Archive for September, 2012

“We’ve got some explaining to do”: The hypocrisy of Shep Smith, Fox and 24 hour news.

It is odd despite the everyday nature of 24 hours news television and the mass public murder/suicide of 9-11, we continue to be shocked when ugly life happens on air. The latest outbreak of outrage occurred today, when Fox News was forced to apologise for showing a suicide following a live car chase from a suburb in Phoenix.

Shep Smith was the on air man providing explanation and context for Fox News viewers in the god voice as the camera rolled when one of his real-life actors went berserk at the end of the chase. Once out of his car, the man staggered around like a hunted deer in the spotlights fleeing from police and the incessant roar of the helicopter above. This might have been the moment to end live coverage but instead the camera kept rolling and Smith struggled with the interpretation for viewers at home. “I would just- he is looking rather erratic, isn’t he?,” said Smith sounding less godlike by the second.

While Smith waited for re-assurance from somewhere, he continued the broadcast with filled pauses of ums and dunnos and oh mys. Meanwhile the cornered man on screen was increasingly out of options. “Well, it looks like he’s a little disoriented or something…” Smith suggested. Desperate to re-assure viewers this could never happen to them, he ascribed a motivation: “it’s always possible he could be on something.” While Smith invented the news, the cameras rolled on.

Utterly helpless and hopeless, the man reached for a gun and killed himself. After a second, the video jerks back to the studio. There is the strange sight of Smith issuing repeated cries “get off” for six seconds. Each call is more urgent than the last, until he shouts one final “GET OFF IT”. He turns away from the camera before they finally break for an ad claiming to be for “mesothelioma families” – Call Now 1-800-444-Meso – but is actually for lawyers.

When he returned Smith didn’t apologise for the fake ad but there was extraordinary grovelling for airing the suicide footage. “We’ve got some explaining to do,” began Smith. With the “we” Smith spread the blame across the organisation. “While we were taking that car chase and showing it to you live, when the guy pulled out of the vehicle, they went on five second delay. So that’s why I didn’t talk for about ten seconds,” he said. “We created a five second delay as if you were to bleep back your DVR five seconds, that’s what we did with the picture we were showing you. So that if we would see in the studio five seconds before you did, so that if anything went horribly wrong, we’d be able to cut away from it without subjecting you it.” Smith paused before adding “And we really messed up.”

That they were continuing to mess it up was shown in the strange editing error that followed immediately afterwards (36 seconds into the video) that makes a double-voiced Shep say “I am all very sorry”. Shep said the footage “didn’t belong on TV” but he didn’t explain why. Instead he worried about the internal systems that failed to keep the content out. “We took every precaution, we knew how to keep that from being on TV,” he said. “And I personally apologise to you that is what happened. “

Looking to the side rather than direct into the camera, Shep continued: “Sometimes we see a lot of things we don’t let get to you, because it is not time appropriate, it’s insensitive, it’s just wrong. “ He turned back to face the camera. “And that was wrong. And that won’t happen again on my watch and I’m sorry,” he said. “We’ll update you on that guy and how that went down tonight on the Fox Report.” Smith repeated he was sorry and then set up his voice for the next story: “Now, the attack on…” It is 24 hour news after all and the show must go on.

Despite Smith’s hopes for “his watch”, a lot of people weren’t going to wait for the Fox report to see “how it went down.” Smith’s patriachal protection of his audience might have worked 10 years ago but not any more. He must have known that someone would grab the footage and it would go viral. Gawker were quick off the mark publishing a link (with caution) to the original footage via Buzzfeed and also to Smith’s on air apology.

The first Gawker commenter picks up an obvious problem: “I’m confused. If they went to 10 delay, how did the suicide end up on screen anyway? I don’t understand Shep’s explanation,” Scout’s Honour said. It was five seconds not ten, but Scout’s point holds up. Wrapped up in his godlike role as narrator, Shep overplayed his hand and took six full second after the death to realise they had “gone too far”. In panic, he takes another five seconds to realise someone has pressed “dump” button out of the broadcast. So we get the strangeness of viewers watching him shouting at some-one to get rid of the delayed footage.

It was a category error on several levels that asked many questions of Fox in particular and 24 hour news in general. Car chases are popular time sinks for the networks and easy to follow once you’ve invested in a helicopter. While one such chase unfolded on air in 2009, Smith quipped on air about the energiser bunny and how he had enjoyed this type of entertainment for many years. So after Buzzfeed, Gawker and others quickly pounced on the mistake, it was surprising to hear several journalists blame the messenger. The Columbia Journalism Review tweeted, “Who’s worse? @FoxNews for airing the suicide, or @BuzzFeed for re-posting the video just in case you missed it the first time?” while Reuters social media editor Anthony De Rosa asked “Why is Buzzfeed sharing a suicide video?”

Al Tomkins in Poynter answered both questions when he picked up on the hypocrisy of the apology. Tomkins wanted to know the guidelines for broadcasting chases. “Are you prepared to air the worst possible outcome that could result from this unfolding story?” he asked the broadcasters. “What outcomes are you not willing to air? Why? How do you know the worst possible outcome will not occur?” It is unlikely any broadcaster has asked themselves too deeply on this or about Tomkins other concerns about car chase coverage: motivations, truth, consequences, tone, safety nets, training and time of day. Broadcasters show them for the same reason they show the 1-800-444-Meso ads: they make money.

Tompkins said he was not an absolutist and there are situations when chase coverage is useful for people near the scene. But his unspoken argument was that they served mostly commercial ends. “These are humans involved, struggling with their lives as we transform them into “stories,” he said. “They are humans, they are not ratings points.” But as long as there are ratings points, we will have to put up with the occasional pious homily about live deaths.

September 30, 2012 at 12:23 am Leave a comment

Peter Jackson: The tragedy of Australia’s black fistic idol

The great black boxer Peter Jackson never forgot his first defeat. Years later on his deathbed in Roma in Western Queensland, Jackson discussed the matter at great length with his doctor Guy L’Estrange. That loss to Bill Farnan in 1884 in Melbourne was Australia’s first heavyweight fight with gloves. Jackson was already a famous and feared fighter and expected to win, despite carrying a leg injury. But Farnan beat him in three rounds.

Jim Corbett v Peter Jackson

We don’t know what rundown Jackson gave L’Estrange about the Farnan fight on his deathbed in 1901, tragically aged just 40. But there is evidence foul play was involved. In in its eulogy for Jackson, the boxing magazine The Referee published the suggestion Jackson was nobbled in the fight and had been “given a dose”.

Despite, or perhaps because of this grievance, the loss spurred Jackson onto greater things. Born in Christiansted on the island of St Croix in what was then the Danish West Indies (and is now the American Virgin Islands) in 1861, this black kid from the Caribbean found himself in the strange world of Sydney aged 16 and standing six feet tall. He was gentle and easy going and didn’t like a fight. But his weakness for food led him to Larry Foley’s Hotel. Larry Foley was one of Australia’s first boxing champions who was undefeated at bare-knuckle fighting. He liked the look of Jackson and tried him out in the back shed. Foley gave Jackson a job and the training he needed in ringcraft.

Jackson became as good as his mentor in bare-knuckle and would sometimes fight with his right arm bound. Four months after the Farnan loss, the pair held a rematch. The bout was indecisive with police stopping the fight in the sixth round after spectators stormed the ring. Farnan retained his title by default but lost it to Tom Lees two years later in 1886. Jackson beat Lees later that year to take the title. Foley gave him a special belt to celebrate the win, now in the possession of a Sydney based collector.

Having conquered Australia, Jackson went off to take on the best in the world in America. He arrived in 1888 and started with an 18 round victory over Black Canadian George Godfrey. Godfrey had previously tried to fight John L Sullivan but after Sullivan became world champion, he refused to fight black boxers. Jackson would run into the same problem with Sullivan – he would not “lower himself to fight a nigger” – and Jackson left frustrated for England.

Jackson chalked up two years of victories in England and returned to the US hoping to get another chance to take on the champion. But Sullivan still would not get in the ring with a black man and turned Jackson down. Instead, Jackson fought Sullivan’s main contender, Gentleman Jim Corbett. Jackson was five years Corbett’s senior and was ill for ten days before the fight in May 1891 and had a sprained ankle. Yet Jackson and Corbett slogged it out for 61 rounds for an energy sapping draw with most observers saying Corbett had the worst of it.

Though Corbett would later go on to defeat Sullivan and become world champion, it was the Jackson fight he remembered best in the biography The Roar of the Crowd. “That night I thought Peter Jackson was a great fighter. Six months later still tired from the fight, I thought him a greater one. I still maintain he was the greatest fighter I have ever seen.”

But Jackson would never lift the world crown. After the Corbett draw he went back to England and defeated the snarling Australian-Irish fighter Paddy Slavin to lift the British and Commonwealth titles in a difficult bout. The pair had bad blood since Sydney days and they still hated each other intensely. In the eighth round Slavin broke Jackson’s rib and a splinter punctured a lung. In intense pain, Jackson seemed beaten but rallied in the tenth to take control of the fight and pounded Slavin to pieces. The referee insisted the fight continue until Slavin was knocked out but the damage was fatal to Jackson.

The punctured lung never repaired and Jackson went on a downhill spiral. He was forced to appear in vaudeville, giving boxing exhibitions in circuses and as Jeff Rickert and Raymond Evans said about him in “Radical Brisbane: An Unruly History”, acting as a grey-wigged Uncle Tom in stage performances of Uncle Tom’s Cabin. Suffering from tuberculosis, his last fight was against the powerful Jim Jeffries in 1898 and Jeffries knocked him out in five rounds.

Though Jackson always retained Danish citizenship, it was to Australia he returned in 1899, his career in ruins. He trained fighters in Sydney for a time but his TB worsened. On the advice of doctors, he retired to the dry heat of Roma, a shadow of the giant he once was. He died on July 13, 1901 at Argyle Cottage a privately run sanatorium which was later demolished to make way for the southern end of Roma’s airstrip. Dr L’Estrange put the cause of death of the “retired pugilist” as pulmonary phthisis exhaustion.

Jackson was due to be buried at Roma but there was a last minute change of plan. Another black West Indian boxer, Jack Dowridge from Barbados, who fought under the label of the Black Diamond, sent a telegram asking for the body to be sent by train to Brisbane. Jackson’s casket was escorted to Roma Railway Station by a band with a procession of sporting bodies and dignatories. In Brisbane, the procession went from Dowridge’s Hotel to Toowong Cemetery where he was buried in an unmarked grave.

Dowridge, with the help of several journalists and Jackson’s former coach Foley began to raise funds for a Jackson memorial. After a public subscription, Sydney mason Lewis Page carved a dazzling white Carrara marble monument over Jackson’s grave with an image that looks nothing like Jackson. The inscription repeats what Shakespeare’s Antony said about Julius Caesar “This was a man”.

But the best tribute was paid by Jack Johnson, an uppity black boxer from Galveston, Texas who achieved what was denied Jackson. On Boxing Day 1908, a white Australian crowd in Sydney was stunned when he defeated Canadian Tommy Burns to become the world’s first black heavyweight champion. A few weeks later he went to Brisbane and Dowridge took him to visit Jackson’s grave in Toowong. A.E. Austin of the Brisbane Courier said the living champion spent a quiet few moments in silent contemplation at the grave of his brother-in-arms. “It was an impressive sight to see the living gladiator kneeling for a moment over the tomb of he who was Australia’s fistic idol”, Austin wrote.

September 27, 2012 at 11:19 pm 1 comment

Clive Palmer: last sentry

Clive Palmer continues to hold a fascination for Australian politicians and the media alike.  Prime Minister Julia Gillard invoked his name in her revenge attack on Campbell Newman’s Queensland LNP Government. Gillard made a long speech to the Queensland ALP conference yesterday but it was the reference to Clive Palmer (curiously left out of the official transcript) that gave the Brisbane Times its lead. “Even Clive Palmer is having doubts,” Gillard said. “You know the ship is going down pretty fast when the bloke who wants to resurrect the Titanic is seen leaving it.”

Gillard is referring to LNP life member Palmer dishing out on LNP leader Newman. Palmer has been on the attack since last week’s Queensland budget where the new government raised coal royalties. The near billionaire Palmer is directly affected through his China First coal project in the Galilee Basin which was cancelled in May though he cloaked his criticism in wider concerns. According to News Ltd, Palmer said “strikes, protest marches and royalty hikes were not good for the image of the state and would drive away investment.”
It is amusing to see Labor use Palmer as a tool of their propaganda after painting him so often as the bogey man. Wayne Swan was in his sights for much of that past 12 months, but the businessman has added the State Government to his grumbles. He is up in arms against both levels of government over his proposal to pump wastewater from his Yabulu nickel plant into the Great Barrier Reef protection zone.
Meanwhile the Queensland Government decision to award Gina Rinehart and an Indian consortium a rail corridor to the Galilee still rankles. Palmer and his Chinese partners have put their joint venture on hold due to the dropping price of coal. Luckily for Palmer, his enormous wealth is in iron ore not coal. His company Minerology painstakingly secured 160 billion tonnes of iron ore deposits south of Dampier in the Pilbara Ranges in Western Australia over 15 years.

Forbes estimates Palmer as being worth $795m making him the 29th richest person in Australia. Palmer said his father George, a successful silent movie star of the 1920s and radio pioneer, had the greatest influence on him. “Dad worked with the then Prime Minister Billy Lyons when he was in power, advising him on media stuff. He was probably the first of the spin doctors,” Palmer told the Gold Coast News. “He also set up train and buslines for transportation. He broke that monopoly that the state railways had. He was quite an amazing guy.”

On leaving uni, George’s son got a job in real estate in the Gold Coast. He quickly became their top marketing consultant, before setting up his own company, GSS Property Sales. With the Coast in the middle of a construction boom, Palmer thrived and was worth $40m before the age of 30. In 1986 he set up companies to buy iron ore deposits and trade oil. He became a close confident of Joh Bjelke Petersen  and an admirer of the way the Premier turned Queensland into a coal exporter.  Palmer was considered the architect of Joh’s final election victory in 1986.

Palmer also met Soviet leader Mikhail Gorbachev and set up joint ventures with Russian companies that persist to this day. Palmer also greased the wheel with Chinese interests and had to be very patient to make the deals work over many years. The lesson was to treat everyone with respect. Palmer said their collective decision-making process often allowed middle management more power than the managing director. But Palmer’s key skill was his sense of timing. As Griffith Uni’s Jason West said, thermal coal prices spiked to unprecedented levels allowing the likes of Palmer, Hancock and Forrest to experience profit margins beyond their wildest expectations. “Instead of earning margins of $2 to $10 a tonne as they had for decades, coal miners were now earning margins of $50 to $100 a tonne which in turn increased asset values to levels rivalling well-established and brand name top 50 firms,” West said.

West said Palmer had one income-earning asset and a whole bunch of tenements offering nothing but promises of future wealth. But some of those promises are extremely lucrative. They include the massive $8 billion Sino Iron Project at Cape Preston, 100 km south west of Karratha, WA expected to deliver before the end of the year. Owned by Hong Kong-based CITIC Pacific, it is on Palmer’s tenements and will be the largest magnetite iron ore mining and processing operation in Australia. The Sydney Morning Herald estimates Palmer will rake in half a billion a year in royalties on Sino Iron.
These are impressive numbers for someone who is still mostly regarded as a joke. Much of this poor public profile is his own fault due to his buffoonish tendency to act as a walking headline. Palmer is not shy about self-promotion and prefers to call himself Professor Palmer, courtesy of an honorarium from Bond University. Somewhat bizarrely, he has also been officially listed as a “national living treasure” though the National Trust of Australia offers no reason for this accolade other than the incorrect statement “Palmer is a self–made billionaire”.

Whatever his status, there remains the unfinished business of political ambition. In a Lateline interview last week, he attacked Campbell Newman for his lack of experience in business. “I’m the most successful Queenslander in the commercial world that’s ever lived, yet I’m not supposed to have any say and any knowledge about that,” Palmer said.  But while he has flirted with Katter, he still wants change from inside his party.  “I love the LNP and I’ve been a supporter of it for 43 years,” he said. “I remain the last sentry at the gate to protect democracy in this country.”  The question remains whether the sentry is there to guard the gate or attack the castle.

September 18, 2012 at 10:56 pm 2 comments

Barbarians at the gate

“Behead all those who insult the prophet” is a curiously worded slogan. It says Mohammed is a figure so holy that even the mildest rebuke should be greeted by severing that person’s arteries at the throat.  It is a common punishment for trivial matters in hard-line Wahhabist regimes such as Saudi Arabia.  One such trivial matter lies behind the latest calls for such barbarism, a “clumsily overdubbed and haphazardly-edited” low budget film with no production values.  Its US-Egyptian maker Nakoula Bassely Nakoula could well be the Ed Wood of the 21stcentury. But because his film contains “insults to the prophet”,  it is capable of causing world-wide riots, multiple deaths including a US ambassador  and the banning of youtube in Afghanistan.

 
Yesterday’s protest in Sydney was the first Australian attempt to normalise such an extreme response. It was a deliberate affront to the norms of western culture and the live and let live philosophy of multiculturalism. Saturday shoppers on Pitt Street would have been bewildered to reads signs that told them  “’Our dead are in paradise, your dead are in hell”.  It was so far outside their life experience as to be surreal. But they would have noticed the anger was real enough.
It was worse in other parts of the world where protesters were taking active steps to behead the insulters. Urged on by opportunist Salafi political leaders they lashed out at whatever target was convenient. But it was contrived.  In Libya and Egypt, it was Al Qaeda-affiliated groups preaching to the disaffecting. In Yemen, it was former president Salahi undermining the current administration. And behind the scenes across the region it was Iran flexing its muscles.  There is no god but God and Muhammad is his prophet, but it is politicians who are pulling the strings.
As usual, the West had no idea how to react. The protests were cloaked in wrath so righteous, it dared not be criticised. Far easier to criticise the target of the wrath, as western countries did in the past, blaming Salman Rushdie or the Danish cartoons for antagonising Muslims, not the protesters themselves for their over-the-top response or their leaders for their cynical manipulations. It is easier to retreat into pious homilies that attack the proximate rather than political causes. Then US president George HW Bush refused to condemn the fatwa on Salman Rushdie with a non-committal “no American interests are involved” while the British deplored his fight with a great religion.
Now the American can’t look away any longer when a work of no artistic value causes international murder and mayhem. Nakoula had every right to make a film that took Mohammed’s life to pieces and portrayed him as a flawed man, not as a flawless “prophet”.  If that was humiliating and offensive, to some then so be it. That is their problem and they could have dealt with it by ignoring it. But the Innocence of Muslims is not only a rubbish film, it is not even honest rubbish. Nakoula lied to his cast and crew about its intentions .
Under an assumed name of Sam Bacile, Nakoula pretended he was making a  “historical desert drama” called Desert Warriors.  His lead character was Master George, a philanderer and husband of multiple wives, one as young as seven. The references to Mohammed and Islam were thrown in later in the absurdly bad editing process. When one of the cast rang Bacile/Nakoula to talk about his deception, he replied, “I’m tired of radical Islamists killing each other. Let other actors know it’s not their fault.”
Nakoula may have wanted to light a flame but it was up to others to burn the house down with it. Former Iranian Hezbollah leader Massoud Dehnamaki gives a clue as to how others would use the spark.  Dehnamaki told the Daily Beast it was up to the US to “prove” it was not involved  The US government had to prosecute the filmmakers, he said. “Westerners see their own freedom in the ability to insult others,” Dehnamaki said. “They see freedom as a one-way freeway that moves in the direction of their demands.  They don’t respect other people’s beliefs.”
And indeed there were pictures in the news today of Nakoula being arrested. Though it was not well explained by media, his crime was not blasphemy or even deception but simply a breach of probation conditions. When he was done for a fraud crime in 2010 Nakoula was not allowed a computer or the Internet without permission for five years.
But there is no crime in his film, except against taste. It was not as the White House said  “reprehensible and disgusting” but the response was. Bad films don’t kill people, people kill people. No one wants to take to side of a convicted fraudster who has deceived his crew and set out to deliberately offend with a ham-fisted film.  But that is what we must do.
Freedom is not a one-way freeway as Dehnamaki calls it. It is an 18th century enlightenment value that understands complex societies need a certain tolerance of difference to survive.  No longer tied to the dictatorial value-system of any one church, some leeway of live and let live is needed to ensure a peaceful life.  It is why blasphemy was mostly wiped off the books in the west in the 20th century but it is also why it is creeping back in the 21st in the form of legislated race hate crimes.
It makes it harder to get criticism into the public domain while doing nothing to address the root cause of the hatred.  And it is the thin edge of the wedge. There are more serious works than Nakoula’s at stake. Only this week, British television canned a serious historical program that casts doubt on the authenticity of Muslim traditions. Filmmaker Tom Holland said his Islam: The Untold Story was a “a legitimate subject of historical inquiry”. But it was cancelled on “security advice”. British audiences should slam Channel Four’s cowardice and demand they show it. This is not war of civilisations, it is test of strength.  We must stand up for free speech. Unless we are happy for western countries to imitate the Saudis, those who demand beheading need to be disarmed.

September 16, 2012 at 11:57 am 1 comment

Birth, marriage and debt: Bankrupcty in Australia

If you are a man, in your early forties and single, then chances are you are more likely to be bankrupt. That’s the finding of the Profile of Debtors 2011 a new report released by Insolvency and Trustee Service Australia.  This Government agency knows this because anyone who becomes bankrupt must lodge a statement of affairs with ITSA.

The Bankruptcy Act 1966 allows for trustees to distribute property fairly among creditors and prosecute dishonest debtors.  Bankruptcy lasts three years but can be extended. Since 2003 several patterns among bankrupts have been noticeable: they are mostly male (55:45), they are getting older, and they have less children than before. The primary causes are unemployment and economic conditions affecting their industry (particularly since 2009). The majority of bankrupts earn $30,000 or less and the size of their unsecured debt is increasing. Despite their low incomes, almost half of them have unsecured debt of more than $50,000 and over a quarter per cent have unsecured debt of more than $100,000.

Over 23,000 Australians went bankrupt in 2011 and ISA constructed a profile of the average bankrupt last year. He was male aged between 35 and 54 years and single without dependents. It was his first time bankrupt. He earned less than $30,000 in the 12 months prior to bankruptcy (well below the $48,000 national average) and owed more than $20,000 mostly to the banks. He had no assets like property that could repay creditors.  Tasmania and Queensland had the highest percentage of bankrupts and NT had the lowest. Three percent of bankrupts identified as Indigenous (who comprised  2.5% of the population). 

Nearly half of the liabilities is unidentified by the research with the “other” category responsible for 47% of all debt. Of the identified debt, credit cards were highest, responsible for 21 percent of unsecured debt followed by personal loans and house mortgage both on 12 percent. Credit cards also accounted for 18% of personal insolvency agreement debtors’ debt and a record 58% of debt agreement debtors’ unsecured debt.

According to ASIC, Australians have over $36 billion owing on credit cards, an average of $4,700 per card holder. MoneySmart’s Delia Rickard said paying off credit card debt should be a top priority for millions of Australians.  ‘If you have $4,700 credit card debt (the national average) and only make the minimum repayments, it will take 49 years to pay it off and cost you around $14,600 in interest,” Rickard said. “But if you are able to pay off $250 each month, you’d pay off your debt in two years and save $13,700 in interest.”

Despite the RBA keeping interest rates at historical lows, banks still charge astronomical rates for their credit cards. Paul Clitheroe said the average card rate is around 17 per cent but many charge 20 per cent or more. “Monthly interest charges continue to eat away at household budgets making it hard to get ahead with card debt,” he said. “If you’re serious about clearing card debt, one solution is to use a personal loan to pay off the balance.” Clitheroe said this would increase monthly repayments but the debt would  be paid off in three to five years depending on the loan term.

There are new rules in place since July 1 which will allow people be better informed against the scams the credit card companies use to fleece their customers. The company must now refrain from offering limit increases on cards, unless agreed, provide monthly statements that show how long it will take to repay the entire balance if you only make minimum repayments and provide clearer details on interest-free periods. All new credit cards must include facts sheets to make it easier to compare offers, the capacity for consumers to nominate the credit limit, a ban on over-limit fees, notifications if you exceed your credit limit and repayments to the most costly aspect of your credit card debt first (such as cash advances) to reduce debt faster.

September 9, 2012 at 1:13 pm Leave a comment

Going Platinum: Lonmin and Marikana

The precious metal platinum is what catalytic converters use to convert the toxic by-products of petrol combustion to something less poisonous.  Platinum is not easy to find in the Earth’s crust and 80% of it is found in South African nickel and copper mines.  One of the earlier companies to see the value in these mines was Tiny Rowlands’ Lonrho. Rowlands was a classic self-made 20thcentury capitalist who turned Lonrho from an obscure farming and mining company into a multinational conglomerate.

 
Rowlands had no compunction with dealing with apartheid era South Africa for which hypocrite Prime Minister Ted Heath called Lonrho “the unacceptable face of capitalism.” But while Rowland was making enemies in London, he knew how to do business in Africa. He made many friends among black African leaders including Nelson Mandela, Kenneth Kaunda and Muammar Gadhafi. When Mandela came to power, he didn’t throw out Lonrho but instead bestowed on Rowlands South Africa’s highest honour the Order of Good Hope in 1996.
By then Rowlands was on the outer at Lonrho after he financed a film exonerating the Libyans of Lockerbie.  In 1999 Lonrho refocussed on its mining core business and renamed itself as Lonmin. The focus of that mining was the wealthy Bushveld Complex of northern South Africa around Johannesburg, home to the world’s largest collection of platinum group metals. It was a money-spinning venture as platinum prices soared. Xstrata saw the value and bought up 30% of the company. Of the 245 tonnes of platinum sold in 2010, almost half was used for vehicle emission control devices.
But by then the bottom was starting to fall out of Lonmin’s market. In March 2008 the global financial crisis was about to strike and platinum was one of the first casualties. The price started to plummet. Lonmin were never big fans of unions and suffered constant safety stoppages because of accidents, numerous labour strikes, and unplanned plant and equipment shutdowns. Yet they were also protected by an ANC-backed National Union of Mineworkers whose leader Cyril Ramaphosa ended up on the board of Lonmin.
But as the NUM flirted with management, its membership fled to more radical unions. There was also simmering resentment from locals who felt they were not getting their fair share of the mining boom. Social welfare organisation Bench Marks Foundation said low wages and social disintegration, crime, murder, rape and prostitution, unemployment and poverty amid the third richest platinum mine in the world, created an incubator rife for worker and community discontent.
On August 16, Lonmin shares plummeted 7 percent on news an illegal strike had paralysed all its South African operations. At its flagship operation in Marikana near Rustenburg, 100km north of Johannesburg,  Lonmin threatened to sack 3,000 rock drill operators if they fail to end a wildcat pay strike.  Clashes between unions claimed nine lives, including two police officers.
Jeffrey Matunjwa of the Mineworkers and Construction Union defended the strike action. He told Al Jazeera they couldn’t stand by while bosses and senior management were getting fat cheques. “And these workers are subjected to poverty for life,” Matunjwa said. He said despite 18 years of post-apartheid democracy, most of the 28,000 mineworkers were still earning $360 a week “under those harsh conditions underground.”
Matters came to a head on August 16. Members of an elite South African police unit were called into Marikana. They opened fire killing 34 strikers and wounding 78 others.  It was the largest single massacre on South African soil since Sharpeville in 1960 and a bloody reminder South African police had never departed from their apartheid-era role “as the brute enforcer of state power.”
Police claim the strikers shot first, for which there is some evidence and many strikers were armed. But there is also evidence the return fire from police wasn’t indiscriminate. The Daily Maverick  estimated the majority of those who died were killed beyond the view of cameras at a nondescript collection of boulders some 300 metres away from the protest. They said heavily armed police hunted down and killed the miners in cold blood.
The only charges laid have been against 270 strikers initially charged with public violence and later murder. These charges were laid under the doctrine of ‘common purpose”, an apartheid era conceit kept by the new rulers.  Their lawyers write to Prime Minister Zuma saying it was inconceivable the strikers would have killed their own people.  Last Sunday the Director of Public Prosecutions for the North West dropped the common purpose charges.  They didn’t explain why but defended the initial decision on “a sound legal principle” and a “prosecution duty” to go for the highest charges.
Yesterday a court released 100 of the 270 miners as most of the unions signed a peace pact with a Lonmin desperate to rid itself of the unwanted international attention. One union and non-union workers have not signed up to the deal so it remains a worrying time.  Lonmin has been losing 2,500 ounces of daily production since the strike started a month ago. With the price of platinum recovering since July to the point where only silver has gained more this year among precious metals, every day of lost production is costing them a lot of money.  The company will be looking for its state links to do whatever it takes to get their mines operational again.

September 6, 2012 at 11:42 pm Leave a comment

Cotton On: Politicians crawl through the Cubbie Hole

The war of words over the future of Cubbie Station has started. The Foreign Investment Review Board has recommended to Treasurer Wayne Swan the sale of Australia’s largest cotton grower and holder of water licences to a consortium dominated by Chinese textile producer Shandong RuYi. The sale, currently in the hands of administrators, required FIRB approval as it was in excess of the $244 million takeover trigger for investigation. While the FIRB has not made its decision public, Swan has used it as a political attackto wedge the Opposition after the State Government backed the sale while local LNP senator Barnaby Joyce said it was not in the national interest.

Swan explained his reasons for the approval in an August 31 media release. Cubbie had been on the market for three years and the joint proposal by Shandong RuYi and Aussie wool company Lempriere had given him several undertakings. These included RuYi selling down its interest to 51 per cent within three years while maintaining “appropriate” board representation, having Cubbie managed by a Lempriere sub-company and offering jobs to all existing Cubbie employees.
Swan points to the National Food Plan which is in draft form and seeking public submissions until September 30. That Plan also vigorously defends the need for foreign investment in Australia which it says is critical for the agriculture and food sectors. “Foreign investment in agriculture supports production, creates jobs and contributes to the prosperity of rural communities and the broader economy,” the Plan green paper said. The paper said foreign investments undergo a rigorous national interest test and are subject to the same laws and regulations dealing with competition, tax and governance.

So why should anyone care about the future of a company that employs only 50 people with another 120 contractors?  It was not a simple case of xenophobia against Chinese investment (though in truth, it would be hard to imagine a similar furore if it were Seattle RuYi buying Cubbie).  It is because as Senator Joyce said today it was the loss of “prime agricultural land to an overseas interest.”  As well, the sale would involve Australia’s biggest water licence going to an overseas interest and 13 per cent of the nation’s cotton crop.

 
Barnaby lives in St George some 80km north of Cubbie so is well aware of how big a deal it is. Its massive scale and its potential to impact on the entire Murray Darling Basin, is most impressive from the satellite image. In the middle of parched brown western Queensland landscape, lies this darker patch of fertile ground following the Murray-Darling plain. Due west of Dirranbandi, (100km north of the NSW border) is Cubbie Station a patchwork quilt of storage dams, stretching along 30km of the Culgoa River. At 93,000 hectares, Cubbie is Australia’s biggest irrigator and most of the water is used to make cotton.
Cottonseed came to Australia in the first fleet and was an early cottage industry. It took the shortages of the American Civil War to set Queensland cotton up on a commercial basis but the industry ebbed and flowed according to inconsistent 20th century demand. With the help of subsidies from the newly elected National Party government, SW Queensland got in on the act in 1960 but has been badly affected by droughts in 1995, 2004 and 2008. In 2010/11 there was a record Australian crop of 4.1 million bales showing an industry in resurgence after almost a decade of drought.
The recovery came too late for the owners of Cubbie, Australia’s biggest cotton plantation.  Cubbie had always got away with paying a pittance for its water much to the disgust of its neighbours and NSW irrigators downstream. Slack government processes allowed Cubbie to gradually suck in more of the region’s scarce water resources. As one commentator noted about other parts of the world, “water diversion on the scale of Cubbie could easily be the cause of war.”
Despite all the favourable treatment, the company still went broke in 2009. Cubbie Group chair Keith De Lacy – a former Treasurer in the Wayne Goss government – blamed the drought for the company’s woes. De Lacy said the station had only had one good season in five and the company was selling up to reduce debt and recapitalise the business to pursue other farming opportunities.  At the time SA independent senator Nick Xenophon said Cubbie going into voluntary administration proved the station was not a sustainable use of water. “What it does indicate is a failure of water policy at the Queensland Government level and it indicates even more strongly that you need to have a federal takeover of the river system,” he said.
This week Xenophon spoke out again on Cubbie opposing the decision to approve the sale. “These important environmental assets shouldn’t be flogged off to a foreign company that has no connection to Australia, and no obligation to act in our interests,” he said. “There’s also a concern the impact this could have on the entire Murray Darling Basin.” He also called on FIRB to make its report public so that the general public could be confident in its decision to approve the sale. “There must be a much lower trigger point for investigation,” he said. “We need much more transparency in terms of why applications are approved or rejected and we need a national register which lists foreign owned properties so that we know who owns what.”

September 3, 2012 at 11:07 pm 1 comment


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