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All posts for the day March 6th, 2014

QANTAS Debate: Cheese-Eating Surrender Monkeys of Australian Jobs

Posted by George Brown on 06/03/2014

Posted in: Aviation, Finance, News, Politics, Safety, Travel, Views. Tagged: Alan Joyce, Bill Shorten, foreign ownership, QANTAS, Tony Abbott. Leave a comment

The Coalition’s partial repeal of the QANTAS Sale Act has passed the Australian parliament’s lower house, as the Senate launched a public inquiry into the airline’s finances. MPs voted 83-53 to support the government’s bill, with independent Victorian MP Cathy McGowan siding with the Coalition. At the same time, the Senate with a Labour/Greens majority will vote down the bill, launched an inquiry into QANTAS’ finances and what measures could be used to support the company, including renationalising it or guaranteeing its debts.

The debate came after Joe Hockey denied pressuring QANTAS to reverse an earlier position on the carbon tax during a phone call with chief executive Alan Joyce yesterday. Greens senator Lee Rhiannon said she wanted Mr Joyce called to give evidence to the new inquiry and for Qantas’s books to be opened up to examination. “Clearly something has gone wrong with QANTAS — it is vital that we use the Senate inquiry to understand what has happened,” Senator Rhiannon said.

In the House of Representatives, Bill Shorten labelled the Coalition a bunch of “cheese-eating surrender monkeys”, a derogatory term for the French. “It’s taken 94 years to build QANTAS; it’s taken the Abbott government 94 minutes to tear QANTAS down. “Shame,” the Opposition Leader said after the vote.

The government’s bill would open the door for a structural separation of QANTAS’ domestic and international arms, repealing the 49 per cent cap on foreign investment in QANTAS and removing the barrier to foreign airlines buying more than 35 per cent of the company. Deputy Prime Minister Warren Truss told parliament QANTAS’ foreign ownership limits were “regulatory handcuffs” that must be removed if QANTAS is to remain in Australia and “grow”.

“Good government is not about playing favourites or being a banker for major companies when times are tough,” Mr Truss said. In my opinion, good business is not having to come to government expecting bail-outs or debt guarantees. Good business is making a profit while working under the regulatory framework in place at any time.

Mr Shorten said even if the bill passed the Senate, it would take years for QANTAS to overcome new regulatory processes that would allow it to raise sufficient foreign capital. In real terms, the bill has little to no chance of passing the senate.

Tasmanian MP Andrew Wilkie voted with the Labor Party, while Clive Palmer and Greens deputy leader Adam Bandt were not present for the vote. Again on an issue as important as this, key parliamentarians are absent from the house.

Later, in question time, the government attacked Labor for suggesting Qantas’s world-famous safety record could be compromised if maintenance jobs were sent offshore. Mr Abbott described the suggestion as “irresponsible’’ and “reckless’’. “The leader of the opposition is trying to suggest that without the restrictions that exist under the Qantas Sale Act an airline can’t be safe,’’ he said.

Independent Bob Katter also questioned the impact on safety of overseas maintenance. “Surely, this must be one whose maintenance is based in Australia, not one whose market advantage comes from a cut-rate cheap jack overseas-based workforce?,’’ he asked Industry Minister Ian Macfarlane. The minister said QANTAS wasn’t the only airline to have a safe flying record. There are other airlines flying in Australia dont necessarily have their maintenance carried out in Australia. Does that make those airlines less safe?.

The Treasurer earlier revealed he yesterday spoke with Mr Joyce about the company’s apparent change of mind on the impact of the carbon tax on the airline’s profitability. QANTAS yesterday released a statement saying the carbon tax was “among the significant challenges” faced by the airline, apparently contradicting its earlier position that its “current issues are not related to carbon pricing”. Then Mr Joyce dramatically reversed his rhetoric on the company’s wellbeing, saying the airline was “extremely healthy”, just four months after warning of its possible demise. QANTAS yesterday said it had not been able to recover the carbon cost by increasing fares because of intense competition, while revealing it had cost $59 million in the past six months on top of $106m last financial year. “It is absolutely one of the factors that’s impacting the airline,” Mr Joyce said.

QANTAS is more than just an airline. It is an Australian airline, an Australian icon, with firm place in the Australian psyche. The “Flying Kangaroo” is a logo of special significance to all Australians. It has been stated that boarding a QANTAS aircraft is like “getting home before being at home”. Mr Joyce being Irish, has failed to realise this. He sees QANTAS in terms of aircraft, infrastructure and staff. As I said before on this web site, Australian business does not support CEOs who lose money and whose comapnies do not turn a profit. They sack them, usually with outrageous severance packages. I believe the axe is about to fall on Mr Joyce, probably sooner than later.

Is this legislation likely to be passed into law? I suspect not. Will QANTAS be allowed to to become more efficient? I believe it must, if it is going to remain a competitive world airline. A compromise position must be found.

In 2013 QANTAS for the first time has secured a place (8th) in the top ten world airlines in terms of service, value for money etc. All efforts must be used to make the airline competitive.

Source: The Australian (as edited)

An Alternative View of the Crimea Crisis

Posted by George Brown on 06/03/2014

Posted in: Defence, History, Legal, Military, News, Politics. Tagged: Crimea, Kiev, Moscow, Ukraine, Vladimir Putin. Leave a comment

While looking through news stories on the crsis in the Crimea, I can came accross this alternate and completely sensible and balanced view on the crisis:

Defiant: Russian President Vladimir Putin.

Contraversial though it is to say so, Russia’s military incursion into Ukraine’s Crimean peninsula does not represent a second Cold War. Instead, it is a rational reaction of a great power into the affairs of an unruly state in its own neighbourhood.

That may sound insensitive, but hyperventilating pundits and politicians ignore an old truth about international relations: great powers are determined to protect what they deem as vital interests in their ”near abroad.” Indeed, a sphere of influence is a key characteristic of any great power, authoritarian or democratic.

Many Americans, guided by a sense of exceptionalism, think they are immune to the historic tendencies of power politics. But when liberals and neo-conservatives slam Russia’s behaviour, they should recall the many US military interventions in the Caribbean and Central America since the Monroe Doctrine in the 19th century. The US sees itself as the global policeman and often exercises that belief. None of this is extraordinary; it is the way the world works, always has and always will.

Since the end of the Cold War, however, a new orthodoxy has emerged: a belief that power politics no longer works in an era of globalisation. We had arrived at the End of Days: the universalisation of market democracy, the triumph of national self-determination and perpetual peace.

That is why President Obama insists that Russia is ”on the wrong side of history.” But one can agree Vladimir Putin is a thug, you have often heard me refer to him as the “former KGB polkovnik“, and still believe he merely wants to restore Russia’s traditional zone of protection on its borders. After all, he presides over a great power still humiliated by the collapse of the Soviet Union and deeply resentful of the prospect of US missiles in its backyard.

For Moscow, there has long been a geopolitical interest in Ukraine, even under the Tsars. Remember the Crimean War of 1853-56? More recently, Ukraine is a conduit for gas exports to Western markets. Russia’s naval base in Sevastopol hosts the Black Sea fleet. And ethnic Russians comprise nearly 60 per cent of Crimea’s citizens.

Meanwhile, a democratically elected, pro-Russian government has been overthrown. And a Western-backed interim government with no democratic legitimacy includes hard-line nationalists with links to terrorists.

Of course, Putin may overreach by toppling other former Soviet satellites. But if he is as calculating as many Russian experts suggest, he is likely to encourage Kiev to allow the de facto partition of areas largely populated by ethnic Russians – from the Crimea in the south to the industrial heartland in the east.

For the West to ignore Russian susceptibilities and to impose sanctions on and isolate Moscow would, as Putin warns, backfire. It could whet the appetite of hard-line Ukrainian nationalists, including anti-Semites. It could also provoke more chauvinistic elements in Russia to exploit wounded national pride in ways that could be dangerous. We are dealing with a regime whose nuclear arsenal poses a threat to the US and NATO allies.

At a time when Americans are suffering from foreign policy fatigue, and the Europeans have no stomach for a stoush, it would not seem prudent to pick a fight with Russia over a region where no US army has ever even fought before, and is of little political interest to the US. Even those cold warriors, Dwight Eisenhower and Lyndon Johnson, backed away from confrontation with the Soviets when it meddled in Hungary and Czechoslovakia in 1956 and 1968. And when Communists crushed Polish Solidarity in an Ukraine-like emergency in 1981, it was (of all people) Ronald Reagan who showed restraint and caution.

Why then would Barack Obama isolate resource-rich Russia nearly a quarter a century after the fall of the Berlin Wall? And why should Putin believe the West’s warnings are any more than a bluff, something done in the hope that the warning itself would be a deterrent with no intention of honouring it?

Source: Tom Switzer, research associate at the University of Sydney’s United States Studies Centre.

Welcome to Western Australia

Posted by George Brown on 06/03/2014

Posted in: Opinion, Politics, Views. Tagged: Senator Ludlum, Tony Abbott, WA Greens. 5 Comments

Over the years I have been a follower of the the ALP (Australian Labor Party) and their politics. Imagine my joy when Gough Whitlam and the ALP was elected to Federal Pariament in 1972, after more than 40 years of Liberal-Country Party Coalition rule.

But they never quite got it right! Subsequent Labor governments also failed to recognise the errors of their predecessors, and to correct them. This culminated in the Rudd-Gillard debacle, where leadership challenges (or talk of them) took centre stage, and all other policy whitered on the vine. “Enough”, I said. I can no longer follow this shambolic rabble that squander every opportunity given to govern.

As I could never follow the Liberal-National Party, as their policies are totally abhorent to my way of thinking, I have have moved my allegiance toward the Australian Greens. This has occurred mostly because of their position on flora/fauna, mining, the environment, fishing limits and their social policies.

But don’t get me wrong. I have a low opinion of ALL politicians, of any persuasion or colour, whose only and most pressing duty, other than to seek as many paliamentary lurks and perks (legal or otherwise), is to seek re-election every three years.

So when I came across this video on YouTube where WA Greens Senator Ludlum was sticking it to Australian Prime Minister Tony Abbott, I knew I had to give it some air.

Also, you might note the empty Senate Chamber. No wonder government in Australia is of such a poor standard. There’s nobody at the helm!

That is Senator Ludlum on his feet in the bottom right of the picture, addressing only 3 other members of a 76 seat Senate!

QANTAS – Still Call Australia Home?

Posted by George Brown on 06/03/2014

Posted in: Aviation, Finance, Media, News, Opinion, Tourism, Travel, Workplace. Tagged: Alan Joyce, job losses, overseas ownership, QANTAS. Leave a comment

The Australian Coalition Government strategy of providing assistance to QANTAS is reminiscent of the American strategy during the Vietnam War. Who can forget the chilling phrase from that era, ”Before we save the village , we have to destroy it”?

As a management strategy, that doesn’t have much going for it.

Views
Anthony Inatey, Bathurst
Sounds like QANTAS will go the way of Vegemite. It will be Australian only in name. No doubt they’ll have the nerve though to ”still call Australia home”.

Geoff Gordon, Cronulla
If QANTAS is sold will Messrs Joyce and Clifford be an inclusion? Ed. – But then Joyce is Irish, isn’t he?

Bill Carpenter, Bowral
Market forces across the global economy will ultimately determine the future shape of QANTAS, not the Australian government nor the unions. QANTAS jobs will be lost overseas with or without the government’s changes to the ownership rules because this country is one of the dearest on the planet for the cost of labour. The unions may claim to rely on QANTAS for their future but research proves the flying public would mostly prefer to rely on cheaper airlines that offer comparable standards.

Phillip Regan, Aberglasslyn
If it is good enough for the federal government to provide a debt guarantee for the banks, why not do the same for the airline industry? Or why not let the banks be swallowed by the big boys overseas?

Mike Powter, Leonay
Tony Abbott reckons Virgin Australia is ”as Australian as QANTAS”. How on earth can that be when Virgin is majority-owned by overseas airlines who, when push comes to shove, will ditch Australia like a hot potato.

Russell Mills, Redfern
When you get on a QANTAS plane overseas and are greeted by cheerful Aussies you breathe a sigh of relief. You are home before you get home. QANTAS is not just another business. It’s who we are, and we are a country which needs a flag-raising carrier to show the world we are a strong nation. We need the planes with kangaroos on the tail.

Jill Power, Manly Vale
While I’m normally angered by politicians doing things appropriately falling to the role of the Governor-General, such as farewelling or welcoming our troops, I can think of no better person than Tony Abbott when it comes to ceremoniously lifting the kangaroo off the tail of the plane the day QANTAS ceases to be Australian.

Michael Creswell, Waterloo
If the Prime Minister wishes to allow greater foreign ownership (which will mean controlling ownership), then why not overlay the kangaroo symbol with some gold stars or plaster a striped background on the tailplane? All national airlines are supported by their various governments, so let us not pretend that it will be a national airline any more. The new owners can remove the present board, remove operations to their own country, and we will be free of yet another piece of bothersome industry.

Donald Hawes, Blayney
If there was more foreign ownership of QANTAS perhaps the fares would be reduced, the service improved and more people would once again want to fly with QANTAS.

Carolyn Wills, Cremorne
I don’t know whether a level playing field can be achieved when you are in the air but I do wonder why the words chief executive Joyce used about the 5000 jobs do not appear to have been accurately reported in print, let alone discussed. What he said on TV was ”the equivalent of 5000 full-time jobs”. Does that mean 10,000 part-time? Get your parachutes on!

Comment:
QANTAS was always at risk of overseas ownership when Alan Joyce was appointed as CEO. Here’s a Irishman who claim to fame was that he has worked for Aer Lingus. From the moment of his appointment to QANTAS, he has slashed jobs, sent maintenance work off-shore all in a glorified and yet vain attempt to make QANTAS more profitable. Has he succeeded? No! Oh sure, he has pulled QANTAS into one of the world’s top ten airlines, and JetStar into one of Asia’s best budget carriers and brokered a deal with Emirates on long haul flights to the UK, but the airline is still haemorrhaging money.

Sadly he has not grasped the concept that to most Australians, QANTAS is more than an airline, it’s an Australian icon, an essential part of the Australian psyche. Russell Mills (above) quite rightly described boarding a QANTAS aircraft as “you are home before you get home”. Mr Joyce has no concept of this.

Also, don’t forget that a QANTAS’ majority shareholder is British Airways, so in a way, QANTAS is already overseas owned. So the Irishman thinks, what’s a little bit more?

There’s only one way to ensure that QANTAS remains Australian, and that for it to have government ownership. But it still has to be profitable. It’s not doing that now, and foreign ownership will not change that.

Lastly, what do Australian companies do with CEOs that don’t perform? Sack them with outrageous severance packages. Goodbye Mr Joyce! You’re not long for QANTAS!