One day is all it took for Barney Joyce to renege on a statement. Is that a record?
On Wednesday he was reported in the Melbourne Herald Sun as promising that the coalition will be prudent and diligent.
Yesterday motor mouth couldn’t help himself. Faced with an open mike and a camera on the under-watched (in the greater Australia) Sky News, Barney Joyce opened up. Prudent and diligent comment was the victim in his raving and ranting.
And, being the slow summer season, the media went for it, just as they chased the Nullarbor Nymph of old, the Blue Mountains panther and the wild statements of Mark Latham in 2003-04. No rhyme or reason to the pursuit, just the chance to enliven what would have been a quiet news day, or somnambulant news bulletin with some of the latest ravings from Barney (“I’m an accountant from St George”) Joyce.
So we heard Australian banks have too much power and Kevin Rudd is doing nothing about it and he will “put everything on the table,” just like the Americans with their Sherman Anti-trust law. He says America could default on its debt.
His comparison to the US anti-trust laws was wrong. Australia and the US have competition laws that apply before transactions and can force asset sales, or denials of deals before approvals are given.
He’s confusing the trust-busting Sherman anti-trust laws from 1890 onwards with modern competition law. (The law is founded on the Sherman Act, but further pieces of legislation have augmented it and made intervention easier). The US Federal Trade Commission is the key regulator. It was set up in 1914 as part of the campaign to “Bust The Trusts”. Perhaps Barney would like to know what the FTC can’t do?
“The commission may prosecute any inquiry necessary to its duties in any part of the United States” (FTC Act Sec. 3, 15 U.S.C. Sec. 43) and may “gather and compile information concerning, and to investigate from time to time the organisation, business, conduct, practices, and management of any person, partnership, or corporation engaged in or whose business affects commerce, excepting banks, savings and loan institutions, Federal credit unions and common carriers.
So financial institutions, railroads, airlines and transport companies are exempt (and regulated by other groups, such as the FDIC, the Fed and several other groups). Bad luck Barney. The Sherman laws can’t be used against banks. But Barney has never been too fussed about facts.
After mergers, it’s normal competition law where companies and organisations can be prosecuted for anti-competitive behaviour, just as they are in Australia; as the late Dick Pratt and Visy found when they were pinged for the cardboard cartel.
In fact, America’s anti-trust powers are little different to ours in Australia and the ACCC, on which it and its predecessor (the Trade Practices Commission ) are based. Both organisations can impose fines and jail sentences, refuse to approve mergers, as CSL, the Australian drug company, found this year in a deal in the US. Or divestitures can be ordered and agreed to before a merger is approved.
So again, bubble-brain Barney is hopelessly wrong and all at sea.
And America to default on its debts? How Barney?
He said it is only sensible to raise these issues, as the reporter on ABC’s AM tried hard to whip up a controversy in an interview with financial services minister Chris Bowen, but we are talking about Barney Joyce here and being Barney and being sensible are mutually exclusive. Nothing he said yesterday and this morning makes any sense.
Take the question of America’s default being raised by Barnaby, and given credence by the ABC this morning, it is is just plain ignorant and uninformed. What Barney doesn’t understand won’t hurt him. He wouldn’t be able to grasp any simple idea.
Perhaps he was talking about America’s credit rating being downgraded? Nope, Barney was talking about default. Latin American-style default.
”That is the first scenario, which is extremely bad for Australia. The worse scenario is where the US doesn’t repay its debt — the $2 trillion in debt it owes to the Chinese, the $1 trillion in debt it has to the Japanese and the $US1 trillion in debt to others — and then we are really nailed,” the SMH quoted him as saying.
Well Barney’s made a few errors. America doesn’t owe China $US2 trillion, it’s about $US798 billion. China has foreign reserves totalling $US2.3 trillion at last report. Did Barney also know that China has about $US370 billion in foreign- and trade-related debt? America doesn’t owe Japan $US1 trillion, that’s the size of Japan’s foreign reserves (within $US100 billion or so).
America doesn’t owe $US1 trillion “to others”. It’s actually considerably more. The foreign debt isn’t America’s its mostly held by American companies, individuals and then some by government. China and Japan and other countries invest in American domestic debt, which is just over $US12 trillion
Barney continued, as the SMH reported: ”The outcome is a shift away from the US dollar as the international trading currency and a shift to the Chinese yuan, and China becomes an immensely powerful player overnight. It’s the real financial crisis, and the real financial crisis will mean this preamble we have just had pales into insignificance.”
Ah, Barney, no one will shift into the yuan because it’s not convertible into other currencies and the Chinese government has made it clear it won’t be for some considerable time. Why? Because that would mean the Chinese Communist Party handing over control of the economy to the market, which would speculate in the value of the currency.
But does our Barney understand what he is saying (I know he’s an accountant from St George and he has Australia as a client)? Is he saying America is in the same position as Russia, which defaulted in 1998 (and is now back as a major global player) or Argentina, which did so in 2001, and is still in business and being governed by a bunch of Peronist populists who would make Barnaby seem like a hardline economic rationalist and not a rabid rural hick populist from St George, and the 1930s.
Perhaps Barney would be better off in Greece, where the previous conservative government lied and cheated its way through two years of government, hiding an explosion in public debt, a fall in tax revenues and the near collapse of the country’s credit rating.
And this is only day three of the Barnaby stewardship.