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Federal Election 2010: Which party will support Aviation?

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Federal Election 2010: Which party will support Aviation?

Old 7th May 2010, 00:23
  #41 (permalink)  
 
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@Chimbu
Spot on about Europe
So far we have all posted statements suggesting that pollies can't be trusted!
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Old 7th May 2010, 01:00
  #42 (permalink)  
 
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Josh

They lost their plasma.....you purchased the most expensive TV you are likely to own

Yep that is the moronic mentaility of a large number of their supporters.....no wonder Kevvie was popular

Give a man a fish you feed him for a day, teach him to fish for himself and he will feed the whole family/village.

J
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Old 7th May 2010, 06:59
  #43 (permalink)  

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I just REALLY wonder about single issue voters.

Fonz121
I'll admit Ive been a life long Labor voter but won't be this time due to the Internet censorship proposal. I couldn't give a rats about aviation policy as there is none. Def won't be voting Abbott.
Is there truly nothing else about Rudd that gives you pause?

Abbott is a religious nutjob? Remind me again who has organised, I would argue cynically, to be filmed outside a church every Sunday?

Abbott is certainly a man guided by the principles of a mainstream religious faith but note it wasn't him suggesting internet restrictions. In fact I have seen no credible reports that indicate he is in any way extreme in his religious beliefs - he did change his mind about becoming a priest - that would indicate to me a fairly realistic approach to life albeit one guided by judeo christian principles that any reasonable person would be hard pressed arguing against. I was born and raised Catholic and now consider myself non religious but I see no problems with voting for a man like Abbott who, while I don't agree with everything he says, on balance is one of a remarkably small number of fundamentally moral people we have now in politics. I wouldn't consider not voting for him because he believes in a faith that has been bedevilled by a tiny % (in the grand scheme) of paedophiles - is that the basis of your dislike of Abbott Fonz121?

Owen Stanley has indicated he voted Labor because of Howard's Work Choices legislation - I think Owen is in the company of 100s of 1000s of voters. I think its fairly clear that single issue voters probably cost the Liberals the last election. Politically naive, even arrogant, of the Libs to put in place legislation that had the potential to be so misrepresented in the MSM so close to an election but what % of these single issue voters actually read and understood that legislation as opposed to being stampeded by the MSM? What % have read and understood the detail of Labor's Fair Work Australia?

I have not read either but I will give some examples - Rudd's wife's business where she made millions was one that was facilitated by Howard's legislation - a mates wife working in QLD Education relates that the WC legislation was mercilessly and horribly applied by the very left wing management of that entity. Several people I know who run very successful small businesses (and who could be fairly described as REALLY good bosses) tell me quite clearly that if their employees understood completely Labor's FWA and demanded all that was within that legislation their businesses would become untenable and go broke.

So which IR legislation was/is worse for Australia and Australian employees - one where nasty bosses could abuse staff but that had (eventually) protections against that (and lets remember the ultimate protection against this is not legislation but the fact good staff leave and the company goes broke thereby relieving the economy of an entity that shouldn't exist) or IR laws which if enacted in totality would destroy highly profitable businesses that employ many people and are owned and managed by bosses with a genuine respect and empathy for their employees?

Edited to add: Does anyone seriously believe Labor's FWA has had ANY impact on the numbers of are$hole employers or their behaviour?

Last edited by Chimbu chuckles; 7th May 2010 at 07:54.
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Old 7th May 2010, 07:27
  #44 (permalink)  
 
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Chimbu...absolutely perfectly said. My thoughts exactly. I like Abbott as a person but the more this goes on, the more I respect his political position (and yes I'm a right wing voter).
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Old 7th May 2010, 09:48
  #45 (permalink)  
 
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managed by bosses with a genuine respect and empathy for their employees?
Wow Chimbu, that's fantastic, can you tell me the exact, or hell, maybe an approximation of the percentage of bosses that fit that description. Hey, I dont know, only asking. No guessing now.
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Old 7th May 2010, 11:20
  #46 (permalink)  
 
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THE AUSTRALIAN SHOOTERS AND FISHERS PARTY strongly support GA in Australia. They support AFAP and an inquiry into pilot terms of employment including a full overhaul of the Award.

They also support the introduction of laws into parliment that support the capping of fees by airport operators and an inquiry into CASA fee structure.

They represent both the shooters and fishos in the community and is run by several high ranked officials, including a sitting member that is strongly involves in GA.

Definately worth supporting.
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Old 8th May 2010, 11:05
  #47 (permalink)  
 
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Chimbu,

I have no problem with Abbott as long as he is prepared to separate Church and State on health matters, particularly regarding women. He has not been able to do so in the past, but anyone can learn.

I voted against the Libs in the last federal election on several issues. Firstly, on their IR package, secondly on their emasculation of the federal public service (particularly the border agencies) while loudly proclaiming that they were tough on border protection and thirdly because I got the feeling that given one more term, Howard would have had himself voted Dictator For Life, a la Julius Caesar. IMO they were in too long, got too comfortable and needed a spell in opposition to rethink their strategy.

I have read the Fair Work Act (all three hundred pages) and I don’t believe anyone understands it fully. However, I was not going to vote for Work Choices. I’m not Labor by any stretch but I do work for wages, I heard my own employer’s plans to take full advantage of the Work Choices provisions and they were scary.

While I was fully in favour of reforming IR legislation (I also have experience with a small business that spent the better part of a year getting rid of a completely incompetent employee), in my opinion, a winding back of the unfair dismissal protections was enough to address that issue. There was no need (and it turns out, no public support) for individual contracts, and there is always a place for collective representation (union or otherwise) in larger companies. A small business is a different environment from a medium-large business, where the boss may not know or care what your name is, and is generally completely removed from his/her workers’ needs and concerns.

Additionally, no one considers themselves a bad boss. In a large company, I worked for a complete despot who would tell everyone that listened what a great people person he was, and how his ‘door was always open’. In reality, about the only person that door was open to was the Union rep, who regularly reminded him of his legal obligations regarding intimidation and consultation.

There was much public whinging from employers about how hard it is to get rid of a problem employee. In my experience (as above) it was difficult and a lot of paperwork, but certainly not impossible. Our very small business (my second employer) managed to do it without paying experts, so I fail to see why any other business couldn’t take the same steps. It was a matter of finding out what was required, counselling and documenting accordingly. Total PITA, but not impossible.

let’s remember the ultimate protection against this is not legislation but the fact good staff leave and the company goes broke thereby relieving the economy of an entity that shouldn't exist
Sure, in Utopia. In the real world, people have mortgages, family commitments and fear. Management intimidation and bullying are alive and well in many medium - large companies, and the individual employee is often too frightened to speak out and too financially committed to leave (which usually involves a temporary pay cut). No one likes unions very much, least of all their members, but they do provide a platform for employees to negotiate terms.

I didn’t like Rudd and Co and I suspected they’d be a f-up, but I wasn’t about to vote myself reduced conditions and bargaining power. It’s all very well for the Libs to whine that they were misunderstood, but I don’t believe they were. Their proposed legislation forced individual workers to do battle with large, well funded companies without protection.

From a rationalist point of view, they should have done the maths and worked out that the electorate has more workers than employers, and therefore you will never win an election pandering to employers at the expense of workers. They will only win the next one if they restore voters’ confidence in their IR platform.

As employer and employee, this is probably not an issue we will ever agree on. You may be a good employer (and kudos to you if you are) but there are still plenty of bastards out there, and while they pay the wages they will still have the upper hand over their workers without legislative safeguards.

Last edited by Worrals in the wilds; 8th May 2010 at 11:25.
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Old 8th May 2010, 11:29
  #48 (permalink)  
 
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Arnold E

I am one of the type CC is referring to and treat employees like one big family........and the FWA thing...down your part of the world, go talk to the bloke who runs Riverina Airmotive....he went along to a seminar about the new FWA and his reaction was ....... best summed as ...close the doors and retire on the dole!

Of course he did not and neither have I, but I can cerify exactly what Chuckles has just posted, and I wish he was wrong, but he ain't.

J

Worals........clearly you have never worked for me. I have good people, its easy to look after them.
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Old 8th May 2010, 12:53
  #49 (permalink)  
 
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Jabba, I know Andrew, good bloke and I like him, but on the other hand , I have never worked for him.
I have also yet to find an employer that doesn't think that any form of industrial legislation is not the end of civilization as we know it. My boss is also a fair and reasonable bloke (and also a friend of mine ) but he is also bound by legislation. If you think that all employers are benevolent........your dreaming. I have worked for employers that would be quite happy in a gulag and if it wasn't for legislation, their employees might as well be in one.
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Old 8th May 2010, 13:21
  #50 (permalink)  

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I am an employee too and have spent my working life outside any form of labour laws that protect workers from bad employers - I certainly agree workers need some rights/protections.

It doesn't take utopia for an employee to change to a better job it merely requires a little drive. If you deem your employer a cretin then you look for something else - if needed you gain extra qualifications to do so. You might even look back and thank the cretin for making you get off your ar$e if you were honest. My best mate growing up and who learnt to fly at the same school at YSBK couldn't/wouldn't leave Sydney to get a flying job (even years later when as a CP I rang and offered him one) and he is now a guard on suburban trains.

I have been an employer too - as a CP a couple of times. People have told me I was a good boss although I have disciplined and sacked people upon occasion - those individuals probably think I am a c--t.

Someone asked above what % of employers I thought were 'good' vs 'bad'. I would bet money that if you were able ask to every employee of every company in Australia what they thought of their employer some would say great and more would say not so - and the difference would be more to do with the employees work ethic/maturity/honesty than whether the employer was a bastard or not.

In 30+ years working from paper boy through sailing instructor, glue factory worker, taxi driver, GA to airline pilot I can only think of 2 bosses that were truly evil/dishonest despite working the last 25 years with NO industrial protections. Most were great as long as you did what you were paid to do - your job.

No doubt the Libs were deemed to have overstayed their welcome and I agree they were getting a bit arrogant - I was desperately hoping they would have their ar$es handed to them on a plate WITHOUT actually losing govt last time around. Labor/Rudd scared the fk out of me.

Whatever Howard/Costello's faults were they pale into insignificance compared to the last 2 years and especially the last week or 3 - this super profits tax is HUGE in terms of wealth destruction across our society NOT just in the board rooms of mining companies and overseas investment banks.

Read this from a US based investment newsletter.

Blunder From Down Under: Australia's Mining 'Super Tax' Will Squeeze the Global Recovery

Rudd/Swan are also hell bent on destroying telstra and its shareholders - An Australian company which, whether you like them or not, provide telco services in areas NO ONE else is interested in. Tanner is saying the Govt is perfectly happy to go it alone and will be perfectly happy with a '6 or7% return' after 15 years - that is < .5% annual return assuming technology hasn't left their NBN behind and its worth ANYTHING at all to sell which is the basis of any return on taxpayers money. Chances of that? Zero - think about the internet technology of 15 yrs ago compared to now. Tanner et al are lying.

Telstra's goose is cooked | Alan Kohler | Commentary | Business Spectator

This is not center left/fiscal conservative (remember Rudd saying that? Liar) socialism its marxist class warfare.

Rudd and Swan are clueless as to the outcomes of their ill conceived legislative efforts.

Yes Howard/Costello benefited from a better economic times but at least they KNEW what to do with their good fortune - KRudd/Swan have absolutely NO IDEA.

From $50 billion surplus to $150 billion in debt THEN Kick the ONE thing that is keeping Australians above water during the last few years in the teeth?

They're behaving like irresponsible teenagers.

People will suggest Howard lied about children overboard (actually debatable) but just consider the lies of the last few months - every time they open their mouths Rudd/Swan/Gilliard display their ability to mislead or downright lie. The latest in a very long line is linking the 40% Resource super tax with increased superannuation. There is NO link - the 40% goes to general revenue and the super is provided by employers. Only one thing happens when employees become more expensive - there are less of them.

To link all this back to the thread and aviation - can anyone think of a better way to damage the aviation industry than what labor is doing now?
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Old 8th May 2010, 13:37
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. Only one thing happens when employees become more expensive - there are less of them.
Logic would therefore dictate, we should all take a cut in wages and conditions. GA drivers will love that!
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Old 8th May 2010, 15:31
  #52 (permalink)  

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Not so. If a company is profitable that entity will pay what it needs to (and no more) to get the right pilots - if those pilots suddenly become too expensive because, for arguments sake the Govt passes some new laws, and the company has no ability to raise its revenue in line with those raised costs (limited market) then it becomes unprofitable unless fewer pilots work harder. If they were all already flying 900hrs/annum then they can't work harder so maybe the company goes broke and none of them have a job.

Would the Qantas group employ as many pilots as they do if everyone was on the mainline award? Can't see it - I am not saying they couldn't pay every pilot employed the current mainline award I am saying there would be a shedload less pilots employed in the QF group flying bigger aeroplanes. And its no use saying "Its only 5$/ticket". A year or so back when oil went to $150/bbl and the airlines put fuel surcharges on tickets fwd booking for J* and VB dried up - LLC pax went back to the busses/didn't travel and holidayed at home.

Same in GA - you could argue, and I would agree, that there are too many pilots and too many GA companies (started often by pilots who couldn't, for whatever reason, make it to an airline job) chasing limited work and that leads to lower entry level wages (and returns on investment for the owners). There are limited ways this situation can change - fewer companies employing FEWER pilots flying fewer aeroplane commanding a better return on capital from the limited market is about the only way - how that is achieved is interesting. I think the only way is raised barriers to entry to the profession (higher standards for pilots). You could of course legislate a 50% increase in the GA award and the FEWER remaining pilots in the remaining companies would be very happy indeed but there is NO WAY KNOWN that there would still be the current numbers of pilots in the industry. At least raising the bar, standards wise, until few people can pass culls the herd down to truly motivated individuals - a 50% increase in the award would simply raise the number of unemployed pilots because only the very best would get the fewer jobs. Its all about incentives and what market signals you want to send.

At some wage level jobs evaporate and it varies from industry to industry and within industries. The only way for the system to function is through millions of people interacting with 10s of 1000s of companies and EVERYONE acting as free agents in their own self interest (with a good umpire and a few rules). Otherwise we return to the 70s and endless strikes/pattern bargaining.

An economy works the same way - millions of people making billions of decisions based on self interest that collectively send signals to 'the market' that is populated by companies that allocate capital to make stuff that meets the needs of the millions of people.

That is why socialism/communism doesn't work - because 4 people cannot make decisions that come even CLOSE to being as good as the millions do - example, pink batts.

That is why Rudd/Labor worried me 2 years ago and should scare everyone witless now.

Last edited by Chimbu chuckles; 8th May 2010 at 16:00.
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Old 9th May 2010, 03:22
  #53 (permalink)  
 
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example, pink batts.
Wasn't the problem with the pink bats, that unscrupulous employers sent untrained young people to do jobs that they were not capable of doing? Nothing wrong with putting pink bats in ceilings as such. All would have been ok had all employers "had genuine empathy" with their employees. And that happened with legislation, imagine what would have happened if Howard and the Mad Monk had got their way and there was no (IR)legislation.
Unfortunately I think it is not going to be very long until we find out
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Old 9th May 2010, 06:20
  #54 (permalink)  
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Thumbs down

millions of people making billions of decisions based on self interest that collectively send signals to 'the market' that is populated by companies that allocate capital to make stuff that meets the needs of the millions of people.
Ahhh Ayn Rand. Like all of these philosophical types, a bit right and a lot wrong.

Wages are only one part of the overall problem, boys, and it says a lot about the limitations of the self-interest principle that nobody looks at the larger issues.

Infrastructure is one such issue. Australia simply does not have a large enough population (and thus, will never have a large enough Aviation industry) to make airports economically viable - especially not in regional areas, but Bankstown and Jandakot's managers have found the same in capital cities.

So - should "the market" decide that there should only be access to the capital cities for the very few extremely rich?

The telecommunications network is the same - private enterprise can never make a big enough margin on the rural and regional services, so Telstra's city clients are subsidising the provision of services to their country cousins.

The "Self Interest" brigade will turn around and say "stuff them, that's where they want to live, bad luck if there's no phone services."

Should "the market" decide that people in rural and regional Australia don't deserve telephone services?

"Economic Rationalism" is only rational if you live in a social and moral vacuum. "The Market" is a civilised term for the law of the jungle.

I will be the first to stand up and say that Labor's first (and hopefully last) term has been a major disappointment (to say the least). But many of us - despite the economic success, or maybe because of it - felt that there were some areas where the Libs policy needed to be softened.

Are we an enlightened, civilised, educated society?

...or are we a pack of savages merely swapping Cannibalism for purist Capitalism?
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Old 9th May 2010, 07:13
  #55 (permalink)  
 
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Howdy Chimbu

I just REALLY wonder about single issue voters.
Whats wrong with voting based on a single issue? If one party wanted to re-introduce conscription would that single issue be enough to sway your vote? Or pick any area you feel strongly about one way or the other. I don't usually vote based on a single issue but I happen to strongly oppose any government censoring of the net and seeing as though old Tony hasn't come out and opposed this proposal its fair to say he's all for it too.

Is there truly nothing else about Rudd that gives you pause?
Yes there is, but they are issues where Abbott isn't any better.

Abbott is a religious nutjob? Remind me again who has organised, I would argue cynically, to be filmed outside a church every Sunday?
Yes he is. I never said Rudd was any better. This is another reason I won't be voting for either.

I wouldn't consider not voting for him because he believes in a faith that has been bedevilled by a tiny % (in the grand scheme) of paedophiles - is that the basis of your dislike of Abbott Fonz121?
I don't think anyone who believes in any Faith as fanatically as he does should be put in charge of the country. A few issues directly linked to his faith,

- Women's rights
- Gay rights
- Euthanasia debate

Before you point it out, I do realise Rudd isn't much better in these areas. That's why I would like to see a PM not linked to religion. So they can govern on behalf of everyone. Not just the deluded. But I guess Im a bit stuck for choice in that area.

Looks like it will have to be these guys... The Australian Sex Party

I especially like this policy,

"Ending the tax exempt status for religions."
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Old 9th May 2010, 07:29
  #56 (permalink)  
 
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Horatio Well said Sir.

Fonz
Looks like it will have to be these guys... The Australian Sex Party
.. but most importantly with the minor parties is where their preferences [puns intended] flow.

Remember to fill out the preferences for yourself
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Old 9th May 2010, 08:58
  #57 (permalink)  
 
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It doesn't take utopia for an employee to change to a better job it merely requires a little drive. If you deem your employer a cretin then you look for something else - if needed you gain extra qualifications to do so.
Agree wholeheartedly. I've been there and done that, took a temporary pay cut and left a public service 'job for life' in the process. However, not everyone has the drive or is in the position to do so. This doesn't mean they should be exploited and as you say, there need to be some protections.

A lot of legislation exists to protect cretins from other cretins, such as the various traffic acts, the criminal codes and a whole lot of other Acts that prohibit stuff we'd never be stupid enough to try. IR legislation is no different.

In 30+ years working from paper boy through sailing instructor, glue factory worker, taxi driver, GA to airline pilot I can only think of 2 bosses that were truly evil/dishonest despite working the last 25 years with NO industrial protections. Most were great as long as you did what you were paid to do - your job.
Most employers are reasonably decent. I don't agree with the 50% figure that was suggested before. I would think 5% is probably more accurate and consistent with both personal observations and the estimated prevalence of Antisocial Personality Disorder. Employers like the Cafe Vamp owner, who was recently convicted of failing to provide a safe workplace after one of his employees committed suicide after enduring serious harassment, or many pink batts installers who jumped on the exploitation bandwagon conveniently provided by the Labor federal government .


Wasn't the problem with the pink bats, that unscrupulous employers sent untrained young people to do jobs that they were not capable of doing?
These employers are a prime example of the 5%. They failed to provide even basic, life preserving training. If the insulation installers had been unionized, their union would have made them aware of the dangers. They weren't, and they were obviously too naive to do their own research. Many people are naive and/or cretinous. They do not deserve to be exposed to unsafe or suicide inducing work practices because of that. The unions have failed today's workers as much, if not more so, than the Libs when they drafted Work Choices, because at least the Libs didn't pretend to care about workers' rights.

I can't stand the current federal government, they are much worse than I expected. They are lying hypocrites who lurch from self made disaster to self made disaster. I sincerely hope they get voted out next election, and I also hope that the Libs have learned their lesson re IR stuff. Barring major gaffes or Inquisitors bursting Aliens style out of Abbot's throat they'll get my vote again before the country is bankrupted by the next media friendly stunt or greedy tax grab to pay their bills.

Anyway, still way off the original topic, sorry. We probably agree on more than we disagree. As for aviation, the mining tax grab is certainly not going to help the industry one iota. Neither will the next green bandwagon fad the current government is bound to fall for. K Rudd has been a proclaimed anti-aviation politician for some time (his own well used Government jet notwithstanding ) so there's no reason to expect any improvement.

Last edited by Worrals in the wilds; 9th May 2010 at 09:32.
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Old 9th May 2010, 11:22
  #58 (permalink)  
 
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Smily-free post. Saving eye-rolls, brick wall head banging, censored yelling for l8r

Back to topic, I'm fleshing out some of the policies that haven't been discussed/debated yet:

Rudd Government
Surprisingly not mentioned on this thread but I seem to remember a 246 page national aviation policy statement published last year. Their sales spin:
Australia needs a comprehensive aviation framework that brings together all aspects of aviation policy into a single, coherent and forward looking statement.

It is surprising that no Government has previously outlined a medium to long term Aviation Strategy before now.
...
  • Ensuring aviation contributes to future economic development
  • Enhancing safety and security
  • Improving planning and infrastructure
  • Promoting sustainability - reducing the impact of aviation on the environment
Australian Greens
From their transport policy
19. a transport system, including roads, railways, airways and sea-lanes, that is safe, environmentally sound, efficient and reliable.
25. major airports located to minimise social and environmental impacts.
27. better transport services in rural and regional areas.
29. environmental costs incorporated into the cost of air travel.
Family First
Hampered by Steve Fielding ... people like this should not be electable ... (from ABC March 2010 ... his performance was laughable)
TONY JONES: So where did human beings come from?

STEVE FIELDING: Well, as I said, I believe that people, you know, started from being created. But, look, there are some other views out there about people evolving from other types of animals.
Shooters and Fishers
No aviation policy but an interesting view on population capping (with obvious economic growth impacts)
http://www.shootersandfishers.org.au/policies/
Commonwealth Government should place an immediate moratorium on (all) new immigration applications. Such moratorium to remain in place until the Commonwealth has carried out an audit of Australia’s natural resources, in particular, water and energy, and until a referendum is held to set the optimum population levels.
Howard Coalition Govt
An enlightening article from Ben Sandilands described the conflict between protectionist Anderson with small-L Howard under Max the Ansett Axe.
Moore-Wilton, now the chairman of Sydney Airports Corporation and the Southern Cross (formerly Macquarie) Media Group, was the head of the Prime Minister and Cabinet Department when evacuated from Washington DC after the 9-11 attacks with John Howard on board Air Force 2, the Vice-President’s 747 airborne command centre.

“We were being flown to Honolulu where we were being asked a ransom to be flown back in some stranded [Qantas] jets,” he said.

It was a flight that coincided with news that Ansett Airlines had collapsed in the aftermath of its abandonment by its owner, Air New Zealand, in the most emotionally charged (but far from largest) corporate collapse in Australian history, but which had been pushed back to page three and beyond by the terrorist attacks in the US.

Moore-Wilton said John Howard was not surrounded by his usual team of advisors and had received a communication about a proposal to Cabinet to spend $750 million “propping up Ansett and rescuing it from its collapse”.

On the long flight Howard received a 10-point document as to the reasons why Ansett should be saved, and Moore-Wilton said he took a pencil to them, cutting out seven or right outright.

He said Howard came to the strong view that “it was time for the airlines to stand on their own feet and in their own right”, which meant Ansett’s hopes for a political reprieve had been snuffed out before Air Force 2 landed at Honolulu, where several Qantas 747s had been diverted on their way to Los Angeles and San Francisco when news of the 9-11 attacks lead to warnings that US air space was about to be closed and ‘locked down’.

Moore-Wilton said: “I think the decision the PM took on that flight allowed Virgin Blue the oxygen to grow and flourish.”

(At that time John Anderson, the acting Prime Minister, was actively pursuing media and political support for an Ansett rescue, only to run into the brick wall of Howard’s disapproval even before he had returned).
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Old 9th May 2010, 13:21
  #59 (permalink)  

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No Horatio not an Ayn Rand fan - like you say there is a little too much extreme in her writings.

Nor do I like the idea of the law of the jungle and I have absolutely NO problem with city folk subsidising the bush - I don't even consider it subsidising - we absolutely need them out there doing what they do.

We do need laws and umpires - as long as they are smart about the incentives they create.

I do try to take an economists view of things when it comes to understanding why stuff happens the way it does. Incentives are a vastly more powerful influence on us as individuals and as a society than most people believe until the economist's understanding of 'incentive' is understood. No one thinks about life much in these terms but I find it a very good way to understand the world around me better.

The only way our modern society differs to Ayn Rand's version of utopia is that our incentives are constantly being modified by all sorts of externalities be they govt intervention, advertising etc. Her version of utopia didn't allow for human nature enough.

When a govt passes legislation it creates new incentives and destroys others. Our current tax rules are a classic example - they are a disincentive to savings and an incentive to invest in real estate and one of the outcomes is low savings and high mortgage debt.

Rudd's pink batts fiasco is another example - prior to his intervention there was a fairly balanced market for roof insulation - supply was meeting demand. Then he announced free pink batts for all and there was created a different set of market incentives that were based on artificial demand. If all those people had wanted insulation all they needed to do was pick up the phone and by doing so they would have collectively sent a signal to the market and it would have ramped up production to meet it. Probably slowly/carefully giving them increased margins and better profitability and an ability to employ more at better pay. It would have been a slow controlled and sustainable increase.

Instead Rudd created a gold rush mentality and supply was boosted very quickly as the demand side said "well ok, its free after all". When it all unravelled - and it was always going to, the exact same thing has been done in other countries (NZ as an example) and the EXACT same thing happened including the house fires and accidental deaths - then demand was instantly shut off by the govt cutting off the money and a massive oversupply of labour and materials suddenly appeared and has all but shut down the industry. 10s of millions of dollars of insulation is sitting in sheds and NO ONE wants it unless its free.

The same thing happened in the BER (Builder's Early Retirement) - artificial demand causing all sorts of rorts and waste.

The Resource super tax changed the incentives for miners and investors - Its now not worth risking Billions in new capital for projects and looking for undiscovered resources because it just isn't worth doing IN AUSTRALIA when the return on capital is so low. The foreign investors that provide the capital (remember our savings rate is very low so we borrow internationally - another reason Govt/RBA/Banks have little ultimate control over interest rates) simply say "Nope, Africa/Canada/etc looks like a better return for MY money". Rudd/Swan have created an incentive for sundry other miscreants in various 3rd world countries to think about have a go at grabbing at the same golden ring. Foreign investment deserts those countries too and before you know it Krudd has created an artificially constrained supply and prices are inflated long term instead of what has always happened before which is supply exceeding demand eventually and prices falling.

People are strange creatures - how many do you know who will drive half way across town to save a few cents a litre on petrol blowing whatever saving that lower price indicated.

Govts MUST be extremely careful about the incentives they create/destroy and the signals they send out as a result. Probably NO Govt is as careful as they should be but this one is not even aware care is needed.

They could have done things differently if their ideology was not one of centralised control. How about lowering taxes and incentivising savings through modified taxation legislation and let people decide what they need to do?

The only downside to that is political - it doesn't give the sugar high instant gratification that politicians need to convince people to vote for them again - which is the ONLY thing that incentivises MOST politicians. But it might have been a lot better for everyone in the slightly longer term.

How many of you know that not much more than 100 years ago there was no such thing as income tax? Federal Income tax wasn't enacted in Australia until 1915 although various states enacted different levels of income tax in the late 1800s. The way (ever increasing) income taxation has modified incentives across society ever since is REALLY interesting reading.
Chimbu chuckles is offline  
Old 9th May 2010, 13:37
  #60 (permalink)  
 
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They could have done things differently if their ideology was not one of centralised control. How about lowering taxes and incentivising savings through modified taxation legislation and let people decide what they need to do?
That sounds a bit like the Henry Review proposals (judging by the introduction, which is as far as I've got) which will no doubt be consigned to the bottomless filing cabinet marked 'reports from experts who made valid points and were ignored by the government that commisioned them'. Tell me if I'm wrong.
- it doesn't give the sugar high instant gratification that politicians need to convince people to vote for them again -
The weird thing about politicians over the last ten years or so is that none of these sugar highs last until the next election. The bubbles always burst well before that. I'm stuck trying to identify their objectives, whether they just want the media grabs, or whether they seek instant support in the hope that enough of it will stick come election time. It's like government has become some strange sort of reality show where you get to vote each week. Maybe they're all using the same media advisors .
Worrals in the wilds is offline  

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