More economics 101 - capacity utilisation and inflation in Australia

Yesterday (19 November 2008) Malcolm Edey, Assistant Governor (Economic) at Australia's Reserve Bank, delivered a short speech to the Australia & Japan Economic Outlook Conference 2008 entitled The Economy in Late 2008: Conditions and Prospects. You can find the full speech here.

There were a couple of interesting graphs in the speech that I thought worthy of a comment because of the light they throw on existing economic problems.

The first graph shows capacity utilisation as measured by the NAB series.

You can see the current downturn clearly. Of more interest, you can see the scale of the crash into recession in 1990.

While I have no desire to see a repeat of 1990, it was quite dreadful from a business viewpoint, it does put the current talk of depression in context. I am sure that capacity utilisation will fall further, perhaps to 1990 levels, but this is not depression.

The second graph shows Australian inflation over the period since the start of 1996. You can see why the RBA was worried during the most recent past when Australian inflation suddenly spiked at the fag end of the boom.

Now there is something very important to note about this graph. Australia's peak inflation is much lower than it was during the stagflation of the 1970s or the end of the 1980s boom. I make this point because it changes the policy equation facing policy makers. We have much more scope to use fiscal policy than before without creating another inflationary round.

The next graph I found especially interesting. It shows the relative shift in prices for non-tradable goods and services as compared to tradables.

When you look at the graph you can see the way the rise in the price of non-tradables, essentially those parts of the economy not exposed to international price pressures, drove inflation. You can also see how the decline in the price of tradable goods - in part a reflection of China's growing role - initially cushioned price rises on the non-tradable side.

The non-tradable side may not be affected by international competition, but it is affected by the current downturn. We can expect price pressures to drop here.

The position on the tradable side is more complicated. I think that the China effect, the way in which growth of Chinese exports pushed prices down, has come to an end. On the other hand, all internationally traded goods will be under price pressure because of the global downturn. So price pressures should ease, offset to some degree in the Australian case by our currently depreciated exchange rate.

Again, the net effect is to give policy makers greater freedom for expansionary measures.

Problems with Australian Films

I am sitting here frustrated. Like many Australians, our internet connection allows for a certain monthly download. Exceed that, and the system slows to a crawl.

This month we ran over our limit early. My fault. I live streamed NZ TV to watch the election. Now the system's crawl is simply awful. Add to this the slowness on this box because all the software alterations have chewed up memory, and I have a real problem. I have just spent forty minutes trying to download a few emails.

I am writing this post on Livewriter. Hopefully I will be able to load it. However, I will not be able to provide the links that I wanted.

There were two major Australian film events this week.

The first was the highly promoted ABC production on the Howard Years. I will write a critical evaluation of the content later. However, just focusing on the filmic aspects, this was gripping TV for anybody with a little background. While I do not think that anyone in Australia can yet do a West Wing, an often re-watched almost cult classic in this household, the Howard Years shows how far local production has come.

The second event was the release of Baz Lurmann's Australia. This release, one I had been waiting for and had written on, is far more problematic. To my mind, the reasons for this go to the heart of some of the problems that Australia, and its film industry, face.

Just to set a context, the share of the local box office held by locally produced films has dropped to around 5 per cent. Australians are staying away in droves. Yet when we come to look at TV ratings, Australian made product still holds its ratings on free to air. However, this household rarely watches it, although I might like to.

Lurhmann's film is a blockbuster - it cost $A120 million to produce - set in Northern Australia. The film centres on an English aristocrat in the 1930s, played by Nicole Kidman, who comes to northern Australia to sell a cattle property the size of Belgium. After an epic journey across the country with a rough-hewn drover, Hugh Jackman, they are caught in the bombing of Darwin during World War II.

At this level, the film has everything. It is by all accounts visually quite striking. Yet I was worried about its local appeal because it seemed to be playing to images that had, to my mind wrongly, receded into our past. When I looked at my own now city family I found that there was very little interest in the film, I think because it dealt with images that are now alien.

Then listening to the discussion about the film, I suddenly found that I was reluctant to go as well for very different reasons. I thought that this was a story, yet somehow it becomes a film in part about the stolen generations, Aboriginal children removed from their parents, and attitudes to race.

Don't get me wrong. These are important issues. Yet when they start being presented as a key element, the story ceases to be a story and becomes instead a politically correct statement.

Media people constantly talk about the demographics, the audience to which a production or a network appeals. When we look at demographics in this sense, Australia has always been divided into multiple audiences based not just on things such as age and education, but importantly too on geography. Melbourne viewers, as an example, often do not like the same things as Sydney viewers.

If you look at successful Australian films or TV productions, you find that they have at least one of, more often a combination of, two things.

Number one is a strong story line. The most successful productions in international terms are those that present what is in some ways a universal story. Baz Lurmann's early film Strictly Ballroom is an example. This relatively low budget has achieved continued success because it is a good story. The Australian elements are there, but they do not intrude.

Number two is that they play to specific popular local images, both seriously and in a comedic fashion. In dollar terms, Crocodile Dundee remains (I think) the highest grossing specifically Australian film. It was a huge success locally because it appealed to Australians images of themselves. It was a massive success internationally because it was visually funny, appealed to international images of Australia and also presented a universal story.

For a number of reasons, over the last thirty years we have constantly hacked away at many traditional Australian images. This has happened at a time when the Australian population itself has become more diverse. As a consequence, the local audience has fragmented.

Many Australians will not go to Australia because they perceive it as playing to past images that have been persistently and consistently attacked as no longer relevant or, worse, wrong. Now others who might be attracted to those past images may not go because they perceive it as in some ways politically correct. All this provides an over-burden that can make it hard for a film to survive.

We saw a similar problem with Ten Canoes. This was an interesting film that deserved a better box office outcome. Looking at it just as a film, while it was not a cinematic masterpiece it was also a fascinating entry point into a different world. Yet once it became embroiled in the discussion about indigenous issues, once it was presented as something that Australians should attend, the point was lost.

I have just been reading at youngest's suggestion a Terry Pratchett Diskworld novel that in fact centres on Australia. This novel is full of local allusions including drop bears, something that comes from Bundaberg Rum ads.

Youngest loves this book because of its localisms, something that I enjoy too. Youngest also likes Crocodile Dundee. She is, in fact, a rampant Australian nationalist, although she might not like me saying so. Yet she has no desire to go to Australia because, I think, she sees it in some ways as old fashioned, discredited.

There is to my mind an awful irony here. The core culture is very powerful and goes on, but has become disconnected from its past. Our cultural elites who have created the disconnect now find themselves in a strange desert, one where they seem to have won so many things. yet struggle to understand why the things that they stand for are not better accepted.

Concluding, I really hope that Australia succeeds. I would also like to see more Australian films focusing on telling a story independent of other overlays. There are so many Australians stories that would make good films. I would like to see more get there.

Postscript

I was mulling this post over because I wasn't quite sure that I had it right. I did draw a comment from Neil on his Google Reader series. The comment is repeated in full below because the GR series posts are deleted after a period.

"Much here I agree with, some I don't. After all, "Rabbit Proof Fence" was a very successful movie commercially as well as artistically. I think one problem is that Baz Luhrmann's vulgarity has betrayed him rather in this one. I liked "Strictly Ballroom" and "Moulin Rouge" as musical and visual entertainments, have little time really for his "Romeo and Juliet" ("West Side Story" did it better) and fear this one has a heavy dose of "Thorn Birds" about it -- one of the most ridiculous novels I have ever read, albeit popular. Not that I have seen "Australia" yet. I am glad to see the Darwin air raids highlighted -- an episode much minimised at the time. Otherwise he seems to have a bit of a Chips Rafferty complex, from what I gather... Maybe I'll do my own post, but I'd rather see the movie first. Like Jim I hope it does the Oz industry good.”

Neil's comment raises a number of issues, some of which link to personal taste, as most of these things do in some way. To provide a basis for later discussion, I thought that should add some strictly factual material.

Neil referred to Rabbit Proof Fence (2002) as a commercial as well as artistic success. In fact, according to Mojo the global box office for this film was $US16.2 million. This means that this film, while one of the best known Australian movies because of its subject matter (the stolen generation) as well as its quality, was at best a modest commercial success.

Certainly it was a commercial success by comparison with recent Australian films. I am not sure that any Australian film made in the last two years has got to $US10 million box office, let alone $US16 million. Ten Canoes, a movie that really deserved a better fate and might have achieved it with different promotion, achieved a global box office according to Mojo of $US3.4 million.

Now compare this with Australian movies that have been commercially succesful.

Crocodile Dundee (1986) achieved a global gross of $US328.2 million, Crocodile Dundee II (1988) a global gross of $US$239.6 million, Crocodile Dundee in Los Angeles (2001) a gross of $39.4 million. Let's take a few others. In some cases, Mojo only had US box office figures.

• Mad Max (1980) earned $US8.8 million in the US.
• The Man from Snowy River (1982) earned $US20.7 million in the US alone.
• Gallipoli (1981) earned $US5.7 million in the US.
• Mad Max Beyond Thunderdrome (1985) earned $US36.2 million in the US.
• Strictly Ballroom (1993) earned $US11.7 million in the US.
• The Dish (2001) earned $US16.6 globally upon release.

This is by no means a full list and excludes Australian made movies that are not identifiedly Australian like Babe.

To really make my case, I would have to go back and check every film in detail. However, my impression is that over the last fifteen years, and with a few exceptions, the Australian film industry has progressively lost its local audience without really adding international reach.

It no longer makes films that Australians want to watch to the point that to call a film Australian made is now a kiss of death. Perhaps the most damning criticism that I have heard is that the industry now really makes art house films and is a failure at that.

Contrast this to TV where Australian content is still in demand. TV has to make product that people want. There is almost no correlation between Australian TV and Australian film in terms of content.

The role of the individual in history

One of the things that I love about the study of history is the way in which the ever-changing past is slowly revealed. Ever-changing because our view of the past is affected by both the evidence available and the questions we ask of that evidence. Slowly revealed because the patterns of the past peep through as we work and are then stitched together to form a story that can be subject to further review, test and development.

Much history is by nature broad brush. We talk about trends, about forces, movements, major events and about individuals who are seen to be of particular importance. In doing so, we can sometimes lose sight of the fact that history is about people.

Much of my own limited historical research, limited because of time, has a local, regional and family focus. I point and counterpoint between local, regional, national and international, but always within a frame set by my immediate interests.

In research and writing, I am constantly struck by the importance of the individual. This can be seen especially clearly at local level, but also holds at broader level.

The members of the Russian General Staff who persuaded the Tsar to play tennis at a critical time to keep him out of contact while they made decisions doomed the entire Imperial family and an Empire. The Generals could have gone a different route, the Tsar could have insisted on being involved.

I am also constantly struck by linkages, by the way in which past sets of actions set the basis for future actions.

In 1928, David Drummond as NSW Minister for Education in combination with S H Smith as head of the Department of Public Instruction pushed through the creation of the Armidale Teacher's College. In turn, this laid the base for the establishment of the New England University College in 1938.

Drummond's individual role was critical in all this. Yet his role rested on a whole series of prior actions by other individuals. Without those actions, neither the Teacher's College nor University would have come into existence.

At broader level, the continuing campaigns for improved country education created a climate that would support what was, at the time, an expensive initiative. At local level, the Armidale location could not have been chosen without previous individual actions that had led to the development of the small cathedral city as an education centre.

The fund raising campaigns that led to the establishment of The Armidale School and the New England Girls School in the 1890s meant that by 1928 Armidale had a significant public and private educational system and was already recognised as an educational centre.

Drill down below this, and you find that particular families such as the Whites played an important role in providing funds for the new Anglican schools. Later when funds had to be raised to finance the new University College - NSW legislation provided for the creation of new institutions, but only if a certain sum of money was raised first - it was again the White family who played a key funding role.

This is not a history of my own area. My point is that this pattern of individual action, of the painstaking creation of linkages between individuals over time and space, of the creation of committees and movements, is replicated time and time again when we come to look at positive changes over time.

Sometimes the contribution can be very small, attending public meetings or keeping committee minutes. However, the cumulative effect is substantial.

This holds true on the negative side as well.

Adolf Hitler could not have risen to power without the cumulative effect of thousands of individual decisions. Even Australian Prime Minister Billie Hughes played an important role through his effective agitation for the imposition of harsh peace terms on Germany at the end of the First World Way. Germany must be made to pay - and pay. We all paid as a consequence.

Just at present I think it helpful to remember that individuals do count not just in a philosophical sense, but as people who affect the course of history. We are all responsible.

Joshua Gans and our Internet community

I wanted to briefly record this one, in part so that I did not lose the reference, in part because I know that there is an interest in our immediate blogging world in research related to blogs and blogging.

In Blogging and piracy Professor Joshua Gans refers to a new academic paper discussing blogging. The post includes a link to the paper. I have yet to read the paper. However, it appears to use the livejournal community as a base, concluding that content rich blogs blogs attract more attention and links because of content, whereas less content rich blogs need to pay more attention to cite and discuss others so as to maintain status. Here the paper apparently makes a distinction between readers (content rich) and friends (links, cross-comments, etc).

I am sure that this is right. However, we also need to take into account the reason for blogging. While all bloggers are interested in things like their Technorati ranking (bloggers are human), to many bloggers it is the friends and interaction that makes blogging worthwhile, not the creation of content as such.

I follow what I think of as our blogging community quite closely. As part of this, I consciously track through comments and cross-links, watching the evolution of the community. Most recently we have seen the addition of a set of new bloggers who have added a new texture. I have picked this up in my material, as has Neil through his Shared Items.

I have used the term village many times to describe the process. In a personal sense, I do not think of the internet world as a mass. I cannot comprehend one hundred million blogs. Instead, I think in terms of people, each with their own unique features.

I can understand Tikno's flood, I may not agree with Ramana's sometimes negative view on the human condition, but I can see his viewpoint, I really laughed at Ben's descriptions of Bachelor's Day. Then, too, I had to withdraw from a discussion with Arthur Vandelay because I found that I wanted to argue, not discuss.

I cannot objectively say that our evolving village is in any way unique, although I think that in some ways it may be because of its breadth of views and the importance placed on manners. I can say that it makes an interesting study, one worthy of a paper in its own right. Certainly it makes for a fascinating sociological or anthropological study.

Postscript

At Tikno's suggestion, I have added Google Translate to the side-bar to make material on this blog more accessible to those speaking other languages.

I am not sure why I did not do this before. I think the first time I thought of doing this, the number of languages covered was still very limited, the translations very odd. My thanks, Tikno, for the prompt.

Australia - Days with Rain

The following map shows the average number of days across Australia recording more than 1mm of rain. While the colouring may be a little hard to read, I thought that showed one aspect of Australia's climate in a rather useful way.

Australia is a dry continent, the driest after Antarctica. If you look at the map, you can see how rainfall increases in rings from the very dry centre of the continent, with the wetter areas forming a semicircle towards the coast in the north, east and south.

During droughts, the pale blue area expands, the darker blue areas contract. As you might expect given Australia's size, the country is affected by different weather systems.

One big concern with climate change is that the wetter belt in the south might move south, dropping its rain out to sea instead of on the continent. This is where the majority of Australians live, where the majority of agricultural production by value occurs.

The map also suggests why Australians may be so sport mad, still so outdoors. A fair bit of space with lots of sunshine encourages outdoors activities.

The map tells us a lot more as well. For that reason, I will repeat it with other material from time to time to help discussion on different aspects of Australia.

Postscript

Lexcen kindly pointed me to this article in The Age (Melbourne) by Kenneth Davidson, Water waste of our dam money. The article bears directly upon some of the points I made in Saturday Morning Musings - why environmentalists (and other enthusiasts) are sometimes bad for the planet.

At this point I have not attempted a critical evaluation of Mr Davidson's views. However, they do point to the importance of balance and evidence in making assessments about perceived problems in regard to water supply.

Sunday Essay - the importance of quiet time in a crowded world

This image from Neil Whitfield's Specials shows one aspect of Sydney's Chinese Gardens.

I don't know about you, but sometimes I really need quiet time, a separation in some way from the busy world around me. The more crowded life becomes the greater the need, but also the greater the difficulty.

I grew up in a relatively quiet world. Not quiet in an absolute sense, there were always bird noises, the sound of distant church bells, even the sometimes discordant notes of a local band practicing in the early morning. However, these were familiar sounds, comforting because they were familiar.

Now in a different world I am surrounded by sound. My children in particular live in a world of constant sound and activity. Youngest loves going for walks, but only so long as she has her ipod!

I sometimes find this very distracting, yet get swept with the flow. I work a lot alone - writing and thinking are by their nature often solitary activities - but my brain keeps up its own constant chatter. I have to make myself break away.

I stand to be corrected, but the need for quiet and some measure of private space seems to be a deeply human trait, as is the need for friendship and human interaction. We can see this in the emphasis placed on solitude - the hermit in the cave - in human religious beliefs. We can also see it in the way manners or architectural styles act to create personal space in crowded societies.

One of the curses of the modern world is time management. In teaching time management, something that I am better at teaching than doing, I have always tried to link this to personal objectives and needs. Yet in practice, time management always seems to come down to activity, trying to do more in less time. Quiet time is crowded out.

In H G Well's Love and Mr Lewisham, a book I read as a child and somehow have never got back to reading again, I was struck by his (Mr Lewisham's) methodical way of drawing up time tables to get best value from his time. I thought that if I did this too I could do a lot more.

I failed, just as Mr Lewisham failed. I know this. I know why. Yet I retain this constant need to try to do more, to keep going, to keep active. Just sitting, consciously withdrawing, sometimes even social participation, seems a waste of time. I know that I need to take quiet time to allow the brain to pause, the soul to recover. I know that I will be far better for it if I do. Somehow, it still seems wrong.

I don't really have an answer to this.

Gardening is good, because it actually provides quiet time in a way that I can justify as useful. It breaks the cycle. Meditation itself is sometimes helpful. However, the things that I find most helpful are linked in some way to my own conceptions of beauty and to things that I find interesting.

Put me in a Chinese garden or an art gallery, for example, and you are likely to lose me for some time. I also try to store memories in my mind that I can use again. Sitting in a particular church. A particular view. A particular garden.

I find, though, that I have to constantly refresh those memories or they lose their effect, crowded out by the present. This brings us back to my starting point, the need for quiet time in the first place. If I don't take that time, then ultimately I am the worse for it.

Postscript

Nick Lancaster from Simplistic Thoughts kindly included this post in the list of resources at the end of a post he wrote on time management and life balance.

Saturday Morning Musings - why environmentalists (and other enthusiasts) are sometimes bad for the planet

I am, in my own way, an environmentalist and have been so for many years. It's just that my views, the questions I ask, the things I want to do or see done, do not fit with the modern definition of "environmentalist". Perhaps it's just that I am not an "ist"!

I have been musing on this one because it somehow links together three apparently un-related issues.

The first is our habit of thinking in absolutes, black and whites. I am told that in western countries at least we have just been through, maybe are still in, what is called a post-modern age. I have never been sure that I properly understand just what post-modernism is. As best I can work out, it seems to imply that the certainties in values, morals and beliefs that somehow marked the past have been replaced by a world in which everything is relative.

I have always struggled with this one because it did not seem to fit with the facts. We actually live in a world that is becoming increasingly puritan, increasingly willing to assert that certain things are absolute.

The second issue is our belief that things can and should be be fixed through law, regulation or some form of official action.

One simple measure of this can be seen in the attached chart showing the growth of the size of Commonwealth legislation. You can add to this equivalent growth in legislation and regulation at state and local levels.

Beyond the complexity of it all, the net effect of our continued belief in absolutes in combination with our belief that things can and should be fixed, means that the public sphere - the areas subject to state and social suasion of one type or another - has grown at the expense of the private sphere.

The third issue is simple information overload. We have access to more information than at any other time in human history. In practice, we simply cannot process this. We have come to rely on visual media, on short grabs, on things packaged to attract our interest.

One side-effect of this is that we have come to live in a short term world always dominated by current problems and concerns. The problem is that the human spirit cannot endure constant exposure to negatives without becoming in some ways twisted. meaner, poorer. A second side-effect is that those who want to bring about change are themselves affected in terms of the information they receive (this helps form their views) and the way they have to operate to bring change about. In many ways, the first part of the new century has become the age of one-dimensional causes.

Let me start with a biggish example to illustrate my point. If you ask most Australians today to nominate the most important environmental problems they will probably answer climate change, water, whales, wood chipping, possibly species loss and oil. These are some of the environmental causes, issues of recent years. Very few will nominate phosphate rock.

Human life depends upon phosphate. The main source of phosphate for agriculture is phosphate rock. This is especially important in Australia whose soils are naturally phosphate poor. However, the world is beginning to run out of phosphate rock.

The chart on the right shows projected global production of phosphorus. This is projected to peak just before 2040, then decline.

This is no small thing at a time the world is facing projected food shortages. In the absence of change, this will bite harder and earlier than either oil depletion or climate change. Already, increased fertiliser costs are feeding through into increased production costs.

If this issue is so potentially important, how come it is largely off the radar screen? I think that the answer here is that it simply does not have the popular drawing power of causes such as whales in mainly urban Australia. We simply don't see it.

We can see something of the same thing in the continuing cut-backs to rural R&D and rural support, most recently in the cuts to Department of Primary Industry staff in the recent NSW mini-budget. I discussed some of this in Agriculture, the environment and Australia's future.

On the surface, there is something seriously our of kilter when we obsess about climate change to the exclusion of agriculture. Don't get me wrong, climate change is important and we need to take action. Yet what we do locally will always be a small part of a global solution. In contrast, our capacity to feed ourselves and those around us is directly important. Yet we largely ignore it.

Rambling on, let me move to a small example that illustrates another problem, Sydney's water restriction. Here I have complained, most recently in The continuing insanity of Sydney's water restrictions about my inability to use a hand held hose to water my garden.

My point was a simple one. I like gardening. It's healthy for me as well as providing fresh food. I gardened in a very water efficient way. However, the way the restrictions were introduced made gardening very difficult. I thought that this was a bad result at several levels. I also thought that it was quite inequitable since other people were allowed to do things like filling swimming pools. I got really irate when dam levels increased, other restrictions were eased, yet I was still tightly limited in my use of a hand-held hose.

I did not get a very positive response. Michelle's comment is typical of many of the responses I received when I raised the issue with people:

What a fuss about nothing. Get a water tank and you will have no restrictions on how much to water your vegetable garden or any other type of garden. I do and my vege garden is prolific and little maintenance. I even run it on a irrigation system rigged up by my husband so I don't have to hand water. I also recycle the water from my washing machine directly into a small tank and use this on shrubs.

I cannot complain about Michelle's personal approach. I am sure that it is very praise-worthy. Yet I also think that it is in part almost a theological statement, a statement of general position (the need to conserve water) that has become so deeply entrenched in official thinking as to become an absolute independent of the actual facts or variations in local circumstances.

I grew up with real water shortages, not Sydney's ersatz version.

In town, limited dam capacity meant that there were often absolute limits on water usage. In the 1960s' drought we came within weeks of actually running out of water. In the country where tanks supplied water, my brother and I as kids used to have three inches of water in the bath, with one taking a bath after the other.

At home we had two tanks as well as town supply. We also had a big garden. We used tank water all the time for cooking, it was so much nicer than the town water supply.

In all this, water usage was a relative thing. When water was scarce, things had to be adjusted to fit. Because vegetable gardens were so important to town life, most people relied to some degree on them for food as well as pleasure, hand held hoses were one of the last things to go as water got tight. As water supply increased, we did more to take advantage of the increased supply.

Things change. Tanks were phased out at the direction of state and local authorities largely, I think, on health grounds. I always thought that this was a bit silly, but those were the rules. Now, of course, they are back in a big way because fashions and views have changed. Water restrictions themselves became progressively more absolute, mandated independent of relative supply or local conditions.

When I look at our environment problems over time, at our environmental successes and failures, I think that the thing that really stands out are the way in which the failures are so often associated with official action at state or national level, the successes so often associated with local action. Too often, official action has been driven by causes and has taken the form of mandated, universal, rules.

Anybody who has been involved with Government policy knows that policy actions often have perverse and unforeseen results. In solving one problem, we create another. Local action is often more effective because it is based on local needs. Official action is often most effective when it facilitates change at local level, rather than mandating universal measures.

Like most things, this statement is a guideline, not another universal. Sometimes mandated universal action is the only way to deal with a problem. However, to my mind such official action should be used sparingly. Once you get to the position that we have now with an absolute over-burden of rules and restrictions, it becomes very hard to even see the pattern, let alone identify what might be done to improve things.

Looking forward, the thing that stands out to me is the diversity of responses that are going to be required to deal with the overall environmental challenges Australia faces.

I am quite fascinated by this one at the moment because I can see some of the the ways that these changes are already manifesting themselves. Take a very simple example, the composting toilet.

This was opposed for many years by local authorities on health grounds. There were good reasons for this because of the diseases associated with human faeces. It took - and this is a case where full credit has to be given to alternative life style and environmental activists - many years of agitation before such toilets were allowed in Australia.

Composting toilets have the advantage that they do not require water, while the urine in particular becomes a useful source of phosphorus. They are not a universal solution, just another small step.

We are going to need many such.

Postscript

I did not give a source in the post for the legislation graphic. I had run it before, and downloaded it from my picture collection. I could not find my orginal post. The graphic came, I think, from an earlier Club Troppo post.

Bachelor's Day - China

I could not resist this post, nor the discovery that 11/11 has a different meaning in different places.

If you want to find out more. I suggest that you read this first and then this.

Quite took me back to my university days.

Ben has been sick. Glad to see that he is better.

Experimenting with Paypal

That small number who read this blog on a regular basis will know that there is nothing that I would like better than to research and write on something like a full time basis, doing some other things to add income including lecturing and speaking. Towards this end, I actually spend a lot of time researching and writing each week.

I have been looking at just what is required to do some of the things I want to do.

Over time, I need to fund some new equipment including a new computer, digital camera plus software and a measure of professional support including graphic design. I have quite good personal computing skills, but there is a real art form in developing a nice looking e or printed product. I also need to fund telecoms costs, consumables and travel so that I can get to more places. Then I have to meet my own living costs, along with a share of the family costs.

I do carry Google ad-sense on the blogs, but I want to be a professional writer, not a professional blogger. So I follow my writing interests rather than the path required to maximise traffic and hence click-throughs. Most of all, I want to maintain, improve if possible, the quality of my content.

As a small next step forward, I am experimenting with the use of paypal starting with a small donation button on this site. While donations would obviously be welcome (!), think of it as a subscription, my real objective is to get to understand paypal properly with the aim of selling some of my writings and possibly other things such as speaker services through the various sites.

Now I have no idea as to whether all this might work. I am sure that, like blogging itself, it is certainly going to take me in new directions!

Postscript

Neil Whitfield mentioned on a comment on this post in his Google Reader series that he would watch this experiment with interest. I can understand this. Neil has a lot of really very good material that, if packaged, might have a value to people beyond simple blog access. If he could do this, then he might generate an income stream independent of his immediate exertion, thus giving him cash to do new things.

Earlier this month in Common Management Problems - get the booklet I tried a related experiment to see if people would be prepared to pay a small fee - $A15 - to get material in a more usable form.

I selected $A15 because it seemed to me that with a few sales it would cover my extra time costs plus processing costs while yielding a small profit margin.

I have no idea as to whether or not this will generate any gains. However, I will keep experimenting and report back on results so that all readers of this blog who are interested can share the lessons.

Bridging the gap between indigenous Australia and the broader community - a methodological note

I still do not want to get drawn back into the policy debate about the condition of Australia's indigenous people. I remain of the view that much of the discussion is misdirected. However, I do want to make two simple methodological points.

Earlier this year, Prime Minister Rudd pledged to "close the gap" between Aboriginal and non-Aboriginal Australians on a range of socio-economic indicators. Now an ANU team has concluded that this could take more than 100 years to achieve based on progress to date as indicated by census data. I have not been able to find the ANU report, so am relying on newspaper reports.

The first point is one apparently made by the ANU team, the danger of articulating sweeping aspirations. Here the researchers:

warned the Government that "a degree of policy realism and caution is required" and that its use of statistical benchmarks might lead to perceptions of policy failure in coming years.

"Under such circumstances we would counsel that commitments to 'reducing disparities' might be a more realistic policy goal for the Rudd Government than 'closing the gaps'."

I think that this is wise advice as former PM Hawke found when he promised to abolish child-hood poverty.

The second, linked point, lies in the dangers of using statistical averages. Take health as an example.

At national level, all the health indicators are national averages, concealing quite wide and arguably growing variations between groups within our community.

Our indigenous population is presently especially concentrated in regional, rural and and remote areas, along with some of the poorer suburbs in our capital cities.

As I have discussed before, general health services in parts of regional Australia have been in decline for some time. There are indications of a growing gap between health indicators for the whole population in these areas and those living in metro areas.

Within metro areas, the poorer suburbs have also been experiencing problems in health service delivery. Again, and for a variety of reasons, health indicators for the general population in these areas are below the national average.

So what does it actually mean to say that we will close the gap between indigenous health outcomes and the Australian average?

Are we implying that we can achieve better Aboriginal health outcomes than those applying to equivalent groups in the broader community? Alternatively, do we mean that we plan to reduce broader health disparities? Then again, are we proposing that the combination of broader social and economic advancement for our indigenous peoples in combination with physical re-location will get the required results? Or some combination of all the above?

My point is that we need to exercise great care in using statistical averages in setting aspirations and as performance benchmarks.

Postscript

David Nash kindly pointed me to the source document for the ANU paper on which the story is based - CAEPR Discussion Paper 287/2008 How realistic are the prospects for 'closing the gaps' in socioeconomic outcomes for Indigenous Australians? by J.C. Altman, N. Biddle and B.H. Hunter.

This is not the first time that David, an Honorary Visiting Fellow, Linguistics, Arts atANU and Visiting Fellow, AIATSIS, has pointed me to material.

The paper is really worth reading for a number of reasons.

It points to the difficulties involved in interpreting statistics in general, indigenous statistics in particular over multiple census periods. It suggests that, contrary to much popular reporting and public perception, the indicators show improvement in the indigenous condition relative to to the broader population since 1971.

Importantly, I think, in discussing the statistics the paper points to some of the variables that affect the indigenous position.

The paper does not affect the methodological points I was making. However, it did leave me thinking that in responding I was caught in a trap that I have complained about before, the way our attitudes and interpretation are affected by current reporting.

This is a very real issue just at the moment, and not just with the Aborigines, because of the way our collective thinking is affected by the constant flood of negative stories.

I am not saying that there are not bad things around, nor am I saying that the news must be good news week. I am saying that the perceptions that are created and that then drive policy and politics may be at considerable variance to the actual facts.

I was thinking about this because of discussions between Ramana and myself, most recently on Agriculture, the environment and Australia's future.

I think it fair to say that I am far less negative than Ramana about the future, although I am also very critical about some current approaches. Part of the reasons for this lies in the way I find a constant variance between short term reporting and commentary including sometimes my own and the reality when I come to check the facts.

Postscript 2

The Acadamy of Social Sciences in Australia has released a paper that bears upon the discussion in this post - Maggie Walter, Lives of Diversity: Indigenous Australia, Occasional Paper 4/2008 census series #2, Academy of Social Sciences in Australia, Canberra, 2008.

Using census data, this paper compares the indigenous position in three different communities - Maningrida (Northern Territory remote), Dubbo (NSW regional) and Perth (WA metro) - with each and with the non-indigenous populations in those communities. In this sense, it addresses one of the statistical concerns that I raised above.

I think that the results can be fairly summarised this way: while there are differences between the three, the indigenous populations are in some ways equally disadvantaged compared to the non-indigenous populations in the same locality. This is a relative, not an absolute measure.

This does not affect the broader point because the paper also draws out differences between the general populations especially in Perth and Dubbo.

There are a number of interesting issues raised by the paper that I will address at some point. For the moment, I just wanted to alert you to its existence.

Charles Chauvel and Sons of Mathew

The Charles Chauvel film Sons of Mathew (still) was released in 1949. It took eighteen months to make at a cost of around £120,000, a very large sum for the time.

The film is an epic of the pioneering families of New England and south eastern Queensland, in part a celebration by Chauvel of his own family.

From my viewpoint, it is an interesting film because it provides a lovely entry point that links together many different features of New England and Australian life. In this context, I have just finished a longish post, Sons of Mathew 2 - Charles Chauvel (1897-1959), looking at the life of Charles Chauvel, one of Australia's premier film makers.

From time to time I will add further posts. However, I don't want to spoil the fun by saying what they might be. Let the story unfold with time.

Purely Personal - Clare returns

To the airport yesterday evening to pick up youngest on her return from New Zealand. She had a fantastic time.

This photo shows Clare a bit below 15,000 feet. As a parent I bit my tongue a little on sky diving, a little less so on bunge jumping.

It was, to use an Australianism, bloody freezing coming down. Hence the somewhat blue face.

Clare was the only Australian with her tour group. The rest came from Europe, the US and Canada. Clare, as she always does, enjoyed the company.

All parents worry about their children. We have given our girls lots of love, an education and a structured if somewhat chaotic life style. We have also tried to give them the freedom within some limits to take risks, to make their own mistakes. I think that is about all we could have done.

Both girls have worked since they were about 15. Clare largely paid for the trip herself, if with a little borrowing from her mother. We pay rent and most food costs, but beyond that the girls are now largely financially self-supporting. I regret this a little because I feel that the need to work has limited other things that they might do. Still, it is no small thing at present to have good part time jobs and stable work records.

Twelve years ago I made the decision to be the primary child carer. For a major part of that time I have worked from home. There have been very substantial professional and financial costs in terms of opportunity and income foregone. There have also been great personal gains that I would not have missed.

I think that one of the greatest things my girls have given me beyond their love and friendship is that they have kept me in touch. By this I mean simply that I do know something of their generation.

My paternal grandfather was born in 1867, my maternal grandfather in 1890. Both left school at twelve. While I never knew grandfather Belshaw, the world that my various grandparents and their children knew is still very real to me from direct contact and family stories.

Now I live in Australia of 2008. There is an enormous gap between this world and that of my grandparents.

I have no desire for my children to directly experience what it was like to live in working class Lancashire when pit (grandfather Belshaw) or mill (grandmother Belshaw) were the natural end points for a twelve year old. I do not want them to know what it was like in the case of grandfather Drummond to lose first a mother and then a father and to become a ward of the state at twelve.

I would like them to understand how and why it was that in the first part of the twentieth century all the children of poor Lancashire industrial workers came to acquire tertiary education qualifications. I would also like them to understand how the troubled child who became a ward of the state at twelve should become one of the outstanding Australian education ministers of the twentieth century.

Most of all, and I think that they do understand this, I would like them to understand the concept of contribution.

When I look at the history of my own family and. more broadly, at history in general, I see how the present stands on the shoulders of the past.

Often in writing about history we look at broad sweeps, at cause and effect. Often we generalise. Always we are attracted by the grand, the apparently big decisions or great men. Yet when I come to look at the detail, I find that many of the most important things came about because individual people tried to do things often over extended periods.

This is, I think, the most important thing that I have learned about history, that is all about individuals doing the best and worst of things for a whole variety of reasons. Further, in the broad sweep of history it is the collective impact of individual decisions that counts.