Monday, July 31, 2006

Smells of propaganda steaks in alleyways...

Donald Sensing has posted (what I consider) a fairly typical "shock horror" item from the Israel /Lebanon war. In that post he links to this article in the Australian Herald Sun.
Photos that damn HezbollahChris Link

July 30, 2006 12:00am
Article from: Sunday Herald

THIS is the picture that damns Hezbollah. It is one of several, smuggled from behind Lebanon's battle lines, showing that Hezbollah is waging war amid suburbia.

The images, obtained exclusively by the Sunday Herald Sun, show Hezbollah using high-density residential areas as launch pads for rockets and heavy-calibre weapons.

Dressed in civilian clothing so they can quickly disappear, the militants carrying automatic assault rifles and ride in on trucks mounted with cannon.

The photographs, from the Christian area of Wadi Chahrour in the east of Beirut, were taken by a visiting journalist and smuggled out by a friend.

Here are the three photos printed in the link...

Now there is one sequence number missing... I wonder....

Sunday, July 30, 2006

Portrait of the past to portrait of the future...

From todays SST, attributed to Getty Images...
A Lebanese boy comforts his mother after their van was hit by a rocket from an Israeli aircraft. The family was trying to flee their village in Southern Lebanon.

Portrait of a future terrorist.

Saturday, July 29, 2006

"Free trade"... again

I knew that this was in the wind. It has been a matter of debate (off and on) here in NZ over the past year or so. There was no firm indication in recent times that Tonga would sign to the WTO, nor any reminder that the deadline was as close as Monday (31 July).

It is an interesting talking point because it gives a concrete example of the cross talk and propaganda that accompanies the debate on world trade, the WTO, and free trade in general.

On the Monday following my last post on the topic, Granny Herald had two op-ed features on the subject of the failure of the Doha round – one expressing dismay at the failure the other equally joyous. One took the attitude that the opportunity for poor countries to trade into greater wealth had been lost the other that the poor countries would continue to be protected from the rape and pillage by the rich nations. ( I can’t link to them as they as both subscription articles).

That discussion piqued my interest in the “anti-trade” argument, and a few (admittedly half-hearted) attempts to dig out some reasoned and meaningful debate discovered great quantities of heat and smoke on both sides and very little that could be said to be factual. The Tonga example has given the opportunity to look at a specific “small third world economy” and its presentation by both sides of the debate.

Probably the leader (one of the leaders) in the anti-WTO side is Oxfam. A worthy NGO with a fairly long and respected history in the fields of humanitarian relief and the development of poor nations.

The other is the response of the Tongan Government to Oxfam’s opposition.

There is another view – that of NZ itself which has taken a long and fairly hard road through some tough economic times to the point where this country is likely to be one of the very few that comply in most respects with WTO requirements for open and unrestricted trade. No, NZ still has some way to go. There are elements which have not met with WTO approval in recent times a major one of which is the genesis of this series of posts on “free trade”.

Back last December, Oxfam published this report which opens with this statement –
The tiny island Kingdom of Tonga in the South Pacific
is about to make history, by joining the WTO on what
are arguably the worst terms ever offered to any country.
The appalling terms of Tonga’s accession package
show that nothing has changed in the way the world’s
smallest and most vulnerable economies are treated
as they seek to join the WTO. It is a further demonstration
that the fine words of the Doha Development Agenda
mean nothing when pitted against the commercial
interests of the world’s richest countries.

The basis of Oxfam’s opposition is in large part based upon the Tongan economy. Like all small Pacific economies, it is reliant upon fish exports, small scale farming exports, tourism, remittances from ex-patriots, and international aid primarily from Australia and NZ. Annual income per head is a bit over USD2000 (CIA Factbook). It is not a tropical paradise. I have visited Tonga twice. Outside of the tourist “spots” it is definitely “poor world”, with the corresponding (glaring) examples of wealth and poverty. (I occasion had to lie to a taxi driver / guide who was taking us around the main island Tongatapu. We had stopped to admire the Crown Prince’s residence – no photographs allowed – and then continued. I noted as we passed through a small village a “residence” on the other side of the road. I grabbed a photo of it as we returned a while later. The guide was most upset that I might have taken a photo of it, “We are not proud of people who live like that”.)
“The terms of Tonga’s accession package are appalling,” said Oxfam’s Phil Bloomer. “This is one of the world’s smallest and most vulnerable economies, and the extortionist demands being made on it should have no place in a “development round”. Apparently, the rhetoric of development means nothing at the WTO when pitted against the commercial interests of the world’s richest countries.”

As the price of joining the WTO, the remote, impoverished nation (population 100,000) will be forced to slash the tariffs on which it depends to pay for vital public services such as health and education.

“Tonga will have to fix its tariffs at levels lower than any other country in the history of the WTO, with the sole exception of Armenia,” said Bloomer. Tonga will be allowed tariffs of no more than 20% on any product. In comparison, the US applies a 350% tariff on beef imports, and the EU applies an equivalent tariff of over 300% to block sugar imports. Such low tariffs threaten to wipe out Tonga’s vulnerable farmers and small businesses.

That is emotive stuff, and if true (I know that some parts of it are very true) then both WTO and Tongan government have much to answer for.

This is the response from the Tongan government on the point.
But the Tongans say that this binding rate is in line with government policy of reducing import tariffs, "in order to reduce the costs of imports to make them affordable to the general public particularly the poorer sections of the community. The government of Tonga has been undertaking an economic reform programme over the past five years, and one of the primary aims of this economic reform is to reduce where possible the costs of living..., with emphasis on areas directly impacting on the poor and on investment, and to reduce the cost of doing business."

They said that at the moment much of Tonga’s consumption, food and non-food items, is imported and the tariffs imposed on those imports are high relative to the income of most of the population who need to import basic foodstuffs such as milk and meat, because little is being produced locally.

Meanwhile, import tariffs on farm vehicles is 45%, plus other taxes raising the total to at least 60% to be added to the landed cost, which the farmer has to pay and, "is surely a disincentive to farmers, fishermen and other investors."

Hands up those who trust a government. In this instance and because the statements are so easy to check, I am fairly comfortable with the veracity of that statement. It also fits with the news that has been coming out of Tonga over a period of time.

So, who do we believe at the moment? Is it the Tongan government, that they are doing the right thing by their people? Or do we believe the NGO, the non-partisan objective promoter of the rights of the poor?

Looking at the comments Oxfam has made about NZ’s economy, our entry to WTO, and the “recent” economic changes made in response to the urgings of WTO, World Bank, and OECD, I have to say that their “analysis” is over the top and very emotive.

NZ started out the process with extensive and complex systems of tariffs, subsidies, and sector protections in place. Some of the tariffs and import duties might have totaled 50% or more of the import cost. Most of the import duties are gone. The highest now 5%, and due for reduction to 3%. All internal industry subsidies went some years back, including all of the agricultural subsidies. There was hardship for some, there are some (like clothing and footwear manufacturers) who have long since departed the economy. But we are not yet bankrupt, like some predicted would happen within five years, or the next five years or… like Revelations there is always the next historical landmark, unlike Revelations though the believers now are silent.

Note, however that I do NOT say that Oxfam’s comments are without validity. There are instances where “following the path” – NZ and Argentina set out together and parted ways after a short distance, to the relief of NZ and the chagrin of Argentina – has left NZ in some very tight holes indeed. Examples –

Sale of the rail system from government ownership and control to private and deregulated ownership, combined with parallel removal of long distance carriage restrictions that acted as internal “tariffs”. It is has for some years been cheaper to travel Auckland – Wellington by air than it is by train. The rail passenger service ceases September 30.

Sale of the state owned and operated Air New Zealand. Bailed out by the government to the tune of $1billion within five years. Argument about the viability of a “small”operator vs bad management. Large part of the problem stems from NZ adopting open skies policy, since has limited internal carriage by other international operators.

Sale of the telephone system on the open market. Profiteering and monopolistic practices have restricted new market entrants, long protracted legal wrangles put broadband back five years.

Closure of the mental health system in favour of “community care” has led to totally inadequate facilities for the care and rehabilitation of the severely mentally handicapped and those requiring 24 hour care and control.

Privatisation of public broadcast media has been a relative success.

Attempts to privatize other “public goods” such as roading, water supply, local government services have led to rather crippling failures. One instance in the local government services area is the cost of what is known here as the “leaky building syndrome”. The failure of policy, regulatory and operational functions to properly handle “new building techniques” has left the nation with a repair bill estimated in the hundreds of millions and climbing.

All of those instances came directly from World Bank and OECD urgings to remove government from the economy – by any means possible.

They are not always “right”. Neither side.

Congratulations, Tonga, on having the courage to take this step on. Kia kaha.

Peter W. Boag

I note, with some considerable sorrow, the passing of Peter Boag.

I knew him as my maths teacher in years 12 and 13. I owe him much for the learnin that he gave all of us in his class.

"Never accept the obvious".

"Always analyse the correct".

"Always question those who tell".

One of his favourite means of ensuring that classes paid attention to his teaching -

In expanding a mathematical statement on the board, he would make an intentional error. The more complex the statement, the less significant the mistake. If the class had not picked it by the end of that line, there would be a quick glare over his shoulder to make sure that we were awake. If it had not been picked up by the end of the next expansion (in which he would perpetuate the error) then the class would be in very deep trouble.

Peter more than any other teacher, taught me - all of us - HOW to think, to analyse, to use our personal skills and abilities to our best. He bacame a teacher whom we trusted, who was always open to discussion and debate, and who more than any other I have had taught the value of debate.

A very rare bird indeed.

Thank you Peter, thank you again.

Friday, July 28, 2006

A little more sport...

If one takes the time to trawl through NZ newspapers at the moment, there are two (connected) items that may catch your eye.

The first is international rugby. Britain and Europe have their "Six Nation Championships". The Southern Hemisphere has "Tri-Nations". Within that Tri-Nations competition there are a couple of annual stoushes, including NZ vs Australia for the Bledisloe Cup. Lord Bledisloe was the Queen's representative (Govenor General, or just GG) in the 1920's or '30s and he left all manner of sporting trophies lying about.

The second, connected, item is the haka that the All Blacks perform as a matter of tradition before every match.

Now "haka" needs some explaining. The traditional pakeha translation of the term is "war dance", which is true if you forget that haka are not only "for war" and that calling it a dance would be like describing an all male university review as classical ballet.

My understanding (based upon what I have been told) is that it is "an action and posture sequence". Pretty plummy that so I'll stick with haka.

The All Blacks (NZ's national rugby team) have traditionally performed a haka known as "Kamate". Reputedly composed by a very high chief in the 1860's by the name of Te Rauparaha. The story behind it has Te Rauparaha pursued by armed men (whether war-like or angry relatives of a woman he had just been in bed with is unclear). The only hiding place was a kumara storage pit, in which Te Rauparaha did hide. After his enemies left, he emerged from his hiding place and performed this haka to celebrate his escape.

Ka mate Ka mate
Ka ora Ka ora
Tenei te tangata puhuruhuru
Whakawhiti te ra
Hupane kupane
Whiti te ra!

Death Death
Life Life
This is the hairy people
Bringing the light
Step up, another step
Here is the light!

To many NZers (the white ones) this is "the haka"; with the intended implication that it is "the only haka".

That is quite wrong. In fact, at the age of eight or nine I knew at least three other haka each with their own history and traditions before we (at the school) were taught "Kamate". I have heard haka composed for a senior man's birthday; for the arrival of a canoe, for the depature of people on a journey, even one composed to publicose the dangers of smoking. One of the most fear-inspiring I have seen in person was at Ruatahuna, a small village about 40 minutes further into the hills from where we were living at the time. Think of 30 or 40 men, from late teens to 70's, from tall and rangey to mill and bush workers weighing in at over 200lbs, ranged up in three lines hitting the ground with their feet so that the pumice dust rises not just under their feet but a small distance away as well.

The All Blacks have been granted a haka - Kapa O Pango "Team in Black". It is a powerful, and (to my eye) traditionally formed haka. It concludes with a gesture which to most Europeans means "cut your throat". It means much the same in this haka. And that one gesture has caused quite a raruraru.

Tomorrow night, the All Blacks play Australia in Brisbane. It is the second round of the Bledisloe Cup and if the All Blacks win they will bring that humungous great mug back to NZ. They thumped the Aussies four weeks back in Christchurch and most are expecting a win (close) tomorrow.

It is the pre-match mind-games though which are almost as much fun as the game itself. The Australian coach is complaining (once again) about the All Black's haka in general, and in particular the closing gesture (ignoring the fact that there are far "worse" in the middle). We went through this a couple years back when the Aussies tried to ban the AB's from performing their haka, and got the crowd in Sydney to sing "Waltzing Matilda" as a response to the challenge. Good stuff all round.

Oh, BTW most will have heard of Bowdler - he who "cleaned up" all of the good bits in Shakespeare. I was introduced to him when the year 12 and 13 students performed Hamlet (I played the priest who buried Ophelia). Among the little tid-bits our enlightened English master gave us was the fact that Rosencrantz and Guildenstern were (pre-Bowdler) called Rosy-pants and Golden-arse. That puts a totally different picture to the two characters and could well explain Hamlet's dad getting all upset about the copany Hamlet was keeping at uni. But I digress.

I suspect that many of the old haka have been "Bowdlerised" by well-intentioned missionaries. It is quite fun to try and imagine just what words and actions Te Rauparaha might have performed in his premiere performance of Kamate. Good fun, but boy might it upset the Aussies... and half or more of the local rugby community.


The AB's performed Ka Mate.

Aussie lost 9-13.

It truly is sad...

...when the pressure to win gets this great.

Yes, I am aware that there has been one previous instance where an athlete was able to prove a "fail" result for testosterone could occur as a result of competition. I expect that if the B Sample is also positive, that Landis will use a similar defence.

There are, however, two very heavy facts that will weigh against him.

First is the spectacular reversal of form within 24 hours from "spat out the back" to "unprecedented solo ride". Comparison with the break-off of a couple days prior (the group of four that went out) is totally invalid. A group of four has a totally different dynamic to a man alone. I doubt that any future pelo will allow a break out like that to occur ever again (well not for a very long time). I have no doubt that form reversal by Landis would be number one in the officials minds when they selected random samples.

Second is the fact that ICU have been under intense pressure for some years (like about 15 years) to clean up the sport at all levels. Their attitude and commitment to getting the drug cheats out has improved from totally deplorable to barely acceptable. Any sign that the ICU is going to back out of this one on Landis will be a major blow to any small amount of credibility that they have at present.

The Olympic govenors reportedly gave ICU the hard word after Sydney, and the policing at Athens was fair.

It looks a good chance that Landis will be the biggest to fall in cycling thus far. That is sad indeed.

Sad because I have no doubt he is a top rider, and deserves to be where he is (without the chemical assistance). I was tempted to write "was" in here. Then I remember the comeback that Armstrong made and left "is" in its place.

Sad because the pressure to win (either personal or team pressure) pushed him past the limit of acceptable action.

Sad because the only likely saviour now is a negative result from the B sample.

Tuesday, July 25, 2006

The problems of "free" trade.... 2

Well, I was living in hope but...

Probably the best, most a propos comment in the Herald article comes not from Lamy, or any of the G8 members on the G6, but from the Indian trade minister Kamal Nath, when asked how long the suspension could last, said:
"Anywhere from months to years."

"The round is not dead. I would say that it is definitely between intensive care and the crematorium," he said.

OK, so what are the problems -

1. US will not move on agricultural subsidies until EU moves on its ag. subsidies and India reduces protections on its industrial sector.

2. EU wants US to cut protections on a wide range of goods, including ag. products.

3. Both US and EU want less restricted access to Brazil and India markets for technology products.

4. The US accused the other participants of "being more interested in creating loopholes for themselves than opening their own markets."

I want to put to you an alternative. It is in part the line of thinking that I followed in my previous post. It is in part this editorial as well, which will give perspective to the issue.

First to pick up here -
When it comes to agricultural products in particular, there are very large manufacturers who are capable of producing a superior product far cheaper than those originating from Europe, or the US.
The consequences of that producer's skill are;

> Being able to land better product than the local, in Europe cheaper than the local industry can make it.
> Being able to compete with the same product on all international markets at governing commodity prices.
> Most importantly, there is no government assistance or subsidy on the NZ product. Here in NZ, I pay the same price for butter (plus mark-ups) as the European bound product leaves port.

What this whole raruraru does is give a picture of the kind of machinations that cloud the diplomacy of international trade, and especially the likes of the Doha round.

RadioNZ this morning had Phil Goff on interview. As usual, he was forthright and blunt.

New Zealand Trade Minister Phil Goff says it may take months to restart trade talks after a last ditch effort in Geneva to agree on cutting farm subsidies ended in collapse.

Mr Goff told Morning Report that Europe needed to give more in terms of market access, and the United States had to give something more on cutting domestic subsidies.

He said India and Brazil had to show some flexibility in terms of cutting tariffs on industrial goods.

But he said; no one made a move to put a compromise on the table - so the talks are unlikely to conclude this year

Not quoted there, he also pointed out that there was another, in my mind far more pertinant factor, behind the intransigence. That, you will have to read on for...

Goff mentions the Indian and Brazilian inflexibility as an additive inertia to the mix.

An Indian perspective from this editorial...
The last-ditch efforts to save the Doha Round of negotiations collapsed when the US refused to reduce its farm subsidies even as it asked the developing countries to open their markets to its heavily subsidised goods.

"We can't accept the opening of our markets for subsidised agricultural products," said Kamal Nath. He said the developed countries should break the deadlock and blamed the US for refusing to make cuts in farm subsidies.

Both the EU and the US spend over $440 billion annually as subsidies for their farmers, which makes it financially unviable for developing countries to export goods to their markets. While the EU softened its stand on subsidies, the US decided not to slash its domestic support.

The emphasis in there reflects exactly the experience of the Aussies in their "Free Trade Agreement" - the Iraq reward - which gives US immediate access to Australian markets, but then phases Australian access to the US market over a period of some ten years without, in some cases, any guarantee of truly "free" access.

The following paragraph shows also the real root of the problem. Every country has its own interests at heart. Who can blame them?

The EU raruraru over NZ dairy product access is in the same vein. Anything that the power nations agree to is subject to "their rules", irrespective of accepted meanings to the terminology involved.

But this is where I want to return to the African editorial I referred to earlier -
What Africa needs is not aid but fair trade. And the rich West has made it virtually impossible for Africa to receive a fair recompense for her vast resources. Nothing illustrates this monstrosity more than the abrupt collapse on July 1 of the ministerial conference of the Doha round of talks on global free trade in Geneva, just in time for the G8 summit in St. Petersburg.


Against the terrorist backdrop in which the birth of Doha was midwifed by the United States in November 2001 as an immediate aftermath of the terrorist attacks on New York and Washington DC, it is in the interest of all that the G8 should strive for economic equity, which to us constitutes the core of global peace, prosperity and stability. Anything short of this is tokenism which, in the final analysis, is only a measure to postpone the evil day.

I think it unfair to lay the entire blame, as this editorial does, at the feet of the Americans. It is an unreasonable conclusion drawn by the writer, given the content of the six or seven paragraphs I have excised from that beginning and the conclusion.
As usual, the latest round of Doha talks foundered on the refusal of the United States and Europe to agree to substantial reductions in farm subsidies and tariffs on industrial goods. This year's Doha talks merely followed the pattern of earlier ones in 2003 and last year when poor countries scuttled both ministerial conferences, simply because they offered, for the first time, comprehensive plans for freeing farm trade. The argument of the poor nations as then and now is that the West is demanding too much liberalisation from them while offering too little itself by way of retaining the farm subsidies it gives to its farmers.


Since the founding of the group of rich nations [G8] in 1975, it has never managed to get an extra cent of investment flowing South, neither has it been able to persuade the protectionist lobbies in The North to dismantle barriers to open farm trade. This year's summit has proved to be no different from previous ones. No EU-U.S.-Japan consensus has emerged to cut down barriers to agricultural trade and increase north-south investment.

With the attitude of the G8, it is easy to see why Doha has failed in nearly five years to get to the root of Africa's economic woes, namely, the lack of free trade on the farm produce which forms the economic mainstay of a prepoderance of its countries.

On the long range, this is a short-sighted policy capable of undermining the rich nations themselves. The consequence of resource-rich, but impoverished Africa is the deluge of economic migrants and political refugees from the continent now assailing the United States of America and Europe. The effect of globalisation is to turn the world into a kennel in which there can be no peace where there are only four bones to six dogs -- especially when one dog alone has access to two of the bones.

It is unfair, given that "the birth of Doha was midwifed by the United States in November 2001 as an immediate aftermath of the terrorist attacks on New York and Washington DC, it is in the interest of all that the G8 should strive for economic equity, which to us constitutes the core of global peace, prosperity and stability."

That piece of natal care was, largely in a moment of self-interest and fear rather than generosity and friendship, a large slice of hope for "the poor world". I am going to retain that in place of "Third World". It is more honest. It is more accurate.

The rationale behind the process was clear and concise.

If we are to counter terrorism, we the rich nations have to give cognisance to the rights of poor nations to trade and to exist in a viable economic climate. To achieve that, we the rich nations must provide opportunities for trade.

The Poor World was shown the plate. The plate had on it a goodly slice of the cake.

What they see now is that the other side of the piece of cake had been scooped out and eaten by the bigger kids. The remains have gone stale.

Now, where can it all have gone so wrong?

It is very simple.

Every one of the G6 nations, every one of the G8 nations, all of the rich nations are democracy.

That one attribute leads to one very important consequence. It is the point that Goff made on the radio this morning.


What we are seeing, from every one of the G6 and the G8, is fear of the ballot box.

It truly is that simple.

Wednesday, July 19, 2006

The problems of "free" trade...

There has been something approaching mild panic in the NZ finance and economic markets over the past five days or so, the consequence of a ruling from the European Commission that the access right for NZ butter were discriminatory because they limited the rights to just one supplier.

As a consequence of that ruling, all NZ butter exports to Britain were stopped.

Now don't get me wrong, this is a matter of some considerable moment. The value of the trade has been put at about USD165 million. That is a sizeable amount to be coming from any one market. It is the kind of money that rightly puts the heat on a few Government chairs (who at the same time have made sure that Winnie the Pooh is well tucked into bed in the US where he can insult the likes of US Senators).

But there are a number of "interesting" sidelines to this rather remarkable dust-up.

Briefly, the history -

1. The genesis is a European Court ruling in a case taken by a German company, alleging that Fonterra's right of access to the EU market was discriminatory and hence against EU "Rules".

2. That German company was seeking the right to market in Germany - yep - NZ butter, made by Fonterra. The rights of access made that impossible.

3. The EU Commission responded by cancelling the right of access to the market, and consequently all existing import licenses lapsed. Well, they were polite about it and allowed existing stocks to be sold, but no new shipments allowed.

4. Initial Fonterra contacts, and from the Government, resulted in that being expanded to allow "shipments on the water" to be received and sold.

That is pretty much where things stand at the moment. But there are others buzzing around the wires as well...

5. The accusation has been levelled that Fonterra is a "monopoly". Comment invited, but in so doing there is one very important thing to remember. Fonterra is a cooperative company. Now that might be a very strange, native to NZ only, kind of beastie. What it means is that the Company is acting solely on behalf of its shareholders. Who are they? None other than the 11,600 dairy farmers who sell their milk to Fonterra for processing and sale. Their "shareholding" is valued by the value of the milk they supply to the company; the better and the more milk you supply, the greater your "shareholding".

6. There is description of Fonterra as "the world's biggest dairy company" (not true, I believe that Nestle, and a couple others are larger), the worlds fourth largest dairy processor (probably correct), the worlds largest dairy exporter
7. To modify that, Fonterra describe themselves as "...the world's leader in large-scale milk procurement, processing and management."

In looking through the 'Net on this there were two specific items that make very interesting reading.

The first is dated 4 July, some days before the decision to withdraw the import licenses. This is not being presented as post fact ipso fact argument, because the original Court case has been around for some years, five I believe. It is not causative to the debate on the rules, or the failure of the import licenses as a result, but it might give a handle on the EU Commission's future response.

From Food and Drink Europe -
Most of Europe’s dairy industry will have eyes fixed on World Trade Organisation negotiations over the coming weeks, but there will be time too for lobbying on short-term market support and more debate over export subsidies.

World Trade Organisation (WTO)
A global trade deal between WTO members will set the agenda going forward for the EU dairy industry, including guidelines for initial discussions on the European Commission's proposed review of EU dairy strategy in 2008.

Pascal Lamy, WTO director-general, admitted this weekend that talks over a global trade deal were in crisis, largely because the EU and US delegations could not agree on agricultural subsidies.
Concerns are growing over the EU's butter surplus and dairy associations are set to increase their lobbying of the European Commission to get more short-term market support.

The EU's intervention store for butter was filled by the end of May, while the similar system for skimmed milk powder had not been used.

Britain's Milk Development Council warned recently that a butter glut had appeared in the EU because Europeans were buying less and non-EU producers were able to sell butter to the rest of the world more cheaply.

The surplus has sent butter prices down to the EU minimum, or so-called ‘intervention' level, putting pressure on processors and producers.

Now, what I understand THAT to mean is this...

By its own Rules, the EU must now pay higher rates of subsidy to all of those dairy farmers who supply European firms making butter. That could be a bundle of its own, and a very particular concern to the French.

To that end the Dairy Reporter (which also carried that last article)-
26/05/2006- British dairy officials are lobbying the European Union to stick to its 2013 deadline for scrapping export subsidies, after nations outside the bloc called for aid to end faster.

Industry association Dairy UK said the latest proposals from certain non-EU countries, including Australia, New Zealand and the US, would require the EU to cut export subsidies by 80 per cent in volume and value terms by 2010. Half the cuts would also take place in the first year.
European Commission figures show Europe’s dairy sector was the biggest recipient of EU export subsidies in 2004, getting nearly €1.5bn in aid. No other sector broke the €1bn barrier.

Government figures obtained by the campaigns group show that big firms take the most money. France’s Danone and Lactalis got €25m and €20.5m in 2004, while the export arm of Britain’s Dairy Crest got £8.3m last year.
Joop Kleibeuker, the body’s secretary general, also told the EU should treat subsidies for different products separately. “In dairy, butter especially should be at the end of the process because of the significant difference between world and EU prices for butter.”

The "process" that last comment relates to is not the making of the butter. It is the withdrawal of the government subsidies on dairy production and export.

Earlier on Dairy Reporter had this as well...
02/05/2006 - The European Commission has raised export subsidies available for butter for the second month running, bowing to pressure from member states concerned at volatile markets.

The Commission's Milk Management Committee has agreed to increase the common subsidy available for butter exports by three per cent to €99.5 per 100kg. Subsidies for butter exports in the Commission's ‘tender' system were also increased.
The Commission has now increased butter export aid in two consecutive months, following a two per cent increase to €96.5 per 100kg in March.
Common butter export aid is also due to be slashed by another €23 per 100kg after the 1 July, intended to reflect cuts to the EU butter price as part of the bloc's Common Agricultural Policy reform.

The idea is that as the Commission cuts EU commodity prices to move them closer to world prices, less export subsidies are needed to make up the difference and keep European firms competitive on the world stage.

Interesting mechanisms there, what?

Let's be honest about things here.

There are some very fancy dances going around one central fact. The general form of that fact is this -

When it comes to agricultural products in particular, there are very large manufacturers who are capable of producing a superior product far cheaper than those originating from Europe, or the US.

In the particular instance of dairy products, NZ has (despite the difficulty of shipping half the world round) a producer that has developed start to market control of its product. The consequences of that producer's skill are;

> Being able to land better product than the local, in Europe cheaper than the local industry can make it.
> Being able to compete with the same product on all international markets at governing commodity prices.
> Most importantly, there is no government assistance or subsidy on the NZ product. Here in NZ, I pay the same price for butter (plus mark-ups) as the European bound product leaves port.

What this whole raruraru does is give a picture of the kind of machinations that cloud the diplomacy of international trade, and especially the likes of the Doha round.

Thanks FIL and NZ Dairy Farmer MMagazine)
Why is the NZ dairy so good? The first photo is a farm holding vat. The second is a milking race. That will give you some idea of the capital investment required, just in the milking shed. There was a very interesting little radio programme - have a listen here if you're lucky last weekend including an interview with a tanker (milk collection) driver doing a run through the Coromandels. An eight hour day, but about a 15 minute segment of the broadcast. It gives an interesting sound picture to a small part of what NZ dairying is about.

It also will give a small glimpse of the technology behind Fonterra's success.

Sedition - I still have me doubts...

Tim Selwyn, of whom I wrote previously has appeared in Court for sentencing on the sedition charge.

Quite apart from the other matters I still have reservations about the sedition charge. The action seems comparatively slight, as does the resulting sentence of two months.

I am not sure, but I seem to recollect that there were one or perhaps two well known Maori gents who faced the prospect of sedition charges - which didn't get much further than the journos' lips - for their whakapohani at Waitangi a few years back.

OK, so the probligo will have to remember that sticking an axe in Auntie Helen's shopfront is not a valid expression of protest.

Oh, BTW this comment in no way applies to any of the other charges Selwyn faced and was found guilty. Those were criminal acts; they deserve the sentence given and perhaps more.

Monday, July 17, 2006

A blast from the past...

Thanks to an on-going, off-blog disagreement with one of those delightful right-whingers one has the fortune to meet from time to time, I followed a couple of serendipitous links and ended up back at my old mate Al the Old Whig who is definitely NOT of that persuasion.

Specifically, I ended up at a post of Al's where he reproduced (very kindly in full) my contribution to a debate of the time.

I hope he doesn't mind, but I am going to reproduce it here.

This is not a case of narcissism on my part, but rather a small lesson of sorts to a nasty little gent (not the one referred to in my opening para) who has as many aliases (on the one comments page at times) as the Hydra of old mythology had heads. Actually, the Hydra metaphor is even more apt given the nature of the beast. The specific comment is found here round about post number 49 or 48... -

People like stevie and probligo and tequila would disagree of course. But of course, they are the quintessential Left in my view so I cannot really expect them to comprehend the essence of others. I got tired of partisan differences a few years ago. Sure, it is good for training, and for neophytes to the political arena, but eventually you transcend the limitations of party and politics.

To show Y how little he knows of me and my politic...


I was thinking of posting this as a comment to your item, but it grew like the proverbial and so it has become a full blooded e-mail instead.

With respect, I believe that you have missed the point that FitzGerald was making. This is how I hear what he is saying...

1. Do not recognize the terrorist groups. So doing gives them legitimacy as "enemies", and gives them the validation that they seek. It occurs to me that this idea could be supported by the example of AlQaeda and its progressively aggressive tactics from USS Cole through Kenya to the ultimate of 9/11 when they did finally get the response that they sought from the US. They were immediately "recognized as a force that even the US could not ignore". From that response they have gained their public legitimacy as the "fighters in the war against the Great Satan".

2. Do not recognize the conflict with terrorists as "war". That again legitimises the terrorist group's "war" against... It is not a war. They are very well organized, heavily armed criminals. They are groups of armed thugs. They have no validation other than as murderers and killers of the innocent. That makes them criminals, not an opponent in war. Look at last night's bombings in Iraq. Who was killed? Iraqi civilians. Who do the Iraqi people blame? The Americans. Why is this? As I read FitzGerald, it is the consequence of "war". The Iraqi people are persuaded (by the Islamic extremists) that America is there fighting ITS war in Iraq. It is NOT IRAQ's war. Therefore (by the terrorists' logic) America must be responsible for the killing. ...Note that FitzGerald REFUSED to speak with either IRA or Sinn Fein. In his mind "they did not exist".

3. Do not alienate the local populace... see 2.

4. Closely allied to 3. is being able to recognize the valid "freedom fighters", the "liberation army" trying to remove an illegitimate or oppressive government. Examples? Well, take your pick in Chechnya; I am not going to judge that one at present. The Taleban in Afghanistan against the Russians? Obviously they were freedom fighters because the US backed them (a slight note of sarcasm here?). If there were to be terrorist action in Burma, Islam against the Burmese government, would that be liberation army or terrorists? Take a look in Zimbabwe... how much effort should there be from the international community to support any effort to overthrow Mugabe? Would such a movement be terrorist or freedom fighters if they came out shooting? The same in Sudan; are the Junjaweed government troops or terrorists?

Al, I am trying hard here not to be judgmental about the actions taken by the US. My personal feelings on the whole matter over the past three years run something like -

1. The response in Afghanistan was well justified, based upon the reasons given for that action.

2. Since the commencement of that action, the US has not followed a particularly consistent path.

3. I have always believed, in the case of the wider Middle East and Iraq in particular, that there had to be "a better way". Not one that is easy to find, or easy to "justify".

Perhaps, just perhaps... no... maybe the FitzGerald interview expressed for me the shape that alternative may have had.

As it is, we the people of this earth, are faced with new history, history in creation, that has a very heavy momentum. For that reason, changing its course is going to take time and great effort. The effort being expended now? Is it in the right direction or the wrong? Personally, I have to go back to what I said above…

"Look at last nights" bombings in Iraq. Who was killed? Iraqi civilians. Who do the Iraqi people blame? The Americans. Why is this? As I read FitzGerald, it is the consequence of "war". The Iraqi people are persuaded (by the Islamic extremists) that America is there fighting ITS war in Iraq. It is NOT IRAQ's war. Therefore (by the terrorists' logic) America is responsible for the killings...."

Turning that just a little...

The terrorists argue "America 'is at war with terrorism'. There are no terrorists in Iraq. There are only Iraqis in Iraq. Why then did America invade Iraq? Because they are the Great Satan and it is every man’s duty and religious destiny to join in that great jihad against the Great Satan..."

Add on...

"America says that it brings freedom and democracy. Where is freedom while our country is occupied by the Great Satan?"

I have said before that I have no truck whatsoever with people who suppress and withhold the rights of others. Terrorism, IMO falls into that category. I say that because terrorists (generally) have the objective of their own and all is subservient to those ends. There is more often than not a desire to impose political, cultural and/or religious precepts on a generally unwilling populace.


the probligo

Now consider first that I wrote that in 2004, after reading an extensive article covering FitzGerald's political life in the period of the IRA terrorism in Eire and Northern Ireland and posting on it here.

Nearly two years later, I have no reason to change my agreement with the comments I made, nor my support for FitzGerald's argument.

The US NEVER uses its power of veto... 2

...and this is how it is usually done.

United Nations, July 16: The United Nations Security Council held closed-door consultations on the mounting violence in Lebanon but failed to reach agreement on a statement that would have called for a ceasefire.

After the meeting last night, Lebanese Representative Nouhad Mahmoud said he was "very disappointed" at the 15-member council's inaction, which he blamed on the United States.

"There was no agreement on a text tonight," French Ambassador Jean-Marc De La Sabliere, the Council President for July, said.

Jean-Marie Guehenno, the Under Secretary General for UN Peacekeeping Operations, earlier briefed the Security Council on the latest Lebanese developments.

"I expected much more from the Security Council," Mahmoud noted, warning that the council's failure to act to stop the bloodshed "would send a very wrong signal not only to the Lebanese people, but to Arab people, to all small nations that we are left (to face) the might of Israel."

He had pressed the council to call for a ceasefire and for the protection of civilians in the face of relentless Israeli bombardments yesterday that killed 38 civilians and struck targets close to the centre of Beirut.

"We wanted more than a statement, we want a resolution, we wanted a ceasefire," he added.

The rationale is, of course, that Israel has the right to defend itself. No problem with that in my mind. Nor is the "proportionate response" argument one that I would try and take up.

But, there is something quite obsene about any military action that has the intention (and let's face it, Israel has been quite open) of destroying the economic infrastructure of both Palestine and Lebanon.

That is about the one word that I can find to describe what is happening, and it is totally inadequate in the context. It is the same kind of obsenity as shooting ducks on the ground, or fishing with gelignite.

But the most obsene is the (intended) implication that the Palestinians have no right to defend themselves, their land, or their families.

Friday, July 14, 2006

The US NEVER uses its power of veto...

...does it!

Of course not!!
The vote on the draft resolution was 10-1, with the United States voting no, and four countries abstaining -- Britain, Denmark, Peru and Slovakia.

U.S. Ambassador John Bolton said Washington had voted against the text because it was "untimely and already outmoded."

A resolution requires at least nine votes -- and no veto from any of the council's five permanent members -- for approval. The five are Britain, China, France, Russia and the United States.

The veto was the first by the United States since October 2004 when former Ambassador John Danforth opposed a resolution calling on Israel to end an earlier incursion into Gaza.

Equally as interesting are the abstentions. Is this a case of "We don't want to stand against you, US, but we can not in any sincerity oppose the resolution."?

Tuesday, July 11, 2006

New scenes... old problems...

As the Doha Round of the WTO negotiations wends its way toward extinction, there is a lonely and vaguely familiar voice out there in the wilderness.

That voice is none other than Paul Wolfowitz, now leader of World Bank.

At the time of writing (7/10/06 1800 EST) I can find very few US publications reporting his letter to the G8 Summit. NYT is there (typically as some might say), Reuters has an article out that should get published over the next 12 hours, All Headline News copies on it, as does NZ Herald and ABC.

Why is this worth posting then?


What kicked me off on this slight addiction of reading international affairs seriously was the influence that other nations have on NZ's ability to trade. Always in the background to the debates, the negotiations, and the rhetoric has been the subsidies paid by "wealthy countries", the barriers both legal and illegal to market access.

This is how stupid it gets.

In Fiji, there are cane sugar growers who have abandoned their land and have diversified into other crops. In Australia, Northern Queensland, the area in cane sugar three years ago when I was last there was only 15% of what it had been 20 years before. The last remaining mill was enough to supply NZ and Australia.

The reason? EU states who subsidise over 70% of the cost of production for their farmers to grow sugar beet. Think about that; the total cost of sugar in Germany could be about 1/3rd of its present cost (if you include potential tax savings).

The only market that keeps the Australians in large scale wheat production is Iraq. They are on the cusp of losing that (news-google Australian Wheat Board to find out why). It is possible that their wheat would be considerably cheaper than that produced in US and Canada and heavily subsidised by the respective governments.

France pays farmers to keep as few as two milk cows in production. By paying those subsidies, they can block access of imported product to both French and EU markets.

But then consider this.

I mentioned Fiji as an opener to the sugar example. In fact, Fiji could land raw sugar in NZ at 2/3rds of the price of Australian and could produce enough to supply both NZ and Australia. That competition for the Australians is the next step.

Afghanistan could grow almost enough wheat to supply Europe. The false markets created by subsidies makes their entry to the market impossible.

Some 90% of Zimbabwe's production of fresh vegetables and fruit went to Europe. Well, it did before Mugabe went mad.

The list is not endless, but there is an important principle at hand. It has its impact upon NZ, not least because it is going to increase the level of competition against us.

If the US wants to make a success of Afghanistan, or Iraq for that matter, then ONE way to help would be to give the people, the farmers, the land and opportunity to produce AND ACCESS TO THE MARKETS necessary to provide economic return.

That is the fundamental that lies behind the Doha round. The reality is that no French government has ever won power without the support of the farming sector; I suspect that no state or federal government in Canada would survive without agriculture support; the US?

"With time running out, our collective efforts can make the difference," he said in a letter to leaders of the Group of Eight industrialised countries and five major developing economies, due to start meeting in Russia on Saturday.

The meeting of leaders from the United States, Japan, Germany, Britain, France, Italy, Canada and Russia comes two weeks after trade ministers met in Geneva but failed to resolve differences over farm and industrial goods which, with services, make up the three pillars of the talks.

"We can work to lift millions from poverty, boost developing country income, improve global market access and reduce taxpayer and consumer costs for all, or allow the whole effort to collapse, with harm to everyone," Wolfowitz said.

The really BIG problem Wolfie, is the harm that would be done to electoral prospects of the leaders of the G8 if the Doha round were to succeed.

Sunday, July 09, 2006

Confirmation bias - 2

I have written before about confirmation bias. I confessed then that I yield to it more often that I would hope. What brought me back to the topic? It was a comment by the old wasp that he had instilled in his children “...well built BS meters...” which, on the surface sounds like a pretty danged number one good idea. But then the settling little thought of “Where is the zero BS mark” came sneaking back into the paradigm.

[sheepish grin] I have often noted that "thrill of the chase" feeling when you find an apt and strong support for a comment, or thought. So, a brief google, and the application of some personal confirmation bias later, and I had an interesting selection of reading matter to wade my way through.

Now there is a scientific basis for the “syndrome”.

During the run-up to the 2004 presidential election, while undergoing an fMRI bran scan, 30 men--half self-described as "strong" Republicans and half as "strong" Democrats--were tasked with assessing statements by both George W. Bush and John Kerry in which the candidates clearly contradicted themselves. Not surprisingly, in their assessments Republican subjects were as critical of Kerry as Democratic subjects were of Bush, yet both let their own candidate off the hook.
The neuroimaging results, however, revealed that the part of the brain most associated with reasoning--the dorsolateral prefrontal cortex--was quiescent. Most active were the orbital frontal cortex, which is involved in the processing of emotions; the anterior cingulate, which is associated with conflict resolution; the posterior cingulate, which is concerned with making judgments about moral accountability; and--once subjects had arrived at a conclusion that made them emotionally comfortable--the ventral striatum, which is related to reward and pleasure.

To me, that sounds as though so very old, primitive, structures and responses are involved. I needed this picture here to try and envisage just which parts of the brain the article was talking about. Hopefully it wil appear below as well.

Now, my interpretation of all that is probably wrong, open to further interpretation, and oversimplified. So I will set the next paragraph in place...

"We did not see any increased activation of the parts of the brain normally engaged during reasoning," Westen is quoted as saying in an Emory University press release. "What we saw instead was a network of emotion circuits lighting up, including circuits hypothesized to be involved in regulating emotion, and circuits known to be involved in resolving conflicts."

Hmm, conflicts? Between emotion and what?

Interestingly, neural circuits engaged in rewarding selective behaviors were activated. "Essentially, it appears as if partisans twirl the cognitive kaleidoscope until they get the conclusions they want, and then they get massively reinforced for it, with the elimination of negative emotional states and activation of positive ones," Westen said.

So, is this the process of rationalisation of perception and emotion that I suspected? Perhaps so.

What I do know is that it always feels “good” to find something that is (to me at least) cogent, logical, and which supports the line of thinking that I believe is “truth”. It is a “profound feeling” that comes from very deep in my mind.

That is one reason why I have steered clear of topics such as Israel and Iraq on thse pages in recent times; not that I have been silent in contributing to comment debates.

The power of confirmation bias at the emotive level - the feel-good factor, the power and fluidity of communication created by having support for a contentious argument – is a dangerous point from which to start.

But that is not the worst of it...

The implications of the findings reach far beyond politics. A jury assessing evidence against a defendant, a CEO evaluating information about a company or a scientist weighing data in favor of a theory will undergo the same cognitive process. What can we do about it?

In science we have built-in self-correcting machinery. Strict double-blind controls are required in experiments, in which neither the subjects nor the experimenters know the experimental conditions during the data-collection phase. Results are vetted at professional conferences and in peer-reviewed journals. Research must be replicated in other laboratories unaffiliated with the original researcher.

Disconfirmatory evidence, as well as contradictory interpretations of the data, must be included in the paper. Colleagues are rewarded for being skeptical. Extraordinary claims require extraordinary evidence.

I have never served on a jury. I shall probably not escape for all that much longer. There will be all manner of personal attitudes that could be challenged by the experience; not the least of which would be my ability to objectively assess evidence and the way in which it is presented.

So, where does my BS meter point to at its apparent zero point? Unlike the old wasp, my parents did not “teach” the differences between “good” and “bad” politics, or religion, or even personal relationships for that matter. There was strong emphasis on personal morality, and the need to observe the societal norms. But that does not of itself constitute a "BS measurement".

That is quite unlike the grounding my wife got in the precepts and foundations of the Labour Party. I swam around in the nether regions of the Communists, National, Labour and eventually the realisation that there was no fundamental difference between Andersen and Muldoon, between Nash, Brash, and Peters. (Is it any surprise that we do not discuss politics at length?) At the very base of each of these people are two things –

The unquenchable belief that they are right and every one else is wrong.

The desire to leverage, extract and maintain every last morsel of fame, wealth and power possible from their respective party followings.

So, in terms of “centering the BS meter”, I guess that there is really very little difference between the KKK member who teaches his kids that all blacks are inferior and should be kept only as pets; the Unionist shop steward who teaches his kids that Savage was a god, and that Kirk sat at his right hand; the businessman who teaches his kids to support National because Brash and Keys will return to them all of the taxes that “those other politicians take to give to the unworthy and poor”.

It all comes down to where the zero point is on the BS meter.

To that extent, the old wasp had it wrong. What I suspect he really meant was that he had given his kids a good grounding in where their truth meter was pointed. It is just the inverse of what he was saying, and it operates in exactly the same manner...

For myself, I will stick with the closure of the SciAm article that I started with –

Skepticism is the antidote for the confirmation bias

I might add the word ONLY in there, just before "antidote".

Wednesday, July 05, 2006

It's harassment now...


Monday, July 03, 2006

When in "Rome"

Some while back, I read a review (can't remember who blogged it or I would give credit where due) giving a strong recommendation for "Rome".

I watched the first episode last night, so this is very much first impression.

I did not like it...

The violence I expected. It adds little, but is part of the story, (in the same way as having the graphic depiction of a Maori chief chomping off the end of a detached, raw, and bloody, penis was part of that story).

The sex, simulated or not, ranging from a casual rape to the interior of a Roman knocking shop reminded me of scenes filmed by Ingmar Bergmann running on a closed loop.

The historic detail I have to accept as being "reasonably accurate".

Entertaining? The kind of thing I might watch on Sunday evening? Errm, not.

The Maori programme?

It is called "Taonga" (Treasures). They are half hour long stories taken from Maori history. The one I referred to above was also last night. It was the story of Lucy Takiora Lord, a half-caste Maori woman who spent a good few years guiding first the British Army then later the mercenary von Tempsky in their attempts to remove the Maori from Taranaki. Lord left behind a diary which has formed the basis not only for this programme, but far more importantly for claims against the Government for breaches of the Waitaingi Treaty and for what these days would be termed "crimes against humanity".

Chilling, chilling history. Never taught in the schools in my time. There are few who would teach the whole, unadorned history even now.

Sunday, July 02, 2006

Well, at least I know where I am welcome...


Well, this is a sad day indeed, one that I thought would never come to pass.

Originally, this post recorded a brief email exchange I had with an American gentleman (I am advised that is a sufficiently polite term for him) regarding the "rules and regulations" for posting at neo-neocon's blogsite.


Extensive cutting and pasting will be grounds for deletion. Repeated violations will lead to banning. Civility and staying on topic, that is not trying to highjack threads, is the preferred discussion method. From a review of your comments, I see several cases where you dance on the edge. Blanket condemnations without precise documentation and logical fallacies as found on this list can result in loss of commenting privileges. Trim your sails and you can still post. Go over the edge and you’re history.

I. BTW, am not a Neo-Con. I’m just an old fashioned Republican; what you would call a “Fascist” in your lexicon. I’ve met very few Kiwi’s in my extensive travel in your country who I would call friends of the US and, frankly, I don’t care what you think of us. For the nonce, and only because it suits our national interests, your country remains under our protection. Treaties are not eternal.

Now, to be fair to this gentleman, he was relatively polite in his insults. He got no worse than calling me a ponce; a term of approbation and endearment in his world I guess. At least, unlike some of the others of his ilk I have had the fortune to meet, he has stayed away from the sheep jokes.

I am removing this post, and a second, because I am not sufficiently vindictive to leave them remain.

What ever this gentleman's background, whatever his reasons, I have had a second series of emails on this same topic. They are written, quite politely, by a "security consultant" apparently engaged by Mr X.

He advises me that I stand to suffer all manner of dire consequences if I am not to remove these two posts. Well, Mr Security Consultant, your threats, and the blatant attempts at appealing to my better side - almost fawning in one instance - are a small part in this decision. Not because of the threats - I would just love to challenge them. No, you have reminded me that I am better than that.

So, to close this sorry chapter, and to all of the "security agents", IP complaint investigators, and others who seem to have been the majority of the traffic through the probligo's little world I have removed the remainder.

I suggest that your read no further, as the rest of this is intended for Mr X as a parting gift.


Mr X, sir.

I hope that all of your fears are realised. I hope that the causes of your paranoia and fear of life come to pass.

You, sir, are not a democrat by any stretch of the imagination.

You, sir, are not what I would call a "fascist" as you have suggested. You would have done well for yourself in the times before Magna Carta - when men were men and serfs were taken to battle for blood sports by the nobility. That is a trait that you have not lost.

Well sir, you tire me.

I leave you with the most powerful insult that I know -


My full name is

Bob Renner

I live at 19 La Perouse St in Howick, Auckland.