=== Todays Toon ===
John Henry Thomas Manners-Sutton, 3rd Viscount Canterbury KCB, GCMG (27 May 1814 – 24 June 1877), known as the Honourable Sir John Manners-Sutton between 1866 and 1869, was a British Tory politician and colonial administrator.
=== Bible Quote ===
“But you are a chosen people, a royal priesthood, a holy nation, God’s special possession, that you may declare the praises of him who called you out of darkness into his wonderful light.”- 1 Peter 2:9=== Headlines ===
Americans are streaming to the polls today to decide the balance of power on Capitol Hill and in statehouses and town halls across the country — here's your inside look at how the night of drama promises to unfold once counting begins.ELECTION ALERT:Mo. Computers Crash
Delays reported in verifying voter registrations in Missouri as the state's computer system crashes, according to local election officials
Coast Guard Targeted In 5th Military Shooting
Authorities are investigating a shooting at a Virginia Coast Guard recruiting office, the latest in a string of shootings at military-related facilities in the Washington, D.C., area
Mail Bomb Panic Rocks Greece and Germany
Police in Berlin find suspicious package outside Chancellor Angela Merkel's office hours after four bombs exploded at various locations across Greece
Search for missing hikers
A SEARCH is underway for four hikers missing at Wilsons Promontory in Victoria's south.
Teen shot dead in Sydney's west
A TEENAGE boy has been shot dead in Sydney's west.
Blasts kill 57 across Baghdad
IRAQI hospital and police officials say 10 blasts ripping through Baghdad's Shiite neighbourhoods have killed at least 57 people.
Man drives car at pub after entry refused
A MAN is under police guard in hospital after he allegedly drove his car at a hotel in Sydney's eastern suburbs.
Shuttle delayed by electrical problem
AN electrical problem has occurred again aboard space shuttle Discovery and could jeopardise tomorrow's launch.
Driver wouldn't take no from bouncers
AN angry driver mounted the steps of the Coogee Bay Hotel in his car to gain revenge on heavy-handed security who'd thrown him out.
Matthew died after wagging school
MATTHEW Appleby was one of more than 33,000 students absent from NSW high schools on any given day when he disappeared.
Shuffles gets a new playmate
TARONGA Zoo has welcomed a rather big bundle of joy into the world with its third elephant calf.
Council staff are abusing power
COUNCIL staff have been using their power for personal vendettas, and whacking fines on people based on "personal perceptions".
Giant locusts take wing in the west
AUTHORITIES are alarmed by the unusual presence of a large swarm of spur-throated locusts threatening to destroy crops in the Central West.
Fire destroys Tent City shop
FIRE crews evacuated several people after flames swept through both levels of the Kangaroo Tent City building in Penrith.
League star's good behaviour bond
RUGBY league star Jake Friend has escaped a conviction for possessing a restricted drug, but is on a good behaviour bond.
MP sun subsidy under a cloud
PLANNING Minister will make three times as much as the rest of us for using solar power.
Treacherous path in the community
IF the footpaths seem to be getting dodgier it may be because the council knows there's now less chance of you being able to sue.
Nanny cam child porn charge
A NAVAL police officer used a hidden camera to catch his step-daughter drinking or doing drugs, but instead it caught her naked after she dropped her towel.
Scooter boy hit by car
A YOUNG boy has been airlifted to Brisbane with head injuries after he was hit by a car in a residential court in Toowoomba.
Campbell Newman's 4th tunnel
THE fourth tunnel in Lord Mayor Campbell Newman's TransApex plan could create the long-awaited ring-road system for Brisbane's inner city.
Spelling error confuses drivers
MAIN Roads should sign up for a spell checker after adding an 'm' into the middle of Woorabinda - then making it a two-word name with a little green paint.
Tunnel carpark plan angers locals
RESIDENTS have hit plans to convert part of a park in Toowong into a carpark for workers during construction of the $1.5 billion Northern Link tunnel.
Invader joins Fashions on the Field
CONTROVERSY marred Fashions on the Field at Eagle Farm yesterday for the second year in a row.
Amazing weather pics in new calendar
THE weather bureau's 2011 calendar is out. It's the full monty on all things meteorological and features 13 smashing pictures of weather events.
Daughter 'lost the will to go on'
NEIGHBOURS of an elderly mother and daughter found dead in a Gold Coast unit have told of a reclusive family who migrated from Yugoslavia 30 years ago.
Bats fly into row
FLYING foxes are spoiling the amenity of a Charters Towers park, prompting the gardener to issue a challenge to Sustainability Minister Kate Jones.
Parents warned of furniture danger
QUEENSLAND parents will be warned about the dangers of children climbing on furniture after a chest of drawers toppled over a toddler and killed him.
Sparks flew from lover's chest
POLICE repeatedly fired a Taser into a man until a spark ''like a piece of lightning'' shot out of his chest, an inquest has heard.
Car ploughs through house
A CAR smashed its way through the wall of a house in Dandenong North overnight.
Shops raided for smokes
TWO men are causing havoc in a string of early morning ram-raid robberies in Melbourne's north.
Search underway for hikers
A SEARCH and rescue operation for four hikers missing at Wilsons Promontory.
Doctors declare radical obesity war
SPECIALIST obesity clinics and more lap band surgery in hospitals must be considered by the next state government, says the AMA.
I'm happy to do time says Hinch
RADIO host Derryn Hinch says he is prepared to go to jail again if he loses a High Court challenge for publicly naming sex offenders.
Scientist's plan to grow bones
THE secret to switching off the devastating effects of osteoporosis and arthritis may have been unlocked by a Melbourne scientist.
Jailed for brutal attacks on wife
THE father of Carol Matthey - who had murder charges against her dropped over the deaths of four of her children - has been jailed.
Donor gives pupils wings
STUDENTS at a suburban high school will take to the skies thanks to a generous donation by a migrant made good.
16,000 kids have repeated classes
MORE than 16,000 state school students have repeated class over the past three years, new state documents reveal.
Miracle tot takes on the world
FIRST miracle tot Tom Roach conquered life, and then the world and now there's no holding him back.
Nothing new
Abbott to meet Woodside locals
OPPOSITION Leader Tony Abbott will fly into Adelaide today to visit the site of the controversial Inverbrackie Detention Centre and speak to locals at nearby Woodside.
Bolt from the blue
STRIKING photographs with a watery theme fill the 2011 Australian Weather Calendar, released today by the Bureau of Meteorology.
Good life for the pup mum didn't want
ADELAIDE Zoo's latest arrival is recovering from a rocky start and winning the hearts of keepers.
Annesley parents losing faith
PULTENEY Grammar will add four extra classes next year as Annesley College parents flock to enrol their daughters at the neighbouring school.
Music festivals go lay-by
MUSIC fans strapped for cash this festival season now have the option of lay-by, with two of the summer's biggest festivals introducing a payment scheme.
Drive to recall our first Grand Prix
IT is 25 years ago today since the first Formula One Grand Prix was raced on our city's streets and Adelaide became etched into motorsport folklore.
ASO 'no' to offer of $2000 bonus
ADELAIDE Symphony Orchestra musicians have rejected the board's offer of a one-off, $2000 bonus on top of a proposed three per cent indexed pay rise.
Councils suppress what we think of them
MOST metropolitan councils have refused to reveal how the public rates them on a website set up for measuring councils' performance.
Murray blueprint delay flagged
SOUTH Australia has refused to accept reductions in water for the Lower Lakes despite signs the national reform plan is buckling to pressure from irrigators.
Child worker laws 'weak'
UNIONS have branded draft laws to protect young workers against exploitation at work as "weak", lacking in detail and failing to protect child employees.
Montara report still undisclosed a year on
THE government is opening new areas for exploration off the WA coast while sitting on the report into the disastrous Montara oil spill.
Perth fuel prices dip to yearly low
HURRY to the bowser because petrol is the cheapest it has been all year and the bargains won't last, according to FuelWatch
80 refugees found off Christmas Island
TWO boats believed to be carrying asylum seekers have been intercepted off Christmas Island.
Train passenger sexually assaulted
A 33-year-old woman was dragged into bushes and sexually assaulted after getting off a train in Perth's northern suburbs yesterday.
Desperate thief robs Salvo's shop
POLICE are hunting a desperate thief who robbed a Salvation Army store in South Fremantle yesterday.
Police seek road rage witnesses
POLICE are seeking witnesses to a road rage assault during which an elderly man was injured.
Quigley slammed over Taser comments
ATTORNEY-General Christian Porter and the WA Police Union have attacked Labor MP John Quigley, accusing him of jeopardising the chances of a fair trial in the Kevin Spratt Taser case.
Reader snaps mystery 'falling star'
PERTHNOW reader Robin Scott captured these images of what appeared to be a "falling star'' early Saturday morning in the Morley area.
Death causes train chaos
POLICE are investigating whether a train surfing prank led to the death of a man which caused major disruptions to the Mandurah railway line this morning.
Hunt after man stabbed to death
POLICE are hunting for a man believed to be responsible for the stabbing death of a 19-year-old man outside a Bassendean house yesterday afternoon.
Man in court charged with bush murder
A MAN has appeared in a Hobart court charged with the murder of John Lewis Thorn, who was shot in the back of the head four years ago in eastern Tasmania.
=== Journalists Corner ===
It's Election Night on Fox News Channel!
Tonight, Bret Baier, Megyn Kelly and the most powerful political team have fair and balanced coverage!
Click here for LIVE updates on the elections!
Get Insider Access with Bill Hemmer, Mike Huckabee and more!
===
Special Election Day 'Your World'
Today the balance of power is at stake! Neil gets sharp analysis from the biggest names in politics and straight talk from the brightest stars in business.
===
Sarah Palin's Election Insight
It's Election Day 2010! As America votes, former Governor Sarah Palin joins Bret with special insight! Plus, state-by-state results as the critical elections are decided!
On Fox News Insider
VIDEO: Name That Politician's Tune With Mike HuckabeeVIDEO: Bill Hemmer's Map Magic and Election Day Schedule
What Will Obama Say in His Press Conference Tomorrow?
=== Comments ===
The Country Takes a Turn to the RightBY BILL O'REILLY
One day before the big vote, the late polling indicates a Republican victory.
Gallup says 55 percent of likely voters will go for the GOP candidates, 40 percent for the Democrats and 5 percent still undecided.
In addition, a new "60 Minutes"/Vanity Fair poll says just 26 percent of Americans believe the president has performed well enough to be re-elected; 39 percent say he has not and 33 percent are not sure.
As far as key Senate races are concerned, let's run them down.
In Nevada, Sharron Angle is up by three over Senate Majority Leader Harry Reid, according to a new Fox News poll among likely voters.
In Colorado, Republican Ken Buck has rallied and is now ahead of Michael Bennet by four points.
Illinois also seems to be leaning Republican, as Mark Kirk leads by four in the race for Barack Obama's old seat.
Washington state is a split decision in the late polls. Fox News has Democrat Patty Murray up by two, but PPP, a Democratic polling firm, has Republican Dino Rossi up by two. So who the heck knows.
In West Virginia, Joe Manchin leads by four over Republican John Raese according to Rasmussen's last survey in that state, so the Democrats have to be happy about that.
In Pennsylvania, two late polls have Pat Toomey over Joe Sestak, so Republicans have to be happy there.
In California, Barbara Boxer is up by four over Carly Fiorina.
And finally, in Connecticut, Rasmussen says that Linda McMahon has closed the gap a little, but she remains seven points behind Democrat Richard Blumenthal.
Key governor's races:
In Ohio, John Kasich leads Ted Strickland by four according to the Fox poll.
Jerry Brown is ahead of Meg Whitman in California by five.
AND WE'LL CLOSE WITH A COLORADO SHOCKER: Tom Tancredo has closed to within three points of John Hickenlooper, despite running on an independent ticket with little money. Tancredo could win.
As far as the numbers game is concerned, no question the Democrats will lose the House, so Nancy Pelosi is finished as speaker. But the Senate will most likely remain in Democratic hands. However, the margin will be slim.
Therefore, President Obama's power will be diminished, but he'll remain a potent force. His veto power alone provides for that.
"Talking Points" believes it is your patriotic duty to vote, no matter how much you despise the political system. So we hope you'll exercise your power on Tuesday.
===
Thrill gone
Andrew Bolt
2008:
2010:
Ah, how the pendulum swings. But once Republican Michele Bachmann disposes of the offensive Chris Matthews so very sweetly (from 0:50), note how the panel back at the no-conservatives MSNBC proceeds to trash her.
UPDATE
Thank heavens Nancy Pelosi is no longer House Speaker. She’s replaced by John Boehner, one of 12 children of an Ohio publican, who tears up badly in telling of his pursuit of the American dream:
UPDATE 2
Paul Sheahan describes the size of the wipeout - the worst reverse in nearly 80 years:
Not since 1932, amid the tumult of the Great Depression, has the party which controlled the White House and the Congress, seen such a cascade of rejection as President Obama’s Democrats, with a projected loss of 60 seats, perhaps more, in the House of Representatives by the Democrats to the resurgent Republicans.(Thanks to reader Andrew V.)
In the Senate, the Democrats have retained control but seen their 57 to 41 majority over the Republicans slashed to a few seats.
Two years of “hope and change” politics has come to quick and decisive end.
===
Solar-powered trough
Andrew Bolt
In how many ways does NSW Labor want to trash its brand?
PLANNING Minister Tony Kelly stands to make three times as much as many other households for solar power after he applied for a subsidy last week, only hours before the benefits were cut back.UPDATE
Mr Kelly now joins Premier Kristina Keneally in facing accusations of trying to profit when the overly generous scheme was under review and, in his case, about to be slashed.
Ms Keneally bought solar panels for her home within days of her Government announcing a review in August, when it became clear it had become so popular it would add billions electricity costs.
Mr Kelly signed up for the 60c per kW/h subsidy within hours of Ms Keneally announcing last Wednesday that the scheme would be slashed to 20c from midnight that night after legislation was rushed through Parliament… After Ms Keneally’s purchase was revealed, the Premier said she would accept the lower subsidy as “a sign of good faith”.
Remember this the next time the media panics over an unusually warm day
The weather bureau says Darwin has had its coldest November day on record.. The previous record over the past 70 years was on November 19, 1981, when the lowest maximum temperature was 26.2 degrees.(Thanks to readers Grand Wizard and Lee.)
Darwin also had its wettest October on record last month, while Alice Springs recorded its coldest October
===
MTR claims another LIberal scalp. Blames Lib HQ.
===
Bolt defends a former ALP minister
===
Republicans not fit to speak on the ABC
Andrew Bolt
The ABC’s Washington correspondent, Kim Landers, keeps the faith in Barack Obama - and also keeps a contact book which seems to contain not a single Republican supporter.
On AM today she reports on the mid-term elections, universally predicted to deliver anything from a rebuff to a humiliation to Barack Obama, with the Republicans almost certain to gain control of the House of Representatives in a landslide. Landers, however, suggests those opinions aren’t so widely shared: “Some political analysts predict they’ll romp home...”
Only some? But her choice of audio grabs is more striking.
Her first audio is with an unnamed Obama supporter who claims the poll is not a referendum on the president and characterises his opponents as aggressive:
I think that the populace does sometimes take out their aggression or frustration with the president.The second is with a Democrat voter at a booth in Virginia:
I think the president is right on track.The third is with another Democrat voter in Virginia:
We believe in miracles and he’s a good guy… Goodness always winsThe fourth is of Obama himself:
You can’t shape your future if you don’t participate...You’ve got to get out there and voteAnd the fifth makes a full house of Democrats - Harold Ford, chairman of the Democratic Leadership Council:
You’ve got to send a clear message to the country that we’ve heard the message...Republicans are storming back into power, yet Landers cannot find a single one to give voice to what’s behind the revolt against Obama and big government,
UPDATE
Same story with Landers’ report yesterday on The World Today:
Her first audio grab was of Michelle Obama campaigning for Senate Majority Leader Harry Reid, a Democrat desperately trying to stave off a challenge from a Tea Party candidate:
I am thrilled, just thrilled to be here. This is amazing and we love Harry Reid!Her second is of former Democrat president Bill Clinton, campaigning for his party:
We just need common sense and we need to quit squabbling over stuff that doesn’t amount to a hill of beans and go back to majoring in the majors instead of majoring in the minors.Her third is of Stuart Rothenberg, editor of a self-described non-partisan political newsletter.
Voters want change and they see at this moment, they see the Republicans as the party of change.Score so far: Democrat voices - 7, Republican voices - 0, “non partisan” voices - 1.
Go back far enough in the archives and you’ll find Landers has managed at times to track down some Republicans - but they are either gun nuts or people at a Halloween parade in a place called Quakertown.
UPDATE 2
In the real world, the swing is on:
Sen. Blanche Lincoln has become the first Democratic incumbent casualty of the night, with Republican Rep. John Boozman projected by ABC News to defeat an Arkansas senator who has occupied that seat for more than a decade.Fox News is predicting from the early vote that the Republicans will win control of the House, picking up some 60 seats.
The Tea Party scored major victories in an election dominated by U.S. economic woes. Republican Marco Rubio is projected to win the Florida Senate race by a wide margin and GOP candidate Rand Paul will win the Kentucky Senate race, according to ABC News exit-poll projections.
UPDATE 3
But the Republicans are falling short of taking back control of the Senate.
UPDATE 4
Toby Harnden:
The bottom line is that the night has been a stunning repudiation of President Barack Obama. The Republicans will almost certainly take control of the House of Representatives but fall short in the Senate…===
The Democrats held West Virginia and California so it doesn’t matter, in terms of control, what happens in Washington state and Colorado (where exit polls had them behind in each). Senator Harry Reid might yet cling on in Nevada. Exit polls showed the race tied and early voting tallies indicated the Senate Majority Leader was ahead.
But across the country Democratic incumbents have bitten the dust. Democrats appear to have lost Obama’s home state of Illinois with the President’s old Senate seat falling into Republican hands. Pennsylvania is still a nailbiter but that also looks like it will fall to Republicans, despite the damage done to Pat Toomey caused by the selection of a very poor candidate Christine O’Donnell in neighbouring Delaware.
Some Democrats who ran away from Obama survived. For others, even that wasn’t enough to save their skins. The only House of Representatives candidate who Obama personally campaigned for, Tom Perriello of Virginia’s 5th district, lost.
Labor admits Hockey was right on banks
Andrew Bolt
Opposition Treasury spokesman Joe Hockey was there first with his nine-point plan for banking sector reform, which earned him Julia Gillard’s abuse-by-slogan:
JULIA Gillard has warned of the emergence of ”a strain of economic Hansonism” linked to economic populism… Ms Gillard’s comments were designed to skewer recent Coalition discussion of intervention in the banking sector ...What a difference one more rate rise makes:
THE Commonwealth Bank’s shock decision to almost double the RBA’s 25-basis-point rate rise has exposed the banking sector to a fresh round of regulation.The Liberals who criticised Hockey might ask themselves what they’ve done lately to match his success in pushing an agenda the Government has been forced to follow.
Condemning the Commonwealth’s move as a “cynical cash grab”, Wayne Swan foreshadowed a reform package to foster competition and stop the big four banks from exploiting their market dominance.
UPDATE
I really don’t think Hockey is losing this argument:
Westpac today added to the furore engulfing the big four banks over rising interest rates and their huge profits by unveiling record earnings of $5.88 billion.In fact, I rather suspect he’s winning:
BANKS are prepared to accept “appropriate” reforms to increase competition in the sector, the sector’s peak body has declared.===
Parodies on parade
Andrew Bolt
Mary Katherine Ham finds Jon Stewart held a perfect demonstration ... of self-deception.
The Second City Network discovers the Stewart rally demonstrates something else about the people protesting against the stupidity of the Tea Party movement:
(Via Instapundit.)
===
Why you may soon need a warmist’s permission to eat
Andrew Bolt
SO you think I exaggerate when I say global warming is just the latest cause of the closet totalitarian?
Then pay close attention to an experiment the warmists are about to inflict on the people of Norfolk Island.
Be warned. What’s being trialled there with $390,000 of Gillard Government money may, if it works, be spread to the mainland, say the researchers.
Which means it’s coming for you.
The plan - and, no, I’m not joking - is to put Norfolk Islanders on rations to fight both global warming and obesity.
Funded by the Australian Research Council, and approved by the Socialist Left Science Minister Kim Carr, researchers from the Southern Cross University will give each volunteer on the island a “carbon card”.
Every time they buy petrol, electricity or an air flight, they will have “carbon units” deducted from the fixed allowance on their card.
More units will be lost each time they buy fatty foods, or produce flown in from a long way away.
If, at the end of each year or so, they have carbon units left over, they can sell them. If they’ve blown their allocation, they must buy more.
But each year, the number of carbon units in this market will be cut, causing their price to soar - and thus the price of extra food, power and petrol to rise - because the idea is to cut greenhouse gases and make Norfolk Islanders trim, taut and terrifically moral.
Conservatives well aware of human fallibility will immediately spot the obvious flaw in this latest scheme of the Left to remake humanity.
It’s this: what happens when people run out of their carbon rations, and can’t afford the extra units they need to buy more fuel, power or even food?
This is precisely what I put this week to Garry Egger, head of this experiment and professor of Lifestyle Medicine and Applied Health Promotion at SCU.
===
Gillard drowns in Asia
Andrew Bolt
JULIA GILLARD’S tour of South-East Asia has become a public relations disaster.
It’s bad enough for the Prime Minister to seem insecure, clueless and, to be blunt, low rent, accompanied by an underemployed and underdressed boyfriend.
She’s so unsure of herself that she’s refused not only to say anything controversial, but anything at all, even on human rights in Burma, a gimme.
Example? Here is Gillard answering a reporter’s question at the ASEAN summit on human rights in Vietnam:
I will be having some comprehensive discussions today with the leaders of Vietnam. I’ll have the discussions and then we’ll talk about matters raised in the discussions, but I anticipate we’ll have a comprehensive engagement across all things in the relationship.Here, in contrast, is US Secretary of State Hillary Clinton at the same forum on the same question:
Vietnam with its extraordinary dynamic population is on the path to becoming a great nation ... that is among the reasons we express concern about the arrests and conviction of people for peaceful dissent, attacks on religious groups and curbs on internet freedom.In fact, Gillard is confirming her admission at the Asia-Europe meeting last month that she’s a fish out of water: “I’d probably be more (comfortable) in a school watching kids learn to read in Australia than here in Brussels at international meetings.”
Forgive my rudeness, but what makes her awkwardness seem due more to a lack of class than of experience is the constant presence on the trip of her partner, hairdresser Tim Mathieson, often shown without a tie.
When the Prime Minister was met at Kuala Lumpur with a formal guard of honour, Mathieson even strolled the red carpet beside her, in brown trousers and a sports jacket.
I know, we’re OK with Gillard not being married to the man, but it signals a lack of commitment, and Mathieson’s sharing of his partner’s privileges will strike many as unearned and casual.
Still, these are largely presentational issues that may hurt Gillard, yet are of little consequence to our foreign policy.
There is one exception. Gillard is also squandering our diplomatic credibility by carrying a dead parrot into her every meeting with leaders in Vietnam, Malaysia and Indonesia.
===
Boats still come, Gillard’s plan still bogged
Andrew Bolt
Has Julia Gillard’s planned East Timor centre deterred anyone yet?
Customs has stopped two boats carrying asylum seekers near Christmas Island this afternoon.In one day, that’s enough arrivals to fill a third of the new detention centre Gillard is building at Inverbrackie, in the Adelaide Hills.
The Federal Government says a total of 142 passengers and two crew members were on board the two boats.
So how did Gillard go yesterday in persuading Indonesia to sign up for her East Timor centre?
Australian Prime Minister Julia Gillard sought Indonesian support on Tuesday for her proposal for a regional refugee centre during talks in Jakarta with President Susilo Bambang Yudhoyono…So four months after Gillard first proposed the idea, the Indonesian president indicates he’s not sure it will work and wants further discussion postponed for a few months.
Yudhoyono said Indonesia believed the issue should be dealt with according to existing frameworks such as the Bali Process and proposed further talks early next year with other countries in the region.
“Indonesia is open to that (a refugee centre), but we have to discuss in depth to ensure once again that this is a solution to deal with our regional problems,” he told reporters.
Working beautifully.
UPDATE
Greg Sheridan shares my view (above) of the Gillard tour of Asia:
Has any new prime minister ever had an initial Southeast Asian tour quite so forlorn as this?===
It is not Gillard’s fault that Malaysia’s Prime Minister, Najib Tun Razak, caught chickenpox and couldn’t see her.
Nor is it her fault that Indonesia’s President, Susilo Bambang Yudhoyono, would rather visit volcano victims in Central Java than have the dinner with her that he was supposed to have. But what a dismal figure Gillard has cut as she continues to try to sell her asylum-seeker processing centre in East Timor even as she refuses to offer the slightest rationale about how it would work and how it would possibly deter, rather than increase, the number of illegal immigrants smuggled around the region.
Why Hockey is right
Andrew Bolt
A leading banking industry executive (who has asked for anonymity) explains why Opposition Treasury spokesman Joe Hockey’s nine-point plan for the banking reform is not just important, but grotesquely misrepresented by Labor, which sneered at its alleged “economic Hansonism”. And the commentators who bought the Labor line - and the whiteanting of Hockey from lazier Liberals - should be ashamed:
I thought your contribution to Insiders today was excellent. I wanted to clarify a few matters for you…
1. Joe has canvassed some very substantive policy issues regarding the unique role banks play in our economy, which, while largely absent from the debate in Australia due to our providence in skirting the crisis, are front-of-mind for conservatives in the northern hemisphere. Centre-right economists such as the Bank of England Governor, Mervyn King, John Cochrane at the University of Chicago, and the former head of the US Federal Reserve, Paul Volcker, have argued similar things. Indeed, what Joe has said is pretty much close to the centre-right consensus in the northern hemisphere—we have just not had a crisis to learn the same lessons, but our time will inevitably come. This is why smart business commentators, like Terry McCrann, described Joe’ speech as ‘substantive, thoughtful, nuanced’ and ‘complementary’ to Glenn Stevens’ speech on the same day;
Joe’s position on interest rates is crystal clear: he has stated that both the RBA and Treasury have now independently concluded that any further expansion of the major banks’ net interest margins, and, more specifically, rate increases above RBA cash rate changes, does not appear to be justified. To quote Jim Murphy from the Treasury last week, “The Reserve Bank and the Treasury do not believe the view being put by the banks that they still need to put up mortgage rates higher than the base rate to recover funds.”
The RBA and Treasury have presented analysis showing that the major banks’ net interest margins are actually higher than they were before the GFC emerged. To quote the RBA’s October Board Minutes, “Members noted staff estimates that banks’ funding costs had been relatively flat over recent months…the spread between lending rates and funding costs…remained well above its pre-crisis level.” One policy question is, therefore, whether the banks are using their newfound market power to extract monopolistic profits that are only enabled by the fact that the taxpayer (via the Treasury and the RBA) has underpinned their existence and served as both the implicit and explicit insurer/lender of last resort to these institutions. To be clear, the normally very bank-friendly RBA and Treasury have put this issue on the table, not Joe;
From a policy perspective, Joe canvassed a range of specific solutions (not all of which are well understood) to address two key things: first, ‘moral hazard’; and second, the dramatic decline in competition (ie, the disappearance of St George, BankWest, RAMS, Wizard, Challenger, and Aussie, which is now wholly funded by CBA). I thought it would be worthwhile shedding some light on the logic underpinning these issues:
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