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Welcome for visiting my blog. Hope you enjoy the visit and always welcome back again. Have a nice day!


Professor Dyfey's comment appreciated

This is a remark following the comments of Proffesors Dufey and Anderson on my earlier comment on and a question to G.E. Anderson "How do Australia’s foreign investment rules apply to China?" 21/08/2009.

Comments of both Profesors Dufey and Anderson are very much appreciated. Also thank Prof Anderson for the reference provided.

Professor Dufey's comment is very helpful to understanding the issue. Firms are regulated by the host country, irrespective its ownship structure and sources.

Nuclear disarmament and non-proliferation

Comments on Ron Huisken “The DPRK wants a new venue, a new game” and comments by Leonid Petrov, 28/08/2009, http://www.eastasiaforum.org/2009/08/28/the-dprk-wants-a-new-venue-a-new-game/

The two issues, namely, the reduction in the number of nuclear weapons (nuclear disarmament by existing owners, especially the US and Russia) and the prevention of nuclear weapons proliferation, should go hand by hand.

But the latter should be effectively enforced, so there is no escalation in the number of nuclear weapons, or an increase in new nuclear weapons. In this regard, it is important for the international community to denuclearise the Korea peninsular.

The current state of play does not have any effective means in controlling proliferation and that is dangerous and a pity.

G-2 or not G-2, who can decide?

Comments on Gerald Curtis “Obama and East Asia: No Room for Complacency”, 30/08/2009, http://www.eastasiaforum.org/2009/08/30/obama-and-east-asia-no-room-for-complacency/

While I personally have little understanding of the so called G-2 concept and its implications, it appears that G-2 is not necessarily just any person's like or dislike of it.

Essentially, it is no different from a bilateral relation, so the two parties can discuss the issues of common interests between them. So it is better to look at the G-2 issue in the way as it should be. Otherwise, people will get frustrated by G-2 or not G-2, won't they?

Our would-be FDRs?

Comments on David Burchell “History, but only as we choose to remember it”, 31/08/2009, http://www.theaustralian.news.com.au/story/0,25197,26003033-5015664,00.html

I agree totally and completely with the following:

"Our would-be FDRs, by adopting the mantle of nation-building without really comprehending its original purpose, have in effect played a joke upon themselves and us."

One is reminded of the essay of our own would-be FDR at the home ground about the economic crisis, some sort of attempt to write the history.

Billions and billions will be wasted, just in the political name of jobs, without cost and benefit analysis at all. Every spending and waste is justified by them with the name of maintaining and creating jobs, though the effects on jobs are a different story altogether.

Why as long as jobs are mentioned, all prudence is put aside? Where is government accountability?

We need honesty from politicians and government. They should stop using endless spins for their political advantages and advancing their own interest in the name of jobs.

Serious government accountability badly needed in Australia

Comments on Glenn Milne “Poodle's bite may yet wound the government”, 31/08/2009, http://www.theaustralian.news.com.au/story/0,25197,26003029-7583,00.html

The federal government begins to effectively acknowledge the huge waste in its spending programs, such as the Indigenous Housing in the Northern Territory where so many months have past and so much money spent and yet no single house has been built, and the Building Education Revolution spending in schools with a blow out to the order of $1.5 billion.

It shows a serious problem with government accountability for spending taxpayers’ money. While Labour has often been guilty of big government and government spending and increasing the level public debt, the lack of proper and effective accountability for spending is not confined just to Labour. We have heard before in huge military program with billions and billions spending that could not achieve the desired objectives.

It is high time to change this situation of seriously lacking of accountability. There are a number of things that can improve Australian politics and government accountability.

The first one is there should be a publically funded organisation to keep a record both online and in file of what the political parties promised policies and a chart for each promise about its status, for the years at least until some years after its finished.

The second is that either this organisation or another publically funded statutory authority to audit and evaluate public spendings. The organisation can also publish other independent assessments in addition to its own assessment.

The third one is that there should be a parliamentary court that can prosecute politicians for their serious mistakes that cause taxpayers' money being wasted or wrongfully spent. There needs to be effective accountability of using taxpayer’s money. The punishment can be banning a guilty person from being a minister, or a politician.

If these things are done properly, the public will have more confidence of their politicians and the government. Australian government will be more efficient and effective and Australia will be a better place.


A disappointing report by the Co-ordinator-General

Comments on Michael Stutchbury “Report fails to see fiscal recovery”, 28/08/2009, http://blogs.theaustralian.news.com.au/currentaccount/index.php/theaustralian/comments/report_fails_to_see_fiscal_recovery/

It is likely the case that the Treasury forecast got the shape of the economic recovery path seriously wrong, by underestimating the growth in the short term and overstating the media to longer term growth.

The shorter term issue was a failure to properly account the effects of two factors. The first one is the good shape of the Australian economy, like the main banks, was almost unaffected by the recession. And the second is our link with Asia, especially the China effect associated with its quicker recovery. Treasury clearly got this wrong.

The longer term issue was a failure of underestimating the serious damage to the US and other major western economies of the great recession following the financial crisis and the required adjustment in savings and consumptions in the US in particular over the next few years and possibly the next decade. Treasury is very likely to have got that wrong.

That adjustment will mean the US is likely to have a prolonged period of below trend growth and that in turn will affect the world growth as a whole, even though Australia is partially isolated from the US slowness.

The report by the Coordinator General is partly a self praising product. It does not appear to be objective and proper analysis. It is a pity the report was done by that person rather than an independent person.

Overall, the report was disappointing at the best.


US is not out of recession yet

Comments on news report “US 'already out of recession', says expert”, 27/08/2009, http://www.theaustralian.news.com.au/business/story/0,28124,25986462-643,00.html

The report starts with the following:

RENOWNED Wall Street analyst Abby Joseph Cohen says the US economy is already out of recession, downplays the risk of a double dip and reckons the rebounding sharemarket "has got it right".
Now head of Goldman Sachs' Global Markets Institute, Ms Cohen yesterday used her Australian visit to echo Wall Street's support for President Barack Obama's reappointment of US Federal Reserve board chairman Ben Bernanke.
"He is the one who stood in the quicksand and kept everyone's head above the level," she said in an exclusive interview with The Australian in Sydney.
And she suggested the US economy would post 3 per cent annualised growth in the second half of this year in the early exit from recovery before easing to a modest 2 per cent expansion next year.
That's ahead of the quickly improving consensus outlook and represents a solid rebound from the US economy's initial sharp slump following the financial crisis that hit nearly a year ago.
Ms Cohen suggested that, while the US recovery would be impeded by weak consumer spending and housing, it would be initially propelled by a rebuilding of business inventories and the rest of the Obama administration's budget stimulus.

Ms Cohen has been good at analyzing equity market from time to time. However, that does not necessarily mean she is equally good at predicting the economy, especially in the wake of the Great Recession since the great depression in the 1930s.

There are many issues in the US economy that need not only very careful, but also very creative policy responses. There is a long road ahead to victory in beating the recession in the US.

The policy makers so far have avoided a total collapse of the banking and finance system and that was creative and should be commended. While everyone is hoping the policy makers will continue their success, but there is no guarantee that the success in avoiding a disaster will automatically translate into an equally success in pull the US economy out of its abyss while the economy is undergoing simultaneously big adjustments like increasing in savings, rising unemployment and reduced asset values. Further, there will be stronger international competition, if the US drops its protection measures introduced in the wake of the recession.

There is no room for complacency. Let’s wait for now and declare a victory until is secured and achieved.

Sheridan is today on a show of ignorance, again

Comments on Greg Sheridan “Soulmate for Rudd on Tokyo horizon”, 27/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25986134-5013460,00.html

The end few paragraphs only show the true purposes and characters of the article’s author. They display his die hard mentality of the cold war era.

There is no question that we Australia should have a good relationship with Japan, given the historical links between the two countries and Japan’s importance in Asia in general and to Australia in particular. However, using the relationship with Japan as a tool to contain China is an extremely bad idea and has been proven to be bad abandoned even by the US.

For Sheridan to advocate such an outdated and ill-conceived and evil spirited idea is totally unhelpful to and against Australia’s national interest. It is even worse for such a person to argue for that bad idea in the guise of Australia’s national interest at a time when there are some temporary difficulties in the relations between Australia and China.

That idea, perhaps with its carrier, should and must be thrown into a historical rubbish bin. It has no place in Australia.

It is difficult to understand why that idea could have passed the editorial test of a national mass media such as The Australian. But it happened and happens fairly often, because Sheridan has been the foreign reporter or editor of the Australian. One can only imagine how many people have been misled by an outdated foreign reporter on foreign affairs issues.

Rudd should pay no attention to or take any comfort in Sheridan’s view on foreign affairs especially when they are related to China, otherwise, small errors in judgement can become disproportionately large blunders.

Gorgon gas deal may be just another new begining

Comments on Bernard Salt “Gorgon gas deal means cultural links”, 27/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25986350-5016345,00.html

A good relation between Australia and China can only benefit both nations and both countries.

The potentials between the two nations are far greater than those have occurred between Australia and Japan in the past up to now. China is more than ten times larger than Japan in population and there are strong bounds between the people of Australians and Chinese, dating back to gold rush era.

While there are still strong political differences between Australia and China, past experience demonstrably shows those differences can be successfully managed. Further, as the links between the two nations becomes stronger by the day and as China undertakes more reforms, it can be reasonably expected that differences will diminish over time.

There will be a very bright future for the relations between Australia and China.

No need for a bill of rights in Australia

Comments on ABC report “Rights charter the triumph of elitism: Howard”, 27/08/2009, http://www.abc.net.au/news/stories/2009/08/27/2668011.htm?section=justin

I don't agree there should be a bill of rights. Australians have been quite content with what they have now, then why do we want an unnecessary bill that will put undue constraints to people? Some people really want to control other people and want to take away the rights of other people and that is a bad idea and should not be supported.

While I may not necessarily agree with some policies of the former Howard government, but I totally agree with Howard on the issue of the rights bill. I think he is right and those advocating for that bill in Australia are completely wrong.


Balance fairness with productivity in IR

Comments on Janet Albrechtsen “Rhetoric fails to tell whole story”, 26/08/2009, http://blogs.theaustralian.news.com.au/janetalbrechtsen/index.php/theaustralian/comments/rhetoric_fails_to_tell_whole_story/

For industrial relations, the most important issue is to get the balance right. Both the main political parties in Australia have strong an ideology on IR, but those relatively extreme ideologies are not the best for getting the balance right in IR between efficiency/productivity and fairness.

Howard government’s Work Choices went too far to the right and did not afford proper protections to employees, while the Rudd/Gillard Fair Work has gone to the left too far and bright collective bargains as the only means of making agreements. Both are unhelpful to having the right balance between efficiency/productivity and fairness.

The Howard government was voted out of office and its Work Choices was one of the main reasons. The Rudd government is still enjoying huge popularity, partly because the oppositions are impotent and error prong, not by its Fair Work.

While the day of reckoning may be still a long way off, there are indeed some signs that Fair Work is showing problems. The minister, Gillard, has given special treatment to the hospitality industry. What this means is that the Rudd government still has the opportunity to correct the shortcomings of its Fair Work to make it more productive.

It is up to the Rudd government to get this issue right.

Economics needs to address economic issues and problems

Comments on Tony Makin “We keep repeating Keynes's mistakes”, 26/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25981707-5015664,00.html

Tony Makin's argument may be more relevant to the current Australian case where the aggregate demand may not have fallen too much and interest rates are not zero and monetary policy is still effective. However, it is a step too far to say the same thing to the current US case and possibly the UK case.

While the consistency in microeconomics is nice in theory, but that theory is based on some assumptions that may not always hold and therefore while the consistent theory always works in theory, it can fail the reality. When it fails seriously, generalised Keynesian theory can help. To deny that is just like to say that the air is always pure and there is no virus in it.

Economics is not just for the sake of a nice and consistent theory. Its main usefulness is to solve economic problems. Anyone who does care the reality will always find difficulties with some not so elegant but actually workable alternatives.

Theoretic ideology alone is insufficient to addressing real economic issues and challenges. Unfortunately, different theoretic ideologies are extremely strong in economics. That is a pity.


More than fune-tuning may be needed for China's economic policies

Comments on Yiping Huang “China needs to fine-tune policy now”, 24/08/2009, http://www.eastasiaforum.org/2009/08/24/china-needs-to-fine-tune-policy-now/

Inflationary concerns in China are more severe in China even than in the US, mainly due to equally loose monetary policies and strong fiscal stimulus, but quite different ways in both monetary and fiscal policy approaches or methods used.

Many people are concerned that asset bubbles in China are inflating, referring to both a rebounding equity market and a record breaking real property market. It appears that some of the huge increases in credits pumped to stimulate the real economy have gone to the asset markets. While it is not too much a concern at the moment of the stock market, given that is still half of its previous peak level, but the over-heated housing market is a real worry, given that the housing price to income ratio is much higher in China than in most countries and it increasing rapidly again.

Relatively speaking, China will have much more serious potential inflation pressure than the US, given the former's focus of its fiscal policy on fixed asset investments and the use of banking credits (by government direct control), both of which would be harder to withdraw.

Chairman Bernanke has outlined the US Fed’s tool kits available to withdraw from its current loose monetary position, it is unclear yet how China would do a similar job for its different monetary mechanism.

Yes, China appeared to have reduced the intensity of its loose monetary policy. But the key problem is how the monetary authority to reduce money supply after the huge and almost unprecedented increases in the first half of 2009. Also, as Huang pointed out, if the fiscal stimulus projects are longer term, then when the other parts of the economy picks up steam, how to maintain those projects without too much pressure on inflation.

I am not quite sure about the likely scenario of world commodity prices. The rebound of commodity prices or “soaring world commodity prices” as Huang put it, was largely not by the expectation of the recovery of the Western major economies – it was largely driven by what was happening in China and other developing economies to a small degree. Of course, the recovery of the major industrialised economies will add further pressure on commodity prices. There is no question about that.

I personally would not be too concerned with that "Many experts oppose macroeconomic policy adjustments", whether it is opposing government interventions in the first place, or withdrawing interventions when needed.

Quite a different Rudd

Comments on Greg Rudd “Goodwill offers a rich yield”, 25/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25975429-5017272,00.html

When I saw the headline the first time, I was thinking to myself: is this guy related to Kevin Rudd, the PM somewhat? I was thinking about how our PM has handled our relations with China and his expert spin skills and his micromanaging management style.

When I was reading the text, I was totally but pleasantly surprised. Not only I realised that this is a quite different Rudd, but also was deeply impressed by his understanding of the Chinese reality and their long but sometimes often troubled history.

As you would have guessed, I don’t know this Rudd either, more so than my knowledge of the other much more famous Rudd, our PM. Even less about his background apart from the one line introduction at the end of the Australian article: “Greg Rudd is managing director of GPR Asia, based in Beijing. It advises on investment and joint ventures.”

However, I like Greg’s approach to a different people with a quite different culture and history, not to mention with the largest population in the world, AND, as most people in the west would say still having an authoritarian government under a Communist party.

In the long history of human kind, when two different races with different cultures met, it often meant wars. It often was the case that one culture conquered the other or suppressed the other as a result.

Greg’s approach is different. It is based on understanding the other side from their point of view. It is tolerance and coexistence. It is based on mutual benefits and common interests.

It is 21 first century now and yes the cold war has ended for nearly twenty years. So let’s embrace what Greg is doing, end the mentality of the cold war era and work for an inclusively prosperous world for everyone.

I salute Greg Rudd.


A poor public policy: the ACT government to ban fireworks

Comments on ABC report “ACT bans fireworks”, 24/08/2009, http://www.abc.net.au/news/stories/2009/08/24/2664761.htm?section=justin

The report says that "The ACT Government has banned the use of fireworks on the Queen's Birthday long weekend."

That is appalling and terrible news. It is a gross violation of people's rights.

Why should all people should suffer for only a handful people's fault of not to follow regulations in terms of restricted time and places? It should be the government's responsibility to enforce regulations or whoever finds that offensive to report the unruly activities. If they can't do it, then it is their problems, and should not punish others for their own problems.

Why so many people freedom and enjoyment is disallowed by the government? They were not voted for such a poor policy.

Further, why should some animals rights be above people's rights? Why can't pet owners control their pets to avoid injuries?

There are public displays of very large scale fireworks in every State. Why does government not ban them and only ban private fireworks? It is illogical and low politics by government.

In the ACT, the policy has been hijacked by Mr John Hargreaves, Minister for Industrial Relations. He argued the reason of such a ban was the move follows an increasing level of misuse, as he said:

"The reasons for such a ban are about property damage, injury to domestic animals and wildlife and of course the general disruption."

He blames other people for his own failures.

There are so many things that can be used for crimes or disorders. Should all those things be banned?

Another case of lack of accountability by government and bureaucrats

Comments on report of “Overseas-trained doctors warned: 'Don't come here'” by DANIELLE CRONIN, The Canberra Times, 24/08/2009, http://www.canberratimes.com.au/news/local/news/general/overseastrained-doctors-warned-dont-come-here/1603704.aspx

This case shows how inefficient government and bureaucrats are and how that inefficiency is affecting the lives and well beings of many Australians. It is totally unacceptable and must be changed. But the sad fact is that it is by no means an isolated incident. On the contrary, similar things can occur very frequently at both the federal and state government levels. One, for example, cannot forget the much talked and delayed project of over $600 million for Indigenous housing. So long time has passed and there is no single house built.

Government and bureaucrats must improve their efficiency of services and make policy more effective. On the one hand, there is a significant shortage of medical doctors and a long waiting list of patients. Yet on the other hand, we have seen cases like this that it took 28 days for the bureaucrats to work out a medical provision number for a newly arrived overseas doctor to work in Australia.

Both the government and bureaucrats should and must be accountable to the public and the taxpayers. The heads of those politicians who are responsible, but more likely of the relevant responsible bureaucrats should roll. Otherwise the lack of responsibility and accountability means inefficiency and more inefficiency, red tapes and more red tapes.

Rethink the Afghanistan strategy of the NATO forces

Comments on Amin Saikal “Afghanistan: a British nightmare?” 23/08/2009, http://www.eastasiaforum.org/2009/08/23/afghanistan-a-british-nightmare/

The military and political reality in Afghanistan after a few years war led by the US with participation of NATO countries appears to suggest that the US led NATO forces strategies are ineffective and poorly targeted.

It is not right to turn almost the whole of a significant ethnic group into an enemy. The purest approach that the Taliban is all evil and should be destroyed needs to be evaluated carefully whether itself may be ethnic “cleansing” and reflects intolerance of another religion or a branch of a religion.

The objective of that war should be the overthrown of the Taliban from power and that has been achieved. While it is important to limit the hardline elements of the Taliban to export terrorism, the justice for destroy the Taliban completely is questionable at the least. It either has become or is in danger of becoming some sort of ideology.

If the Taliban, whether it is in Afghanistan or Pakistan, can stop its exports of terrorism and terrorists to other regions and do not engage in terrorism in their own regions, the war against them perhaps should be called off. If they do engage in terrorism or export it, then the international community can pursue a strategy to stop them from doing it.

It has been reported that the Afghanistan president has called for dialogue with the Taliban. If Afghanistan is willing to do that, why would the international community, supposed to help them, is not willing to do it? Does it indicate that the strategy by the NATO forces is contrary to what it says to help the Afghanistan?

History cannot and shouldn't be forgotten

Comments on Dibyesh Anand “Moving beyond the Blame Game: China-India Border Relations “, 22/08/2009, http://www.eastasiaforum.org/2009/08/22/moving-beyond-the-blame-game-china-india-border-relations/

I am a Chinese Australian, so my views may be biased in favour of the Chinese or China. I say that upfront so not to be accused that I may mislead people by disguise.

I do not find the statement that "... they avoid a serious engagement with the domestic and international compulsions of the Chinese leadership in 1950s and 1960s" justifies any improper behaviour and actions by India that may have provoked the China-India war in the early 1960s.

At that time, the least China wanted was a war, given its domestic economic problems. So I personally don't think that war was the fault of China.

If that statement by Dibyesh Anand is correct, it was most likely that India wanted to take advantage of that situation at the expenses of China. Of course, the Chinese leadership then could not tolerate violations of its sovereignty and territory integrity – China may be economically weak, but militarily it was not that weak to accept another country’s unfair will. On that one, while I don’t think it is a matter of whether the Chinese current communist leadership allows reflection of what occurred then at the border with India, it is more likely that most Chinese have the view that it was India’s fault that has little to do with current government view or policy.

Dibyesh Anand’s argument about the sovereignty, culture and politics is hardly acceptable by international standard. It sounds like an argument to support for an independent Tibet that does not disadvantage India in any way at the expense of China to lose its territory. I don’t know whether such an argument can receive any sympathy from China. It can only make the China-India border issues unnecessarily more complicated and it is highly likely to be completely rejected by China. I suspect that that argument reflects the fact that it is in India’s but not China’s interest to do so.

To most Chinese, although the war with India may have been won, but they still remember China voluntarily retreated more than they should, either for military reasons or political reasons. While the current political leadership may compromise with India, most Chinese are unlikely to support that approach even though they may be ignored by the political leadership for now.

There have been lot strong complaints about how the border issues with Russia have been settled. Most Chinese are unlikely to forget the border issues with India, no matter how their political leaderships think.

Public services must be services for the public

Comments on Janet Albrechtsen “Not much open justice and even less public service”, 23/08/2009, http://blogs.theaustralian.news.com.au/janetalbrechtsen/index.php/theaustralian/comments/not_much_open_justice_and_even_less_public_service/

That is an awful experience with public services. Was that an encounter with public services at the State level or federal level? What about the freedom of information act? Does that act cover the justice or court system?

It is ironic that the court proceedings are open and its transcripts are not. Also, the public servants whom Janet Albrechtsen described do not serve the public. The story also reveals the serious inefficiency that the public services provide their services.

Both the inefficiency of public services and the non-public access to court transcripts are unacceptable and must be changed or improved. Public services must be efficient and serve the public. The court transcripts should be available for whoever is interested. Only a more open justice system can improve the accountability of justice and justice itself.

Charges may be applied, but they must be reasonable to cover the costs at most and should not be run as a commercial business. And those charges must be openly displayed.

There is a need for public service ombudsman so the public can have a place to complain about inefficient and unfair public services. That will help improve public services and increase accountability of public services.

The Commonwealth government needs to respect states' sovereignty

Comments on Kenneth Wiltshire “Putting fox in charge of the chicken coop”, 24/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25970688-5013480,00.html

Kenneth Wiltshire has a strong point. The federal government appointed tax review board does suffer from its federal government or centralist bias. Australia is a federation with States have their constitution power and responsibilities. Any changes to federal financial relations or arrangements should be inclusive and have the States being represented.

A successful federation needs to reflect the constitutional arrangement and the costs and benefits of centralisation versus decentralisation. A tax review board appointed by the federal government with virtually no State involvement is hardly inclusive or balanced between the federal and the States.

The Rudd government’s intention to reform Commonwealth State relations is good, but it needs act in consultation with the States to have a due respect for the constitution. The neglect of States’ participation in such a review of the Australian tax system shows that it was rushed and lack of judgement and reflected the federal government’s centralisation tendency.

It also reflected the Rudd government’s micro managing inclination and practices. The evidence so far has shown that its micromanaging approach is not successful and experience indicates that it is unlikely to be successful on average.

Of course, the Rudd government could say it will consult with the States on the review panel’s recommendations and the implementation of any agreed and accepted recommendations. But that way does negate the disrespect of the constitution and the States’ sovereignty.


Eco literature reference - 2009-08

This is another potentially useful reference in economics, from: liuqi7222, http://www.pinggu.org/bbs/thread-529931-1-1.html. Don't know if it works.


Some references for economics - August 2009

This is a resource reference for economics, from lindaso的日志, 《转》经济学资源网站——怕以后找不到就先存起来了, http://www.pinggu.name/space-1173345-do-blog-id-18791.html 23/08/2009

Not sure if they, the links, work.

1、http://vax.wcsu.edu/socialsci/ecores.html 美国西康狄涅格州立大学社会科学系提供的网上经济学资源链接站点。包括一般经济学资源、经济问题、国际经济资源、金融经济学资源、经济数据资源、美国人口普查及杂项资源等。2、http://www.inomics.com/cgi/econdir 网上经济学资源索引,这是一个经济学站点大全,内容极其丰富,涉及经济学的每一领域,值得仔细挖掘。3、http://sun3.lib.uci.edu/~dtsang/econ.htm 经济学资源站点链接。包括一般经济学资源、经济学期刊和工作论文、经济数据资源、智库、经济发展、劳动研究、运输研究等。4、http://cepa.newschool.edu/het/alphabet.htm 极好的经济学家个人主页链接站点。一些著名经济学家的部分经典文献可在其个人主页上免费下载。如阿罗(Kenneth J. Arrow)与人合写的《Existence of an Equilibrium for a Competitive Economy》、《On the Stability of Competitive Equilibrium I》、《On the Stability of Competitive Equilibrium II》;米尔格罗姆(Paul R.Milgrom)与人合写的《The Value of Information in a Sealed-Bid Auction》、《Competitive Bidding and Proprietary Information》;西蒙(Herbert A. Simon)写的《A Form al Theory of the Employment Relationship》、《A Comparison of OrganisationTheories》、《A Behavioral Model of Rational Choice》;斯蒂格利兹(Joseph E.Stiglitz)与人合写的《Increasing Risk I: A definition》、《Increasing Risk II: Its economic consequences》;Jacob Marschak写的《Remarks on the Economics of Information》以及Martin Shubik、James Tobin等人的大量经典文献都可以在他们各自的个人主页上找到。5、http://www.bepress.com/ 柏克利电子出版社(英文简称BEPRESS)的主页。该社由加州大学柏克利分校的RobertCooter、Aaron Edlin、Benjamin Hermalin、David Sharnoff四位教授于1999年共同创立,旨在改进学术出版状况,减少进入成本和进入障碍,促进学术思想的传播。在这儿,你可找到一个名为“威尔逊的博弈论传统”(Game Theory in the Tradition of Bob Wilson)的专题,该专题是斯坦福大学商学院威尔逊(Robert Wilson)教授的学生为庆祝他65岁的生日而设的,编辑是MIT的Bengt Holmstrom教授、斯坦福大学的Paul Milgrom教授和哈佛大学的Alvin Roth教授。该专题有一些经典文献可供下载,譬如:Clauded'Aspremont 和Louis-André Gérard-Varet合写的《激励与不完全信息》(Incentives and Incomplete Information)、Steinar Ekern 和Robert Wilson 合写的《On the Theory of the Firm in an Economy with Incomplete Markets》、Alvin E. Roth 和ElliottPeranson 合写的《The Redesign of the Matching Market for American Physicians: Some Engineering Aspects of Economic Design》、Bengt Holmstrom 写的《GrovesScheme on Restricted Domains》、Paul Milgrom写的《Rational Expectations,Information Acquisition, and Competitive Bidding》等等。BEPRESS出版的经济和商业类期刊有:《经济分析与政策杂志》(The B.E. Journals in Economic Analysis & Policy)、《宏观经济学杂志》(The B.E.Journals inMacroeconomics)、《理论经济学杂志》(The B.E. Journals in Theoretical Economics)、《农业与食品工业组织杂志》(Journal of Agricultural & Food Industrial Organization)、《非线性动态学与计量经济学研究》(Studies in Nonlinear Dynamics and Econometrics)。以上期刊只需你免费注册一下,输入自己的用户名和密码即可全文浏览或下载。6、http://cowles.econ.yale.edu/default.htm 耶鲁大学Cowles经济学研究基金会的主页。该研究基金会于1955年在耶鲁大学经济系建立,目的在于引导和鼓励经济学、金融学、商业、产业和技术等方面的研究。Cowles基金一直寻求对改进和发展应用经济分析及相关社会科学的逻辑方法、数理方法、统计方法的研究提供支持。该主页上有大量重印的1943年至1997年的经济学期刊论文及工作论文,可免费全文下载。7、http://www.bol.ucla.edu/~joonsuk/elinks.htm 独到的经济学资源链接站点。包括许多经济学家个人主页的链接地址。8、http://faculty-web.at.nwu.edu/economics/chung/link/economist.homepage.html 一个较全的经济学家个人主页链接站点。9、http://faculty-web.at.northwestern.edu/economics/chung/link/resource.html 美国西北大学经济系助理教授Kim-Sau Chung收集的经济学资源链接。包括经济学工作论文系列、经济数据、经济研究院(所)及经济学会(协会)、经济学教育、研讨会信息及资料、供经济学者使用的其他资源等。10、http://www.albany.edu/econ/eco_phds.html 美国、加拿大能够授予经济学博士学位的大学的链接。该网页是根据Peterson'sGraduate Programs in the Humanities, Arts & Social Sciences, 2001》的内容提供的链接服务。11、http://ideas.repec.org/ 网上经济学资源接入服务(英文简称IDEAS)站点。该站点拥有世界上最大的文献数据资料库。截至目前,大约收录了115499篇工作论文、80478篇期刊论文和944个软件,并且还在不断增加中。其中,4万多篇有JEL(Journal of Economic Literature)分类号,超过10万篇可下载。12、http://web.uvic.ca/econ/info.html 加拿大维多利亚大学经济系提供的网上经济学资源链接,内容丰富,值得一看。13、http://economics.uchicago.edu/researchlinks.html 芝加哥大学经济系推荐的网上经济学资源链接。14、http://www.sims.berkeley.edu/~hal/pages/interesting.html 加州大学柏克利分校的经济学教授范里安(Hal R. Varian )推荐的有趣的经济学链接。15、http://www.repec.org/ 经济学研究论文链接站点。来自30个国家的100多名志愿者鼎力合作,共同致力于促进经济学研究成果的传播。截至目前,该站点收录了118000篇工作论文、79000篇期刊论文、900个应用软件,并且还在不断增加中。其中近100000篇论文可下载。16、http://www.wcsu.edu/library/ss_economics.html 美国西康狄涅格州立大学图书馆推荐的网上经济学资源。包括一般经济学资源、经济与金融分析、经济数据、指标与报告、专题经济学资源、组织与学会(协会)、政府机构、学校与研究院(所)、出版物等。17、http://rfe.wustl.edu/EconFAQ.html 供经济学家使用的网上经济学资源(Resources for Economists on the Internet)。这个由Bill Goffe建立、美国经济学会(American Economic Association)赞助的网页, 大概是目前对互联网上经济学资源的最佳分类索引。它列出了大量的网上经济学材料,学院派和非学院派的经济学家,甚至业余爱好者,都可以在此找到有用的资料。而且,每个仔细分类的链接项目,都附有相当详尽的介绍。根据版主Bill Goffe的讲法,他们在选择链接项目时,有相当严谨的原则,因此最终被选中的项目,要么能够提供丰富的资料,要么专于某一特别领域。网页内有该索引的用法简介,读者可先读这部分,然后再依照指引,寻找心目中的资料。基本项目包括以下各类: 新闻传媒(有关经济学,下同)、学术会议、组织协会、顾问咨询、经济预测、数据、学术交流、经济学系或研究院、应用软件、教学材料、职位、资助及学术建议、论坛、邮件列表、词典、词汇及百科全书、经济学家、其他网上索引等。可以想象的,几乎都可以找到,总有一些你会觉得好用。对于经济学教师和学生,笔者特别向各位推荐这个网页的教学资料部分,因为Bill Goffe实在有眼光,被选中的都是极好的网页。18、http://sosig.ac.uk/roads/subject-listing/World-cat/econ.html 英国和欧洲的几个研究机构创建的社会科学信息门户网站有关经济学资源的指引。包含很多经济学相关资源的链接。主要专题有:经济发展、经济史、经济体制与经济理论、国别经济学、环境经济学、实验经济学、金融经济学、产业与商业、国际经济学、宏观经济学、数理经济学、微观经济学、旅游产业。此外还有大量的经济学教研材料、邮件列表、经济新闻、工作论文等。19、http://www.restud.com/accepted.htm 即将发表在顶尖经济学期刊《经济研究评论》上的文章。可全文下载。20、http://www.helsinki.fi/WebEc/journal2.html 主要经济学期刊的链接地址。21、http://netec.wustl.edu/NetEc.html 非常棒的网上经济学资源站点。它位于美国华盛顿大学圣路易斯分校,是一个连接全球经济学家的联机论坛,强调原创作品的发布。主要包括四部分:BibEc (关于工作论文的信息)、WoPEc (经济学工作论文的链接)、WebEc(网上经济学资源)、JokEc(关于经济学家和经济学的笑话)。可检索。22、http://www.ssrn.com/ 哈佛商学院的詹森(Michael C. Jensen)教授与人合作创建的社会科学研究网(英文简称SSRN)。包括社会科学方面的研究论文,有8个专业研究网,分别是会计研究网、经济研究网、金融经济学研究网、法律研究网、管理研究网、信息系统研究网、市场营销研究网、谈判研究网。詹森教授的许多经典论文在这儿也可以找到。我们非常喜欢这里的有关“组织与市场”的专题研究论文。譬如:Luigi Zingales 和Raghuram Rajan合写的《企业理论中的权力》(Power in a Theory of the Firm)、Rafael La Porta、FlorencioLopezde Silanes和Andrei Shleifer合写的《世界范围内的公司所有权》(Corporate Ownership Around the World)、Raghuram Rajan、Luigi Zingales和Krishna Kumar合写的《什么决定企业的规模?》(What Determines Firm Size?)、George Baker和Brian Hall合写的《CEO激励与企业规模》(CEO Incentives and Firm Size)、Steven Tadelis写的《名声代表什么?声誉是一种可交易的资产》(What's in a Name? Reputation as a Tradeable Asset)、Steven Tadelis 和Patrick Bajari合写的《激励与交易成本:一个采购合约理论》(Incentives versus Transaction Costs: A Theory of ProcurementContracts)等论文都非常优秀。23、http://www.economist.com/ 英国《经济学家》杂志的主页,部分文章免费。24、http://edirc.repec.org/index.html 世界上的大学经济系、研究院(所)和研究中心的主页链接地址。该站点提供了216个国家和地区的6981个大学经济系、研究院(所)和研究中心、经济学学会和协会、以及财政部门、统计部门、中央银行、智库及非赢利机构的链接。按国家、地区排列。而且提供链接的国家、地区及机构还在不断增加中。本文来自: 人大经济论坛 详细出处参考:http://www.pinggu.org/bbs/viewthread.php?tid=523605&page=1&fromuid=1173345


Principles for a simple, effective, efficient and equitable international agreement on global actions on climate change

Comments on Rajiv Kumar “India: Are we isolated on climate change?” 17/08/2009, http://www.eastasiaforum.org/2009/08/17/are-we-isolated-on-climate-change/

I think an effective, fair and practical international system for carbon emissions mitigation should be based on the following principles:

1. It is efficient from the global point of view, that is, to incur the least costs in achieving a given objective. This means every country needs to participate and a global tax imposed on emissions from every country.

2. It is effective, that is, it achieves the objective the target to mitigate global emissions. This means the targets of emission mitigation should be based on the most reliable scientific evidence.

3. It is fair to every country. It seems that a most likely internationally equitable approach is to have everyone at a certain given time the same "property right" of the global atmosphere, so they have the right to impose penalty on emissions from any countries. This means that the global tax should be distributed to everyone equally, irrespective which countries they are from.

4. It is simple to implement.

An international system of climate change may take many forms, but the underlying principles should be clear and well founded. An agreement based on the above principles is likely to be much superior to most systems currently discussed and debated in many countries, such as the emissions trading scheme bill in Australia recently defeated in its senate, or the similar bill in the US that passed its House of Representatives and is in front of its Senate. Those bills may aim at effecting a domestic emissions trading scheme that can be costly to administer.

Any country including both developed and developing countries alike can use these principles to formulate their negotiation strategies. India can be more proactive and effective in its attitude towards climate change and Copenhagen negotiation. A fair international system will not undermine developing countries’ interests, like India’s, but it will be in the best interest of every country.

Why and how different ownership matters in foreign investment?

Comments on G.E. Anderson “How do Australia’s foreign investment rules apply to China?” 18/08/2009, http://www.eastasiaforum.org/2009/08/18/how-do-australias-foreign-investment-rules-apply-to-china/

What does the ownership in terms of public versus private make to owning some shares of a firm in another country? All firms in a country are subject to the regulations of that country, whether they are owned domestically or by foreign investors. A country can always regulate the behaviour of the firms operate in its land. So what are the concerns or fears of a firm is owned by a public firm of another country? It defies logic to understand the reasons behind.

In many countries, foreign investment is subject to government review and approve. In Australia, there is a Foreign Investment Review Board (FIRB) that does reviews and advises the Australian Treasurer on foreign investment matters. Reuters reports that the FIRB is described by critics as secretive and sometimes unpredictable. It says the following:

“Australia approves about 99 percent of large foreign investments, the vast majority being routine property purchases, but it does occasionally reject contentious deals that it deems to be against the national interest. It rarely, if ever, gives a detailed public reasoning for such decisions.”

This seems to suggest that there is not much transparency in government decisions to block foreign investments. As a result, it may be used as an unfair protection or discrimination against foreign investments.

Also, there are few internationally agreed rules governing international investments. This is an area that has huge potential to impede international capital flows, because a review of foreign investments can not only slow the process and create inefficiency, but also create difficulties for large investments.

There is an urgent need for transparency in government regulations of foreign investments and a need for an international agreement on international capital flows to remove discrimination and barriers to foreign investments.

Different attitudes of Canadian and Australian governments towards Chinese investments - which is better?

Comments on Yuen Pau Woo “China Inc. comes to Canada”, 20/08/2009, http://www.eastasiaforum.org/2009/08/20/china-inc-comes-to-canada/

The contrast between the Canadian and Australian governments' approaches to Chinese investments reflects that Canada is more pragmatic, realistic and less protection and restrictions against Chinese investments. While Canberra may have thought it had done in its national interest, the costs and benefits of unduly and overly restrictive to Chinese investments remains to be seen. As in the case of international trade, many protectionists thought or think their protections would be beneficial to their protective countries, but economics has proven the otherwise.

The international economic structure has been experiencing a significant transformation and this trend is set to continue for the foreseeable future. Although a developing country, China has shown to become a large capital exporting country, largely as a combination of main two reasons: a very high rate of savings and a very rapid grow of a large economy. On the other hand, a number of industrialised countries have been or become capital importing countries mainly due to relatively low saving rates and relatively low costs of international capitals.

International capital flows, as international trade in goods and services, benefit both capital exporting and importing countries, by raising the returns to capital for exporting countries and lowering the costs of capital in importing countries in the first place, and by smoothing savings, consumption and investment of every country over time and contributing to welfare maximisation in each country beyond what is achievable in the absence of international capital flows.

Due to various reasons, there are restrictions and protections regarding international capital flows and cross border investments, just as in the case of trade in goods and services. Some restrictions may be justified, but most are reflection of special interest groups, poor understanding including the economics of it and self-inflicted fears.

As in the area of trade, there appears a need for an international or world organisation / institution where countries come together and agree on a set of well defined rules governing international capital flows. Such a need is becoming stronger and stronger as the magnitude of international capital flows expands and also the incidences of “protection” are increasing. Otherwise, there is a rising danger of investment protection.

Managing Australia China relations

Comments on Mark Dodd “Beijing gives Ferguson cold shoulder on LNG trip”, 21/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25959288-601,00.html

It has suddenly proven to be a challenge for the Rudd government to manage Australia's relationship with China, even though Kevin Rudd seemingly has considerable expertise in Chinese and China affairs. It seems that the government in both countries have been surprised by the other and that their relations have deteriorated significantly in recent few months. There are quite a few issues hanging in the air at the moment and need to be resolved.

It is a time for both governments and both nations to reflect on what has been going on, where things have worked well and where they haven’t. For Rudd and Australians, it is important to realise that China has changed a lot over the last 3 decades, also since Rudd was left his Beijing posting. It’s economy is much stronger and larger and firmly market driven. It is now a world economic powerhouse and will remain so for a long time to come. Its political system has shown remarkably successful in terms of leadership succession and power transition.

For the Chinese government and the Chinese people, they need to understand and accept that Australia differs in some values from China and that will remain so for a very long time, even though the economic links between the two countries are strong and will become stronger over time.

There is no question that the two countries have a lot of common interests and are strong partners bound by extremely strong complementariness. The 21st century is an Asian century and the relations between Australia and China will be very important in that context.

There are some issues that are sensitive either to one side or to both. They need and must be handled with extreme political care and diplomatic skills.

Both sides need to be more mature and skilful in understanding the other and managing the bilateral relations.


Where is accountability for Indigenous affairs by government?

Comments on Natasha Robinson “Slice of pie for building is shrinking by the day”, 20/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25954870-5017272,00.html

It is appalling that when there is such an urgent need for Indigenous housing and the federal government has promised 750 houses would be built under the $672 million Strategic Indigenous Housing and Infrastructure Program, not a single house has been built so far yet after so long. There should be reasonable accountability at both the federal and the Northern Territory governmental levels, some heads of responsible politicians and top bureaucrats should and must roll for such incompetency and negligence of duty.

This is likely to be one of the reasons why the state of our Indigenous people’s welfare has been in so poor for so long – governments and bureaucrats may have been seldom truly accountable for their policies and actions regarding Indigenous welfare. Some people say that our Indigenous people live like third world citizen in wealthy Australia. We need to change that intolerable situation now and act urgently.

Australia needs a much stronger voice from our Indigenous people. There should be an effective national Indigenous body to represent them and to have dialogue with our politicians and top bureaucrats on how to improve the situation of our Indigenous people. Their voice must be heard and their views listened to.

The failure of the $672 million Strategic Indigenous Housing and Infrastructure Program thus far should serve as a warning for action, for the governments, the ministers for Indigenous Affairs, the relevant agencies involved in Indigenous affairs. They need to get their act together, now and quickly. Any further delay is absolutely unacceptable by any standard.


A need for a world investment organisation

Comments on Maaike Okano-Heijmans and Frans-Paul van der Putten “Europe needs to screen Chinese investment”, 18 /08/2009, http://www.eastasiaforum.org/2009/08/18/europe-needs-to-screen-chinese-investment/

It seems there is a fairly urgent need to have an international or world organisation to facilitate and oversee international capital flows or cross-border or foreign investment, given the magnitude and importance of capital movement internationally at present and into the future, and the likely increasing disputes or impediment or protections that affect the efficient allocation of global financial and physical capital resources.

There should be a set of agreed principles that govern international capital flows. The principles should be non-discriminatory in nature. National security may be a legitimate reason for some government intervention, but the rules governing it needs to be spelt out clearly and that should not be used as an excuse for discrimination at will by governments or politicians either economically, politically or racially.

There should be an international agreement on international investment and capital flows. One additional advantage of having an international overseeing organisation is to minimise the potential damages done by big speculative players in the international capital market.

Should different ownership be treated differently, given that all firms are under the regulation of a sovereign country? But it is an interesting and legitimate question and needs to be addressed openly and fairly.

One option for such an international organisation is to broaden the responsibility of and empower the WTO, so it would also serve as a forum for nations to settle disputes in international capital flows. Another option is to restructure the IMF and give it a new mandate on overseeing international capital flows.

Good relationship requires efforts from both sides

Comments on Rowan Callick, Asia-Pacific editor of The Australian “Tale of final straws and camel backs”, 19 /08/2009, http://www.theaustralian.news.com.au/story/0,25197,25950438-7583,00.html
The following is the first few paragraphs from Callick’s report:
CHINA has launched a two-track strategy to manage its increasingly strained relationship with Australia, encouraging investment to continue while freezing out Canberra on the official front.
The opposition blamed Kevin Rudd yesterday for the deterioration, which includes the downgrading of diplomatic visits including Vice Foreign Minister He Yafei being replaced as China's envoy at the recent Pacific Islands Forum summit in Cairns by Pacific desk chief Wang Yongqiu.
"Our relations with China are at the lowest ebb they've been for many, many years," Malcolm Turnbull said.
"Mr Rudd has been making an absolutely ham-fisted effort with our diplomatic relations. He obviously has no leverage with China left at all."
Liberal Queensland senator Russell Trood, former director of the Centre for the Study of Australia-Asia Relations at Griffith University, said: "The humiliating, disdainful and provocative treatment of the Australian government by the Chinese government is the direct consequence of confused and muddled foreign policy objectives that Prime Minister Rudd has been pursuing in China since 2007."

It also said quoted Alistair Nicholas, originally from Sydney and principal of consulting firm AC Capital in Beijing, as saying: "It seems Australia is now public enemy No1 as far as the Chinese media is concerned. The straw that probably broke the camel's back for China was the granting of a visa to another public enemy of China -- Rebiya Kadeer, the leader of the World Uighur Congress."
It also reported that:
AC Capital's Mr Nicholas said: "What can Australia do to get out of China's crosshairs? Probably very little. The debate is at fever pitch in China. Rational arguments will fall on deaf ears.
"As a rising power, China is going to have to come to terms with the way of life in liberal democracies like Australia and the US, just as many Westerners have had to learn about the Chinese way of doing things."

What Nicholas said makes sense. China and the Westerners need to understand each other better and to be both sensitive to the other and show more tolerance for other’s way of living and doing businesses. It requires the efforts of both sides.

Renewable energy has a bright future in Australia

Comments on Paul Kelly, Editor-at-large for The Australian “Renewable energy target initiative is mad, bad tokenism”, 19 /08/2009, http://www.theaustralian.news.com.au/story/0,25197,25949700-12250,00.html

Paul Kelly is a well respected commentator in Australia and is mostly balanced in his comments. What he says should be listened to very carefully. However, although I hate to say this, I may have to disagree with him on this issue.

I think some comments make sense that the energy consumption worldwide is unsustainable and the market has been unable to price the true costs of energy consumption. It is a market failure in the global scale. Energy consumption is underpriced for two main reasons, one is that fossil fuels, like oil, gas and coal are limited resources and not renewable, current level of consumption means sooner or later they will be gone, but the market does not take that into account.

The other major failure is the carbon emissions into the atmosphere to form greenhouse gases. This means there is a very big negative externality of fossil fuel consumption.

In this context, to develop and use more renewable energies is a correction of the significant and known market failures. Yes, it is difficult to price fossil fuel from long term sustainability point of view, although the price for limiting carbon emissions may be easier to determine. Nevertheless, renewable energies are likely to be competitive if all the costs of fossil fuels are considered.

Australia has a huge advantage over most other countries in developing renewable energies. It has one of the lowest population per land unit. Most of its vast land enjoys excellent sunshine all year round. It is surrounded by sea from all sides. So there are the most enviable natural conditions in Australia to develop renewable energies.

Further, Australia has also been in the forefront of solar energy technologies. It was reported that California will use an Australian firm’s solar technology to construct a large scale solar energy base. So why don’t we put that technology into good use and improve Australia’s energy consumption and contribute to the global effort to combat global warming?

The Australian Industry Group submission, the Business Council of Australia, the Productivity Commission submission and the Ross Garnaut argument, well all respectable, seem all miss the point of market failures, or at least have not take the full account of them. Besides, the AI and BCA are business focused and there is self interest involved.

What this gas deal between Australia and China indicates?

Comments on the report “Australia signs $50bn gas deal with China” by Michael Sainsbury, China correspondent, The Australian, 19/08/2009, http://www.theaustralian.news.com.au/business/story/0,28124,25950461-5005200,00.html

This gas deal is a big trade deal between Australia and China. It is reported this deal will facilitate “The Gorgon venture (that) promises to be Australia's biggest resources project, pumping $40bn into the federal government's tax coffers over the next 20 to 30 years.”

It demonstrates the great complementarities between Australian and Chinese economies. Australia has abundant natural resources, including minerals and energies. Trade and external markets are important to Australia. China has a huge population, abundant cheap labour, enormous domestic market and a booming economy with rapid industrialisation. Secure supply in mineral and energies from trade is important to China. The geographical proximity of the two countries adds some natural advantages to trade between them. Trade between the two countries has huge and unprecedented potentials to benefit both countries.

The deal also indicates that it is “business as usual” in terms of the fundamental relations between the two countries, especially in trade.

While there can be tensions over certain issues between the two countries, the common interests of the two countries are overwhelming and paramount. Politicians in both countries always need to focus on important issues between them, while resolving any other issues subtly to the satisfactions of both sides. Great diplomatic skills are required to manage this bilateral relationship.

Rudd's dealing with China so far

Comments on Greg Sheridan “PM's stand on Beijing pleases Obama”, 19/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25950437-5013460,00.html

Rudd is having a difficult task for himself in dealing with the relations with the US and China. While he may have earned praise from Obama administration, he may have created a lot of difficulties for his proposal of an Asia Pacific community (APC), in which the two most important players are the US and China.

While Rudd has seemingly more expertise in dealing with the Chinese due to his diplomatic post in Beijing and his mandarin language skill, he does appear from time to time to overestimate the tolerance of the Chinese on some sensitive issues and cause unnecessary tensions between Canberra and Beijing. That does not help his cause of the APC.

Canberra wants to play a middle power and softly influential role in shaping the outcomes of the strategic relations in the Asia and Pacific region in the next 20 years and beyond. That does require discipline and discreet and high diplomatic skills.

To manage the relations with two almost equally important partners, the most important thing is balance.

Rudd has done well in some areas so far, but not so well in some other very important areas. That is a call of judgement that only he himself can make which is which and that most commentators probably can't.


Some resources for CGE and macroeconomic modeling

For some resources see the following:

1. GTAP - a CGE model of the international ecoomies, also there is a dynamic version. Standard version can be used online or downloaded: https://www.gtap.agecon.purdue.edu/
2. Monash Model - a dynamic CGE model of the Asutralian economy: http://www.monash.edu.au/policy/
3. G-Cubed model - McKibbin model, based on agent optimisation and expecations, has money or monetary policy in it, multi country model, has features of CGE and macro models (commercial): http://www.msgpl.com.au/
4. The Fair models - macroeconometric model of the US, and macroeconometric model of the US and ROW - Econometric model, estimated, both models and data freely available online and downloadable: http://fairmodel.econ.yale.edu/main3.htm
5. IMF GEM model: http://www.imf.org/external/np/res/gem/2004/eng/
6. World Bank: http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTPOVERTY/EXTPSIA/0,,contentMDK:20481491~isCURL:Y~menuPK:1108016~pagePK:148956~piPK:216618~theSitePK:490130,00.html
7. ECB:

A true reason for delaying the ETS legislation

Comments on Dennis Shanahan “Time to hit the brakes on ETS”, 18/07/2009, http://www.theaustralian.news.com.au/story/0,25197,25944030-17301,00.html

It should not matter whether Australia passes the ETS bill or not before Copenhagen, give both the flexibility of the varying voluntary targets of that bill and the goodwill shown by other countries including the US and China so far. So Rudd and Wong do not have a strong rationale for Australia having to pass that bill before then. It has a strong enough mandate to go to Copenhagen and represent Australia in the best possible terms to achieve a good international agreement.

There is a strong reason for delaying that legislation, that is, to make the best possible policy among all options available with the least costs for any given targets, like analyzing the Frontier Economics modeling. So it makes sense for the government to hit the brakes on ETS now.

Rudd and Wong should be courageous enough to realize this and not to return the bill to the parliament before Copenhagen.


Henry's cautious optimism justified

Comments on report of “Henry cautiously optimistic on economy”, The Canberra Times, 17/08/2009, http://www.canberratimes.com.au/news/national/national/general/henry-cautiously-optimistic-on-economy/1597731.aspx

Dr Henry's cautious optimism is justified and should be commendable.

Australia has been doing better than all reasonable previous expectations and is still being so, so we do have some causes for optimism.

However, the media and media to longer term world economic outlook is still very much uncertain and there could be a second shockwave coming from international economies as Dr Henry said. We need to prepare ourselves for that possible scenario and be prudent both fiscally and monetarily.

Internally the Australian economy is strong and there are also some encouraging external factors like the rapid recoveries of some economies in Asia. Those will be good for our economy. However, there are also significant uncertain external factors, like the still fragile US economy and how the US and the Chinese economies will adjust to resolve their significant imbalances in savings and consumptions. They can have a big impact on our economy.

Treasury is having a very important task ahead to assist the government in steering the economy to its best possible courses for the future. Dr Henry's statement gives us considerable confidence that they can do it well.

Frontier Economics' Price must be heard

Comments on Danny Price “Tyranny of old ideas dogs Emissions Trading Scheme”, 17/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25937950-5013479,00.html

I don't pretend in any way that I understood Frontier Economics' modeling, but I am so encouraged by Danny Price's article arguing for genuine debate, because there is so much at stake with global warming and emissions reductions, as Price pointed out.

Price sounds genuine enough and open and transparent. Every of the country's leading political group should take a step back, be cool and have a serious rethink about how the country should go about ETS, or possibly another new one. Party politics must give way to national interest.

The government has shown common sense and demonstrated some flexibility in its approach to the renewable and ETS by agreeing to separate the two bills, so the less contentious renewable bill can pass the senate without too much problems. It should be commended by this courageous action.

It is now again a test of leadership. Let's hope God bless Australia and our political leaderships stand the test.


An ignorant Aussie polly

Comments on Michael Danby “Let's not appease Beijing”, 14/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25925627-5015664,00.html

It is appalling to see an Australian Labor federal politician is so, arrogant, ignorant and biased on prejudice on issues related to China. It is surprising to see a person with such a view of China still exists more than thirty years after 30 years of reforms and opening in China. It seems that Mr Michael Danby has lived in a complete isolated and different world during this period.

It is true that China is a different country with quite a different system. But China has changed enormously compared to what it was more than 30 years ago. Its economy is a market economy. It is not too much different from the Australian one and certainly not too much different from most Western European ones.

Mr Danby says that China is not a normal country. What is his definition of a normal country? Is that definition normal or from a same mind? One would ask. An abnormal person may see normal things as abnormal. That appears to be the case here.

There are differences in economic structure, in the share of public enterprises and in government policies. Can Mr Danby say the Australian economy is the same as the US economy in every aspect? Every adult with a same mind would know that they are different.

Mr Danby said so many things about China, but none of them makes sense. He appears to be on the charge in leading the Rudd government's poor encounter with China, one of the most important bilateral relations to Australia.


Senator Wong needs to be more sensible after the senate No vote

Comments on report “Senate votes down ETS”, The Canberra Times, by PHILLIP COOREY, 13/08/2009, http://www.canberratimes.com.au/news/national/national/general/senate-votes-down-ets/1595200.aspx

Rudd and Wong need to consider very carefully why no non-government senators, including the greens, and the independents, voted with them. Political cynicism and bully are not in the nation’s interest.

They need to be serious about emission reduction and developing renewable energies. At the elast, they need to separate the ETS bill from the renewable energies bill to make the way for the renewable bill to be passed in the senate. They should not be politically opportunistic and use the ETS bill as a double dissolution trigger for an early election. That would be purely partisan politics and not in the nation's interest.

Rudd and his government should have the gut and political courage to have them judged by voters in a full term. They should not be acting cowardly to rob the public an opportunity to see the full effects of its current budget and how it makes the next one in May 2010.

Be a responsible government and manage the economy and budget well

Comments on Alan Wood “There's plenty to borrow, but Rudd will need to cut debt”, 13/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25920869-5013578,00.html

There are several issues raised in this article. Firstly, it is not just the level of budget deficit and government debt but also the quality of government spending that leads to the deficits and debts that will matter. While it is difficult to judge the level of the projected budget deficit is the appropriate or not at the time of the budget being made, it has now been shown that some of the government spending in its budget measures are wasteful and could have been better targeted and managed to either reduce the size of deficits or achieve greater and better outcomes.

Secondly, Australia is a small country internationally, so the impact of its borrowing internationally will not have a significant impact on the international capital market, although the costs of borrowing both publicly and privately will be higher due to tightening internationally capital market. That impact may be sizeable in terms of the dollar amount, but that should not be a worry itself.

Thirdly, it is absolutely an imperative for any government especially the Rudd one to guard against unnecessary government spending and be smarter, highly focused and well targeted in its fiscal policy to minimise spending and maximise the budget impact on growth and employment. The government must wind down its deficits and reduce the debts as early as possible and stand ready at any time when and if appropriate to do that.

Rudd and his government, have a huge responsibility to return the trust the Australian public has given them and do a better job than they have done so far. They paid some learning fees in how to manage the economy. They should learn rapidly enough to get on top of their jobs, starting from now.

Leave politics aside and examine the Frontier Economics modelling

Comments on Lenore Taylor “Business wary of $1.3bn black hole”, 13/08/2009, http://www.theaustralian.news.com.au/business/story/0,28124,25921906-5018012,00.html

The Frontier Economics modelling and result deserve a careful analysis and investigation by other credible modelling agencies, including the Treasury, to see if it was done correctly.

It presents very good result, lower costs and higher reduction. But one needs to make sure it is not "too good to be true". I hope it was done correctly, but I am cautious.

Political persuasions of all sides need to be seriously examining that modelling. Politics should give way to national interest on this important economic issue that will have long term and very significant bearing on Australians’ well being.

Sheridan speaks some truth sensibly this time

Comments on Greg Sheridan “Uighurs must fight for rights within China”, 13/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25920872-5013460,00.html

While I do not share Sheridan's claims of racial discriminations in Xinjiang and I think it is absolutely incorrect, I appreciate his view to support the territory integrity of countries, including China and Indonesia as he clearly mentioned. That is a common sense approach, as he said once that starts there is no place to stop but with violence and bloodshed and ethnic cleansing.

Sheridan is the foreign editor of The Australian and has a responsibility to speak truth to Australians about foreign affairs matters and the truth about other countries. He would benefit from frequent overseas travel and get the first hand information, rather than relying on second hand or past prejudice. I would suggest that Sheridan visits China, including Xinjiang and Tibet, listen to all sides. In that way Sheridan will have a better and correct understanding of the matter and will e in a better position to tell stories in China.

I am a Chinese Australian. I personally don’t think that China has ethnic discriminations that adversely affect ethnic minorities. To the contrary, China has ethnic policies that are in favour of ethnic minorities in China. But it is up to Sheridan to find out himself is I am right or wrong on this matter.


Rudd / Gillard's education revolution unsuccessful so far

Comments on Kevin Donnelly “They said we want an education revolution”, 12/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25916618-7583,00.html

Rudd/Gillard have copied British approach to school revolution/intervention so far, it is likely that they will also equally capable of leading that revolution to nothing but a waste of taxpayers' money.

There is nothing wrong in copying others’ formula, but it needs to be done in the right way. First, what is copied should be generally a success that others have achieved or demonstrated. Second, one needs to adapt it to local conditions and circumstances.

From what we have seen so far, the Rudd / Gillard education revolution approach to school halls and libraries has been a wrong priority, and is being done very hastily, and has resulted in a lot of waste. In another word, it has been a failure so far.

A better way is to set aside whatever amount of additional government funding for schools and entitle every student's family the same amount of money per capita for them to decide how to spend that on schools. Every school can organise discussions and vote for how to use that money in their schools.

Rudd and Gillard like micromanaging. But that is unlikely to achieve any desired results and outcomes.

Working hard is a good virtue and should be commended. But one has to pay attention to effectiveness and outcomes. That is the key to judge success or failure of one's actions. Unfortunately, that has been demonstrated as the area where the Rudd government has failed miserably.

Frontier Economics' too good to be true, or has the government got its ETS wrong?

Comments on Michael Stutchbury “Give Malcolm his due for a clean idea”, 12/08/2009, http://blogs.theaustralian.news.com.au/currentaccount/index.php/theaustralian/comments/give_malcolm_his_due_for_a_clean_idea/

The Frontier Economics result is very interesting indeed. If that result is correct, clearly it is a better approach and must be considered by the government, if the government is serious in achieving good outcomes in an ETS.

What is better than a greater reduction in emissions and a lower cost in doing it? The government should delay the current legislation and organise a parliamentary investigation of the Frontier Economics modeling by all political parties, and any interested public.

The Climate Minister and the government are wrong in dismissing that result so lightly. It defies any reasonable logic and common sense. It shows they are not really interested in achieving good outcomes but only in political opportunism.


Beyond spins: where is Rudd government's accountability?

Comments on Jack the Insider “Aboriginal housing Labor’s greatest shame”, 10/08/2009, http://blogs.theaustralian.news.com.au/jacktheinsider/index.php/theaustralian/comments/aboriginal_housing_labors_greatest_shame/

This is yet another example of the Rudd government’s inability to get policy implementation right. After 18 months and with $672 million planned funding, there is no single house built, yet an estimated $50 million of filthy lucre has or will be sucked down by the Northern Territory bureaucracy. Further even the federal minister for Indigenous people has admitted that more than $100 million (probably $150 or $160 million from my memory) of that funding will not spent on real buildings but in administrations and other processes.

This also shows that the Rudd government has no real and hard accountability to the Australian people and Australian taxpayers for their money through their hard work. Of course, an ineffective and ineffectual federal opposition also provided a fertile ground for the prevalence of such a lack of accountability. They are not good enough and must change or be changed.

It is good that the government has taken some social initiatives with good intentions. But it is an entirely different matter if those good intentions cannot be translated into the intended outcomes.

Mr Rudd and its government must take a hard look at and think about its policy implementations after nearly two years in office and make urgent changes to make its policy effective, and to be really accountable to the Australian people and taxpayers. The time is overdue and they need to do that soon. Billions and billions are at stake, Mr Rudd. Do it and do it now.

Separate the making and and implementation of fiscal policy for economic interventions

Comments on Michael Stutchbury “Beware rent-seekers”, 11/08/2009, http://blogs.theaustralian.news.com.au/currentaccount/index.php/theaustralian/comments/beware_rent_seekers

This raises two points. One is that the government should not intervene unless it is clear that its intervention will certainly bring good. The other is that it is better to trust major interventions to organizations independent of the government and get them done at arms’ length, if the government is to intervene.

It is unavoidable that government has to intervene in special circumstances when and if warranted. The financial and economic crises are examples that government needs to get involved and intervene. But that does not mean any government interventions have been necessarily done in the most effective and efficient way, or in a satisfactory manner.

As far as government spending is concerned, it may be a good practice of public policies to separate the government’s policy initiative and its implementation in general, including any significant spending measures contained in its normal annual budget. To have the policy formulation and making separated from their implementation will enable closer scrutiny of the implementation processes and improve their effectiveness, but does not impede in any way government’s policy direction or its ability to take any policy initiatives. It will reduce the potential for political favours and a lot of inefficiency by incompetent bureaucrats with little commercial expertise and experience.

In a sense, some of the government implementation processes can be out sourced and subject to market competition.


Hope Frankel's rose assessment can stand time test

Commnets on Jeffrey Frankel “An evaluation of the first 200 days of Obama economics”, 10/08/2009, http://www.eastasiaforum.org/2009/08/10/an-evaluation-of-the-first-200-days-of-obama-economics/

This is a very rosy assessment, although it may well be correct.

Likely problems will emerge over time in the coming years. They are likely to be associated with the speed of the recovery over the next 2 to 5 years. Will it be another Japan's 1990s, if consumer spending and firm investment take a hit due to reduced assets and demand? Or will the US be shrug off that dilemma and this great recession would have been just a big scare? That remains to be seen.

Further, how will the anticipated consumer adjustment in terms of spending and saving affect the growth in the next few years? That is also likely to affect the growth scenario.

What about any further changes or shifts in international competitiveness, due to continued improvement in the competitiveness from big developing countries such as China and India?

So, it is too early to cast a sure judgement, yet. But I sincerely wish/hope Professor Jeffrey Frankel is correct in his early assessment, because that will be good for not only the US but also the whole world.

A simple and effective principle for a global climate agreement

Comments on Yongsheng Zhang “Bush wrong on India and China and climate change”, 22/07/2008, http://www.eastasiaforum.org/2008/07/22/bush-wrong-on-india-and-china-and-climate-change/

While there can be many different arguments, as Zhang and others may have done so, the most realistic and practical way in the most simplest manner, in concept, could be characterised as to apply a global carbon tax so to achieve whatever the target would need to be, then distribute this global revenue to the world population (maybe based on a certain time) equally, that is equal per capita.

This approach will be able to address many problems except the historical causes or contributions. But that point could be regarded as “bygone as bygone” (we won’t hold those dead people to be responsible for solving our future climate problems), if and when the current allocation can be done on an equal per capita basis.

Based on this principle, other scheme broadly consistent with this can be designed and implemented.

This time the IMF has better insight and foresight than Aussie Treasury

Comments on Michael Stutchbury “IMF sees problems here even after global crisis passes”, 10/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25906807-5017771,00.html

While the IMF has got its forecast wrong many times as any other economic forecasters did in the past, its assessment of this time seems more reasonable than the Treasury's used in the may budget. The destruction to the Australia's capacity may not be very big, but to the main OECD countries are very large indeed. This is one reason why the media term growth cannot be as those in previous recoveries from recession.

Another main reason is the inevitable adjustment to rebalance internationally, especially in the US and China in particular to their economic structures and savings and consumptions. That adjustment process of the main international economies on top of the damage to productive capacities by the great recession will see a slower world growth. That in turn will mean a slower growth for the Australian economy, both in the recovery phase and thereafter.

The Treasury needs to have another very careful examination of its assumptions used in its economic forecast. The structural parameters have changed and one cannot simply extrapolate the past experience without taking into account the new international situation.


Time to test the Rudd government's economic management and governance

Comments on Michael Stutchbury “Stimulus could hurt recovery unless wound back faster”, 8/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25899373-5017771,00.html

If the Rudd government and the Treasurer Swan are competent in economic management, they need to hear the advice from the RBA governer.

If they are economic conservatives, they must reflect on their spending spree policies, the efficiency of their spending, like the school funding for school halls and libaries, NBN.

It remains to be seen if the Rudd government uses the threat of recession as a guise or cover for their big government, big spending approach to governance – the Labour’s tradition.

It is time for the Rudd government to show its true colour in economic management and governance.

We need truth not lies regarding Chinese ethnic policies

Comments on Greg Sheridan “Courage of her convictions”, 8/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25898107-5013460,00.html

I am a Chinese Australian and belong to the Han ethnic. I have not been to Xinjiang, the Uighur Autonomous Region in China. I have not met Rebiya Kadeer personally. I don’t know much of what she has done either. So I can’t comment on whether the Chinese government’s claim she is a terrorist is correct or not, or whether the Australian government’s view that she is not a terrorist is correct or not.

However, what I can say is that some of what she has said is incorrect from my experience in China and my understanding of the Chinese government’s policies towards ethnic minorities including the Uighurs. More specifically, the following view of hers is clearly incorrect:

She says it is Beijing's policies that have made it difficult for Uighurs and Han Chinese to live together in harmony: "After six decades of Chinese rule, it is the Chinese government policy of portraying Uighurs as enemies of the state, and as a threat to the Chinese people, which has destroyed the preconditions of coexistence. The Chinese government rhetoric that Uighurs are all separatists has played a big role in making the minds of Chinese people see the Uighurs as enemies. As a result we saw the clashes of recent times. It's hard to imagine the two groups can go back to friendly relations."

As I said, I am an ethnic Han origine and lived, studied and lived in China for over 30 years. I am not aware of any Chinese government policies that have been adversely targeted towards any ethnic monorities in China. I have had no memory of any sorts of Chinese government policies that would have caused any ill feelings towards the Uighur ethnic people, or any other ethnic groups in China. So I can say categorically that these statements are false, incorrect and nothing more than lies.

In fact, ethnic monorities in China have been given preferential treatment than the dominant Han ethnic people.

One significant policy has been the family planning policy. The general policy has been characterised as one couple one child policy to control population growth. While the Han people have generally not allowed to have more than one child, the one child policy has not been applied to other ethnic minorities, so they can have more than one child.

Is that policy discriminatory towards ethnic minorities? Yes, but in their advantage or favour. Just think about how important the Chinese people think about family continuation from the male side of the family, one would understand that the Chinese government policy has not been anti ethnic minorities.

In terms of political representation, ethnic minorities have generally been given special above their population shares representation or quote in government or people’s representatives.

As I said I am a Han, so people may say that I am biased from the outset. That is understandable, but I am ready to debate with any person or people in terms of racial discrimination in China towards Chines ethnic groups. If I am presented true evidence that can show I am wrong, I would apologise.

PS: I think the Author of this article, Mr Greg Sheridan, has a strong bias towards the Chinese government. Although the Chinese government may have some problems in terms of human rights as the West sees it, it is incorrect and wrong to say that they have been racist towards ethnic minorities. I often find his views extreme and offensive.


A fine balance in judgement required

Comments on DANIELLE CRONIN “PS warned over damaging leaks”, 7/08/2009, http://www.canberratimes.com.au/news/national/national/general/ps-warned-over-damaging-leaks/1589609.aspx

While the PS commissioner had a point, it is nevertheless not always clear cut between whistleblower and leaking. For example, if the authorities that the commissioner said whistleblower should report to are the problems themselves, how can a whistleblower report to them?

So in the current form of parliamentary democracy and politics, PS has to make a judgement between legitimate and inappropriate leaking.

It is a fine balance of judgement.

Asia goes alone for green growth?

Comments on Brad Glosserman “Wisdom of an Asia rising”, 6/08/2009, http://www.eastasiaforum.org/2009/08/06/wisdom-of-an-asia-rising/

I’d like to make some quick comments.

1. Are “self interested” individual countries necessarily incompatible with the common good of a group? Adam Smith had a quite different idea that laid the foundation of economics.

2. While it is obviously very important to ensure human activities are sustainable environmentally, is it economically sound for Asian countries to have greener consumer consumption, irrespective what is happening elsewhere and what the process or trajectory of human green evolution or revolution? Wouldn’t that “go it alone” mentality, especially for developing countries in Asia, be too far ahead the possible reality to be optimal for them?


Sinodinos' extraordinary vision

Comments on Arthur Sinodinos “Why not trade our way out of the climate crisis?” 6/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25888591-5013480,00.html

This is an excellent article with an extraordinary vision to link the three most important and urgent world economic issues, namely, climate change the global warming, the Doha round trade negotiation and the current great economic recession. Trade liberalisation is the common thread to all these issues.

All members of the international community should realise that by further liberalising international trade and investment, every nation will benefit. Undoubtedly, it will assist the world to recover from the recession. With true world leaderships by important and influential world leaders, it will accelerate the international efforts on climate change and reach a meaningful international agreement. Both developed and developing nations should participate in and contribute to the course of limiting human induced adverse climate change in a practical and equitable way.

I think Australian government needs to take Sinodinos’ idea very seriously and lead the international community in this direction. Sinodinos should be invited to be an advisor on these issues.

If the international community can achieve Sinodinos’s vision, he should be nominated for a Nobel prize.


Don't ask carbon tax to do too much

Comments on Robert Gottliebsen “Our carbon bubble danger”, 4/08/2009, http://www.businessspectator.com.au/bs.nsf/Article/Our-carbon-bubble-danger-pd20090804-UKT7J?OpenDocument&src=sph

While the merchant baker’s idea of a revenue neutral carbon tax and tax reduction on consumers sounds attractive, it may be difficult politically. One of the main difficulties might be how to cut income taxes and raise social benefits. Different implications may render the carbon tax as a revenue grab by some to derail the carbon tax scheme altogether.

It may be a long term policy goal, but in the shorter term, it is better to focus on using the tax collected from carbon to fund other energy alternatives, or address some transitional issues.

Don’t attempt too much at one go and be practical about political processes.

Let Australian banks compete with other banks on their own feet

Comments on Michael Stutchbury “Bank props must go”, 4/08/2009, http://blogs.theaustralian.news.com.au/currentaccount/index.php/theaustralian/comments/bank_props_must_go/

Stutchbury is absolutely right in that the bank guarantees should go as the danger of the global financial crisis is passing and over.

Australian banks have been the safest and most resilient among the world in the financial crisis. They are very profitable. There is no need for continued government guarantee. They should be able to stand on their own feet and compete with any banks.

Unnecessary government supports will distort the market and the price signals, hence alter the behaviours of private businesses. Further, there is no need to put taxpayers at unnecessary risk for the profit of private businesses.

Rudd - PM, leadership and essays

Comments on Greg Melleuish “Stick to day job and hold the essays”, 4/08/2009, http://www.theaustralian.news.com.au/story/0,25197,25877024-5017272,00.html

Doing writings while in office should not be an offence itself, unless it really and demonstrably distracts one's governing duties and effectiveness in office. If a person can do both well at the same time, let him or her do it. So the real test of its appropriateness or otherwise is the person’s performance in office.

While Rudd has been very popular and successful politically, his real performance as a PM has been questionable. He seems to have too many spins and lack of substance in policy.

Cash handouts dressed as fiscal stimulus, wasteful school spending spree as education revolution, rush and stubborn on ETS, announcing NBN of $43 billion with no proper business study, many broken election promises like takeover of State public hospitals, all reflect his failures in public policy.

In this regard, Rudd has not got his priority right as the PM. He should spare his time from writing essays and focus on managing the country. As a result I agree with Melleuish on this point.