Against decentralising: why crowded is good

Note: This post was original published on 6 July 2015; I’ve updated it several times because both parties keep revisiting a decentralisation agenda.

Once again we’re hearing the argument that Australia would be a much better place if only we could actively “decentralise” population. The argument is we should encourage people out of our big cities – notably Sydney and Melbourne – and into smaller cities, like Wollongong and Ballarat. One recent claim comes from the Liberal Party’s Tim Smith, the member for Kew and Victorian Shadow Parliamentary Secretary to the Leader (Population Policy and Housing Affordability). In an article in The Australian, he argues:

Opposition Leader Matthew Guy’s vision is to decentralise Victoria and develop its regional cities, to take the pressure off Melbourne and grow country Victoria.

The state desperately needs a government that is committed to decreasing the percentage of newcomers who make their home in Melbourne. Our state needs a government that will ­engage in a mature debate about how to incentivise newcomers to move to country Victoria, or give them the confidence that if they move to a regional centre they can commute to Melbourne with reliability and ease …

… An effective decentralisation agenda is key to improving capital city liveability and the economic wellbeing of the regions.

In pursuit of this, various governments over the years have tried to move departments out to regional cities. Smith implies that Labor doesn’t want decentralisation, but the evidence suggests Labor is just as keen on the idea as Smith is. The Victorian government under John Brumby even ran an advertising campaign in Melbourne encouraging people to move out and resettle in regional Victoria.

This sort of argument has often been based on the idea that these regional areas have lots of existing infrastructure that we can exploit at little cost. It has been encouraged by talk of the “Death of Distance” and “The Flat World” – the idea that globalisation and modern telecommunications are making location obsolete, so you might as well live in the countryside. It’s particularly popular wherever there are plenty of marginal regional electorates.

And this argument seem to be spreading. So here’s the case against spending government resources to actively encourage decentralisation.

Continue reading

Posted in Economics and public policy, Innovation, Politics - national | 54 Comments

The corona cost-benefit analyses of Richard Holden, Bruce Preston and Neil Bailey: ooops!

The economic and social damage of lock downs in Australia is starting to get noticed so much that even academic economists are paying attention. After months of resisting actual data, some Australian economists who previously refused to even contemplate the idea that an economic collapse would also cost lives are finally trying their hands at data and have produced cost-benefit analyses for the corona crisis. Unfortunately, it is clearly novel territory for them and they have made basic, yet grave mistakes. Let me dissect their writings.

First off, Richard Holden and Bruce Preston, previously active in that “infamous letter by economists” which Sinclair Davidson rightfully has termed bizarre, tried their hands at a cost-benefit calculation in the Conversation. Their calculation is of great simplicity: they say the economic collapse will cost Australia at least 180 billion AUS and then they look for how much the lives saved by the lock downs would be worth. To do that they use the “statistical value of life” estimate used in some government calculations, ie 5 million dollars. I have used the same number in some of my writings here on Troppo, so though I would argue it is not the most appropriate number, it at least is defensible to say that one thinks it will eventually cost one whole life if GDP is reduced by 5 million.

Then they claim 1% of Australia would have died without the lockdowns, which is around 220,000 Australians. They multiply that 220,000 by 5 million and say the lock downs saved Australia 1.1 trillion dollars. That “estimated benefit” is bigger than their claimed “cost” so they conclude the lock downs are worth it.

Mountain Out of Molehill Images, Stock Photos & Vectors | Shutterstock

They make three big mistakes. One is a rookie mistake, two are less serious but still bad mistakes.

The rookie mistake is that they use the statistical value of life for someone who dies of corona. Yet, the statistical value of life holds for a whole life, ie 80 years of life. By contrast, the corona victims would have expected to live only 3-5 years more. So one should only count 5% of the 5 million as the appropriate value of those years, ie 4 years out of the 80 in a full life. That, after all, is how the statistical value of life estimates are used in government allocation decisions. Holden and Preston seem just not to know this, thus confusing their molehill for a mountain. Using the statistical value of life properly would get them a “saving” of only 45 billion Australian dollars of the lock downs, which is 4 times less than they themselves claim is the economic loss.

So if Richard Holden and Bruce Preston are scientifically honest they should immediately update their own figures and own up to the fact that using their own methodology they themselves now think the economic collapse costs at least 4 times more than the lock downs saved.

They make 2 more mistakes, less serious, but still grave. Continue reading

Posted in Uncategorized | 71 Comments

On Corona/Covid-19, herd immunity and WELLBY tradeoffs: key predictions and numbers

[in progress: will add more references, links and latest numbers when I get the time]

In this note, I want to deal with three related issues: the main lessons on the corona virus from the reported deaths across countries with different policies; the feasibility of different “end games” relevant to this pandemic, including vaccines and herd immunity; and some key WELLBY numbers relating to loneliness, unemployment, and how government expenditures link to lives saved. Armed with these numbers you can generate your own estimates for how various policy scenarios change the numbers of happy lives lived by the population.

The take-away message is that I think most European countries will end up with a “Sweden, perhaps on steroids” strategy, openly adopt a not-much-to-truly-fear narrative, and that the key wellbeing consideration for the next two years will be jobs and social closeness. We will then also hopefully acknowledge as Westerners what the awful and totally predictable costs have been in the rest of the world of our attitudes and policies in dealing with this virus.

The dangers of the corona virus: on New York, Sweden, South Korea, and herd immunity.

In February / March, when many key policy decisions had to be made, it was still possible for a reasonable person to think more than 1% of the whole world would die if one didn’t lock down the majority of the population. With the benefit of all the research and information of the last 2 months, we now know much better what the risks are and what matters in terms of policies. The key information that is new is how many victims the corona virus has made in different countries following different strategies and with different circumstances. Though there are huge statistical issues with this data, including the fact that some countries are more strict than others when counting a death as covid related, and the large differences in just what part of the population was exposed, we can nevertheless turn to this data to help see the main contours. Continue reading

Posted in Coronavirus crisis, Cultural Critique, Death and taxes, Democracy, Economics and public policy, Education, Employment, Health, IT and Internet, Libertarian Musings, Life, Politics - international, Politics - national, Science, Social, Social Policy, Society | 55 Comments

The Drew Pavlou case: business with China versus the American lobby

In a week from now, UQ student leader Drew Pavlou will face an internal hearing at the University of Queensland to decide whether or not he will be expelled for having organised rallies against various pro-China organisations on campus and generally being a pain in the *rse of UQ’s management. I want to talk about the merits of the case, what Drew should expect, and the wider battle within Australia between those who make money off the Chinese and the pro-Americans who want these economic ties severed. This battle will involve Drew’s case.

The background.

The bare bones of the case are simple: Drew is a charismatic 20-year old student who likes to get in trouble and expose corruption and misdeeds around him. This modern-day Don Quixote finds himself at a university (UQ) where its management is basically a kind of maffia that has plenty of skeletons in the cupboard. Hence Drew has been running amok, getting himself elected as student representative in the UQ Senate. Its the place where all the important decisions of management are usually rubber stamped, but where Drew now causes a riot about every little corrupt decision made. I can only smile when I think of how he will have thrown his indignation around in those Senate rooms when it came to decisions around university property-deals or English-language ability requirements.

From his position on the UQ Senate, Drew has complained in the media about the exorbitant salaries the vice chancellor Peter Hoj and his many cronies give themselves, as well as their selling out to the Chinese government in various ways. They for instance gave the Chinese consul general an honorary academic title, and allowed a Confucius institute on campus whose main role is to spread the view of the world of the Chinese government, ie the Party. They do this via “sponsoring” academics and academic courses, where the message of those academics is in line with what is deemed acceptable by the embassy. From a traditional Brisbane perspective, there is nothing unusual about this: it is simply good business to cosy up to rich and powerful friends. Queensland as a whole has very strong economic ties to China: its mining companies are largely China-owned, many students and tourists come from China, and its property boom largely rests on the Chinese as well. UQ in that sense is simply part of a larger convenant between the Queensland elites and Chinese interests.

When Drew started organising somewhat aggressive demonstrations in support of students in Hong Kong, and also expressed strong views about the treatment of the Uighur in China, involving heated exchanges with Chinese students on the UQ campus, the management of UQ tried to shut him up. They did their usual bully shtick on him, via a 186 page allegation document where the internal UQ-police (whose task is to do whatever Hoj wants them to do) went over every tweet and facebook comment they could find by him, and package it all up to paint a picture of a second Che Guevarra who was a menace to the University of Queensland. In protest, Drew managed to get 20,000 signatures supporting his case, a QC who was prepared to represent him pro bono, and he also gave several media appearances.

My interest in the case

I am interested in the case for two reasons. For one, I have been through a similar trajectory myself with UQ’s management, culminating in a court case that I won, around a similar “hot topic” (see here for the court decision which made clear UQ management had not followed its own rules nor natural justice when inventing and pursuing their case against me). In my case, I dared to research racist behaviour in Brisbane, looking at the question what type of ethnicity was more likely to get a free ride on buses, finding that white and East Asian (!) students were far more likely to get a free ride than black or Indian students. The Brisbane elites disliked having such stories in the media and UQ’s management was happy to go after me using any excuse it could. My case also had media, petitions, and the like, but ultimately there was no strong group really bothered enough by racism in Brisbane to truly stand against UQ management. Continue reading

Posted in Cultural Critique, Democracy, Indigenous, Inequality, Journalism, Law, Libertarian Musings, Politics - national, Print media, Race and indigenous, Uncategorized | 10 Comments

Info-philanthropy: a small cost for a big benefit

As part of the Government 2.0 Taskforce in 2009 I coined the term ‘info-philanthropy’ though someone may have coined it before me and the Taskforce proposed that it qualify as a head of philanthropy. I don’t think any changes have been made, but there’s reasonable scope to include it under the existing arrangements.

In any event, I’ve been doing a bit of work with the Paul Ramsay Foundation on philanthropy’s response to the crisis. As usual, my own mind goes towards using the crisis to try to innovate in ways that survive long after the crisis. In any event, this is a small thing which is to identify one useful thing people can do with their time sitting at home.

I’m a fan of Libri-vox – but more or less on principle. It’s a surprise that it’s not a lot better than it is. Most of the recordings are a good deal worse than the professional recordings on Audible. You might expect that, and in the early days of peer-to-peer production, you’d be in company. But with the appropriate adjustments in expectations, Wikipedia is better than Britannica and Linux is better than its professional competitors. I see no reason why there shouldn’t be retired actors, and non-retired actors seeking a name for themselves, teachers and just normies recording books with the best being promoted through the ranks so that with popular books like Middlemarch and Crime and Punishment there are really great recordings available.

But alas it is not so. Anyway, I gained insight as to why when I enrolled in Librivox myself with the intention of recording a few chapters of R. G. Collingwood’s Religion and Philosophy, which isn’t available, or chapters of books that I’d like to read by Alfred North Whitehead that are likewise not available. Then I got the email recorded over the fold.

As you can see, it’s a miracle of user-unfriendliness. So that’s something that could be attended to in the crisis. A simpler set of instructions and a service to take prospective narrators sitting out there in the suburbs through what steps remain necessary. And an engagement with retirement villages and aged care facilities everywhere to get those who might like to do this kind of thing doing it.

To paraphrase Winston Churchill during another, more serious crisis, it’s hard to think of a resource that might be provided by so few that could do so much for so many.  Continue reading

Posted in Cultural Critique, Democracy, Economics and public policy, Information, Web and Government 2.0 | 10 Comments

Altruism comes from a model – the virtues from life

Models, windows, reductionism and pluralism

We’re familiar with the idea that thought creates ‘models’ of reality. So it’s easy to slip into thinking that our task is then to just make our models better and better, i.e. more accurate representations of reality. This leaves out what Mary Midgley calls ‘philosophical plumbing’ which involves continuing careful thought about how well those ideas are doing their job. That’s why I like her alternative metaphor which involves thinking of ‘reality’ as the body of water with fish swimming through it in a public aquarium with our ‘thought’ being the various different windows through which we can view that space.

The metaphor by which thinking builds ‘models’ of reality often leads to reductionism. Living in the physical world we all acquire the intuition that smaller objects are the building blocks of larger ones and, in that sense more fundamental. The sandcastle is built of grains of sand and not vice versa. Those grains of sand are built from chemicals, and those chemicals are built from atoms and so on. Similarly, it has been proposed that physics investigates the most fundamental things about our universe, then chemistry, then biology and then the social sciences.[1]

Midgley’s ‘windows on an acquarium’ view of thought suggests otherwise:

There is, for example, the way a furniture maker studies tables (as solid things on which one can rest a cup) and the way sub-atomic physicists study tables (as collections of atoms that consist mostly of empty space). One is not more “real” than the other.

The easy intellectual pluralism of Midgley’s aquarium metaphor prompts us to ask how good the view is from each of the windows available to us. Any window might be large or small, clear or foggy. Its location might obscure important perspectives or enhance them.

Which brings me to my subject. In the last two hundred-odd years our ethical world has become impoverished. Until then our view of our ethical life was had through the numerous windows which we called the ‘virtues’. Virtues such as courage, and honesty and prudence and justice. Adam Smith takes a peek through all these windows and more in his first book, The Theory of Moral Sentiments. 

However today the virtues seem old-fashioned and they’re strangers to much modern ethical thinking. Today we talk about ‘altruism’. But altruism is a new-fangled fiction, like ‘the ether’ in nineteenth-century physics and cosmology. It’s a ‘filler’ concept which enters our mind because it seems to be implied by the way we’re thinking. Its presence in our lives is experienced, if at all, only dimly. I think we rely far too much on this window into our ethical life. I make this argument in the following sections, firstly by outlining some other fictions, then by describing the origin of altruism as a concept and then by elaborating the appeal of the virtues. Continue reading

Posted in Ask Troppo's Love Gods, Cultural Critique, Ethics, Philosophy, Political theory | 25 Comments

What should Australia do in the coming recession?

There is one hell of a recession coming for Australia. Economic activity has already reduced by 20% and actual unemployment will probably peak near 20% too, and about a million businesses have already applied for some sort of assistance. The population increase of the last 20 years has come to an abrupt halt, from an increase of a quarter of a million per year, to a decrease this year that can easily be half a million.

Even if countries stop their lock downs and gradually return to some semblance of economic policy sanity, there are three economic shocks Australia cannot avoid, and a fourth one its politicians must work hard to avoid:

  1. A shock to commodity prices and profits. Oil prices have more than halved and coal prices are down 30% from last year. These prices should be expected to remain low given the huge reduction in international demand and the build up of stock piles. What that for instance does is make shall oil and gas exploration in Australia uneconomical. It greatly reduces profits to mining companies, and negatively affects pensions which have invested heavily in commodities.
  2. A shock to tourism, business trips, and foreign students. This year, the tourists and traveling business people will stay away because they are not allowed to fly in. Ditto for many students. The hospitality, business travel, and student market should be expected to tank for several years because there is now less money for long-distance travel and high-priced university degrees. Also, China and India, which are the two biggest suppliers of foreign students, are going through their own down turn and are quite likely to try and reduce the number of students and business travelers going to Australia, keeping them in their own countries.
  3. A shock to the property market via a reduction in population coupled with a glut in accommodations coming onto the market anyway. The property boom is effectively over and seems unlikely to re-start for years.
  4. A shock to the trade relations with China. This one depends on whether the American lobby can be prevented from forcing Australia to sever the ties.

 

One should not underestimate the size of these shocks. They herald a major downturn in the biggest export industries and in the major sources of growth of the last 20 years. Let us look at the implications for foreign policy, education, macro-economic policy, and taxation. Continue reading

Posted in Coronavirus crisis, Death and taxes, Economics and public policy, Education, Employment, Health, Politics - international, Politics - national | 13 Comments