Why Kevin Rudd is SMILING in this world wide recession.

Comrade Rudd and Madame Rein
Australians would be smiling too if they were about to reap a $300million dollar wind fall due to the world wide recession and the policies of Comrade Rudd's Socialist Government.

UK deals windfall for Rein enterprise

Peter Wilson, Europe correspondent
The Australian
March 11, 2009

KEVIN Rudd's family finances are heading in a different direction from those of most people as the global recession helps to add as much as $300 million to the annual turnover of his wife Therese Rein's job-placement company in Britain.

Industry experts familiar with her main operating company predicted yesterday that its turnover would more than treble in the next three years from about pound stg. 60million ($130 million) to pound stg. 200million.

While most families and industries struggle with the recession, Ms Rein, who is estimated to be worth $60 million, is prospering because her firm is already winning new British government contracts and her chosen profession of helping the unemployed is one of the few businesses that continues to boom in bad economic times.

Ms Rein's decision to sell her Australian operations to avoid a conflict of interest after her husband was elected prime minister in 2007 has turned out to be beautifully timed because she concentrated on the British job market just as it was preparing for an explosion of private sector activity.

Her firm, WorkDirections UK, is believed to have doubled its turnover from the pound stg. 32 million it reported in June 2007, while its workforce has also doubled to more than 700.

That growth is mainly being driven by the British Government's injection of new market forces and private enterprise into the task of finding jobs for the unemployed, but the recession is giving her business a further boost.

The upturn in Ms Rein's fortunes comes as Opposition Leader Malcolm Turnbull stands by his claim that it is hypocritical of Mr Rudd to attack "neo-liberal" policies when his own family finances have benefited from the privatisation of government services.

Ms Rein's acumen and business success have been well documented, but the extent of her expansion in Britain is only now becoming clear.

"Selling up in Australia and turning most of her attention to here (in Britain) turned out to be the smartest thing she could possibly have done," one economic adviser to the British Government said yesterday.

A spokeswoman for Ms Rein's holding company, Ingeus, yesterday refused to comment on the firm's growth prospects, issuing a statement saying that "we are not in a position to speculate about our purchasers' response to current economic conditions (but we) will continue to respond to employment services tenders as they arise".

Labour now pays about pound stg. 1 billion a year to private firms and voluntary groups for job services but it is committed to giving them access to more of the pound stg. 36 billion that it spends on the unemployed each year.

The likelihood of a Conservative election victory next year suggests there will be an even bolder shift to the private sector, with the Tories promising to put many more job-search functions out to contract and to make heavy cuts at the Department for Work and Pensions, which has already lost 30,000 jobs under Labour.

With Britain suffering one of the deepest downturns in the developed world, the number of people on some form of jobless benefits is tipped to double to two million, prompting Gordon Brown's Government to increase the scale and pace of its shift to private-sector job placement.

One of the Government's flagship programs, the Flexible New Deal for the long-term jobless, has been expanded from 100,000 places to 300,000 and the upfront payments to job placement firms have been increased to help fund the start-up of what is essentially a new private industry.

Several experts in London said the next 18 months to two years would be difficult for the private providers as they struggled with their own structural changes and a shortage of job vacancies, but when the recession eventually eased the profits would roll in. When the economy finally began to create more jobs the job placement agencies would thrive because they would have large numbers of relatively skilled and work-ready people on their books.

Richard Johnson, a former executive at Ms Rein's firm in Britain who now heads one of her rivals, yesterday backed the prediction that she could triple her turnover in the next three years.

"If you do the numbers you do come up with a result like that and Therese has built a company that deserves that sort of success," said Mr Johnson, the managing director of welfare-to-work programs for Serco, one of the world's largest providers of privatised public services.

"WorkDirections has probably the best reputation in the country for quality and integrity. It pays its front-line staff more than other providers and something like 90 per cent of them have university degrees.

"That high-quality service is a point of difference in the market and it has been a very clever strategy because the trend now is all about basing payments on results and if you deliver better results you will be better rewarded."

The Government is offering 24 large five-year contracts to provide job services in different parts of Britain and WorkDirections is widely expected to win three or four contracts.

That would lift its turnover to perhaps pound stg. 105 million and similar results in the next two annual rounds of contracts would lift it to about pound stg. 200 million.

Professor Dan Finn, a welfare-to-work expert for the Centre for Economic and Social Inclusion who has studied the introduction of such schemes in Australia and the US, said the first few years of the new British contracts were likely to have generous government funding.

"If you look at cases like the Jobs Network in Australia they tend to spend a lot to make sure it gets up and running, and then they tighten up the funding," he said.

"That is when the number of providers competing for business falls away ... and the quality operations like WorkDirections are left standing."

Ms Rein's firm has also entered the French, German and Swedish job markets but the greatest rewards have been offered by the structural reforms in Britain. Labour has already brought single parents and the disabled into welfare-to-work programs and is now flirting with the more radical step of using the huge pot of money that is normally reserved for unemployment benefits to pay job-placement firms for reducing the benefits bill.

Follow New Zealand NOT Obama

Follow the Kiwi leader, not Obama
In this crisis, our neighbour is a better economic model than the US or Britain,contends Tony Makin

The Australian
March 11, 2009

DESPITE the federal fiscal stimuli we had to have, Australia is almost certain to experience the recession it was not supposed to have.

So, with earlier stimulatory measures failing to work as expected, what alternatives would work better?

The answer is: those primarily focused on the production rather than the spending side of the economy.

Federal fiscal packages unveiled since October last year have aimed to boost consumption in the short term, in keeping with Treasury advice at the outset that the best fiscal response to the global financial crisis was to "go early, go hard, go households".

However, an arguably sounder fiscal response would have been the exact opposite: go later, go easy, go firms.

This does not mean federal policymakers should have ignored the downturn or that all aspects of fiscal stimulus packages have been unworthy. On the contrary, many infrastructure projects scheduled for future years have been overdue, there is some business tax relief and business regulation problems are being addressed.

But too much faith has been put in using fiscal policy to boost consumption on the demand side of the economy in the short run via tens of billions of dollars' worth of bonus payments. A different mix of measures should have recognised that the financial crisis first struck the aggregate supply side of the economy, not the demand side.

For federal fiscal policy to go later would have meant letting monetary policy go further in the first instance to pre-emptively manage the expected downturn in short-run macro-economic activity. The Reserve Bank of Australia has had much greater scope to do this compared with central banks abroad because official interest rates in Australia had been too high for too long before the global financial crisis hit home.

Inflation also had been wrongly diagnosed as an aggregate demand problem rather than a supply side, or cost-push, problem thanks to high oil and other international commodity prices.

The lowering of official interest rates by four full percentage points since September and the sharp exchange rate depreciation since then will do more to buffer the economy from the worst of the crisis than any fiscal action in train.

It also would have been advisable for federal fiscal policy to go easy in the light of the whack to budget revenue and the budget bottom line as a result of global commodity price falls and diminishing company and capital gains tax receipts.

Moreover, going easy on fiscal policy would have avoided the problem that will soon arise when government borrowing to fund growing state and federal budget deficits puts upward pressure on long-term interest rates, thereby limiting the Reserve Bank's discretion to lower interest rates across the spectrum.

"Go households" has meant channelling scarce federal fiscal outlays to select segments of the economy's household sector. But this has ignored the fact firms were the first victims of the crisis.

For many struggling firms, falling sales were initially less of a problem than the unavailability of credit. Paradoxically, the raft of hasty public spending initiatives implemented across the world may hold back recovery if households and markets become increasingly alarmed about higher future taxation, interest rates and inflation.

Unemployment is the scourge of recessions. However, it is the business sector, not households, that ultimately employs most people, creates most of gross domestic product and invests in the economy's future. Hence, it would have been better to assist firms' bottom line directly on the cost side through rapid regulation relief and tax relief, such as payroll tax reduction, than assist indirectly on the revenue side through trickle-down sales.

Though the federal fiscal response so far offers some business tax relief, this is dwarfed by the bonus payments aimed at boosting consumption.

Rather than following aggregate demand-oriented approaches adopted by the US, Britain and other countries, federal policymakers should look to New Zealand, which so far has avoided measures aimed directly at inflating consumption spending. Instead, the NZ Government has emphasised supply-side measures that will flatten marginal taxes levied on individuals, improve infrastructure and quickly lower the regulatory burden on business.

This is not the first time NZ has led the world in economic policy innovation. It was a Labour government there that initiated comprehensive economic reform under the direction of treasurer Roger Douglas from the mid-1980s.

This change in policy direction occurred following a currency crisis resulting from fiscal excess and included labour market reform, privatisation, public finance reform and trade liberalisation.

The breadth and depth of NZ's reforms had no precedent in the Organisation for Economic Co-operation and Development, and the measures were initiated before the Hawke-Keating government commendably followed suit with a similar reform program that delivered the strong productivity gains Australia enjoyed until the turn of the century.

NZ was also the first country to formally legislate for an independent central bank whose sole objective was to keep inflation low.

Years later Australia adopted a weaker version of the NZ monetary policy model, as did Britain. It's now time to emulate the spirit of NZ's fiscal response to the crisis.

We all know about NZ's rugby prowess and how often it beats Australia at the game. If we were to score Australia v New Zealand on fiscal responses to the global financial crisis so far, it would be Australia0, NZ 1.

That's not counting penalty tries where one side gets points for being obstructed by the other. Such obstruction will be evident as public sector borrowing resulting from aggregate demand management by the state and federal governments in this country pushes up Australasian interest rates at NZ's expense.

Tony Makin is professor of economics at Griffith University's Gold Coast campus.

Too simple, just common sense, Obama & Rudd are, we are told, highly intelligent, so they must be must be sending the United States ( western world) and Australia, to hell in a hand basket deliberately. See Rudd's hand outs below.

Australia's much loved,Dear Leader,Comrade Rudd salutes his adoring followers.

Family bonuses roll out tomorrow

News.com.au
March 10, 2009
CENTRELINK will start rolling out one-off payments to families from tomorrow as part of the Federal Government's $42 billion stimulus package.

Single-income families will receive a $900 bonus if they are recipients of Family Tax Benefit part B.

Families receiving Tax Benefit A will get a $950 back-to-school bonus for each child aged between four and 18.

Recipients of the carer payment or disability support pension, aged less than 19 years old on February 3, 2009, will also receive $950.

Eligible drought-affected farmers will receive $950 hardship payments from March 24, the same time a $950 one-off training and learning bonus and education entry payment is paid to eligible students.
The one-off bonus of up to $900 for taxpayers, earning less than $100,000, will flow from April.

Australia Heads towards Recession.... the one we were told we were not going to have.

Donald Trump talks common sense to Sean Hannity

Why can't the Messiah, understand such simple concepts,as those enunciated by Donald Trump in the following interview with Hannity ?

".....whens the economy getting better?
It can't get better until you destroy OPEC "

But hey,what would Donald Trump know compared to a self described "Community Organizer" aka Barack Hussein Obama.