Full time jobs grow, but what does it mean? Differing opinions about the significance of employment and unemployment figures released yesterday. For the Sydney Morning Herald‘s Jacob Saulwick, the trend is grim with the jobs market market beginning 2009 as it ended 2008 — in gradual but incontrovertible decline. David Uren in The Australian tends to agree with him — the outlook is likely to get worse, with business yet to announce large-scale layoffs in the wake of the economic crisis. None of that glass half empty business for The Age‘s Peter Martin. His is half full with evidence pointing to the success of the first fiscal stimulus package has been presented to the Federal Government just as the Senate has rejected the latest one.

Dealing with a blackmailer. There generally has been a pretence by independents and minor parties in the Senate over the years that they treat each individual piece of legislation on its merits and do not engage in cross trading where one thing is supported in return for a government promise about something else. It’s a way of disguising the inevitable vote buying that goes along with a government not having a majority in its own right because most Senators do not like being openly associated with political blackmail. They think it makes them look just a touch too grubby whether they are on the paying or the receiving end.

The Tasmanian Independent Brian Harradine made an art form of the practice during his years in the upper house. He brought home great dollops of money for his home state and had a victory or two for causes dear to his heart, like stopping Australia funding abortion and birth control as part of its foreign aid programs, without openly acknowledging that deals were done.

The Senate’s latest independent to find himself in a powerful bargaining position, South Australia’s Nick Xenophon, is not so coy as his predecessor. He shamelessly called for a significant increase in funding to help more water come down the Murray River into his home state. After a rather dramatic game of bluff where Senator Xenophon made his demands publicly clear, the government would not pay.

Like a proficient blackmailer, the Senator realised if he was to be effective in future he would have to deliver on his threat. And so it came to pass that the $42 billion economic stimulus package was defeated.

Today after further discussion between the government and the independent it was the Government which blinked. Extra money was provided for the Xenophon cause and the people of South Australia will get their Tasmanian style bundle of money.

It is a measure of the Government’s concern about the course of the economy that it did so but it will now find that blackmailers have an insatiable appetite.

A gloomy world out there. Just when you think things could not get worse in world economies, they do. Overnight came the news that the collapse of European industry is collapsing far more dramatically than the pundits had predicted. Eurostat, the arm of the European Commission which collates statistical data from all member countries, has reported that in December industrial production was 2.6% lower than November — and fully 12% lower than during the same time period a year ago.

Giving the market cowboys a new toy. If there is one lesson we should have learned from this financial crisis, it is that so-called free markets are prone to being rorted. In the pursuit of a dollar, a pound, a euro or a yen, clever minds find clever ways to get an edge and the ones who end up paying for these market excesses are the ordinary people.

Which is why I was at first so delighted yesterday to hear that the Australian Treasurer was getting a group of his colleagues to review the planned emissions trading scheme. I thought it might mean that the whole crazy idea of creating a new toy for the merchant banking boys and girls to distort was going to be abandoned and replaced through the much less manipulable taxation system. Such a decision would certainly be consistent with our Prime Minister’s recent disenchantment with neo-liberal philosophies.

And then I read this morning that a spokesman for Kevin Rudd insisted the Government was 100% committed to the carbon pollution reduction scheme it announced last year. So what Treasurer Wayne Swan’s asking the Economics Committee of the Labor Caucus to “inquire into the choice of emissions trading as the central policy to reduce Australia’s carbon pollution” is all about I now know not.

Which, given the experience of what has happened in Europe with emissions trading, is a great pity. In Germany, for example, roughly 15% of the country’s electricity now comes from solar, wind or biomass facilities, almost 250,000 jobs have been created and the net worth of the business is €35 billion per year. But, reports Der Spiegel , there’s a catch: The climate hasn’t in fact profited from these developments. As astonishing as it may sound, the new wind turbines and solar cells haven’t prohibited the emission of even a single gram of CO2. The trading in permits has simply allowed other European nations to produce more electricity from dirty coal.

The German Greens Party is apparently now questioning its whole support for alternative energy as they consider whether, when reduction of CO2 emissions is more cheaply achieved through insulating a building than using a wind turbine, that is where they should concentrate their support. When you look at the following table you can see what they mean.