The rear-view mirror is always clearer than the windshield

 

My office in town

 

On leaving Thursday Island in the Torres Strait in late 1977, Donald Gubbay in Noumea had suggested that he had work for me in his trading company in Honiara in what was then still the British Solomon Islands Protectorate.

I had lived and worked in Honiara in 1973 as commercial manager for the British Solomon Islands Electricity Authority and had liked the place and going back there would be like coming home!

After a few uncertain months spent in Canberra while waiting for my travel papers, I finally moved into my bungalow in November 1977 ...

... which overlooked the Ironbottom Sound ...

... and had its own swimming pool ...

... and a native couple as domestic servants.

Brian Herde who had a knack for inviting himself whenever he could stay somewhere for free, came across from Port Moresby for Christmas.

Brian Herde on Red Beach

There are plenty of people, and certainly many accountants, who like nothing better than to find an agreeable place in which to while away their years with the least amount of effort, but I was not your average accountant and still in my early-thirties which were my "Sturm und Drang Jahre" and I was intent on changing the world and my place in it.

I was totally unprepared for the sheer mundaneness and repetitiveness of the job, so when the Pacific Forum Line in Western Samoa ask me to assist in the formation of this new shipping line, I jumped on a plane in mid-January 1978. Just before I left, I got myself some carvings from the Betikama SDA Mission, a beautiful nguzu nguzu head and a sign in ebony with my name inlaid in mother-of-pearl so I won't forget it.

Forty-seven years later, with my "Sturm und Drang Jahre" long behind me, I sometimes wonder why I didn't linger a little longer. Those were, to quote Shakespeare, "my salad days, when I was green in judgment."

The rear-view mirror is always clearer than the windshield.

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Exorbitant Privilege

 

This is a recording from eleven years ago

 

The phrase "exorbitant privilege" was coined in the 1960s by Valéry Giscard d'Estaing (then French minister of finance), to refer to the financial privileges the US has enjoyed in the post-World War II era, due to its currency being the international reserve currency.

 

Read the book online at www.archive.org

 

"Serious economic and financial mismanagement by the United States is the one thing that could precipitate flight from the dollar. "And serious mismanagement, recent events remind us, is not something that can be ruled out. "We may yet suffer a dollar crash, but only if we bring it on ourselves. The Chinese are not going to do it to us."

Barry Eichengreen, professor of economics at the University of California, Berkeley, published that passage in the wake of the 2007-09 financial crisis. And it came true last week when, due to the market dysfunction triggered by Donald Trump's tariffs, traders stopped treating the United States as a financial safe haven. Donald Trump, take a bow!

 

 

According to Mr Eichengreen, "It costs only a few cents for the Bureau of Engraving and Printing to produce a $100 bill, but other countries have to pony up $100 of actual goods and services in order to obtain one".

This is what exorbitant privilege was all about, and it has come to an end, thanks to "genius" Trump who wrote "The Art of a Lousy Deal".

 

 

 

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This was Russia's Pearl Harbour!

 

 

A Ukrainian drone attack has destroyed billions of dollars worth of Russian aircraft stationed at bases across the country, including at locations as far away as Siberia, in what Kyiv claims is its longest-range assault of the war.

The spectacular operation, known as Spiderweb, was prepared in secret over 18 months. Ukraine’s agents moved short-range drones and explosives inside Russia before they were launched remotely for a coordinated strike on Sunday that was intended to strike at Moscow’s air superiority.

Vasyl Maliuk, the head of the Security Service of Ukraine (SBU), said drones were smuggled into Russia and placed inside containers, which were later loaded on to trucks.

With the trucks positioned near Russian bases, the roof panels of the containers were lifted off by a remotely activated mechanism, allowing the drones to fly out and begin their attack. The drones had first-person view, or FPV, technology that allowed them to be operated remotely, hitting planes worth a combined $7 billion at four airbases.

This was Russia's Pearl Harbour! This was the sort of stuff they'll be writing books and making movies about in years to come, by which time, we all hope, the Ukrainians will have sent the Russians home.

 

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So how will this proposed new super tax work?

 

 

We all know about the well-known "Death and taxes" idiom that signifies the inevitability of these two things in life. What seems to have become just as inevitable is Labor's proposed super tax. So how will it work? Here's the most succinct explanation yet:

 

A person has a super balance of $4 million at the beginning of the year and $4.5 million at the end of the year, a $500,000 increase.

Of that increase, $25,000 is a new contribution made by the person or their employer, which was taxed at 15 per cent.

Subtracting that amount, the person has $475,000 in earnings.

These earnings are already subject to the existing 15 per cent earnings tax.

But because the person has a super balance above $3 million, they will also pay the new additional 15 per cent super tax.

This does not apply to the full amount — it is scaled by the fraction of the person's super balance that is above the threshold.

In this case, one-third of the person's $4.5 million super balance is above $3 million. That means they pay the extra 15 per cent tax on one-third of $475,000 — a tax of $23,750.

 

A main criticism against this tax is that it would apply not just to "realised" earnings like dividends or interest income, as is now the case, but also to "unrealised" increases in the value of assets like property. If a house, a painting or a farm is held in someone's self-managed super fund and it becomes more valuable, they would today only pay tax when that value is realised upon sale, but under the new arrangements that would change for those with over $3 million. The person in the example above, who has $4 million in super and then "earns" $500,000, would have to pay $25,000 in tax even if the "earnings" come from the unrealised increase in value of a house or some other asset that is not liquid.

It seems it is the super industry itself that is driving this because it is easier for them to implement the tax this way. Large super funds "pool" the money of their members and invest it as one, earning dividends and interest at the fund level. Under current arrangements, they pay 15 per cent tax on behalf of all their members whenever they realise a gain. But they say applying a higher rate to a small proportion of members every time would be complicated, whereas applying the new rate once a year based on members' total fund balances is easy.

Apart from that technical reason, Labor argues it is fair for the small minority of people who put millions' worth of assets into their self-managed super funds to pay more tax. They would say that, because they haven't got the guts to make the fairest tax change of them all: increase the GST from 10% to 15%

 

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P.S. If you need help with your SMSF, check out SuperHelp Australia. I've been with them since 2008, and in 17 years they've never let me down!

 

 

History is just one f***ing thing after another

 

 

Set in a boys' senior school in the Eighties, "The History Boys" encapsulates many of the current arguments about the purpose of education, with Alan Bennett's characteristically witty and moving dialogue describing both the tussles of staffroom rivalry and the anarchy of adolescence.

"The school gives them an education. I give them the wherewithal to resist it. Examine a boy and he is tamed already. Only examine him and you can tax him, empanel him, enlist him, interrogate him and put him in prison. You have only to grade him and you have got him."

There is Hector, a romantic, motorbike-riding maverick English teacher with a habit of quoting poetry, who is devoted to the passing on of knowledge and a love of literature to his beloved unruly boys. A group of eight have been selected by the league table-obsessed headmaster for the Oxbridge entry examination. The wry Mrs. Lintott supplies the more traditional book-learning approach, but the headmaster has also hired a young supply teacher, Irwin, who is the polar opposite of Hector, to coach the boys in the clever tricks of exam-taking and interviews.

There is a fundamental clash between the passion of Hector and the cynicism of Irwin at the centre of the piece. Around this swirls a broader look at styles and philosophies of teaching, suffused with the very human, and often comic, stories of the boys as they pursue sex, sport and the much sought-after places at university.

I enjoyed the adaptation for radio by Richard Wortley and performed by the original theatre cast ...

 

 

... but at just four dollars I couldn't resist buying the movie as well.

 

 

How did I get here? Well, someone reminded me of Alan Sillitoe's "The Loneliness of the Long-Distance Runner", which I had read and watched many years ago, and followed it with, "Another northern author I enjoy is Alan Bennett who wrote 'The History Boys' and 'The Lady in the Van', both of which were made into films". I've seen "The Lady in the Van", starring the unforgettable Maggie Smith, but "The History Boys" revealed a gap in my education which I was keen to fill. And I'm pleased I did!

 

 

And I must buy and read Alan Bennett's memoirs "Untold Stories":

 

Preview of the book    (for a preview of the audiobook, click here)

 

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