, as if that would make a difference.

The sort of people who drive pissed, are not going to change their behaviour because it is technically illegal to purchase the alcohol, as well as drive after drinking it. It won’t affect the problem drink drivers, but will criminalise a million or so young Australians.

I might be wrong, but I suspect Helen Clark hated that her first meeting with Barack Obama was having John Key introduce her as his predecessor, after Obama goes out of his way to say hi to Key.

We sometimes forget what a great reputation our country has overseas as a place to live:

Mr Obama had a friend living in New Zealand who had raved about the country praising its golf courses, skiing and lifestyle for families.

If Obama does visit at some stage, he’ll be a lot more popular than he is back home. UMR released a poll yesterday on NZers views of world leaders. The net positive ratings were:

1. Barack Obama +82% (88% favourable, 6% unfavourable)
2. Kevin Rudd +45%
3. Angela Merkel +15%
4. Nicolas Sarkozy +2%
5. Gordon Brown -1%
6. Silvio Berlusconi -16%
7. Vladimir Putin -19%

AAP report:

Mr Rudd joked that as the US is absorbed with its own policy debate on health reform he had had his own experience of “socialised hygiene”.

“I woke up this morning at the appropriate hour before some further breakfast organised for me by staff and then, only to encounter a queue, a line of people outside my bathroom, led by the Prime Minister of New Zealand, the Foreign Minister of NZ and most of our diplomatic staff,” Mr Rudd told a lunch in New York on Wednesday (NY time).

“So, if Mayor (Michael) Bloomberg is here, I would say this is an extreme way to treat our Kiwi cousins,” Mr Rudd said.

The story explained:

Prime Minister John Key was forced to go cap in hand to the residence of the Australian Ambassador to the UN for a wash this morning (Wednesday NY time) after water to his hotel was cut off.

Australian Prime Minister Kevin Rudd got more than he bargained for when he woke to find a queue of unwashed Kiwis waiting to use his bathroom.

In the true spirit of trans-Tasman cooperation Mr Rudd extended a cousinly hand to Mr Key in his hour of need.

Mr Rudd and his wife Therese Rein are staying at the residence of the Australian Ambassador to the United Nations near the UN building on the east side of Manhattan and were close at hand when the water was cut off at the hotel next door.

Dozens of people, including the New Zealand and other foreign delegations, along with members of the Australian diplomatic party and Mr Rudd’s staff were left without any water for several hours, as they woke up to get ready for another day at the UN.

I can see Rudd dining out on this for for quite a while!

Generally profane language from Prime Ministers can land them in trouble. But when they use it against their own colleagues, I suspect the public is far more approving. The details are:

The factional leaders had gone to see the Prime Minister in his Parliament House office to object to government plans to slash MPs’ printing allowances from $100,000 to $75,000 a year. The decision was in response to a report into parliamentary perks by the Auditor-General.

According to sources present, Mr Rudd said: “I don’t care what you f—ers think!”

Even better, he swore at MPs protesting against his reducing their perks. Definitely a poll bump on the way.

He then went on, singling out Senator David Feeney declaring, “You can get f—ed”, before asking, “Don’t you f—ing understand?”

I suspect the Senator now does.

An insightful column by Fran:

But with China poised to overtake the United States within a decade as the world’s largest economy, it is no surprise that the implications of China’s rapid economic rise were given considerable focus during New Zealand and Australia’s first joint Cabinet meeting in Sydney eight days ago.

Herald inquiries indicate Rudd went to considerable lengths to outline why the two Australasian countries should move closer together at a strategic level through maintaining “close foreign policy settings” during a lengthy overview he gave as co-chair of the joint Cabinet.

The issue barely rated a mention in the two prime minister’s joint press statements. But Herald inquiries indicate that Rudd strongly positioned the impact of China’s rise on Australasia during a lengthy strategic overview.

Several Cabinet Ministers from both sides privately credit the “risks based” analysis – above all other factors – as paramount in the Rudd Government’s decision to focus on New Zealand’s strategic utility to Australia, by moving to finalise single economic market negotiations by 2015. And to increase military co-operation to protect (if needed) supply lines between Australasia and the region during possible fractious times ahead.

This would explain why Australia has gone from luke warm to highly receptive on the move to a single economic market.

For most of our existence our location has been a barrier economically. In the next century, we may find being so close to Asia is a life saver. The US economy, and to a lesser degree the EU, could struggle to match Asian economic power in a few years.

Under this scenario, Australia – as a country with “middle power” pretensions – will increase its regional impact by drawing New Zealand further within its own strategic sphere of influence.

This is where NZ needs to be a bit careful. While I am fully supportive of closer economic ties with Australia, we must not lose our identity. NZ is generally held in higher esteem than Australia with most Asian countries – partly because we are non-threatening, but also because we have never been seen as the US Deputy Sheriff.

Rudd – who thinks deeply about strategic issues – believes that unlike previous downturns, Australia and New Zealand cannot rely on American consumers to quickly refuel global economic growth through another debt-fuelled spending binge. Both New Zealand and Australia thus needed to focus on how to sustain their respective economies.

Both prime ministers share the belief that it is in the countries’ interests to strongly brand Australasia as an investment destination focused on quality products and lifestyles, and, are concerned at the upcoming “war for talent” implied by changing demographics.

Key, in particular, sees a future where both nations will have to pay “near global price” to attract and retain highly-skilled people such as doctors, lawyers and engineers.

By drawing closer together the two “Europeans in Asia” will be able to more strongly position themselves as the Asian century develops.

This makes us closing the gap with Australia even more important. You want to keep doctors, lawyers and engineers? Well maybe then allowing mining on 0.0001% of the conservation estate is not the end of the world.

From Kevin Rudd’s Flickr account. John Key would have been a relieved man at the whistle.

Kevin Rudd has just announced a major shift in policy:

THE Federal Government has announced the “largest infrastructure decision in Australia’s history” after deciding not to award the national broadband network contract to a company.

Prime Minister Kevin Rudd said the Government would lead the development of a national fibre-to-the-home broadband network up to “100 times faster than what many people use now”.

“Years of failed policy have left Australia as a broadband backwater,” he said.

“This new super fast national broadband network is the single largest national building project in Australia’s history.”

Mr Rudd said the Government would seek investment from the private sector to build the network.

Construction would begin in the middle of the year and take “seven to eight years”, he said.

Sounds somewhat similiar to here.

NBR reports:

The winning telco in Australia’s national broadband network tender? None of the above. At a press conference this morning, prime minister Kevin Rudd said the government will drive the building of a fibre network itself – taking a leaf out of New Zealand’s book.

The government has also dramatically expanded the scope of the network from fibre-to-the-the node to fibre-to-the-home, putting the total build cost in the vicinity of $A43 billion.

The government’s share of the network, beyond the initially promised $A4.7 billion, will be funded by an infrastructure bond.

The network will be built by a private-public company, with the private investors able to hold up to a 49% stake – a set up that echoes the public-private fibre companies proposed on this side of the Tasman by Communications and IT minister Steven Joyce last week. …

“Fibre to the home, fibre to the business and fibre to the premise is what the 21st Century economy is all about,” says Mr Rudd.

Well done Kevin Rudd. This may also provide some opportunities for companies to pick up work on both sides of the Tasman.

There are some interesting debates happening on various stimulus packages around the world. Take this AAP article on Kevin Rudd’s:

ECONOMISTS have raised concerns the Federal Government’s cash handouts to millions of people will be blown on pokies and plasma televisions.

The Government wants to give payments of up to $950 to individuals as part of its $42 billion economic rescue package….

Reserve Bank board member Warwick McKibbin called for the payments to be scrapped.

“A cash payment … only has the potential to temporarily stimulate demand and has no long-run benefits to the economy,” Professor McKibbin told the inquiry last night.

He said it would be better to bring forward tax cuts or temporarily cut the GST.

So what will the money go on. remember this is a one off payment, not a permament change in income:

Sinclair Davidson, professor of economics at RMIT, slammed the handouts.

“Do we believe that Australians have not been borrowing and spending enough on alcohol, pokies and tobacco, and that there aren’t enough plasma televisions around?” he asked the inquiry.

Then we look at the polls in the US on the Obama package:

In a CNN/Opinion Research poll, 54% of respondents said they favor the stimulus plan that the Senate is expected to pass on Tuesday. And 64% said they felt the bill would help the economy recover. …

But 55% of respondents said that even the less expensive Senate plan would cost too much in spending and tax cuts, according to the survey. In addition, 30% think it’s just the right amount of money and 13% said the government needs to spend even more.

The amount of pork in the Obama package is huge, and it is interesting that already most Americans say the package is too large.

Then back home Rob Hosking at NBR argues not to go too large:

Today’s infrastructure announcements from the government should provide a welcome boost for the economy, even though the $500 million spend is hardly earth shattering.

But too much stimulus – and it is not difficult to have too much – and ministers risk an inflationary surge and large interest rate hikes just as they head into the next election. …

Hosking continues:

There is already a fair surge of stimulation working its way through the New Zealand economy.

On the monetary side, the Reserve Bank has more than halved interest rates over the past six months and will continue cutting for until April or maybe even June.

The official cash rate was 8.25% just over six months ago: it is now 3.5% and likely to go to 2%.

It is very important to remember interest rate changes have a lag effect of 12 to 18 months before they fully work their way through the economic system.

That is a key point. Many of the effects are delayed and you risk having all this stuff kick in as the recession is ending, resulting in inflation.

Colin Espiner seems impressed with Kevin Rudd’s big bang package of NZ$53 billion.

Yesterday Rudd threw the kitchen sink at the Australian economy, spending a whopping NZ$53 billion on everything from schools to home insulation to road repairs to tax breaks for businesses. Hell, he even doled out $12.7 billion in one-off cash bonuses for struggling low-income families.

It should be noted that Kevin Rudd had a healthy surplus. Michael Cullen left Bill English a decade of huge deficits. But also the Rudd approach is not without critics. The Asian Wall Street Journal notes:

From Washington to Tokyo to London, politicians the world over are using the global financial crisis as cover to extend their powers. In Australia, Prime Minister Kevin Rudd is taking that tack a step further — he’s manufacturing a philosophy to justify his actions.

In an essay published in the February issue of the Monthly magazine, Mr. Rudd lays out his vision for “social capitalism”; a kind of halfway house between what he calls “extreme capitalism” and “an all-providing state.” “Whatever the nomenclature,” he writes, “the concept is clear: a system of open markets, unambiguously regulated by an activist state, and one in which the state intervenes to reduce the greater inequalities that competitive markets will inevitably generate.”

This is just the usual Rudd spin, or another name for Blair’s so called third way.

This is a vision for a greatly expanded state cloaked under the rubric of “free markets,” one in which Canberra would decide what inequalities were worth smoothing out and which ones weren’t. Australia had that model once; it was called the Gough Whitlam government. In the 1970s, Mr. Whitlam nationalized health and higher education, hiked public-sector wages, increased government spending and pandered to labor unions, a key Labor Party constituency. The result was one of the worst recessions in Australia’s modern history.

That’s why the Labor Party — the same Labor Party that Mr. Rudd belongs to — embraced truly free markets, trade liberalization and deregulation in the 1980s and 1990s. Those reforms underpinned 17 consecutive years of economic expansion.

Indeed the Australian Labor Party under Hawke and Keating did many good things. And Rudd’s record to date hasn’t been too bad – but he seems to be panicking.

Mr. Rudd makes only a passing reference to this record, acknowledging the Bob Hawke and Paul Keating Labor governments’ ”ambitious and unapologetic program of economic modernization.” He goes further: “Neo-liberalism, and the free-market fundamentalism it has produced, has been revealed as little more than personal greed dressed up as an economic philosophy,” he writes. This is a far cry from the economic conservatism for which Mr. Rudd was elected in 2007.

Indeed, you never heard that on the campaign trail from him.

In his essay, Mr. Rudd uses the global financial crisis as a cover to attack his political opponents and talk up his own recent record. The opposition Liberal Party, Mr. Rudd writes, is “the political home of neo-liberalism in Australia” and bears blame for the current financial crisis, while Labor “has acted decisively through state action to maintain the stability of the Australian financial system.”

The irony is that Australia was better prepared to deal with the financial crisis because of its long record of liberalization and sound regulatory oversight. Australia wasn’t hit by a slew of subprime mortgage defaults or bank runs. Its problems came courtesy of muddled government interventions on foreign shores. Mr. Rudd’s Labor government reacted by guaranteeing bank deposits at taxpayer expense, banning short selling and proposing huge public spending programs.

The reason Kevin has so much money to spend now, is because unlike in NZ, he inherited a healthy economy. The bank deposit guarantee is not one I agree with the WSJ on, as almost all countries have been forced into that as a least worst option. As for increased spending – it depends on what the spending is for. Bringing forward infrastructure spending is desirable. Borrowing money to give cash handouts is not.

Milton Friedman once wrote: “What most people really object to when they object to a free market is that it is so hard for them to shape it to their own will.” It’s not necessary to read between the lines of Mr. Rudd’s essay to understand that that’s what’s going on here.

Very astute.

A very funny take-off of Kevin Rudd tying to explain the Australian Emissions Trading Scheme can be viewed as video here, or a transcript here.

Also I am sure Frog Blog will love the latest contest between two Australian PR agencies. Last week it was selling the invasion of New Zealand. This week it is selling the benefits of global warming.

The Loud agency goes for the emotions with the plight of a poor bird struggling to survive winter but there is hope if enough fossil fuels are burnt to warm the planet and rejuvenate plant life. Ursa however pushes the plight of the 100,000 homeless and how every mle you drive will help warm up the winter for homeless people.

I voted for Loud.

I have had a fairly benign to positive view of Kevin Rudd as Australian Labour under his leadership seem so much more moderate than NZ Labour. And he cut taxes in his first budget – unlike Helen who raised them, and didn’t cut them until budget No 9.

I was intrigued to listen to Andrew Bolt, talk at length on Kevin Rudd a few months ago, Bolt, was dismissed by a few people here as ill informed because he is a conservative commentator. But what I found interesting is that his criticisms were not that Rudd is left wing, but that Rudd is inclined to ill thought out populist ideas which annoy his colleagues and that he is ill disciplined.

I have to say the more time goes on, the more I regard Mr Bolt as having been very insightful with regards to Rudd. I’m not saying the Rudd Government is pursuing bad policies (overall quite good), and the Liberal Party leadership is near unelectable, so I still regard Rudd as the best choice (until Turnbull steps up anyway). But Rudd’s proposed EU style Asia-Pacific Union seems to be exactly what Bolt was speaking about.

There has been considerable comment in NZ that Rudd didn’t even consult New Zealand over his proposal, which is just plain stupid. Helen Clark has fairly astutely fired a subtle barb back without it coming directly from her lips, as Fran O’Sullivan notes.

Audrey Young also blogs on the issue, and quotes Greg Sheridan:

Sheridan has written an excoriating column this week against Kevin Rudd’s recent forays into foreign policy – after just six months in office. Rudd is just completing a visit to Japan.
It is a column with which Clark may have some sympathy.

”KEVIN Rudd is in danger of turning what should be his greatest strength into a serious weakness,” writes Sheridan.

”I refer to his weird and increasingly ratty habit of announcing foreign policy initiatives of soaring ambition and utterly amorphous content on the run, half baked, with no detail and no credible prospect of success.

”In the past week alone we’ve had Rudd threaten to “take the blowtorch” to the Organisation of the Petroleum Exporting Countries to produce more oil and lower prices, nominate [former diplomat] Dick Woolcott to reform Asian security and trade structures, and now appoint Gareth Evans to head a commission to end nuclear proliferation and secure nuclear disarmament.

”If you announce twice a week that you’re going to save the world and you manifestly lack the means to give the slightest effect to your pronouncements, the world soon loses interest. The chief casualty is your credibility.”

The test for Rudd will be how well he learns from his mistakes.

One of Rudd’s Ministers is Craig Emerson, whom I had the pleasure of meeting last year at CIS’s Consilium conference. He is now the Small Business Minister (a portfolio we could do with here).

He gave an excellent speech to the Sydney Institute two days ago. Some extracts:

… the role of policy makers is to allow the market to create prosperity and out of that prosperity to expand opportunity, not the welfare state. In the market democracy so fashioned, citizens enjoy freedom, self-fulfilment and sovereignty over the state, not subjugation to the state through financial and regulatory welfare.

This is the philosophy of like-minded people whom I call market democrats – the modern Labor champions of the traditional Labor values of prosperity, fairness and compassion. Market democrats harness the power of the market for the public good.

Not a bad term – market democrats.

But as a new recruit to the ALP I again began to ask: is there truly a conflict between self-interest and moral behaviour and is there a conflict between morality and markets? …

But self-interest is not synonymous with selfishness. An athlete is not selfish for wanting to win a tournament, but is self-interested. A singer is not selfish for wanting to win Australian Idol. An artist is not selfish for wanting to win the Archibald Prize, nor is an author for wanting to win the Booker Prize. A scientist is not selfish for wanting to achieve a breakthrough ahead of other scientists.

Athletes, singers, artists, dancers, authors and scientists are self-interested but this does not make them selfish. Some may be arrogant and rude, some selfish, others humble and altruistic, but all are self-interested. Without self-interest, economic and social progress is impossible.

A very useful differentiation between self-interest and selfishness.

Labor was making itself the party of competition and compassion. Out of the proceeds of growth, the Hawke government was lifting school completion rates, supporting the parents of poor children to keep them at school. My moral questions were being answered through the competitive yet compassionate philosophy of the Hawke and Keating Labor governments – a philosophy that sat easily with Adam Smith’s Theory of Moral Sentiments and the Wealth of Nations. There was, I concluded, no inherent conflict between markets and morality.

How nice to have a reference to markets without a sneer, as one would get in NZ.

Competitive markets reward effort, risk-taking and entrepreneurship and they encourage innovation essential to the growth of a market economy. The forces of competition create pressure on businesses to be efficient and to come up with and apply new ideas for application in producing goods and services valued by consumers.

Yet markets are chaotic and wasteful. Predicting the prices produced by markets is always hazardous. Markets force businesses to close, wasting the building renovations and obliging employees to seek work elsewhere. But far more wasteful and chaotic are central planning and governments pretending to be good at running businesses in so-called mixed economies.

In other words markets are not perfect, but they are generally a lot better than the alternatives.

If poverty in Australia is no longer primarily a poverty of incomes but a poverty of opportunity, the goal of a fairer society is best pursued through a more equal distribution of opportunity than through a more equal distribution of income. A nation’s people are not better off if all live on equally low incomes. Of course it is unfair if the rich get richer while the poor get poorer. But why should governments seek to prevent the rich from getting richer if the poor also get richer as a consequence of the wealth creation process?

And he shoots bullets through the arguments of the poverty industry who use a definition which means poverty will never be solved.

Many Australians earning below-average incomes choose to forego higher pay in favour of spending more time with their families and friends or just relaxing or playing sport. By doing so they are making measured income inequality worse but, through free choice, they are making their own lives better.

Indeed. And incomes are also very tied to age and experience. Demanding that an unskilled 19 year old should be earning 60% of the average wage of 40 and 50 year olds with 20 – 30 years experience is madness. It is about opportunity.

The goal of market democrats is prosperity and fairness through opportunity for all in a market economy. Market democrats strive for a more equal distribution of opportunity. If opportunity is equally distributed, incomes in the future will be distributed more equally. Prosperity and fairness become partners not rivals.

I like how Emerson can say what I think, but state it so well.

But for those out of the workforce who have income-earning prospects, perpetual income support payments without any effort to remedy the causes of disadvantage are not the pathway to a prosperous, fair society; they are a perilous road to welfare dependency, low self-esteem and servitude to the state.

When was the last time a NZ Labour Minister spoke about welfare dependency?

Seeking to use industrial muscle to gain pay rises in excess of productivity growth is inflationary and ultimately self-defeating. Modern unionism can involve offering a bundle of services that are attractive to members. These services can extend beyond representation in workplace bargaining to support for lifelong learning, financial, tax and legal advice and advice on superannuation, private health insurance and even personal counselling services.

A wonderfully clear statement that The Standard will hate. Pay rises without productivity growth lead nowhere.

In a market democracy governments should serve the people instead of seeking to subjugate the people to the will of government through high taxes and heavy regulation. By allowing markets to reward hard work, risk-taking and entrepreneurship without unnecessary interference, market democrats advance
freedom and self-fulfilment.

Serve not subjugate.

Market democrats think of markets first and, only where necessary, strengthen or complement markets with efficient regulation. In a market democracy, regulation is justifiable in strengthening markets and remedying market failure.

Exactly, regulation is basically a last resort. Which is why I supported it in telecommunications. There was massive and clear market failure after 15 years of waiting. But it should always remain the last tool, not the first tool, that Governments reach for.

But the previous conservative government thought of regulation first, presiding over what the Business Council of Australia describes as the creeping re-regulation of business. This is why, in a process initiated by Kevin Rudd, Lindsay Tanner and I are so vigorously working with the States and Territories in cutting back overbearing, inconsistent and overlapping Commonwealth and State business regulation.

While in NZ we get review after review of the need to reduce regulations ignored by the Government

Now not everyone in Australian Labor shares his viewpoint. But my God wouldn’t it be nice to even have a single NZ Labour MP who gave speeches like that.