I spent an interesting 24 hours in Christchurch on Friday and Saturday as a guest of the New Zealand Broadcasting School.

I was a speaker at the school’s conference to celebrate 25 years of turning out great Kiwi broadcasters and industry heavyweights.

Some other interesting speakers too, including the head of the Australian Special Broadcasting Service, Shawn Brown, himself a Kiwi; Brett Impey, the CEO of Mediaworks; Rick Ellis, CEO of TVNZ, Jim Mather, head of Maori television and John Follett, the head of Sky New Zealand.

All of them had some interesting things to say about the state of Kiwi broadcasting, but they are also fairly optimistic that the industry is in relatively good shape-if only it wasn’t for this blasted recession.

Advertising revenues are down somewhere between 15 and 30 per cent and of course there’s been several rounds of cost-cutting, particularly in news and current affairs, but each of them was surprisingly upbeat about the state of broadcasting, particularly television, in the relatively (in global terms) small New Zealand market.

I was on a panel talking about the future of news and my fellow presenters were TVNZ head of news and CAff, Anthony Flannery, his TV3 counterpart, Mark Jennings and a recent NZBS graduate, Katrina Bennett, who’s now with the Radio Network in Wellington.

We had a lively discussion and again both Mark and Anthony were confident that television will continue to be the dominant news media for some time to come.

There were some great questions from the audience too: about the ubiquitous TVNZ live cross that doesn’t seem to go anywhere. Anthony Flannery made the point that he thinks TVNZ news gets it right about 40 per cent of the time.

There was also some discussion of how PR is tending to overshadow news to some degree and Katrina made the interesting point that to some extent journalists have just become the re-mediators of press releases. She asked why don’t organisations like the police just go straight to the public and this provoked some interesting responses from the panel and from the floor.

I suggested that for some organisations it was convenient to use the news media as a form of “information laundering”, by which I mean that the information presented as news loses the stink of being just PR when it is reformatted and given the credibility of news.

Mark Jennings also made the point that in some cases if the media weren’t in there chasing the police they might just resort to lying about events like police shootings or accidents in which police drivers kill or injure pedestrians.

My presentation was based on the central theses of my forthcoming book, News 2.0: Can journalism survive the Internet. I can safely say that it’s nearly finished and will be with the publishers in a couple of weeks.

In case you’re interested here are the seven theses. None of it is really startling, except perhaps the public/worker control argument at the end.

The idea is really to summarise the current state of events, suggest some ways in which we got here and to look at what’s being proposed as potential solutions, particularly to the vexed business model question.

One more thing before I go; there was an interesting short presentation on a new US business venture called Zillion TV and I think that perhaps some of the industry chiefs were too dismissive of it.

A key problem is monetizing the clickstream-that is finding ways in which it becomes acceptable for Internet users to pay for information that they currently get for free. I think this is a cultural issue-we used to stuff being free and are now reluctant to start paying.

Zillion TV gets around this by transferring web-based content into a TV environment. The cultural barriers to subscriber television are very low and we’ve been used to this model now for several decades. So perhaps the idea of repackaging online content into a televisual space (from the computer screen to the TV screen) is not such a stupid idea.

Anyway, enough from me. Here are my speaking notes – a rough guide to News 2.0.

News 2.0: Can journalism survive the Internet

Thesis 1: the hunger for news is a universal human need, it won’t go away anytime soon.

People feel let down

Journalists are low on the global trust scale

However, because of their adherence to market forces the mainstream media has let down the public in terms of big picture political and social issues. The pursuit of profits has led the MSM down market, thinking that they were following, not creating public taste. We are now living in a sick celebrity culture that distorts our self-perception and that is slowly driving us all insane.

Thesis 2: digital technologies have forever changed the ways in which we consume news.

Globally, television is still the dominant news and entertainment media (Thussu, 2007), but for how much longer?

• 1.5 billion televisions
• 1.5 billion PC screens
• Several billion mobile phone screens
• 6.7 billion people on the planet
• Uneven distribution: in some countries there are too many televisions, in others no where near enough

News is mobile

News is going mobile and it’s being condensed. It might be a worrying thought for some, but the 140 character text message and Twitter “tweet” format could be the future of most information exchange.

Markets are fragmenting

Mass markets for news are now fragmented—what the marketing mavens call “niche”. This has been bad news for the economics of all publishing and broadcasting that is advertising supported.

Impact on politics and social conversation

This fragmentation also impacts the body politic. Where do we have the important local, national and global conversations today when our eyes are on the phone screen and our ears locked to the beat of the iPod?

Thus the digital dialectic is both promise and curse.

Thesis 3: the singularity of convergence culture has also changed the world of news for ever.

Convergence culture – there’s no going back

Professional ideology of journalists is under pressure

Professionalism has become a trap for journalists – they are tied into a corporate culture that no one’s buying anymore. Perhaps, as Robert McChesney suggests, journalists have to become “unprofessional” in order to reconnect with audiences.

Convergence culture is UGC

D-I-Y news via social networking is on the rise, User-generated journalism (of which Citizen Journalism is but one subset) is also creating new forms. People are no longer reliant only on MSM for their news.

The people we used to call the audience

Should not be over-stated

The dialectic here is between a more democratic public sphere in which those we used to call the audience (Jay Rosen) are now the producers (producer-consumers) and the desperate race of the MSM to further colonise this space and to cement it into their monopolistic control – through copyright law and buying up the social network real estate

Thesis 4: we have to separate the crisis in the news business model from the discussion about the crisis in journalism.

They are related, but different.

Partly they are united by a crisis of trust and credibility and partly by the fact that in a capitalist economy the sale of newspaper/TV/radio/online advertising pays the wages of the content producers – in this case journalists.

We are now in a critical juncture and the global financial crisis is a further threat to the political economy of the news business.

Thesis 5: new online business models for news publishing are not yet tried and true.

The current experiments with Christian Science Monitor, for example may yet turn out to be expensive failures.

The confusion is evident in the roller-coaster ride taken by the Finnish financial daily Taloussanomat that stopped its print edition in 2007 (Thurman & Myllylahti, 2009), but was not able to contain costs and increase revenue enough to maintain an independent online presence. By quitting its paper editions, Taloussanomat quickly saw its costs fall 52 percent. But, according to Thurman and Myllylahti, the new online only service,Taloussanomat.fi, also lost 22 percent of its users and 75 percent of its revenue. Less than two years later, the company that owns the Taloussanomat brand announced the merger of the financial website with a mass market tabloid Ilta Sannomat newspaper it also owns (Andrews, 2009). The company wants to achieve savings of around 30 million Euros, but according to management, was only half-way there in May 2009.

“The programme launched in January will save us about EUR 15 million, but unfortunately that is not enough. New actions are called for in order to keep the foundation of the company sound, in order to be able to invest resources in further development and in order to continue securing the prerequisites of independent journalism” says Mikael Pentikäinen, President of Sanoma News. (WebWire, 2009)

Thesis 6: we can take away some positives from social networking and Web 2.0.

Collective intelligence

BUT: Noise to signal ration very high in some situations

In particular the collective nature of trust and verification is a key element of peer-to-peer sharing of information and this can apply to news. One key point from this is also that in terms of the book’s argument about working journalists, there is collective strength in the union.

We need to position journalism (in all forms and formats/platforms) as the collective wisdom of the public interest and speaking truth to power. This will ultimately require some form of collectively organised system for gathering, analysing, interpreting and distribution information in the format of news.

Thesis 7: Can journalism survive the Internet?

What happens to “news” when the economics of the news business are no longer working?

It is not clear that the current commodity form of news can sustain itself, unless there is a solution to the broken business model of publishing and free-to-air broadcasting.

We might expect there to be some other commodity form for information, but what is it?

Subscription models—such as pay TV—are available, but it is not certain that people will be willing to pay for content online. The internet has been “free” for so long that the cultural expectation of free content will be hard to break.

If the news industry collapses, how will we get our information and exchange important news?

If news is a universal trait of human society (thesis 1) then a method needs to be developed of continuing to provide reliable and common news-like information from trusted public sources.

Perhaps we need to redefine journalism as “public reporting” and recognise that for the foreseeable future it’s going to be a mix of the industrial model (commodity journalism with all its dualities and contradictions) and an emerging model of prosumer news of varying levels of complexity and quality.

Extending the watchdog role through alliances (various pro-am experiments) and building the collective strength of the reportorial community (in which both working and amateur reporters collaborate, cooperate and critique each others work) are the key.

Platform is somehow irrelevant in an informational sense of the democratic circulation of ideas and information in the easily-digestible form of news. Newspapers in their current formats will have a finite life; we may have to start paying for information from the web—though information may continue to “want” to be free.

There will continue to be tension—the dialectic—between journalism’s commodity form (exchange value) and it’s informational use value.

The pressure from below: user-generated content—amateur, or alternative journalism (Atton & Hamilton, 2008) and “produsage” (Bruns, 2008)—is not going to ease. There is a variety in amateur public reporting and that is one of its strengths. But there is a high noise to signal ratio in social media still and the collective strength of the reportorial community will have to maintain the pressure against attempts for further commercialise the clickstream.

Ultimately, we need to maintain some form of paid, organised collective reportorial community for the sake of democratic reform and change.

What is unclear is whether or not this can have a viable commercial commodity form (the industrial journalism model)

The basic principles around which a community of journalists—the new “reportorial community” (Hirst & Harrison, 2007)—of working (professional) journalists and a variety of amateur communities (citizen journalists, eye-witnesses, accidental journalists, bloggers and gatewatchers) can be outlined as follows:

1. Defend and extend the public interest

2. Access to news is a human right

3. Through collective strength journalists (public reporters) speak truth to power

4. The union represents the class interests of journalists and the present form of its potential democratic and collective strength

Andrews, R. (2009, 9 May). So much for onlne-only; Finnish web paper back in print. Retrieved 16 May, 2009, from http://www.paidcontent.co.uk/entry/419-so-much-for-online-only-finnish-web-paper-back-in-print/

Atton, C., & Hamilton, J. (2008). Alternative Journalism. London: Sage.

Bruns, A. (2008). Blogs, Wikipedia, Second Life and Beyond: From production to produsage. New York: Peter Lang.

Hirst, M., & Harrison, J. (2007). Communication and New Media: Broadcast to Narrowcast. Melbourne: Oxford University Press.

Thurman, N., & Myllylahti, M. (2009). Taking the paper out of news. A case study of Taloussanomat, Europe’s first online-only newspaper. Journalism Studies, iFirst Article, 1-18.

Thussu, D. K. (2007). News as entertainment: The rise of global infotainment. London: Sage.

WebWire. (2009, 7 May). Sanoma News expands its rationalisation programme. Retrieved 16 May, 2009, from http://www.webwire.com/ViewPressRel.asp?aId=94463

Australian Services Union Victorian Branch Assistant Secretary Igor Grattan has announced that the Union will do whatever it takes to get unfairly sacked members Mick Van Beek and Peter Anderson their jobs back at the City of Greater Geelong’s Drysdale depot.

Van Beek and Anderson were unjustly sacked after the pair filled in two pot holes hazardous to elderly patrons of the Leopold Sportsman Club last November during their lunch break, receiving two free steak sandwiches at management’s insistence a week later.

Click here to send an email to the Council showing your support for the workers.

Grattan is shocked the Council went to such lengths over two workers simply being Good Samaritans.

The Council’s decision to sack these workers is harsh, unfair and unjust. The punishment clearly outweighs the alleged conduct, and the ASU will be doing everything within its power to help get these two men their jobs back. We are willing to fight for their rights until a fair resolution is reached.

In support of the pair, hundreds of work colleagues, friends and family were in attendance at a rally at Geelong City Hall last night, urging councillors to reinstate Van Beek and Anderson.

Earlier, council workers at the City of Greater Geelong walked off the job to rally at Johnstone Park to express their views on what can only be described as unfair dismissals.

The ASU is still awaiting a response from Council as to whether they are willing to reconsider their decision and reinstate Van Beek and Anderson.

For further information

Igor Grattan – ASU Assistant Victorian Branch Secretary, – Mobile 0419 555 350 – Email: igrattan@asuvic.com
Barry Miller – ASU Organiser – Mobile 0419 555 354 – Email: bmiller@asuvic.com

Conservatives argue that the election of Barack Obama means that the US is somehow a post-racialist society.  Certainly the American electorate rejected the overt racism of the Republicans.

But putting an African-American into the White House when millions of blacks and Latinos are losing their homes and jobs shows that the idea of  post-racialism is a sick joke.

Most sub-prime loans went to poor African Americans and Latinos.  The racism of the past – their poverty and specifically racist policies like redlining and failing to develop city centres – forced black workers into these loans to achieve ‘the American dream’ of home ownership.

The Great Recession is hitting every worker across America.  Yet as unemployment skyrockets it falls disproportionately on  African Americans.

Barack Obama has done nothing to save black jobs.

Or take the justice system. Barack Obama is in charge.  Young black men are seven times more likely to be jailed than white men. 

This means that in a country that still allows the barbarity of executions in many states, black men are murdered at a much greater rate than others.

The justice system is an institutionalised regime to protect the rich and their wealth from the poor and working class.  And so it locks up the poor and alienated – African Americans for example – at huge rates.   A young black man is more likely to be in jail than in University.

Harvey Gates’ arrest shows that nothing has changed. 

Obama’s first reaction – the arrest was stupid – reflects his experience as an African American growing up and working in a racist society.  His backtracking – why don’t both of you come and have a beer in the White House? – shows he is now running that racist society.

Barack Obama may have raised expectations about change but the reality of racism will see those expectations dashed on the rocks of reality – poverty, poor education, discrimination, jail, low pay, poor housing.

Barack Obama manages a racist system and can’t change its fundamentals.  Only an upsurge of mass struggle akin to the Civil Rights movement of the 60s can bring about real change.

For further analysis you should read Keeanga-Yamahtta Taylor’s article ‘A “post-racial” America?’  in the latest edition of the US magazine Socialist Worker.

Back in the mid 1980s Australia moved from an exemption system for foreign taxed income to a foreign tax credit system (FTCS). 

In essence under the FTCS Australian residents declare their foreign income and receive a credit for the foreign tax they have paid on it. (The credit is now called a non-refundable tax offset.)

As a rough rule of thumb an Australian resident can live overseas for about two years and still have Australian residency status for tax purposes.

There was one exception to the FTCS.  For residents whose salary and wages was earned overseas the Labor Government of the day decided it would remain exempt if it was taxed overseas.  This exemption is found in section 23AG of the income tax law.

The argument Hawke Labor used was that the exemption would save these Australian resident salary and wage earners from the compliance costs associated with including the income only to see them receive a credit roughly equivalent to Australian tax.

This has some superficial appeal.  Many Australian resident expatriates do pay income tax in other countries on their overseas salary that is roughly equivalent to Australian tax levels on the same income.

But of course, many do not.  Expatriates in Hong Kong for example pay a maximum of 17.5 percent tax on their salaries there.  Until recently, as Australian residents they were exempt from any tax in Australia on that lightly taxed income.

However it is likely the real driver for the section 23AG exemption was political. Labor didn’t want to be seen as attacking working people.

And no doubt they reasoned that since the exemption was limited to Australian tax residents earning foreign salary and wages this meant that these people were out of the country for up to two years and so wouldn’t be getting the benefits of Government expenditure on taxpayers in Australia, things like schools, hospitals and roads, without contributing to Australia’s tax coffers.

Almost immediately there was a problem.  What about offshore oil workers who worked five weeks on in foreign waters nearby and paid foreign tax, and then spent 5 weeks at home with the family in Australia?

The Tax Office developed a ruling which decided the 23AG exemption applied to such people. 

Then pilots began to get in on the lurk.  Many had families in Australia.  Yet they themselves might notionally be based in a foreign city and pay tax in that low tax country.

Pilots would structure their flights in such a way that they spent their rest days and other leave days in Australia.  This meant they were with their family, enjoying our roads, hospitals and schools, but arguably paying no Australian tax on that income.

In other words globalisation and the free flow of labour (a free flow for some skilled workers, not refugees unfortunately) undermined the exemption.  The inequity was obvious – why should pilots of foreign airlines pay no tax in Australia when they, like their Qantas counterparts, really lived here?

The Tax Office tried to deal with the problem administratively by issuing a ruling. The outcome was an interesting comprise between competing interests which didn’t really prevent the rort. 

Interested parties merely sought the advice of counsel that their arrangements were OK and ignored the ruling.

The personal tax area of the ATO did not see enforcing the ruling (for example by auditing a large number of foreign airline pilots living in Australia) as a priority. It didn’t have the staff and international matters were not given high priority. 

Treasury took the position that the matter could best be resolved administratively.  Why waste Parliament’s time? And, so the argument went, there were bigger tax fish to fry.

But, as Treasury’s own Tax Expenditure statement shows, the cost of the exemption (and another minor one) was estimated at $520 million last financial year.

Couple that with a Government keen to cut its deficit in any fashion possible to fund its stimulus package and it is not surprising the Government changed the rules with effect from 1 July 2009.

Only charity workers, aid works and defence personnel (to simplify) will now be eligible for the exemption.

The Treasurer estimates this reform will bring in an extra $675 million over the next four years.  That is likely to be an underestimate.

So what seemed to be a sensible policy exemption became a burgeoning drain on revenue as globalisation made it easier for skilled labour to exploit the weaknesses in the provision.

The good thing has ended, and with many tax arrangements cleverly designed as agricultural schemes collapsing, I wonder now where the pilots and their crew will put their money?

 My guess is superannuation and negative gearing, using the halving of the capital gains rate as an extra incentive.

Let’s hope the Henry Tax Review fixes up superannuation and negative gearing, and the capital gains concessions, all of which favour the rich.

After all, Treasury’s own Tax Expenditure statement shows the cost to revenue of tax exemptions, deferrals and the the like at around $80 billion a year.

Most of these disguised grants go to the rich or go disproportionately to the rich. 

I won’t hold my breath that the Henry Review will do anything since the whole of our tax system is one giant conduit of revenue from ordinary workers to the well off.

PRESIDENT BARACK Obama declared at the Summit of the Americas meeting in Trinidad and Tobago in April that there would no longer be junior and senior partners in the Americas–but his actions are sending a different message.

The most egregious case is Honduras, where the U.S. has played ball with the coup-makers who overthrew democratically elected President Manuel Zelaya earlier this month. The Obama administration also failed to speak out against last month’s Peruvian police massacre of more than 50 indigenous people in the Peruvian Amazon who were protesting the incursion of petroleum transnational corporations into their territory.

In Bolivia, too, Obama failed another important test. On June 30, the Obama administration rejected renewal of the Andean Trade Promotion and Drug Eradication Act (ATPDEA) for Bolivia, citing the country’s alleged failure to cooperate in drug eradication efforts.

With this pronouncement, the administration ratified George W. Bush’s decision last November to suspend the trade agreement with Bolivia on the basis of supposed non-cooperation in counter-narcotics operations. In reality, the suspension was one of a series of tit-for-tat moves that began when Bolivian President Evo Morales declared U.S. Ambassador Philip Goldberg persona non grata after he advised opposition politicians plotting a coup last September.

Bush overrode the decision of Congress to extend the agreement for six months just a few weeks after Morales announced that the Drug Enforcement Agency was no longer welcome in Bolivia. A few months earlier, Morales had supported the decision of coca growers in the Chapare region, where Morales was a union leader before becoming president, to expel the United States Agency for International Development from the area.

THE U.S. allegation that Bolivia has failed to cooperate in the “drug war” carries serious economic penalties under the terms of the 1991 Andean Trade Preference Act.

According to the Office of the U.S. Trade Representative, the law was intended to help Colombia, Ecuador, Peru and Bolivia “in their fight against drug production and trafficking by expanding their economic alternatives. To this end, the ATPA provided reduced-duty or duty-free treatment to most of these countries’ exports to the United States.” It was renewed in 2002 under the ATPDEA name.

The criteria for continued participation fall into four categories: investment policies, trade policies, counter-narcotics operations and workers’ rights.

While the decision cited Bolivia’s supposed failure to meet its counter-narcotics commitments as the reason for non-renewal, it is clear from the text of the U.S. Trade Representative’s report that Bolivia had offended the U.S. in other areas as well. The report cites Bolivia’s nationalization of hydrocarbons, the country’s withdrawal from the International Center for Settlement of Investment Disputes, a “difficult investment climate,” and increased tariffs. These are described in matter-of-fact language–but it’s clear that the U.S. is none too pleased.

In the area of counter-narcotics, the trade representative’s report claims that the “loss of the DEA presence and its information network has severely diminished Bolivia’s interdiction capacity in both the short and the long term.”

The report concedes that the Bolivian government has “maintained its support for interdiction efforts” and that “interdiction of drugs and precursor chemicals continues to rise,” and that “the Bolivian counter-narcotics police and other CN [counter-narcotics] units have improved coordination effectiveness.” Yet even Bolivia’s success in these efforts is seen as a problem–the U.S. report concludes that Bolivia’s increased drug interdiction is evidence of “increased cocaine production and transshipment.”

While it appears that cocaine production has, in fact, increased in Bolivia, this is being used as an excuse for the U.S. to punish a government that is challenging American interference within its borders.

If the U.S. government was truly concerned with stopping the production and distribution of illegal drugs, and believed that ending trade preference agreements could have such an effect, it would refuse to extend trade preferences to U.S. ally Colombia, a country at the heart of cocaine production.

According to the Andean Information Network, coca production has risen in three of the four Andean countries participating in the ATPDEA: Colombia, Peru and Bolivia. The United Nations Office on Drugs and Crime reported that land area under coca cultivation in the region grew by 16 percent from 2006 to 2007. Colombia led the way with a 27 percent increase, while growth in Bolivia was 5 percent and in Peru 4 percent. “Overall, Colombia accounted for 85 percent of the net 24,700 hectare increase region-wide, while Peru accounted for 9 percent and Bolivia for 6 percent,” the UN agency reported.

Despite this region-wide spike in cocaine production, only Bolivia faces non-renewal of trade preferences. The U.S. recently renewed the ATPDEA for Peru and Colombia, and renewed it for Ecuador the same day it denied renewal to Bolivia.

The suspension of preferred trade status as of December 2008 had already led to a 14 percent decline in Bolivian sales to the U.S. and the loss of more than 2,000 jobs in the country’s largest textile exporter. The textile industry had benefited the most from trade preference and is being hit the hardest by its suspension.

According to AmericaEconomic.com, “Bolivian exports to the U.S., in large part due to the ATPDEA, reached $171,920,000 dollars in the first five months of 2008. In the same period in 2009, exports fell 19.5 percent to $138,370,000. The textile industry has protested that the suspension of the ATPDEA will lose the sector close to 9,000 jobs.”

The Agencia de Noticias Fides (ANF) estimates that 46,000 jobs will be lost nationally and between 5,000 and 7,000 businesses will be affected in the department (region) of La Paz alone. The Santa Cruz Chamber of Exporters estimates that exports from its department to the U.S. will decline 60 percent by the end of the year.

- – - – - – - – - – - – - – - -

IN THE lead-up to the decision on ATPDEA, President Morales appealed to the U.S. to renew the agreement, even sending a delegation to the U.S. to make the case. “If President Obama wants to have good relations,” Morales said, “I want to publicly tell him that hopefully he can mend the ways of ex-President Bush.”

When Obama followed Bush’s lead and refused to renew Bolivia’s status as a cooperating government in anti-drug efforts, Morales said the decision was “clearly political.” “I feel deceived by the suspension of the ATPDEA because the Obama government has lied and made slanderous and false accusations against the Bolivian government to suspend the trade preferences,” he told reporters.

So much for the Obama administration’s stated aim of improving relations with Latin America by establishing mutual respect and cooperation. Rather, recent events indicate that Obama is committed to re-establishing U.S. hegemony in the region in order to counter the “pink tide” of center-left governments that have been elected from Central America to the Southern Cone.

Morales put it well:

In the U.S., the appearance of the leaders has changed, but the politics of empire have not. When he told us in Trinidad and Tobago that they are no longer senior and junior partners, President Obama lied to Latin America. Now there is not only a senior partner, there is a patron [boss], a policeman…

They told me not to trust Obama–that the empire is the empire. To those who made this recommendation to me, I thank you. Truly, the empire is the empire. But thankfully, the battle will continue with the consciousness of not only the Bolivian people, but all of the peoples of Latin America.

In a discussion with a New York audience in May, Uruguayan author Eduardo Galleano urged Obama, instead of restoring U.S. “leadership” in the region, to leave Latin America alone. While Obama would win a lot more favor with Latin American governments and populations were he to follow this advice, all signs point to an empire that is gearing up to reassert control in what it has long considered its backyard.

But the increasing consciousness, organization and mobilization of Latin America’s popular classes–there to see on the streets of Honduras in recent weeks–means that the U.S. won’t be able to re-establish hegemony in Latin America without a fight.

It marked the beginning of a now infamous convergence of interests, which saw the CIA, the Saudi Arabian regime and the Pakistani Interservices Intelligence Directorate (ISI) equip and train the Islamist mujahideen resistance to the Soviet Union.

For the US, this was an immense opportunity. In the preceding 5 years, they had been booted out of both Vietnam and Iran. It had been “the most humiliating half decade in American history”. 

Now they sought to hand the Soviet Union their own Vietnam by luring them into an intractable guerilla war in Central Asia.

Over more than a decade up to 35,000 fighters from the Muslim world were recruited, US$10 billion worth of aid channeled (including, by 1987, 65,000 tons of arms), and a “ceaseless stream” of CIA and Pentagon officials helped to plan mujahideen operations.

According to Stephen Coll, writing in The Washington Post, “at any one time during the Afghan fighting season, as many as 11 ISI teams trained and supplied by the CIA accompanied mujahideen across the border to supervise attacks… CIA operations officers helped Pakistani trainers establish schools for the mujahideen in secure communications, guerrilla warfare, urban sabotage and heavy weapons.”

But not only this. They gave support to the most retrograde elements like Gulbuddin Hekmatyar. His followers, according to journalist Tim Weiner, “first gained attention by throwing acid in the faces of women who refused to wear the veil”.

The reasoning of the CIA was simple: The more fanatical the fighters were, the more brutal they were, the better they would fight so the more support they should get. Ronald Reagan – the same man who denounced the African National Congress and the Palestine Liberation Organization for not renouncing violence – described the mujahadeen as “freedom fighters.”

Reagan, now president, met in Washington with rebel leaders like Abdul Haq, who openly admitted his responsibility for terrorist attacks, such as a 1984 bomb blast at Kabul’s airport that killed at least 28 people.

Meanwhile, with CIA assistance, the mujahadeen greatly expanded opium production in areas under their control – turning Afghanistan into what one US official later described as the new Colombia of the drug world.

One of the first non-Afghan volunteers to join the ranks of the mujahideen was Osama bin Laden, hailing from a wealthy construction family in Saudi Arabia. Bin Laden recruited 4,000 volunteers from his own country and developed close relations with the most radical mujahideen leaders.

He also worked closely with the CIA, raising money from private Saudi citizens. By 1984, he was running the Maktab al-Khidamar, an organization set up by the ISI to funnel “money, arms, and fighters from the outside world in the Afghan war.”

According to journalist John Cooley, “the CIA gave Osama free rein in Afghanistan, as did Pakistan’s intelligence generals. They looked with a benign eye on the build up of Sunni sectarian power in South Asia to counter the influence of Iranian Shi’ism of the Khomeiny variety”.

By 1989 the Russians were exhausted. They indeed got their “Vietnam”. News of the Soviet defeat saw champagne corks popping all over Washington.

The cold war was about to become history – the US had triumphed.  But when the USSR finally withdrew, the administration of George Bush Sr. turned its back on Afghanistan -leaving it, in the words of The Economist, “awash with weapons, warlords and extreme religious zealotry.”

As the state funding from the Saudis and the US dried up, private financiers – like bin Laden himself – further stepped up their contributions to “the cause”. The Soviets may have gone, but there were new targets, and they weren’t limited to within Afghanistan’s borders…

Looking back on his role in the conflict Zbignew Brzezinski asked (in 1998), “What is most important to the history of the world… some stirred up Muslims or the liberation of Central Europe and the end of the Cold War?”

In light of the new “war on terror” Brzezinski’s question is tragic. The hypocrisy is there for all to see: the “terrorists” of today were trained, funded and backed by modern imperialism yesterday.

Bin Laden gave Bush just the excuse the US needed to go into Afghanistan again, and to follow it up with the obliteration of Iraq. That “war” shows that while Bin Laden may have been a useful protege, the US is still the master when it comes to terror.

This article, by Ben Hillier, first appeared in the May 2007 edition of Socialist Alternative.

The other day the Australian Bureau of Statistics announced that headline inflation was now 1.5 percent for the year ended 30 June 2009.

This is the lowest figure in over a decade and well below the Reserve Bank’s target range of 2 to 3 percent.

Yet core inflation is 3.9 percent, up 0.8 percent.

 So what is going on?  And what’s the difference between headline inflation and core inflation?

Headline inflation is the movement in prices of a basket of goods and services measured over time. 

There are different measures of core inflation. One way is to remove volatile components like food and petrol.

The Reserve Bank often averages the trimmed mean and the weighted median to give itself a measure of underlying inflation. As an RBA Bulletin puts it:

 The trimmed mean is calculated as the weighted mean of the central 70 per cent of the quarterly price change distribution of all CPI components; that is, the top and bottom 15 per cent of the distribution are trimmed.

The weighted median is the inflation rate for that item which is in the middle of the total distribution of price changes; that is, it trims away all but the midpoint of the distribution so that half the component weights are on one side of the median, and half on the other.

The weighted median and trimmed mean rose by 3.6 percent and 4.2 percent respectively on a year ago.  An average of the two  gives an underlying inflation rate of 3.9 percent, up 0.8 percent on the year before. 

The RBA looks carefully at the underlying inflation rate as  a better guide to what is actually happening because it uses statistical methods to remove volatility. 

In fact underlying inflation is an attempt to exclude those goods like food and fuel which traditionally rise in price greater than other commodities and use this lower inflation figure as a way to cut workers’ living standards.

But with falling fuel prices last year, this has backfired.

So inflation is both going up and down? Yes and no seems like a fair enough answer if we factor in the fact that inflation measurements are done to benefit capital not labour.

Having a range to choose from enables the bosses to pick the lowest as the benchmark for wages and the highest for interest rates policy, for example.

The big year on year price falls were in fuel and financial and insurance services. Housing, food, health and education rose markedly.

It is underlying inflation which is important to the RBA. It is going up. In other words the trend for price increases (statistically removing the more volatile component) is up.

Yet at the same time the headline figure is down. In other words there is increased downward movement in some volatile components around a rapidly increasing core of prices. 

My take on this is we could be heading into a period  of stagflation – rising inflation in a time of increasing unemployment.  To quote from Inevitable inflation? from Fruits of Our Labour:

‘From Marxists.org:

Given that price expresses the ratio between a given quantity of a commodity and its equivalent in money, it is self-evident that inflation manifests the falling value of money, rather than the increasing value of all other commodities. Thus, the reasons underlying inflation need to be sought in factors which may be undermining the value of money.

‘In Capital (Vol I, Chapter 25) Marx discusses inflation and its relationship to the crisis of capital.

Thus, when the industrial cycle is in the phase of crisis, a general fall in the price of commodities is expressed as a rise in the value of money, and, in the phase of prosperity, a general rise in the price of commodities, as a fall in the value of money. The so-called currency school concludes from this that with high prices too much, with low prices too little money is in circulation. Their ignorance and complete misunderstanding of facts are worthily paralleled by the economists, who interpret the above phenomena of accumulation by saying that there are now too few, now too many wage-labourers. Marx, Karl. Capital, Volume I, Chapter 25. 1867.

‘Inflation has always been blamed by classical economics on the increase of workers wages. The logic being that, the more workers get paid, the more money is in the system, and therefore the less value the currency has vis-a-vis goods and services.

‘However, history has shown that in fact repeated financial bubbles lead to crisis in capital through boom-and-bust cycles which are the prime drivers of inflation. Again, from Marxists.org:

The most common cause of the loss of value of money is the creation of “Fictitious capital”, i.e., the creation of money or credit exchangeable for money without the creation of commensurate value in the form of goods and services, thus undermining the value of all forms of money and credit: for example, the excessive printing of paper money by the government to finance public works, the creation of fictitious value by banks through unsecured loans, the declining exchange rate of a country’s currency, causing prices of all imports to increase, and so forth.

Does that sound at all familiar?

Indeed it is possible that the Reserve Bank will soon raise interest rates because of underlying inflation fears thereby attacking workers living standards and perhaps increasing the drive to create more fictitious capital.

But there is something more to all of this.  Most wage increases are measured against headline inflation.

So the bosses will use that low figure to argue that we shouldn’t get any increase, or an increase around 1.5 per cent.

So too will most union leaders.

As the discussion above shows, with underlying inflation at 3.9 percent, wage increases of around 1.5 percent are effective wage cuts of over 2 percent.

Wages don’t cause inflation, just as they don’t cause unemployment.  The profit system does.

Any wage increase less than 4 percent in the coming year will be a real wage cut.  Let unions fight to defend living standards.

The latest in this descent into madness is the cancellation of  a union demonstration against the Labor Government’s Australian Building and Construction Commission which was planned for the Labor Party National Conference opening in Sydney on 30 July.

The ABCC has draconian powers to force building workers to attend hearings and provide evidence.   These powers only apply to construction workers.

They exist to smash any action on building sites to protect lives, jobs, wages and conditions.

Since the ABCC came into existence deaths on building sites have gone up because workers can no longer use industrial action to enforce safety on site without the fear of Gillard’s Gestapo taking action against them.

Labor is now going to keep John Howard’s ABCC by giving it a new name. 

The lapdogs of Labor in charge of the union movement feared a demonstration would tarnish the image of the conference.  Au contraire, Labor’s ABCC does that.

More importantly cancelling the demonstration is a clear sign the Australian Council of Trade Unions has decided to capitulate over the ABCC and so will not now allow any further protests.

This means the ACTU has effectively abandoned workers like Ark Tribe who refused to attend an ABCC hearing and now faces 6 months in jail for his principled stand.

While he faces jail, the ACTU will sup with his political jailers.  It is clear which side they are on.

This current ACTU leadership is but a Labor Party adjunct, fearful of unleashing its own powerful working class forces to sweep away the rotting recrudescence of anti-unionism in the ALP. 

The ACTU are at best the willing prisoners of Labor, and at worst the prison guards of labour.

Instead of a demonstration, the ACTU will have a lunchtime forum on the ABCC, among other topics.  That is how our brave ACTU warriors will fight this attack on basic union rights.

That should have the bosses and Rudd Labor worried.

But there is a logic here.  The ACTU long ago abandoned class struggle and now merely talks. 

Talk and trade union treachery won’t save Ark Tribe from  jail and won’t stop more deaths on building sites.

Industrial action could.

Workers in 1969 smashed the anti-union penal powers by going on strike across Australia for the release of jailed union leader Clarrie O’Shea.  

But in those days there were left wing union leaders prepared to defy the ACTU and mobilise workers to take strike action to defend their interests. 

The lesson?  Rank and file building workers need to organise independently of the ACTU to defend Ark Tribe and smash the ABCC.

A rank and file union demonstration outside the ALP National Conference closing down Sydney building sites to attend would be a good start.

The Education Department said then that the land was surplus to requirements.

The Labor Party dominates Banstown Council. Two Council decisions rejected the school application. 

You can guess the nominated reasons and you’d be right.  Planning issues. Traffic.Noise. Design.  

Funny how it is only Islamic schools that have all these problems, isn’t it?

Two Court decisions overturned the Council’s decisions. 

According to Jennie Curtin in the Sydney Morning Herald (Minister moves to buy back Islamic school site) Land And Environment Court Senior Commissioner John Roseth asked “whether the council would have raised quite as many contentions as it did if the application had been for an Anglican school.”

After the second unfavourable decision the Council wrote to Verity Firth, the Labor Party Minister for Education, asking her to buy the land back, either by agreement or compulsorily.

Evidently the area suddenly needs a new special school and this is the best site.

An independent councillor told New Radio this was not true.  The area already has 3 schools catering adequately for special needs students.

So what could be the real reason for the Labor Government buying back the proposed Islamic school site? 

I’ll let you connect the dots.

The ban protects 4 heritage listed Victorian terraces and the people who live in them.  Members of the union will vote soon on making the ban permanent.

This will force the New South Wales Labor Government to move the station to another site.

The Builders Labourers Federation pioneered green bans in the 1970s to protect Sydney’s heritage. 

After Labor smashed the BLF its members eventually became part of the new ‘super’ union, the CFMEU.

The Pyrmont green ban shows the power of workers to defend their built environment. Without the CFMEU no redevelopment can take place.

This got me thinking about Peter Garrett’s decision to approve the Four Mile uranium mine in South Australia. 

A CFMEU green ban on uranium mining to protect our environment has the potential to destroy the industry in Australia.

But there are major differences between banning uranium mining and banning a re-development project that will go ahead elsewhere. 

The CFMEU is a an amalgam of unions.  While the construction side is more militant and often environmentally aware, the Mining and Energy section are more conservative and put immediate jobs above all else.

They are also in competition with the Australian Workers’ Union whose leadership is more receptive to the entreaties of the bosses.

All of this is a long winded way of saying that the CFMEU is not going to ban uranium mining.

That too got me thinking about how to stop this industry of death.

 The CFMEU will argue that they are about jobs, not some environmental and utopian nonsense from armchair socialists like me.

First, to imagine the mining bosses are about jobs is to misunderstand them.  They are about profits. 

In fact the Great Recession has seen the major mining companies in Australia sack thousands already, with more to come. 

Socialists are about jobs. 

But we have to think long term as well as short term.  To use the language of bourgeois economists like Ross Garnaut the cost of doing nothing on climate change will be much greater than the cost of any mitigation action.

This means that in the drive for profit we could well be destroying future jobs for current ones.  Uranium mining is very much part of that destruction. 

There are a number of problems with mining uranium.

It is about creating fuel for nuclear weapons. It produces waste that is highly toxic for thousands of years.  It is uneconomic and job destroying.

And if uranium mining is the asbestos industry of the 21st century, we may well be condemning some workers to early deaths.

The alternative is green jobs.  A rational society would develop renewable energy – solar power, wind energy, tidal power and the like. And it would do it now.

Doing this on a massive scale to power households and industry would create more jobs across Australia than the mining and energy sectors currently employ.

Add to this  a planned and fully funded re-training program and the legitimate fear of workers about their jobs and livelihoods can be addressed.

For example the $52 billion the Rudd spent on the stimulus package in Australia could have funded instead a spending program on renewable energy to save the environment and create jobs. 

This would ready us for the future, not trap us in the past.

Transferring wealth from the polluting companies and their class more generally would be a rational way for this to occur. 

These are the sorts of arguments that environmentalists and socialists must put to workers and their unions day in and day out.

 A successful response to global warming can only be  a communal one.

Yet the present ’solutions’ – for example nuclear power, and cap and trade systems – are market based and don’t challenge the cause of the problem, the market itself and the competitive drive for profits.

If it is the profit system that is a fundamental impediment to a green and secure future, then the solution seems evident too.  As Marx and Engels put it in the Communist Manifesto, in drawing the lessons of history:

Freeman and slave, patrician and plebeian, lord and serf, guild-masters and journeyman, in a word, oppressor and oppressed stood in constant opposition to one another, carried on an uninterrupted, now hidden, now open fight, a fight that each time ended either in a revolutionary reconstitution of society at large, or in the common ruin of the contending classes.

Global warming is leading us to common ruin.  To avoid that we need a revolutionary reconstitution of society.

One small step for mankind must be a massive development of renewable energy now. 

Green bans are one small part of that. Workers banning uranium mining would be an important move in that direction.

Every day that argument becomes stronger and more urgent.

Jonathon Neale’s Socialist Worker article Create green jobs and save the planet ,Peter Jones on Why Kevin Rudd is heating up the planet and Saving the planet or selling off the atmosphere? and Liz Ross on Emissions Trading: a trading and pollution bonanza are also relevant.