It’s been a very mixed bag in Parliament in the past two weeks with the so-called Luxury Car Tax Bill passing the Senate and the Medicare Levy Surcharge Bill being defeated.

Last week we had the unedifying spectacle of the House of Representatives—where Labor has the majority - refusing to even debate whether they should consider a Bill which had been duly and constitutionally passed by the Senate. The Bill, proposed by the Coalition, would have given single aged pensioners an immediate $30 a week increase.

The Luxury Car Tax Bill was much amended by the Government to win the support of the Greens and others and is now a strange hybrid that favours imported cars over locally manufactured ones and farmers over other rural groups.

Low emission cars, and four-wheel drives used by farmers and tourism operators, are exempt from the increased tax so the result is that the cost of an imported low-emission Jaguar used in Brisbane doesn’t go up but the price of a Toyota Landcruiser used by a country vet does.

It’s a bizarre result that will be a nightmare to administer with the local car industry being one of the big losers. The Liberals argued that there will no longer be any incentive for local automotive innovation which is generally introduced at the top-end of the market first (think of airbags).

The Coalition was supported by Family First’s Steve Fielding in defeating the Medicare Levy Surcharge Bill. The Senate Inquiry into this Bill showed that the Labor move will push about 700,000 Australians out of private health insurance into the already dysfunctional public hospital system and lead to increased premiums for those who continue to have private health insurance.

Both Bills are products are Labor’s ‘politics of envy’ ideology but it was difficult to see any rationale for their attitude to pensioner increases.

The Coalition, initially under Dr Nelson and then Malcolm Turnbull, introduced legislation into the Senate to give single aged pensioners the desperately needed increase.

The Clerk of the Senate, Mr Harry Evans, insisted in two written opinions that this was constitutional but Labor in the Reps refused to even debate the constitutionality of the legislation, let alone the Bill itself. Given that almost all of Labor Ministers have confessed that they couldn’t live on the pension, the Government’s insistence that pensioners must wait for the outcome of the Harmer Review due in February is bureaucracy gone berserk.

Labor’s argument that the former Liberal Government should have acted doesn’t hold water or rationality! Prices have increased an annualised 3.5% since they came to government and, even if an increase was needed last November isn’t it even more necessary now?

But the most breath-taking hypocrisy came from Minister Jenny Macklin who claimed that the Liberal legislation ignored disability service pensioners, carers and others.

In other words, the Liberal Bill, which the Government refused to even debate, didn’t go far enough according to that same Government. It felt like time for a ‘Please explain’.

It’s hard to see where Government priorities are with Labor oscillating between arguing that you are rich if you can afford a car worth more than $57,300 regardless of circumstances; not rich if you are a single earning $50,000 a year but OK if you are a single aged pensioner on $286 a week ($14,872 pa), except that the Howard Government should have given these pensioners a rise 12 months ago.

CONGRATULATIONS TO NEW LEADER AND SHADOW MINISTRY

I’m sure hundreds of people will develop 20/20 hindsight in the months to come but right now, the only certainty is that the US financial crisis will have significant knock-on effects for Australia.

The current sub-prime mortgage crisis in the US economy has been driven by a boom in the housing market, fuelled initially by relatively cheap money and then by riskier and riskier loans. In Australia a similar demand for sales drove the growth of "low-doc" lending.

For some borrowers their housing investment could only be sustained by continued growth in the value of the properties they had. When the value flatlined or actually dropped, these owners could no longer maintain payments. In the US, this has led to "jingle mail"-- homeowners giving their house keys to the bank because they owe more than the house is worth and can't make payments.

The astounding growth in US mortgage fraud in the past 10 years illustrates the problems with reduced regulatory and reporting requirements (see http://www.fincen.gov/news_room/rp/reports/pdf/MortgageLoanFraud.pdf for further details).

FinCEN is the Financial Crime Enforcement Network, operating under the US Department of the Treasury. It has a role very similar to ASIC in Australia.

This includes deliberate fraud and fraudulent "padding" on loan applications. Australian prices have, apart from Sydney, suffered much less. Australian mortgage stress has been driven by interest rate rises which some people had not factored in. This meant that any increase in interest rates, no matter how small, caused repayment problems.

As US borrowers defaulted on their loans, the problems spread to banks and mortgage lenders. Many lenders had used complicated debt instruments - with mortgage-backed securities (MBS) and collateralised debt obligations (CDO) - to pass along the credit and default risks to investors.

Because of the possibility of default, many financial institutions have tightened their lending practices, making it more difficult for investors to refinance. This caused further problems as liquidity dried up. US new home construction has crashed dramatically, creating significant pockets of unemployment and critically damaging major lending institutions such as Bear Sterns and Lehman Brothers and insurers including American International Group (AIG).

The Government Sponsored Enterprises (GSE) of Freddie Mac and Fannie May, charged with making loans and loan guarantees available to expand the housing market, have suffered severe problems.

A $700 billion bailout deal was rejected by Congress on Monday, but further negotiations will continue later this week.

Australia fortunately is much better placed to ride out many of these financial problems, not least because the Howard-Costello Government built a healthy surplus and tightened financial regulation. Over the past 10 years, our economy has become less dependent on the US and now has major markets in China and India.

The ASX graph below shows the significant market and world events since 1900. A more detailed version can be downloaded from http://www.asx.com.au/products/pdf/share_price_movements.pdf .

EXPORTING OUR EXPERTISE

When you think of Australian exports to the world, surf lifesavers probably don't come to mind. However our surf lifesavers are much in demand, with two trainers recently travelling to Goa in India to assist in lifeguard recruitment and training.

India has more than 40,000 drowning deaths a year along its coastline. More than 150 Indian lifeguards have passed the SLSA Bronze Medallion course over a three-week period and there’ll be red and yellow flags raised on 15 beaches in Goa by the start of the season in October.

A group of Indian lifesavers have been developed as trainers who can take surf life-saving skills to other parts of India.

GROCERYCHOICE AND FUELWATCH

While the Labor Government’s Grocerychoice website appears to be undergoing significant rethinking, the Government's Fuelwatch plan looks unlikely to succeed in the Senate before its planned December launch.

The Coalition, Family First, Independent and Greens Senators have all indicated that there are significant problems with the current proposal. South Australian Independent, Nick Xenophon, said that while he supported the scheme when it was introduced in Western Australia he was now convinced the idea didn't stack up.

Under FuelWatch all petrol stations would have to tell the Australian Competition and Consumer Commission their prices for the following day by 2pm. The commission would publish the prices on a website and by emails and text messages to motorists. Petrol stations would be required to sell at the notified price for the whole of the next day.

The problem with this proposal is the potential abuse of market power by Australia's major distributors, and, as we've seen with the Western Australian model, the removal of price competition during the day.

However, a good working model that provide direction for a working Fuelwatch is available here. It pulls the data from MotorMouth and puts it on GoogleMaps, even allowing you to track seven day trends for individual stations. What it doesn't include are prices outside the major capitals, and the ability for verified users to update the prices.

FIDO, the consumer education part of ASIC, has just updated their website with specific articles for younger people. At http://www.fido.asic.gov.au/fido/fido.nsf/byHeadline/Young%20Investor you'll find easy to use information on credit cards, insurance, superannuation and ways to protect yourself from scams. The tips on protecting yourself from social networking fraud should be kept next to every computer. It's worthwhile looking at the information even if you're a parent (or grandparent).

In the meantime, you can always check out the latest grocery figures on my ShopSmart website at www.shopsmart.sueboyce.com.au.

THE HOWARD LEGACY - OUR GUN LAWS WORK

Watching the news last week as the mass shooting in Finland unfolded, I'm reminded of the Port Arthur tragedy in the first few months of John Howard's Prime Ministership.

After 35 people were killed and another 18 injured in the massacre, the Prime Minister introduced some of the world's toughest gun laws, with strict controls on semi-automatic rifles and pump-action shotguns.

This didn't require a summit, or a white paper, or even a narrative - just a decision.

The report "Australia's 1996 Gun Law Reforms: Faster Falls in Firearm Deaths, Firearm Suicides and a Decade without Mass Shootings", states that the average number of firearm suicides in the 18 years before the gun buyback was 492 a year.

After the introduction of the buyback scheme, that figure dropped to 247.

The rate of gun homicides fell from an annual average of 93 between 1978 and 1996 to an annual average of 56. There is also evidence of wider collateral benefits in reduced gun deaths overall.

Gun deaths in Australia are dominated by suicides, comprising about 79% of all gun fatalities (followed by 15% homicides and 2% accidental shootings). When those attempting suicide use a gun, they don't need a semi-automatic, as a single shot usually suffices. By removing semi-automatics from the equation, a drop in gun suicides wouldn't be an expected outcome.

Yet firearm suicides in males declined from 3.4 deaths per 100,000 person years in 1997 to 1.3 per 100,000 in 2005, a decline of 59.9%. The rate of all other suicides declined from 19.9 deaths per 100,000 in 1997 to 15.0 per 100,000 in 2005, a 24.5% decline, less than half that for gun suicides.

This is one of the many legacies of the Howard Government of which we can be justly proud.

Y.A.S. - YET ANOTHER SUMMIT!

As we approach the six month anniversary of the 2020 Summit, Kevin Rudd has announced a Local Government Summit for all Australia's 565 local councils. Originally proposed for 28th November, the date has been put in the "to be confirmed" basket after the Federal Opposition pointed out that Victorian councils have elections the day after the proposed summit.

Mr Rudd said the first Council of Australian Local Government meeting would focus on nation-building infrastructure and the challenges facing major cities. Local Government will be hoping for some action, not more talk on these issues.

WORLD MENTAL HEALTH DAY

World Mental Health Day is an annual international event that celebrates and promotes mental health, and was first established in Australia in 1992. This year WMHD takes place on October 10, and is held in conjunction with National Mental Health Week.

The Community Affairs committee, of which I am a member, tabled it's report "Towards Recovery : Mental Health Services In Australia" in the Senate last week. I was particularly surprised by the continuing stigma faced by people experiencing mental health problems.

It is crucial that we raise awareness about mental health issues, promote mental health and work to prevent mental illness. It is also an opportunity to combating many of the myths about mental illness and the stigma and discrimination attached. For more information, go to http://www.wfmh.org/00WorldMentalHealthDay.htm

DSAQ BUDDY WALK

Buddy Walk – Australia is a National Event held in cities and towns across the country to raise the community’s level of understanding and inclusion of people with Down syndrome in all aspects of social and family life. It’s a wonderful, heart-warming event that celebrates the many abilities and accomplishments of people with Down syndrome.

In October 2008, Buddy Walk - Australia will be the first truly national (and the largest) celebration ever held in this country for people with Down syndrome. All communities across the nation can take part in Buddy Walk - Australia, celebrating the achievements of people with Down syndrome while supporting and understanding their needs and abilities.

The Brisbane Buddy Walk will take place in New Farm Park will take place on October 12. For more information, go to http://www.buddywalk.org.au/