Risk: the good and bad
From the bookshelves
IN recent weeks it was announced by the State Government that several local councils would merge. In particular Dubbo and Wellington have been matched with public reactions being appropriate.
Discussing this with a longterm friend on the north coast, he mentioned the pathetic status of one of the councils in that region which had been subject of a merger in recent years. The result of that merger had not changed the management, with KGHP in Melbourne reporting on their status as having outgoings being 150 per cent of income. Of course this was not made known to the public which raises a couple of questions? Why hasn’t the State Government moved to fix such problems, and why hasn’t that council been placed in administration? It’s a risk to leave them there.
In 1998 Peter Bernstein wrote “Against the Gods” in which he discusses the remarkable story of risk. One reference he makes is to the 1830 estate of John Mclean that left $50,000 to Harvard College. That amount was reduced because of risk taking in a case involving the so-called “Prudent Man Rule”. It runs: “Do what you will, the capital is a hazard... All that can be required of a trustee is to invest, is, that he shall conduct himself faithfully and exercise a sound discretion. He is to observe how men of prudent discretion and intelligence manage their own affairs, not in regard to speculation, but in regard to permanent disposition of their funds, considering the probable income, as well as the probable income of the capital to be invested.” That matter has rested for over a century and could be a good discipline at all levels of government decisions.
Considered an expert on economic/political text, author Ian Bremmer has written “The End of the Free Market” in which he discusses who wins the war between states and corporations. He considered that we are on the brink of a new kind of Cold War, one that pits competing economic systems against each other in a battle for dominance. He examples countries where governments use markets to create wealth that can be directed as political officials see fit.
State capitalism takes many forms: the Saudis use their massive oil revenues to buy domestic security and their citizen’s loyalty. The Chinese send state-owned companies abroad in search of long-term access to oil, gas, metals and minerals. There is risk when we don’t know what they are doing.
Kate Kelly has written “The Secret Club That Runs the World” which takes us inside the inner circle of a group of men who gamble with our future every day. This group of elite commodity traders control the prices of a small collection of daily essentials and their astonishing wealth has been created in near-total obscurity. But risk is still evident with the recent changes in oil prices.
When it comes to reducing the risk of bush fires there is a lot to be learned from the Indigenous peoples’ practice in this country described in “The Biggest Estate on Earth” by Bill Gammage. The landscapes described by early explorers bear no resemblance to today’s where regulations on both public and private land prevent appropriate clearing.
When Black Saturday occurred north of Melbourne a few years back, in one area the only house that was not destroyed by fire was one where the owners had cleared scrub from around the premises to reduce the risk of fire, yet they had been fined by authorities for doing so.
In the recent fires along Ocean Road, where 116 homes were destroyed, I could find only one reference to the fact that clearing had not been carried out. When the Warrumbungles burned three years ago, through the Observatory area and north to Bugaldie, the formalities had prevented the local farmers from doing back-burning.
The media feeds the general public in the cities the photos of country landscapes, and a recent view shows a resident looking out over recently harvested country. There was a time when a hay cut was made around cereal crops whilst it was still green, and then a fire break ploughed along that area. The press showed a colour photo of a harvested paddock with no such provision, and the outside of the fence showed a substantial accumulation of windblown dry grass – just ideal for a massive blaze.
When we listen to the daily 6am news we can expect to hear the list of crimes that occurred overnight. Stabbings, shootings, domestic violence, one-punch knock-outs, store hold-ups, the list goes on to show that some people have no respect for the law – obviously because the law is no deterrent. How often can we give the media credit for tracing inappropriate activities?
Journalist Kate Mcclymont wrote “He Who Must Be Obeid”. Bethany Mclean is the author of “All the Devils are Here” detailing the hidden history of the financial crisis. The media congratulates Canberra on the international Trade Agreements and yet, when one reads “The Landgrabbers” by Fred Pearce, we gain a better idea of foreign ownership of our agricultural land.
US company Westchester now owns 73,000 hectares of cropping country. And that’s before we include regional farmland purchased by Saudi, Asian and Chinese buyers. If intelligent administration fails us, the public is at risk.
“Trust Me, I Know What I’m Doing” by Bill Fawcett lists 100 examples of mistakes, i.e. results of risks taken by prominent people through history. One example occurred in 1929 when US President Herbert Hoover decided to let the economy fix itself and the Great Depression got greater. Without any doubt, if this nation’s risk on social and financial issues are to be minimised, things have to change. Enjoy your browsing, Dave Pankhurst.
In one area the only house that was not destroyed by fire was one where the owners had cleared scrub from around the premises to reduce the risk of fire...