Mining Tax SNAFU

Wayne Swan is pitching it as “…a way in which all Australians share in the bounty of the mining boom,” but Alan Kohler destroys any illusion of that:

There was, and is, a fundamental disconnect between the terms of trade boom that was killing manufacturing and tourism and the tax revenue governments were getting from it because royalties are levied on volume not price.

The Henry proposal involved a 40 per cent extra resources rent tax and a reduction in company tax to 25 per cent, plus a series of depreciation and capital allowance benefits for manufacturers and other small businesses.

Now, that particular reform wasn’t ever posed by Rudd, but something very much like it existed, however briefly, before the miners took a hatchet to the government. It’s only now that the majority of people are starting to see the two-speed economy for what it is.

.Julia Gillard negotiated a lower tax on iron ore and coal with BHP, Rio Tinto and Xstrata so that only the smaller companies with smaller advertising budgets would complain. As part of that, she was forced to allow existing mineral royalties to be deducted from the tax, which totally negated the idea of replacing ad valorem royalties from a tax on profits.
And then, to make the whole exercise completely pointless, she tied it to an increase in the superannuation guarantee levy from 9 per cent to 12 per cent.

That increases manufacturing costs instead of reducing them, and vastly increases the cost of the exercise to the federal budget.

According to Brian Toohey in this morning’s Financial Review, the cost to the budget of the extra superannuation tax deductions will be $4.2 billion in 2019-20. The total cost of the concessions connected to the MRRT will be $9.4 billion in that year – less than a third of which is paid for by the revenue to be collected from the MRRT.

The latest concessions negotiated by Andrew Wilkie undermine any credibility he had – his electorate in Hobart doesn’t have any mining interests, so his conditions on improving things for small miners is clearly the result of targeted lobbying. Oakeshott and Windsor did well for their electorates, raising the issue of Coal Seam Gas – but Wilkie betrayed the idea of the independent representative.

the daily column

Video Game Values

Overthinking It reviews L.A. Noire, and realises it isn’t your run-of-the-mill sandbox game:

There are a few ways to play L.A. Noire:

  1. Do your best on the fly, looking for clues at crime scenes and making your best guesses, maybe taking advantage of the in-game help, but mostly just playing at the pace of the story to get to the next cutscene.
  2. Read or watch walkthroughs and do the things they tell you to get five stars on every mission.
  3. Puzzle out the specifics of the cases, which can be surprisingly time-consuming and require a whole lot of attention to detail.
  4. Focus on reading the characters’ faces and gestures, and use that to guide you through interrogations, rather than the evidence.
  5. Brute-force everything, clicking on everything in every search and restarting each interrogation over and over again until you get it right.
  6. Dick around, free-roam and do side quests and stuff.

[I]n video games, brute forcing is almost guaranteed to work — rather than a problematic chore for cryptologists, it has become the major driving force behind playing most games, ostensibly for fun. Let’s act like algorithms for a few hours until dinner-time. Ah, leisure!

The thing that surprises me the most aboutL.A. Noire is how badly brute forcing works

I’ve played L.A. Noire and that’s all absolutely true – the usual approach of try-it-and-see fails altogether, and the game definitely discourages attempting to replay right away. It’s frustrating in many ways to feel like you don’t get to see “everything” in the game, but I guess that’s the point being made in this article.

There’s some interesting observations in there about how the mentality of video gaming is changing mindsets of the younger generations, how video games subvert normal expectations of how to deal with situations and just general riffing on the whole issue of video games and human psychologies. Fascinating stuff.


How the GOP Became The Party of the Rich

Astonishing reading for anyone who realises the November 23 deadline for the “supercomittee” is coming up, and they’re not doing anything about it – the malaise set in a while ago:

In November 2002, at a meeting in the White House, the president and his top economic advisers packed tightly around a mahogany table in the Roosevelt Room. With the administration’s own forecasts showing that the economy had already regained its footing, one after another of Bush’s deputies sounded the alarm about the dangers of a new tax cut. “This burns a big hole in the budget,” deputy chief of staff Josh Bolten told the president. “The budget hole is getting deeper,” added Daniels, “and we are projecting deficits all the way to the end of your second term.”… Entertaining the chorus of doubters, Bush himself voiced qualms about more cuts for the rich. “Won’t the top-rate people benefit the most?” he asked. “Didn’t we already give them a break at the top?”

But Cheney was having none of it. When O’Neill warned Bush that America was headed for a “fiscal crisis,” the vice president, sitting at the Treasury secretary’s right elbow, dismissed him midsentence by citing the ultimate champion of Republican tax cuts: “Ronald Reagan proved that deficits don’t matter, Paul.”

A true student of Reagan would have understood that 2002 was the moment for a tax increase. When his 1981 tax cut overshot the mark, Reagan had put aside ideology and raised taxes, putting the needs of the country above the desires of the wealthy.

For all their clamouring and strident proclamations, the current Republican leadership doesn’t have a clue as to how to get back into surplus. It’s much the same in our dear little opposition.


Book Review: Cryptonomicon by Neal Stephenson

If there’s ever a book that you can say is pure geek indulgence, it’s Cryptonomicon. No other book I’ve seen takes the abstract concepts of topics as varied as UNIX, cryptography and normalising preferences between siblings for Grandma’s inheritance through a distribution on a cartesian plane formed in a parking lot. You can tell this isn’t your daddy’s war novel.

Stephenson weaves together two stories, interlinked through blood – in the 1930s, Lawrence Waterhouse, a borderline-Autistic mathematician encounters Alan Turing shortly before World War II is due to break out; Bobby Shaftoe is a U.S. Marine stationed in Asia, retreating from Shanghai ahead of the march of the Japanese through China, while Goto Dengo is Bobby’s counterpart of sorts on the Japanese side, a soldier who dares to think of self-preservation ahead of the Emperor’s wishes.

In the late 90s, Randy Waterhouse is being dragged into a business venture by his friend and former business partner Avi; he ends up working with Amy and her father Douglas Macarthur Shaftoe, son of Bobby. They employ the services of one Goto Engineering, which, yes, is presided over by Goto Dengo himself. All this has the backdrop of the mysterious Societas Eroditorum in the background, with a seemingly ageless preacher by the unlikely name of Enoch Root playing a part in both timelines.

This is all not even mentioning the central push of this novel, which is so loaded with technical details it’ll make your head spin: the Cryptonomicon is all about cryptography, encoding messages for secure transmission. It has actual technical details, an algorithm and even an actual Perl script for encoding and decoding a method of encryption specifically invented for this book. There’s even an appendix dedicated to explaining the method for the audience that didn’t catch on through the novel. I mean, damn!

Although some of the technical aspects can be a bit overbearing in the middle of a novel, and the different voices of the narrators are occasionally jarring – albeit pleasingly distinct – this stands on its own as a thriller without the technical background.

The technical details are more easily understood if you come from a software background, but nevertheless I would suspect this would add greatly to the realism, at least for all those that know precious little about both the code-breaking efforts in WWII and the workings of today’s technology.

Rarely does Stephenson use these elements gratuitously. His writing is dense and yet spare, descriptive without being prescriptive – you can easily imagine these people in your head, but the descriptions aren’t overly specific or belaboured.  In some ways, perhaps that does truly identify it as a geek novel: it says enough to get the salient points across, but without being needlessly wordy about it.

Cryptonomicon suffers a little from the same issue many a novel that uses historical characters in its narrative, namely that had the fictional characters actually be interacting with the non-fictional ones in the ways described, the non-fictional novel should be equally if more significant than the ones the actual characters deliver.

Ripping and engaging yarn, hard to put down. ★★★★