Category Archives: politics

Keep the date, and Vote

James Glover is back with another guest post, this time digging into some poll figures ahead of the postal plebiscite on same sex marriage.

Hey, there is a survey/plebiscite/referendum on, in case you haven’t heard. It’s on same sex marriage or marriage equality. Leaving aside the fact that this is a survey and not at all binding on MPs, this post is not about the rights and wrongs of SSM but about how to interpret the results of a recent Newspoll. Unlike most Western democracies voting in Australian elections is compulsory but as this is voluntary we are left with the additional problem for psephologists of determining not just how people would vote but whether they feel strongly enough to vote. The Newspoll produced two sets of results. The familiar one of whether people supported SSM or not, but also whether they intended to send in their postal surveys. Strangely enough they didn’t include information on the voting intentions of those who actually intend to vote.

So I made a spreadsheet model to try to determine some possible outcomes and what were the real drivers of the result based on what we gleaned from Newpoll but with some possibilities of one side or the other getting more people out to vote and the underlying vote being skewed towards the “Yes” vote. We know from dozens of polls going back 10 years that the majority of people, when asked, support the general notion of SSM. The results are usually in the range 60-70% in favour, 15-25% against and about 15% undecided. Newspoll has the overall level of support at 65%, about in the middle of that range. And if the ABS, who are conducting the survey, were to conduct a statistically significant poll they would almost certainly (the probability theorists technical get out statement) say a clear majority support it. Game over. Surely?

But there are other factors coming into play here. Here is a table of the Newspoll results by age, probably the most significant determinant, outside political views, of whether they support, or not, SSM.

Support for SSM by Age18-3435-4950-6465+Overall
Yes7064644962
No2228304732
Undecided88646
AEC enrolled population 4,271,2894,271,2904,271,2914,271,29217,085,162

To determine the ”overall” figure, and what I will refer to as the “voting population”, I am using the AEC’s own figures on people enrolled to vote, as of June 2017, which is the last line.

As has been noted support for SSM decreases with age. But the number of people in each age cohort is about the same. The overall figure for support of 62% is towards the bottom end of most surveys but let’s leave it at that.

The Newspoll also provide figures on whether people actually intend to return their surveys.

Intention to vote18-3435-4950-6465+Overall
Definitely will vote5864737668
Probably will1916111114
May or may not129889
Probably won't45323
Definitely won't35323
Uncommitted41212

One obvious thing to note is that older people, who are also more likely to vote “No” are more likely to vote. That will skew the results towards the “No” case.

But polls two months out may not reflect the final vote as happened in the recent US and UK elections, and support for the “Yes” case may soften. And the “No” case is probably doing a lot more to ensure they get as high a turnout as possible. So, in my model, on a spreadsheet of course, I included some assumptions and variable inputs which are:

  1. I assume all people who say they definitely will vote is 100%.
  2. “Probably will vote” is an input
  3. “May or may not vote” is an input
  4. Probably won’t, definitely won’t and uncommitted is set at 0%
  5. Turnout for the “No vote”. Based on the polulation figures the turnout, overall should be about 83%. So one input is the turnout for “No vote” assuming they make more of an effort to get their supporters out to vote. The turnout for the “Yes” vote is then deducted from this number to match the overall turnout, 83%, by age group so higher turnout for “No” automatically leads to a lower turnout for “Yes”.
  6. For people who will claim that the “Yes” poll result is exaggerated and is actually lower, or will soften closer to the closing date I have included an adjustment term. So “-5” means I have reduced the polled support for “Yes” by 5% making it 57% rather than 62%.
  7. Splitting the “undecided” vote between “Yes” and “No”. “P” means I have allocated it proportionally to the level of support, but there is a parameter which splits it, say, 25% to “Yes” and therefore 75% to “No”.

So the results? Well here they are:

SummaryBCSExp SRWCSWCS
% "probably will vote" who do vote75%75%50%25%
% "may or may not" who vote50%50%32%0%
"No" vote turnoutP95%95%100%
undecided split to "Yes" votePP30%0%
adjust yes vote00-5-5
Vote Yes66%62%50%40%
Vote No34%38%50%60%
Support Yes67%67%59%57%
Support No33%33%41%43%
Overall turnout84%84%78%71%
Yes turnout83%78%67%50%
No turnout85%95%95%100%
Population Yes vote56%52%39%28%
Population No vote28%32%39%43%

There is good news, and bad news, depending on your viewpoint. My own view is a “Yes” vote is a good thing but if you feel otherwise feel free to substitute “Best” for “Worst” in the above table. So here are the 5 scenarios. Note that once you fix the “No vote” intention to vote at, say, 95%, you remove people who intend to vote “Yes” in order to keep the Newspoll and AEC derived figure of 83% intending to vote.

  1. BCS – Best Case Scenario. Based on the Newspoll numbers I have split the intention to vote and undecided vote equally among “Yes” and “No” voters. I have also assumed 75% of the “Probably will vote” and 50%” of the May or may not” voters will vote. The result is a clear win 66:34 for the “Yes case”. Also the overall number of people voting “Yes” is 56% of the voting eligible population so hard to argue this isn’t a decisive result.
  2. Expected – I am assuming that the people on the “No” case will be better at getting people out to vote than the “Yes” case, 95% of them. Here there is still a clear win for “Yes” at 62%. And overall that represents 52% of the population. A clear win for “Yes” on the vote and over 50% of the population vote “Yes” as well.
  3. RWSC – Reasonable Worst Case Scenario. This is a term that I (and the Mule) picked up in our early days at DB to describe a scenario which assumes negative (from my point of view) parameters that could nonetheless be possible. Here I am assuming only 50% of probably wills and 33% of may or may not’s vote. Because I have fixed the “No” voting rate at 95% this leads to less “Yes” votes” to keep the overall participation rate at 83%. Here the result is a line ball at 50:50. It could go either way. The population “Yes” vote is close to 40% so people might argue that less than 50% vote “Yes” and hence conservative MPs shouldn’t take the result as definitive.
  4. WCS – Worst case scenario. Only 25% of the maybe votes and none of the may or may nots vote and 100% of the “No” votes do. I’ve reduced the support for the “Yes” case by 5%. All undecideds get allocated to “No”. Despite the overall support being 57:43 in favour of “Yes” the actual vote goes 40:60 in favour of “No”. And the overall population vote is 43:28 in “No”s favour. Under these circumstances the PM has said the vote for SSM won’t come to parliament. Largely this is driven by the 100% turnout for “No” and only 50% turnout for “Yes” as well as softening of support for “Yes” and undecideds voting “No”. This is the result the “No” campaign will be, literally in some cases, praying for as it will be difficult for the Opposition and proponents of SSM to argue the issue hasn’t been settled for the time being.

My own guess? It will be 55:45 in favour of “Yes” with overall support at 65:35. That will be enough for the anti SSM lobby to say support was never as high as the “Yes” camp claimed. But a win is a win and only the most devout glitter sellers won’t be running out of stock by Xmas.

Extra: How do I think the ABS should actually conduct this poll? Not by post for a start. There are 150 electorates and one of the arguments against using results from 1,400 people is that it barely samples many of those, less than 10 people is some cases. In actual fact the mathematical 95% margin of error for sampling N people is (approximately) 1/sqrt(N) or for N=1400, 2.67%. So the overall sample size is sufficient if the result is 60:40. But to give everyone the feeling their voice and their neighbour’s voice is being heard how about sampling 150,000 people? That is 800 people in Australia’s smallest electorate, Kalgoorlie. The MoE by individual electorates would be better than +-3.5% and over the whole Australian voting population 0.25%. And it would only cost $10m. It might even become a regular thing.

May day was in June

The father of the Mule is currently in  the UK and penned the following piece as he reflected on the outcome of the election. With the speed of the election cycle, the election results may already seem a distant memory, but any tardiness in publishing this post is entirely due to a slow editor (me) rather than late filing!

The only word to describe Theresa May’s unnecessary recent decision to call an early election in Britain is “hubris” and that hubris has now led to irremediable humiliation. “Strong and stable” could have described her political position before the election, but as a campaign slogan, delivered with numbingly motoric repetition, it became risible as “Jobson Growth” had been in Australia last year.

Beyond May’s trouncing, the election has also invalidated many British political verities: “Young people don’t turn out to vote” is, probably, the most significant of them and this is a healthy reminder that the future is theirs not (as with the referendum in 2016) that of the frightened older generation. Politics is more than the “reality” of hard-headed professionals; it is about hopes and dreams. Young people rightly have those; we oldsters have largely lost them. Ironically Jeremy Corbyn revealed a striking ability to combine the use of modern social media with old-fashioned mass rallies to persuade the young, especially women, to listen and to support them in their yearning for a better future. As a result, the overall voting turn-out (69%) was the highest since 1997 and exit-polls indicated that the increase was 12% amongst the under-35s. A post-election poll of over 50,000 people showed that the age cross-over in voting preferences occurs at 47, with increasing Labour support below that, reaching over 60% in those younger than 30.

Another challenge to conventional wisdom is that it is now accepted that threats to “law-and order” such as the recent terror attacks, no longer seem to favour right-wing parties. There may be a resonance in this for Australia.

For those of us who love data, consider the vote in Corbyn’s own constituency of Islington North: he won in 2015 with a 60.24% of the vote and a majority of 21,194; this year his vote was 72.98% and the majority 33,215. By contrast, consider Canterbury, amidst a sea of Conservative blue in the south-east, where a Tory ascendancy of more than 150 years has been turned from a 9,798 win in 2015 to a Labour majority of 187 (in a swing of 9.33%). Significantly, it is a university city.

The house next to where I am staying in London, displayed a “Vote Labour” poster, and vote Labour the constituency did, with a 30,509 majority for the member Keir Starmer, the former DPP and human rights lawyer. In fact, London (with 49 Labour seats, a gain of 4, to the Conservatives’ 21, a loss of 5), remains an astonishing Labour stronghold.

The overall national vote for Labour was 39.98%, very close to the 41% of the 2001 “landslide” for Tony Blair. This secured them 261 seats (a gain of 31 seats) compared to 318 to the Conservatives (with 42.45% of the vote and a loss of 12 seats).

But the traumas were for more than for the Conservatives alone. North of the River Tweed the Scottish National party has been reduced to 35 seats (a fall from 50% support in 2015 to 35% this time, at a cost of 19 seats). Another independence referendum there now looks pretty unlikely. The other loser – unsurprising, perhaps, because the 2016 “Brexit” rather pricked its balloon, leaving it “a rebel without a cause” – was UKIP (the “UK Independence Party”) which fell, overall, from about 13% to less than 2% of the vote, leading to the immediate resignation of Paul Nuttall, its third leader in a year after Nigel Farrage’s retirement; Nuttall finished an ignominious third (with only 3,300 votes) in the constituency which he contested.

So where does this leave the hapless Theresa May? And, more important, where does it leave Britain – without a plausible government and the Brexit negotiations looming within days? She has been looking weak and opportunistic in seeking a “deal” of sorts with the members of the so-called Democratic Unionist Party from Ulster (one of whom is the son of the Rev Ian Paisley), “our friends” as some shameless Tories have been calling them. She will find them uncomfortable allies, with special interests as well as regional and sectarian concerns. When a former Conservative PM strongly criticises this deal, as John Major did on radio a few days after the election, the political right looks as fractured as Britain, itself.

Yet, oblivious to all of that, May returned from an interview with the Queen on Friday 9 June and made a speech saying, “The government I lead will put fairness and opportunity at the heart of everything we do”, as if the Corbyn ethos and campaign hadn’t existed, and all of that would happen “over the next five years”. She appears to be the only person in the country who thinks that she can last even 5 months, let alone five years. Ever since the shock of election night, numerous members of her party have been trenchantly critical of her campaign and, no less importantly, of her performance as PM. Her two vilified senior advisers promptly resigned; it was as if, somehow, they were to blame because she listened to them so exclusively and ignored everyone else. Somehow the reality was forgotten that consequences flow from accepting advice: a politician (like everyone else) has the freedom to reject it. For example, I saw one former minister say that “Mrs May must now obviously consider her position after a dreadful campaign.” And a former Cabinet Secretary (Lord Turnbull) bluntly said that May “isn’t up to it……she doesn’t have the skill-set to be Prime Minister….and should resign”. May has prodigally thrown away her limited political capital, most likely having over-estimated it from the beginning.

Of course, the British political and historical perspective is limited. They seem to have a fierce aversion to coalition governments and hung parliaments (though te PM seems the one being hung this time) and fail to understand that such arrangements are the norm in many other successful (even “strong and stable”) societies. That word “hubris” comes to mind again. Meanwhile, as the political classes fret intensely, life for everyone else goes on: the fickle weather alternates between sunshine and bleakness, it’s still possible to do research in libraries and archives; there are still fine exhibitions to be visited. And there will be a record number of women in the Commons – more than 200. So there’s always a bright side in politics – we just need to look properly.

John Carmody

More on Brexit

After observing the Brexit poll at close quarters, guest Mule contributor John Carmody travelled on to Europe and continued to reflect on the significance of the vote. In this follow-up post he reflects on the historical journey of the European Union and his reasons for thinking that the Leave vote was a terrible mistake on the part of British voters.

I have also continued to reflect on the vote and have arrived at a similar conclusion for different reasons. I do have some sympathy for some of the political sovereignty arguments for Leave (although not those based on Farage and UKIP xenophobia), but I still think that Remain is the better option. The best analogy I have come up with is someone regretting the decision to get a large tattoo. While it may have been better never to have had the tattoo, removal can be painful and leave an ugly scar. In the same way, Britain does not have the option to wind back the clock and eradicate the last 40 years of history: it did join the Union and an exit will lead to a very different Britain. There is no way to transition to a counterfactual Britain that never joined back in 1973 and had developed its own trade agreements, human rights legislation, environmental legislation, funded all of its own infrastructure, scientific research, etc, etc. Exit will be painful and, even if joining in the first place was a mistake as some would argue, leaving will be worse.

But back to the guest post…and I would be interested in reactions to this post, so please post your thoughts in the comments.

As with beauty, the rights and wrongs of the British “Brexit” vote will lie in the eye (or the prejudices) of the beholder.  Certainly, innumerable words are still being deployed about it, though many of them (notably, but certainly not exclusively, in Britain) are rather self-interested or poorly informed.  I believe that the Anglophone world, in general (including in Australia), has a poor understanding of the structure and operations of the European Union and a fortiori of its genesis in the fraught history of Europe, since the Reformation.

It is in part a historical institution and in part a philosophical one. It has grown from the fraught history of European religious, territorial and mercantile wars as well as the growing sense, notably in the twentieth century, if the “idea” of Europe. As an island (even insular) nation which has not been successfully invaded since 1066, Britain has played only a sporadic often simply self-interested part in those developments. And Australia, influenced so powerfully by Britain (as, indeed, it still is) shares much of that ignorance of European history and thought.

Experience commonly determines understanding.  As time passes and people forget or, without that lived experience of adversity, become complacent (especially, in this specific case, about Europe’s peace since 1945): it is the serious responsibility of politicians, as well as teachers and journalists, to impart this knowledge.  Even writers in the International New York Times, who ought to understand a federation, use such demeaning words as “bloc” or “imperfect union”—as if the USA is any different in its fallibility.  Of course, the EU is “imperfect”: it is (like every human institution) “a work in progress”; but commentators need to acknowledge that it has made astonishing progress.  Of course, for a diversity of reason (not the least of which is language) it is not as mature a federation as those of the US and Australia, but in fields as diverse as health and the environment, education and agriculture, for example, it has transformed Europe.  There is, for all its limitations, a far greater sense of a European identity than when I first went there 40 years ago.

Regrettably, for years, journalists and politicians—in particular those in Britain (and hence in Australia, because our journalists are essentially compacts)—have failed in their responsibility to inform, rather than manipulate, their constituencies.  In fact, it has often seemed that they were determined, for their own partisan interests, to misinform and profit from prejudice — especially in that recent “Brexit” campaign.   Australians are all too familiar with some of this behaviour: we have seen many comparable instances when our politicians have engaged in what is called the “blame game” between the states and Canberra.  Thus, British politicians have blamed “Brussels” for decisions which were democratically made in the European Parliament, even when they were elected members of it and they actually voted for the contended measures.

All too frequently the talk is about some sort of opaque and unaccountable bureaucracy, whereas the truth is (as I have been advised by well-informed lawyers) that the administration exercised by the European Commission (as that civil service is called) is pretty lean, and smaller than pertains even in some of the larger cities in Europe.  Furthermore, is it overseen by two levels of representative oversight. Contrary to what many in Britain believe, or are told to believe, this Commission does not control Europe, any more than the public service in Whitehall “controls” the United Kingdom or the Canberra bureaucracy “controls” Australia.  That authority is exercised, jointly, by the Councils of Ministers and the European Parliament. Those several Councils are composed of the relevant Ministers from the legislatures of the constituent countries of the EU, all of whom are accountable to their home Parliaments and electorates.  The European Parliament is made up of directly elected members and is, therefore, no less democratic a body that the House of Commons (and it is decidedly more democratic and representative than the House of Lords).  Of course, as happened with Federation in Australia, when the uniting colonies ceded some powers to the Commonwealth but retained others, this sharing of power is undertaken for a greater good, but it has costs: it is certainly not a “loss of control” as Boris Johnson and his henchmen duplicitously asserted and (either through lack of ability or conviction) David Cameron failed to properly contradict.

That was not the only lie of the recent British referendum.  Another was the claim that a vote for “Brexit” would return to the National Health Service an amount of £350 million each week (the asserted, but seriously inflated, figure for the current British payment to the EU budget).  Almost as soon as the referendum results were declared, the “Leave” proponents were repudiating that promise.  A former Conservative Leader, Iain Duncan Smith, brazenly insisted that “I didn’t say that”, even when he was reminded that the posters and leaflets which his group issued had promised exactly that.  His revised promise became, instead, that the NHS would receive “the lion’s share” of whatever was left over after the essential compensation was paid to British farmers for the loss of their substantial subsidies from the EU.

Other falsehoods, though, continued to be promulgated after the referendum.  In a column in the Daily Telegraph, Johnson wrote that “there will continue to be free trade, and access to a single market.”  In other words, the insular British could continue to have their current cake and eat it too (Johnson once said that this was his “policy”).  It was a reiteration of the campaign propaganda—that it was possible, in effect, to remain a member while avoiding all of those inconvenient costs of membership, political and financial.  That is utter nonsense.  Either Britain is a member or it is not.  There is no possibility of being “a little bit pregnant”.  The situation of Norway was often mentioned.

But, I am advised that, as a non-member wishing to enjoy free-trade, Norway must pay about 90% of what its contributions would be if were actually a member.  Britain would have to pay something comparable if it wanted access to the European market and, given the stern attitudes which, understandably, are currently attributed to such leaders as Dr Merkel and M. Hollande, more attractive rates are highly unlikely.  The bitter result for Britain from Johnson’s interpretation of “free access” would be a comparable cost but with absolutely influence on EU laws and policies.

Some Independence Day for Nigel Farage and his “UKIP”!  Some “regaining control” for the Colonel Blimps and their powdered ladies of “Middle England”! And even worse prospects for the struggling under classes, especially in the north.  Wrongly, they feel neglected by Brussels (the reverse is actually the truth), but, for decades, Westminster has shown little regard for then.

Even if, to other than close observers, the outcome of the poll were unexpected (it had seemed highly likely to me), the heterogeneity of the results – age by age, region by region, class by class—were a harsh reminder of what a fractured county Britain currently is.  The “United” part of the name UK, is meaningless.  Scotland (68%), Northern Ireland (56%) and London (60%), for example, voted strongly to stay in the EU; much of the rest of England voted to leave (52-58%).

Various analyses have shown that education played an important role.  In regions where fewer than 22% of the population have a degree, 62% voted “Out”, but that vote was only 42% where more than 32% of residents have a degree.  The age disparities were even more stark.  Commercial polling, after the voting closed, showed that 73% of 18-24 year-olds support EU membership but only 40% of those over 65.  Those with a future have been trumped by those who may not live to see the promised “independent future”.  As a Cambridge colleague recently said to me, “We feel in free-fall”.  Many Europeans to whom I have spoken are just as perplexed.  Perhaps the real truth was recognised by an astute and experienced Italian journalist, Beppe Severgnini, who wrote, “One should understand that it wasn’t fear, or anger, that brought so many English to vote for Brexit on June 23.  It was nostalgia…….nostalgia for a self-sufficient, cosy Little England that is long gone.  But they don’t seem to realise that nothing, not even voting to leave the European Union, can bring it back.”

Of course, there were as many individual reasons as there were voters: but in some places there seemed an almost wilful determination – notwithstanding that the rage was probably directed at the wrong target – to inflict self-harm.  In some places which depend upon EU finances for their very lives (and certainly their jobs), it ironically became art transformed into life with the “What have the Romans ever done for us?” cry in The Life of Brian turned into “What has Europe ever done for us?”  When reality eventually strikes, it will certainly be harsh and those misled communities will feel the greatest pain and social upheaval.  Certainly, given the deep and serious rifts in her party—let alone British society at large—the task which faces the new Prime Minister designate, Theresa May is immense.

The voting figures indicate that there are clear political divisions as well.  On the day after the vote, the formidable Nicola Sturgeon was unequivocal.  As the First Minister in the Scottish Government, she pointed out how strong the “Remain” vote had been north of the Tweed.  A new referendum on independence for Scotland, she declared, is certainly “on the table”.  Indeed, without Scotland, Britain would shrink to “Little England”, with the serious risk of a crippling reduction in its importance as a financial centre, let alone its potential scientific losses.  Furthermore, whether the enduring sectarianism of Northern Island would prove an implacable impediment to some sort of union with the Irish Republic in the south has become a hot topic because, otherwise, their border would also become the British border with the EU and securing it would be an enormous challenge for both sides in every conceivable respect.

Much has been made of the concern that “Brexit” might encourage more breakaway movements.  While the focus has been on Madam Le Pen and her National Front in France, or the extreme Rightist party of Geert Wilders in Holland, concern will also be felt about the intentions of such nationalist groups as the Basques and the Catalans.  It is ironic that, as the world is supposed to becoming more integrated, notably as electronic communications and transport become ever faster and less expensive, smaller communities and political groups seem so alluring.  Currently, this is simply speculation, but to many people (not just politicians) it is troubling just the same.

Even so, the final card may not have been played in Britain.  The political and legal power of such a referendum as was recently held there are far from clear in that nation’s diffuse constitution.  A corollary of the contemporary rhetoric is that the people want the British Parliament to be supreme.  The logical consequence of that aspiration would be that the parliament must make the ultimate decision about whether to act on that slender 52%:48% margin (keeping in mind the principle that a greater majority—say of 66% or even 75%—ought to have been mandated before any radical action was triggered).  To deny the people their “choice” might seem politically foolhardy (or, even responsibly statesmanlike); but that it why so many nations have parliaments, rather than frequent national plebiscites.

Yet, legally speaking, the position it far more complicated.  It is certainly not a matter of the new British Prime Minister sending a letter to Brussels to trigger exit negotiations.  That action, under the terms of membership agreements, requires action by the appropriate law-making bodies in the member country in question: in Britain that it the parliament—it certainly is not the cabinet, let alone the individual PM.  So, this can hardly be done – in the legal way which Brussels would require, before Parliament returns from its scheduled summer recess, if only because the required legislation (especially if it is to specify the conditions of the negotiations with the EU in the requisite detail) will be difficult and time-consuming to write and debate.

For all that many are said to be calling for a speedy resolution, it simply cannot occur in a hurry.  Lady Macbeth’s wish that the deed should be done quickly might be appealing, but it is not practicable.  Patience is less often understood as the political virtue that is should be.  Like beauty and its appreciation, it is uneven in its distribution.  Sagacity, not seduction, is what is now required on all sides.

Brexit

Sometime Stubborn Mule contributor, John Carmody, finds himself in the UK at the time of the Brexit vote and has filed the following report. Meanwhile, back here in Australia, the Mule is watching anxiously for signs that we are on the verge of the end of Western civilisation “in it’s entirety”.

On the night before the “Brexit” poll, London had heavy rain with much thunder and lightning: Donner and Blitzen if we want to be Europeans. Later that day London had further downpours with associated disorder with transport and traffic all of which created real difficulties in what was regarded as a “Remain” stronghold. It was very striking to me – having been in London for the past few days, how prominent the “Remain” supporters were on the streets (as was also the case when I visited Cambridge”: the “Leave” supporters were silent and not to be seen there.

Many schools were closed for the day because they were commandeered as places for voting (oddly, the British still vote on Thursdays because, as I’ve been told, that was “Market Day” hundreds of years ago, therefore people “came to town: so much for progress and change here). If the day seemed “business as usual”, I saw some hint of the latent tensions late in the afternoon when I strolled into a polling place in Charing Cross Road. It looked like a second-hand bookshop, and apart from a few officials I was the only person. A prim woman told me that if I “did not have the right piece of paper”, I was not permitted to enter. I protested that I simply wanted to see how the British vote: she said that I might be a terrorist and simply had to leave (so I went to the opera down the road and felt part of a greater reality).

The polling closed at 10.00 pm and, to the television watcher (the coverage was less lively than we’re accustomed to in Australia) the results seemed to be declared rather slowly. But it was different from an election: it was the actual numbers that were crucial and, astonishingly early, the trend became clear. By the end, before 5.00am, it was 52% to leave, with the greatest turnout (72% in a country without compulsory voting) in more than 20 years: the political and financial leadership had been rebuffed and, before 8.30am, standing outside Number 10 in Downing Street, David Cameron – having suffered the fate which, maladroitly, he had brought on himself – announced his resignation. That was inevitable: but, curiously, he will remain as “caretaker” until the party conference in the autumn. The result will be a Tory party that is focussed, not on national problems or the negotiations with the European Union, but with their leadership battles. Not that it is more cheerful for Labour. That party also needs a new leader. Jeremy Corbyn was, plainly, conflicted during this campaign – a “Eurosceptic” he found campaigning with conviction for “Remain” was beyond him and in an interview after the result was clear, he was equivocal, pallid and deemed utterly out of his depth. As with Australia, a big section of the electorate seem to be disillusioned (or worse) with the two political power-blocs.

And if the forthcoming politics seem turbid, it is just as perplexing and concerning for the economy. The immediate result was a fall in the value of the pound and of the stock market fell by 8-10% and we were told, the banking stocks fell by 20-30%, the pound by a margin which has, allegedly not seen since 1985. The Governor of the Bank of England, Mark Carney, made an impressive and emollient speech (which was plainly directed to the markets) but words have a limited utility. The metaphorical economic storm clouds are serious for Britain.
Even the very use of that word seems problematic at present. The country is seriously divided. The out votes were 53% in England, 53% in Wales, 44% in Ulster and 38% in Scotland. No less significant is the fact that whereas certain results were expected (notably with London and the major cities strongly for “Remain”), in traditional Labour areas, notably in the north, there were strong “Leave” votes. Cameron gave the electorate the opportunity to repudiate the government, and they took it; but it was also an expression of “no confidence” in the Opposition.

So there is already serious talk about another independence referendum in Scotland (and even in Northern Ireland); Nicola Sturgeon will clearly feel emboldened. And there is, understandably concern in the European capitals: the talk about Britain not being able to “cherry-pick” the conditions of its exit. The politicians in Brussels and elsewhere do not want to encourage the waverers in the EU.

Meanwhile, though there is much brave talk in Britain – about “reclaiming independence”, or “protecting democracy” or “taking back control” – this is a step into an uncertain future. There’s a wide and exciting world out there, but a timid majority of Britons seem unwilling – or afraid – to want to live in it. It’s their choice, their risk, their lost opportunity. But as a great British writer and Divine once wrote, “No man is an island”.

Direct Action

It has been a very long time since there has been a post here on the Stubborn Mule. Even now, I have not started writing again myself but have the benefit of a return of regular guest poster, James Glover.

This is a post to explain the Australian Government’s policy called “Direct Action”. I will spare you the usual political diatribe. So here is how it works. The government has $3bn to spend on reducing carbon emissions. At a nominal cost of $15/tonne that could be 200m tonnes of Carbon.

Okay so how does it work? The government conducts a “reverse auction” in which bidders say: “I can reduce carbon emissions by X tonnes at a cost of $Y per tonne”. You work out what is the biggest reduction for the least cost. You apportion that $3bn based on the highest amount of carbon reduction. Easy peasy. That $3bn comes from government spending so ultimately from taxpayers. [Editor’s note: while not directly relevant to the direct action versus trading scheme/tax discussion, I would argue in true Modern Monetary Theory style that the Australian government is not subject to a budget constraint, beyond a self-imposed political one, and funding does not come from tax payers].

As our new PM Malcolm Turnbull says why should you have a problem with this? There is a cost and there is a reduction in carbon emissions. There will always be a cost associated with carbon reduction regardless of the method so what does it matter if this method isn’t quite the same as a Carbon Pricing systems previously advocated by the PM and his Environment Minister Greg Hunt? As long as there is a definite amount, Xm tonnes reduced.

Well here are a few thoughts:

1. if a company is currently making a profit of, say, $500m a year, producing electricity using coal fired power stations then why would they participate in this process? There is no downside. Maybe.

2. Okay it is a bit more subtle than that. Suppose the difference between the cost of producing electricity using coal or renewables works out at $15 a tonne. You might reasonably bid at $16/tonne. In reality there is a large upfront cost of converting. There is a possibility that an alternative energy provider takes that $15/tonne and uses it to subsidise their electricity cost. That could work. That encourages a coal based provider to move to renewables. But so might a coal based electricity provider at $14/tonne to undermine them. What we call a “race to the bottom”.

3. It seems to be an argument about who exactly pays for carbon pollution. Well here is the simple answer: you pay. Who else would? And you pay because, well, you use the electricity.

4. There is no easy answer to this. Which approach encourages more electricity providers to move to renewables? That is hard to say. Every solution has its downside. I decided while writing this I don’t actually care who pays. As long as carbon is reduced.

I started out thinking Turnbull was just using the excuse “as long as it works who cares?” but I have moved to the view that it doesn’t matter. All carbon reduction schemes move the cost onto the users (of course). There are many subtleties in this argument. I personally think a Cap and Trade system is the best because in a lot of ways it is more transparent. But in the end, as PM Turnbull says who cares, as long as carbon is reduced. Presumably as long as that is what really happens, eh?

Chinese non-residents…in China

CCTVRecently I travelled to China for the first time. My first glimpse of Beijing took in the Escher-like headquarters of Chinese TV station CCTV. It is an extraordinary building and to get a proper sense of it, you have to see it from a number of different angles.

Driving across the city, impressed by the scale of the place, I asked one of my hosts about the population of Beijing. He told me there were about 40 million, including non-residents. Almost double the entire population of Australia. Maybe it’s an exaggeration, but more than the figure itself it was the reference to “non-residents” that piqued my interest. Where there really so many people moving to China as to have a significant impact on the population of the capital?

Later, I learned that these non-residents were in fact people from other provinces. Under China’s Hukou system, restrictions are imposed on people’s ability to move from one part of the country to another. Many people from rural areas are drawn to cities to find work, but without residency rights for the city in which they work they cannot access public education or health care. So, Beijing is full of married men who have left their families at home in the provinces. Living in tiny apartments, they work all year and then travel back to their families for Chinese New Year, taking their earnings with them.

Being used to freedom of movement in Australia, it’s hard not to see this as a harsh system. But, reflecting on the numbers, China is a country of 1.3 billion people; if there are already 30 to 40 million people in Beijing, how would the city cope with a sudden influx of millions more? Only a few days ago, the central committee of China’s communist party released new targets to increase urbanisation from 53.7% of the population to 60% by 2020. This plan involves granting urban hukou status to an additional 100 million rural migrant workers. Even so, another 200 million migrants will remain non-residents. It is sobering to consider the potential consequences of granting full freedom of migration to the entire population rather than managing the process in this highly controlled fashion.

I’m not about to renounce my belief in democracy (however challenged it may be in many Western countries today), but, much like the CCTV building, it seems that to better understand China, you have to see it from a number of different angles.

The price of protectionism

An  article in Friday’s Australian began

Ford has blamed Kevin Rudd’s $1.8 billion fringe benefits tax overhaul for halting production, forcing at least 750 workers to be stood down in rolling stoppages that will further imperil Labor’s chances of retaining the nation’s most marginal seat.

and goes on to report that the Federal Chamber of Automotive Industries has called on Labor to reverse its changes to the application of fringe benefits tax (FBT) to cars.

So what exactly has Labor done to put these jobs at risk?

The previous regime provided two mechanisms to determine tax benefits for expenses incurred for cars used for work purposes:

  1. the “log book” method, whereby the driver maintained records to show what proportion of their use of the car was for work rather than personal use, or
  2. an assumed flat rate of 20% work use of the car (regardless of how often the car is actually used for work purposes).

The government has eliminated the second option. So, the estimated $1.8 billion saving is due to the fact that a significant number of drivers using the 20% method could never come close to a 20% proportion of work use if they took the trouble to maintain a log book. Either that or they don’t think it is worth the effort to maintain the log book records.

While the elimination of this tax-payer largesse for drivers may come at a cost to workers in the car industry, does it really make sense to reverse the changes to save 750 jobs? These jobs would be saved at a cost to the tax payer of $2.4 million per job. Now these are just the jobs at Ford and (for now at least) we should acknowledge that some Holden jobs may also be saved, bringing the cost closer to $1 million per job.

The car industry in Australia has long benefited from government support, but surely there are better ways of saving these jobs. A job guarantee springs to mind.

Of course, industry protectionism is far from unique to Australia and this week I had my attention drawn to an extreme example in the small central American nation of Belize.

On 7 August, the parliament of Belize met for the first time since April. With so long between sittings, there were many bills for parliament to pass that day. Included among these was one which increased the already high import tariff on flour from 25% to 100%.

Wheat

Why such a dramatic increase? For some time, local bakers had been buying their flour from Mexico for 69 Belize dollars per sack (approximately A$38). It was hard to justify buying the more expensive local flour at BZ$81 per sack (A$45). The new tariff will push the price of Mexican flour up to around BZ$110 (A$61), which is good news for the domestic flour mill and its employees.

That domestic flour mill is operated by Archer Daniels Midland (ADM), one of the top 10 global commodity firms. This is the same ADM which is in the process of trying to buy GrainCorp, Australia’s largest agricultural business.

But back to Belize. ADM’s website proudly declares that it “employs more than 40 people” in its Belize mill. Presumably, parliament had an eye to saving these jobs from the threat of cheap Mexican flour when it hiked the import tariff. With a population of only 335,000, Belize is 1/70th the size of Australia. You could argue that saving 40 jobs in Belize is the equivalent of saving 2,800 in Australia and that this is a far more effective form of protectionism than reversing FBT reforms.

But protectionism always has consequences and in Belize these are easier to see than is often the case.

Bread in Belize is subject to price control, along with rice, beans and even local beer. By law, bakers must sell “standard loaves” of bread for BZ$1.75. The August sitting of parliament may have increased flour tariffs, but it did not increase the price bakers could charge for bread.

Bakers in Belize will see their profits squeezed, job losses may follow and there are more bakers in Belize than workers at the ADM mill. Needless to say, the Belize Baker’s Association is lobbying for an increase in the controlled price of bread.

Perhaps it is time for the Belize government to consider abandoning the flour tariff and trying a job guarantee instead.

Poll Dancing

With elections looming, and Kevin Rudd’s return to power, it is time for our regular guest blogger, James, to pull out his beer coaster calculator and take a closer look at the polls. 

It is really that time again. Australian election fever has risen. Though in this case it feels like we have been here for three years since the last election. Polls every week telling us what we think and who we will vote for. But what exactly do these polls mean? And what do they mean by “margin of error”?

So here is the quick answer. Suppose you have a two party election (which two party preferred, 2PP, effectively amounts to through Australia’s preference system). Now suppose each of those parties really has 50% of the vote. If there are 8 million voters and you poll 1,000 of them then what can you tell? Surprisingly it turns out that of these inputs the number of 8 million voters is actually irrelevant! We can all understand that if you only poll 1,000 voters out of 8 million then there is a margin of error. This margin of error turns out to be quite easy to compute (using undergraduate level Binomial probability theory) and only depends on the number of people polled, and not the total number of voters. The formula is:

MOE = k × 0.5 /√N.

where N is the number of people polled and k is the number of standard deviations for the error. The formula √1000 = 33 so 1/√1000 = 0.03 = 3%. The choice of k is somewhat arbitrary but in this case k = 2 (because for the Normal distribution 95% of outcomes lies within k=2 standard deviations of the mean) which conveniently makes k × 0.5 = 1. So MOE=1/√N is a fairly accurate formula. If N=1000 then MOE=1/33=3% (give or take). This simply means that even if the actual vote was 50:50 then 5% of the time, an unbiased poll of 1,000 voters would poll outside 47:53 due purely to random selection. And even if the actual vote is, say, 46:54, the MOE will be about the same.

Interestingly in the US where there are about 100m voters they usually poll at N = 40,000 which makes the MOE = 0.5%. In this case the economics of polling scale as the number of voters hence they can afford to poll more people. But the total number of voters, 100m or 10m, is irrelevant for the MOE. As the formula shows to improve the accuracy of the estimate by a factor of 10 (say from 3% to 0.3%) they would need to increase the sample size by a factor of 100. You simply can’t get around this.

One of the criticisms of polling is that that they don’t reach the same number of (young) people on mobile phones as older people on land lines. This is easily fixed. You just adjust the figures according to what type of phone they are using based on known percentages of who uses what type of phone. Similarly you can adjust by gender and age. The interesting thing though is that the further you get from actual phone usage/gender/age in your poll you also need to increase your MOE, but not your expected outcome.

Okay so that is it: MOE = 1/√N where N = number of people polled. If N = 1000 then MOE=3%. My all time favourite back of the beer coaster formula.

The recent jump in the 2PP polls for Labor when Kevin Rudd reassumed the PM-ship from about 45% to 49% were greeted by journalists as “Kevin Rudd is almost, but not quite, dead even”. I found this amusing as it could statistically have been 51%, within the MOE, in which case the headline would have been “Kevin Rudd is ahead!”. Indeed barely a week later he was “neck and neck” in the polls at 50:50. Next week it may be “51:49” in which case he will be declared on a certain path to victory! However within the MOE of 3% these results are statistically indistinguishable.

From my point of view, as a professional statistician, I find the way many journalists develop a narrative based on polls from week to week, without understanding the margin of error, quite annoying. Given the theory that if a politician has the “The Mo” (ie. momentum) it may end up helping them win when it is irresponsible to allow random fluctuation due to statistical sampling error to influence the outcome of an election. Unless of course it helps the party I support win.

What is Tony talking about?

I first experimented with word clouds several years ago and used them to visualise the speeches of Kevin Rudd and Malcolm Turnbull. I have now learned from the Fell Stats blog (via R-Bloggers) that there is an R package for generating word clouds.  The package makes use of tm, a text mining package for R, which I have been meaning to look into for some time. So, it seemed only appropriate to explore the speeches of Tony Abbott.

This word cloud shows the 150 most-used words in Tony’s speeches over the last 18 years. Perhaps disappointingly, since my efforts to strip punctuation also stripped apostrophes, “cant” actually only shows the frequency of the word “can’t”.

Pretty though the word cloud is, a little more can be gleaned from the word usage patterns through time. The correlation in recent years between “carbon” and “tax”, is clearly due to Abbott’s attacks on Labor’s imposition of a price on carbon. His stint as health minister is also evident. I did expect to see more of an impact from his “stop the boats” campaign (here the count for “boat” includes “boats”).

Abbott word count through time

Admittedly, there are no particularly deep insights here, but it was a fun way to learn about the tm and wordcloud packages.

UPDATE: In response to the comment from Dan, I have added a chart showing word frequency rather than count. This accounts for distortions arising from the larger number of Abbott speeches in recent years.

Abbot Word (freq)

 Abbott word frequency through time

For those who are interested, I have uploaded the (python) code for downloading the speeches and the (R) code for generating the charts to github.

A way with words

Sometimes the things that are unsaid are far more telling than the things said.

I had cause to reflect on this when I stumbled across a book on my shelves that I have not opened for many years. The book, entitled “Deutsche Bank: Dates, facts and figures 1870-1993”, is an English translation of the year-by-year history of the bank compiled by Manfred Pohl and Angelike Raab-Rebentisch. In keeping with the title, the style is more bullet points than narrative. Nevertheless, I continue to find the pages spanning World War II strangely fascinating.

In 1938, with the connivance of the French and British, Germany annexed Sudetenland in Western Czechoslovakia. For Deutsche Bank, this meant more branches.

Deutsche Bank 1938

The following year, Deutsche Bank was fortunate enough to be able to continue its branch expansion, this time into Poland. At least this time, there is a mention of the events outside the bank that may have been relevant.

Deutsche Bank 1939

Another year, and some more expansion for the bank including a few branches in France. No need to mention the invasion of France here, of course.

Deutsche Bank 1940

From 1942, outside events start to interfere with the bank: the “impact of war” forces rather inconvenient branch closures.

DB War End

To see these extracts in the full context, here are the pages spanning 1934 to 1940 and 1940 to 1946.