From under the linoleum
Old newspapers show Mussolini's imperialism looked a lot like today's

I sat on the floor and picked through the tragedy of the country we now call Ethiopia laid out on the yellowing pages. It was eerily reminiscent of the current Iraq adventure.

A tale for our times
The December 1934 assassination of Sergei Kirov

Seventy years on, the killing of Sergei Kirov casts an eerie light on the events of 11 September 2001, the invasions of Iraq and Afghanistan, the “war on Terror” and the state-sponsored hysteria surrounding the shadowy figures of Osama bin Ladin and Abu Musab al-Zarqawi.

Ninety-three years of bombing the Arabs
It was the Italians, hell-bent on acquiring an African empire, who got the ball rolling. In 1911 the Libyan Arab tribes opposed an Italian invasion. Their civilians were the first people in the world to be bombed from the air.

Dispossessed all over again
After spending nearly two months in the West Bank the pull towards my village was growing stronger, especially after being detained twice and threatened with deportation … an Australian Palestinian returns to her ancestral home.

The tragic inevitability of a forlorn hope
Australia slides further into the Iraq quagmire
Cabinet documents recently released under the 50-year rule show that, in 1954, Liberal (conservative) Prime Minister, Robert Menzies, and key figures in his Cabinet were extremely gloomy about the prospects for success in an American war against nationalists in Indochina. But eventually they went to the Vietnam War anyway.

Bombing King David
One man’s freedom fighter is another’s terrorist

Some historians date the beginning of modern terrorism from the 1946 bombing by Zionist terrorists of the British military HQ in Jerusalem.

Don’t loiter near the exit
Military debacle and economic decline haunt the Bush regime

When I was just a young possum in the school cadet corps there was a hoary old war story that we all knew. It was almost certainly apocryphal, but it ruefully expressed a nasty historic truth about the US role in the demise of the British Empire.

 


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Brushtail Graphics

Terrain, terrain! … pull up, pull up!
A requiem for the airline industry

26 June 2012

I was wandering across a blackened, smoking, urban landscape, strewn with mangled remains of jet engines, wings, seats, luggage. There were men in high-vis gear picking through the ruins, which stretched as far as I could see. The whole airline industry had augered in – crashed and burned.

And then I stumbled across the crash investigators and they’d found the black box jammed under the remains of a car and they start playing the tapes.

And I could hear the cockpit mechanical voice screaming: wind shear, wind shear… sink rate, sink rate… too low, too low…  terrain, terrain… pull up, pull up…  two hundred, one fifty… pull up, pull up. And the industry heads were screaming at each other and applying more cheap money, more cheap money, low fares, low fares, competition, competition.  Suddenly, somebody just said ‘Aw shit’ and the recording stopped.

And then I woke up, freezing cold, with my snout on the desk and a cramp in my tail. Outside the window, weak winter  sun was starting to creep down Werrong Lane. Jesus wept, I thought, this airline corruption case is starting to get to me.

So I went down to the brushtail Café for breakfast and a caffeine hit and the place seemed strangely deserted. Joadja was polishing glasses, which is always a bad sign.

“Where’s the masses?” I asked.

“All gone overseas, I’m afraid.”

“What about old Granny Papadopoulos?”

“Her too. Flown home to see the relos in Greece.”

“Gee, she’ll have a fun time there. Is she still up for a riot? And Colonel Stan?”

“The UK, Ireland, France, Italy, Spain.”

“Bruce and Tarkis?”

“LA. And then across to New York via Vegas. Did you know that last year about a quarter of the Australian population went overseas?”

“Yeah, but Oz is about the last happy spot for the airline industry and it can’t go on. Peak oil is killing the thing”, I said.

In Australia we’ve been blinded by special factors - the mining boom and the growth of an East Asian middle class – but a chill wind is howling through the world economy and nothing is more threatened than the international airline industry. Steadily increasing oil prices and the eurozone crisis are slashing airline profits to the bone.

The International Air Transport Association reckons that revenues will continue to plummet, generating profits of only $3.5 billion, max, this year – a drop from the $7.9 billion in 2011 which represented a 1.3 per cent net profit margin. This year’s projected profit margin looks like being just 0.5 per cent or lower. To put that in perspective, average retail profit in Australia is 3.9 per cent, and it has the lowest rate of any sector. The average profit rate for all sectors is about 11 per cent.

This year, Asia-Pacific carriers are expected to make the biggest contribution to airline profits – $2.0 billion – even with a $0.3 billion downgrade from the previous estimates, due to a weak showing in the first quarter. That’s less than half the $4.9 billion profit that the region delivered in 2011 and a quarter of the $8.0 billion achieved in 2010. The trend is relentlessly down.

So, $3.5 billion profit this year? For the whole goddamn airline industry? Yes, you heard that right. That’s a third of BHP’s profit for the second half of 2010; an eighth of what Gina Rinehart is worth; an eighth of Australia’s small defence budget; a third of what NSW spends on education; less than half the annual budget of Ethiopia; a fifth of what the US Army spends annually just on air conditioning for its troops in Afghanistan. Forget Anthony Albanese’s gibberish about a second airport for Sydney – this is an industry on the edge of disaster. Aviation gasoline supplies are now so tight and prices are climbing so relentlessly that cutting wages and staff and pouring billions into upgrading to more fuel-efficient aircraft is inevitably a losing game.

Truth to tell, airline margins have always been pathetic. Warren Buffett once observed that despite the countless thousands of billions that have been invested in airlines over the years, net profit is still, in the long historical view, less than zero. The industry has always depended either on being subsidised by governments for reasons of prestige or nation-building, or in the last few decades, kept afloat by continual injections of cheap money. A couple of whole generations of Australians have come to believe that cheap flights to wherever are their birthright.  They’re in for a rude shock.