May 28, 2015

Frustrations drive Aussie online shoppers to retail stores

Nearly half of online shoppers in Australia and New Zealand have abandoned a purchase after experiencing frustrations with the website, a survey shows. Rackspace polled more than 1000 shoppers across the two countries, discovering that 45% had abandoned an online purchase due to website performance issues, while 47% have gone to a different site to buy the same product. Online frustrations are driving some users back to brick-and-mortar stores, with 29% of respondents reporting having given up on an online purchase and visited a shop instead. In addition, while 83% shopped online for the convenience, 44% believe traditional retail shopping is faster if they know what they're looking for and 44% prefer the service they receive in-store. According to the respondents, the top frustrations with e-commerce include too many pop-up advertisements, inferior service and the time-consuming task of narrowing down the options available. But more than half of online shoppers agree that there is more variety than in brick-and-mortar stores. While 37% have used web search filters to shop online, 42% complain that online search categories do not match their required criteria. “People shop online due to the convenience it offers, but they are being driven away because they aren’t able to navigate through to purchase quickly and easily enough,” Rackspace ANZ Director and General Manager Angus Dorney said. “Retailers should apply the same, simple, old-fashioned customer service values to their online site as they would to the physical shopfront. It should be inviting, easy to navigate and helpful.” -


May 26, 2015

Massive cost of rooftop solar | The Australian

The fact rooftop solar has been a policy debacle will not come as a surprise to readers of this newspaper. We have consistently argued against populist measures that rewarded the better off (those with the disposable income to spend on rooftop panels) at the expense of everyone else and did so with very inefficient results in carbon abatement. Even so, the scale of the subsidies and costs, estimated in a new report from the Grattan Institute think tank, is startling.
The report — Sundown, Sunrise: How Australia Can Finally Get Solar Power Right — concludes that the cost of rooftop solar outweighs the benefits by almost $10 billion. The cost includes overly generous “feed-in” tariffs paid to householders exporting surplus electricity to the grid, as well as a pricing system that fails to charge these householders for their continued reliance on grid power during the evening peak. The benefits embrace less demand for grid power and reduced greenhouse gas emissions.
This has been a prohibitively expensive and inequitable form of greenhouse abatement — the equivalent of a carbon price of $170 a tonne, according to Grattan’s energy program director Tony Wood. By contrast, the Abbott government paid an average price of $13.95 a tonne for carbon abatement in its first auction of emission reductions last month. And the costs continue because, quite apart from poorly designed pricing systems, some of the overly generous state feed-in tariff regimes still have time to run.
“By the time the subsidies finally run out, households and businesses that have not installed solar (panels) will have spent more than $14bn subsidising households that have,” the Grattan report says. If the expenditure tied up in Australia’s 1.4 million rooftop systems — the world’s highest penetration of household solar installations — had been spent instead on industrial-scale solar power generation in arid zones, the result in terms of carbon abatement would have been impressive.
But the practical question is how policymakers should respond to the high penetration of rooftop solar as well as its future uptake. The Grattan report wisely suggests a deadline for nationwide use of smart meters so that pricing can distinguish between peak and off-peak use. This would eliminate one source of the inequitable subsidy enjoyed by households with rooftop solar. It also would create an incentive for these households — and for new solar power customers — to sign up for battery storage as this technology becomes available. This would allow solar households to draw on their own stored power during the evening peak and thereby reduce demand on the grid.
It is difficult to predict with any precision the effect that widely available battery technology will have on the electricity grid, a subject of keen interest to a state such as NSW that has yet to privatise its poles and wires. The Grattan report concludes that the so-called “death spiral” — as more and more customers disconnect from the grid — is not imminent. It estimates that, at least for the next few years, the upfront cost for a typical urban household to go off-grid will be prohibitive. These calculations may change quickly; forecasting technological change is famously hazardous. Whatever happens, policymakers must learn from past mistakes and make sure they respond with efficient and equitable measures.

May 21, 2015

Few doctors warn of over-diagnosis risks - 9news.com.au

Most Australians screened for breast or prostate cancer are not informed of the risks of being diagnosed with a disease that may never cause them harm.
A new survey also found that 90 per cent of people generally have not been told by their doctors about the risk of over-diagnosis.
"Over-diagnosis occurs when someone is diagnosed with a disease that would not have harmed them, often as a result of undergoing screening," said Bond University researcher Ray Moynihan.
This can lead to them being labelled unnecessarily and then undergoing unnecessary and invasive treatments.
The study, published in the scientific journal PLOS ONE, noted UK estimates that one in five cancers detected by breast screening would never go on to harm the woman.
And US estimates found as many as one in two prostate cancers detected by screening may never harm the patient.
The Australian survey found more than 80 per cent of those screened for prostate cancer and almost 90 per cent of those screened for breast cancer said they were not told about the risk of over-diagnosis.
Overall, only one in 10 people had ever been told about over-diagnosis, said Dr Moynihan, the study's lead author.
The survey also found that 78 per cent of people thought doctors with financial ties to drug companies should not be members of panels that define disease.
Dr Moynihan said over-diagnosis was linked to the relationship between doctors and pharmaceutical companies.
"Disease definitions are often widened to include people with mild problems or at very low risk of illness, therefore turning previously healthy people into patients," he said.
"The survey results add weight to recommendations that influential medical panels should be free of financial conflicts of interest."

May 19, 2015

Hadoop demand falls as other big data tech rises | Matt Asay

Hadoop makes all the big data noise. Too bad it's not also getting the big data deployments.
Indeed, though Hadoop has often served as shorthand for big data, this increasingly seems like a mistake. According to a new Gartner report, "despite continuing enthusiasm for the big data phenomenon, demand for Hadoop specifically is not accelerating."
According to the survey, most enterprises have "no plans at this time" to invest in Hadoop and a mere 26 percent have either deployed or are piloting Hadoop. They are, however, actively embracing other big data technologies.

'Fairly anemic' interest in Hadoop

For a variety of reasons, with a lack of Hadoop skills as the biggest challenge (57 percent), enterprises aren't falling in love with Hadoop.
Indeed, as Gartner analyst Merv Adrian suggests in a new Gartner report ("Survey Analysis: Hadoop Adoption Drivers and Challenges"):
With such large incidence of organizations with no plans or already on their Hadoop journey, future demand for Hadoop looks fairly anemic over at least the next 24 months. Moreover, the lack of near-term plans for Hadoop adoption suggest that, despite continuing enthusiasm for the big data phenomenon, demand for Hadoop specifically is not accelerating.
How anemic? Think 54 percent with zero plans to use Hadoop, plus another 20 percent that at best will get to experimenting with Hadoop in the next year:
Gartner HadoopGartner
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This doesn't bode well for Hadoop's biggest vendors. After all, as Gartner analyst Nick Huedecker posits, "Hadoop [is] overkill for the problems the business[es surveyed] face, implying the opportunity costs of implementing Hadoop [are] too high relative to the expected benefit."

Selling the future of Hadoop

By some measures, this shortfall of interest hasn't yet caught up with the top two Hadoop vendors, Cloudera and Hortonworks.
Cloudera, after all, will reportedly clear nearly $200 million in revenue in 2015, with a valuation of $5 billion, according to Manhattan Venture Partners. While the company is nowhere near profitability, it's not struggling to grow and will roughly double revenue this year.
Hortonworks, for its part, just nailed a strong quarter. Annual billings grew 99 percent to $28.1 million, even as revenue exploded 167 percent to $22.8 million. To reach these numbers, Hortonworks added 105 new customers, up from 99 new customers in the previous quarter.
Still, there are signs that the hype is fading.
Hortonworks, despite beating analyst expectations handily last quarter, continues to fall short of the $1 billion-plus valuation it held at its last round of private funding. As I've argued, the company will struggle to justify a billion-dollar price tag due to its pure-play open source business model.
But according to the Gartner data, it may also struggle due to "fairly anemic" demand for Hadoop.

Moving beyond Hadoop

There's a big mitigating factor. Hadoop vendors will almost surely languish -- unless they're willing to embrace adjacent big data technologies that complement Hadoop. As it happens, both leaders already have.
For example, even as Apache Spark has eaten into MapReduce interest, both companies have climbed aboard the Spark train.
But more is needed. Because big data is much more than Hadoop and its ecosystem.
For example, though the media has equated big data with Hadoop for years, data scientists have not. As Silicon Angle uncovered back in 2012 from its analysis of Twitter conversations, when data professionals talk about big data, they actually talked about NoSQL technologies like MongoDB as much or more than Hadoop:
MongoDB vs. HadoopSilicon Angle
Today those same data professionals are likely to be using MongoDB and Cassandra, both among the world's top 10 most popular databases, rather than Hbase, which is the database of choice for Cloudera and Hortonworks, but ranks a distant #15 in terms of overall popularity, according to DB-Engines.

Buying an ecosystem

Let's look at Gartner's data again, this time comparing big data adoption and Hadoop adoption:
Gartner Hadoop vs. big dataGartner
A significant percentage of the delta between these two almost certainly derives from other, highly popular big data technologies such as MongoDB, Cassandra, Apache Storm, etc. They don't fit into the current Hadoop ecosystem, but Cloudera and Hortonworks need to find ways to embrace them, or risk running out of Hadoop runway.
Nor is that the only risk.
As Aerospike executive and former Wall Street analystPeter Goldmacher told me, a major problem for Hortonworks and Cloudera is that both are spending too much money to court customers. (As strong as Hortonworks' billings growth was, it doubled its loss on the way to that growth as it spent heavily to grow sales.)
While these companies currently have a lead in terms of distribution Goldmacher warns that Oracle or another incumbent could acquire one of them and thereby largely lobotomize the other because of its superior claim on CIO wallets and broad-based suite offerings.
Neither Cloudera nor Hortonworks can offer that suite.
But what they can do, Goldmacher goes on, is expand their own big data footprint. For example, if Cloudera were to use its $4-to-5 billion valuation to acquire a NoSQL vendor, "All of a sudden other NoSQL vendors and Hortonworks are screwed because Cloudera would have the makings of a complete architecture."
In other words, to survive long term, Hadoop's dominant vendors need to move beyond Hadoop -- and fast.

Turn spotlight on labour hire contractors | The Australian

While the government is to be commended for its establishment of a special taskforce to address fraud in the working holiday visa program, its target should be labour hire contractors, not working holiday-makers.
The first job of the taskforce is to come to terms with the increasing commercialisation of migra­tion. The business model of many labour hire contractors hinges on exploiting vulnerable migrant workers. These contractors present themselves to employers offer­ing a simple, attractive and integrated service.
For example, as a recent ABC Four Corners program exposed, in the agriculture industry contractors not only recruit migrant workers to pick the crop but the contractors also assume responsibility for wages and all employment paperwork, including superannuation and tax. All the farmer need do is pay a single invoice to the contractor.
In this arrangement, the mig­rant worker loses out every time. The farmer gets a ready supply of labour without the hassle of paperwork. The contractor gets a tidy windfall from paying workers less wages in return for finding them a job, providing crammed housing and ferrying them to and from their place of work each day. While there is no firm evidence about the extent of the contactor system, we know it accounts for a substantial and increasing share of the harvest workforce.
To make matters worse, the labour hire arrangement is a “triangular” one, so when workers are being exploited they don’t know whom to turn to. The Four Cornersprogram perfectly captured the precarious situation of many migrant workers by revealing what happened when a migrant worker made an allegation of sexual harassment to the farmer about the labour hire contractor. The worker was told by the contractor that there was no more work for her to do and she was out of a job. Labour hire workers are the ultimate disposable labour force. Given the myriad vulnerabilities faced by many working holiday-makers, it is vital the taskforce focus on labour hire contractors as the primary culprit for fraud, not migrant workers.
The demonisation of migrant workers for failing to meet statutory obligations backfires as it makes these workers afraid to complain. Labour hire contractors take advantage of this as they know they can get away with exploitation of workers as the latter will get deported if they are in breach of their visa conditions. Migrant workers need to be protected so that if they complain to the taskforce about an exploitative employer or labour hire contractor, this information is not passed on to the Department of Immigration and Border Protection. Thus, the second job of the taskforce is to create a safe environment for whistleblowing by working holiday-makers.
A third job of the taskforce is to ensure employers are held accountable for engaging dodgy labour hire contractors. All participants in the supply chain should be held responsible for breach of labour standards.
The final challenge for the government goes beyond the taskforce, and relates to the design of the working holiday-maker visa. The visa is aimed to allow genuine tourists to supplement their holiday finances but increasingly has become a back door for employers to access low-skilled workers.
The agriculture industry is a good example. Farmers say they turn to working holiday-makers at harvest time because there are no locals willing to do this work. Unions argue no locals are available because the wages and conditions are set too low. Farmers respond that their profits are being squeezed by the deadly duo of overseas competition, where produce is picked by cheap labour, and by ineffective labelling laws that allow imports to seem like they are Australian-made, without being so. The bottom line for farmers is that if they can’t find workers at harvest time, then their produce goes to waste. We need to have a conversation about whether a low-skill work visa is the solution to this impasse. A low-skill work visa would need to be effectively regulated so workers were not an easy target for exploitative work but also so it doesn’t unnecessarily burden employers with too much red tape.
Nonetheless, it is not acceptable for the status quo to continue. The working holiday-maker scheme is not adequately regulated to protect these visa holders in the labour market and this visa should not be used by the government to address specific labour shortages by providing short-term casual employment to regional industries. This situation is unfair to migrant workers as it creates the conditions for exploitation to flourish, and it is unfair to employers as it makes it more difficult for them to meet their staffing needs.
Joanna Howe is a senior lecturer at the University of Adelaide law school.

Woolworths bid to beat Bunnings laid bare in court

The highly confidential strategies and inner-workings of Woolworths’ ambitious push into the $40 billion hardware market were laid bare in court yesterday when it was revealed that senior executives, including current boss Grant O’Brien, rushed after sites for its new Masters chain before proper planning just in an effort to thwart arch rival Bunnings.
It shows the intense competition between entrenched market leader Bunnings and Masters, fighting it out for land and sites across the country.
It has also led to Woolworths being accused of deceptive behaviour when it wiggled out of a contract that would have seen an empty patch of land in the Victorian regional town of Bendigo developed into a glistening new Masters store in 2009, and which could see Mr O’Brien front court to give evidence about the soured land deal.
Claims of dumped property contracts, incomplete store designs, secret meetings and even a fake email address named after a pet dog to hold talks between the owner of an independent hardware store in Bendigo and Mr O’Brien were all aired in the ­Supreme Court in Melbourne yesterday.
Meanwhile, Masters, the still struggling hardware arm owned by Woolworths and its US joint venture partner Lowe’s, is likely to ring up losses of $500 million for the past three years as its ­format continues to misfire.
A court was told yesterday that Mr O’Brien, who six years ago was leading the Masters charge, was so intent to beat Bunnings to the punch that Woolworths sped through land deals just to enter the market quickly and hit its stated target of 150 stores in five years.
The opening day of the trial also aired private emails between Woolworths executives, including one from Mr O’Brien to then Woolworths head of property Richard Champion, which showed the urgency to which the now Woolworths CEO wanted to roll out Masters — even before the proper designs were created for the store layout.
Investors and analysts would argue that with Masters still dripping in red ink — it is likely to make a loss of more than $200m this financial year — the spluttering chain was possibly ill-conceived at the very early stages of its creation.
A civil case brought by property developer and Maxi Foods founder Brendan Blake claims Woolworths, which back in May 2009 was still months away from surprising the market with a billion-dollar push into home improvement, had walked away from a contract for him to build and lease a new Masters store in Bendigo. Mr Blake’s North East Solutions would have gained a 42-year lease from Woolworths if the deal had gone ahead, and the businessman is claiming loss of that rental income and other costs, which combined could be up to $16m.
Woolworths walked away from the deal a year after contracts it has signed because it heard rival Bunnings was circling local independent hardware store Hume & Iser and it wanted to grab the business first, denying Bunnings a second store in the town. Woolworths then engaged on a “deceptive course and feigned negotiations’’ over its contribution to the construction of the store on Mr Blake’s land only to walk away from the site, the court was told.
Peter Bick QC, acting for North East Solutions, told judge Clyde Croft yesterday in submissions that the contracts stated Woolworths had to negotiate in good faith when a deal couldn’t be reached on the retailer’s bill to help develop the site.
Woolies had agreed to fund the difference between the cost of building a Masters store and a similar Bunnings store. This was an inducement to bind landlords to agreements. The court was told the Masters store, with its better lighting and store layout, would cost about $12.3m against $8.3m for a Bunnings store.
Mr Bick QC said the decision was made by Woolies to enter into binding agreements in the first place to secure critical sites for Masters before Bunnings could secure them, even if it meant Woolworths had to assume the risks of unknown building costs at the time of entering deals with property developers.
Mr O’Brien, the court was told, wanted Masters “kits” — the design and fitout plans for all Masters stores — ready as soon as possible as construction was imminent, no matter the risk. “Even if we expose ourselves to the cost of the unknown,” Mr O’Brien wrote in the email to Mr Champion, “Bunnings have a kit and could, as a result beat us to the punch.”
Mr O’Brien said the Masters kits needed to be ready “tomorrow/ASAP/pronto/NOW!”.

May 11, 2015

Widow sues Cabrini Hospital, specialists over husband's death

Widow sues Cabrini Hospital, specialists over husband's death

The UK Labour party should blame Keynes for their election defeat | Niall Ferguson

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C

redit where credit is due. Lynton Crosby is getting the plaudits for the Conservative party’s successful election strategy, but the real architect of this victory was surely George Osborne, the chancellor. Leave aside Labour’s collapse in Scotland, arguably the election’s most striking result. In England, the Conservatives won because Mr Osborne was right and his critics were wrong.
The comedian Russell Brand was not alone in having his celebrity endorsement of Labour roundly ignored by the voters. Even more ignominiously humbled were the Keynesian economists who have spent so much of the past five years predicting that the economic consequences of Mr Osborne’s policies would be disastrous.

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In the vanguard of the Keynesian attack was Paul Krugman of The New York Times. In August 2011 he denounced the “delusions” of the chancellor whose “experiment in austerity” was “going really, really badly”.
Why? Because, in seeking to bring the government’s deficit under control, Mr Osborne was worrying needlessly about business confidence. “The confidence fairy” was the term Mr Krugman coined to ridicule anyone who argued for fiscal restraint.
Unfortunately for Mr Krugman, the more he talked about the confidence fairy, the more business confidence recovered in the UK. In fact, at no point after May 2010 did it sink back to where it had been throughout the past two years of Gordon Brown’s catastrophic premiership.
Mr Krugman was equally relentless in predicting that austerity would lead to recession; indeed, he insisted that the UK’s economic performance would be worse than during the Great Depression. In April 2012 he warned darkly that Britain would “continue on a death spiral of self-defeating austerity”.
It was, he lamented, a “policy disaster” that would cause a double-dip recession and “cripple the UK economy for many years to come”.
In fact, there was no double-dip recession. The UK had the best performing of the G7 economies last year, with a real gross domestic product growth rate of 2.6 per cent. In 2009, the last full year of Labour government, the figure was minus 4.3 per cent. Moreover, far from being in depression, the UK economy has generated more than 1.9m jobs since May 2010. UK unemployment is now 5.6 per cent, roughly half the rates in Italy and France. Weekly earnings are up by more than 8 per cent; in the private sector, the figure is above 10 per cent. Inflation is below 2 per cent and falling.
Meanwhile, the government’s much-derided policy of fiscal stabilisation has also been a success, even if the extent of deficit reduction fell short of Mr Osborne’s original goal. According to the International Monetary Fund, the general government deficit has been nearly halved from 10 per cent in 2009 to 5.7 per cent last year; the structural deficit more than halved from 9.8 per cent to 4.2 per cent. The net public debt has been stabilised at roughly the same level relative to GDP as that of the US.

In depth

David Cameron is back in Downing Street for a second term after a dramatic victory that defied predictions to trounce Labour and win an outright majority in parliament

Full coverage
Few governments since 1945 have achieved comparable economic results from such a difficult starting point. If the opinion polls had been right, and the Tories had not won this election, it would have been a travesty.
Last week’s result thus fits into a simple pattern of postwar history. Labour governments have generally caused either inflation or unemployment or both to rise, or at least not to fall. Conservative governments have generally done better. However, the electorate has not always rewarded the Tories for their economic competence. In 1945, 1964, 1974 and 1997 voters felt that, after doing what had to be done under the Conservatives, they could now indulge themselves with a flutter on Labour, which remains, incorrigibly, the party that promises to spend more on the welfare state by taxing the rich.
Not this year. Throughout the campaign, Labour leader Ed Miliband and Ed Balls, his shadow chancellor, trailed their Tory counterparts on the issue of economic competence. The electorate had not forgotten Labour’s disastrous stewardship before and during the financial crisis. Nor did they miss that Mr Miliband and Mr Balls had (temporarily) swallowed Mr Krugman’s fairy story of austerity-driven double-dip recession.
True, not all those who intended to vote Tory showed their hand to the opinion pollsters, who have almost as much egg on their faces as the Keynesians. Next time, however, the pollsters can simply adjust their projections by using a simple economic model. Just so long as they make sure it’s not a Keynesian one. Shame where shame is due.

May 10, 2015

‘We’re all doomed’: Jim’s Mowing founder Jim Penman

Who knew that the Jim behind Jim’s Mowing has a PhD in history? It turns out that Jim Penman only became an entrepreneur because couldn’t get a job as an academic.
Founding and running Jim’s Group has kept Penman pretty busy, but he snatched time here and there to continue his research and published various articles in peer-reviewed journals. Now, 32 years after completing his doctorate at Latrobe University, Penman has published a book calledBiohistory: Decline and Fall of the West. As the name suggests, Penman believes that Western Civilisation is already decades into a decline that could be terminal.
His book applies the study of epigenetics – a branch of biology that looks at changes in genetic expression as a result of environmental influences rather than changes to the DNA sequence. Penman’s premise with biohistory is that trends in history have roots in biology – and there is more of this in the book and also on the website where there are two videos explaining the theory.
BRW recently caught up with Penman to discuss his new book and his business.
BRW: Is there any common thread between your research and your business?
JIM PENMAN: “The biggest connection between my business and my research is very unorthodox thinking.”
BRW: How would you sum up your book?
JP: “The book itself is an understanding of the biology behind history. It’s looking at things like the War of the Roses and the First World War and drawing, I think, some very convincing parallels with what goes on in animal populations, such as the way that lemmings and musk rats behave. It’s going back to biology and thinking about biology in history and economics. If it’s shown to be correct - and there are scientific ways of investigating it - then it would be an intellectual and scientific revolution and you’d have to rewrite every history book ever written and all the economic texts.”
BRW: In what way do you apply unorthodox thinking to Jim’s Group?
JP: “We’re the only franchising system in the world that allows franchisees to vote out their franchisors. We have an absolute obsession with service to the extent where we think the primary goal and purpose of the whole system is looking after franchisees. There are a whole lot of mechanisms, so for example franchisees can move to other regions, to other franchisors, if they wish to. We give people the right to walk out of the system when they want to, at the most pay a few thousand dollars; we don’t hold them with legal requirements. We give people the automatic right of renewal. The contracts themselves are very unusual.
“Our IT department costs something close to a million dollars a year. We’ve got a huge investment in IT with very innovative ways of controlling complaints for example and improving customer service.
“This is going to sound weird because everyone knows that inflation has gone away but in actual fact my theory suggests that hyper-inflation is going to be a problem at some point in the future so all my contracts have been changed to allow for monthly increases if inflation goes past a certain point.
“I’d also be very sceptical of anything that relies on China because there are reasons to believe that Chinese growth is going to slow down very radically and even go into reverse.”
BRW: On the point about franchisees voting out franchisors, wasn’t there an incident a few years ago where they tried to vote out you as the master franchisor but couldn’t?
JP: “There is no legal mechanism for voting me out. I could be voted out if I were a divisional franchisor but not as CEO of Jim’s Group. It was a tiny minority, about 1 per cent not 51 per cent. It was a non story.”
BRW: What is the main finding of your research?
JP: “The main idea is that temperament is behind everything: economic growth, political structures, intellectual structures; everything depends on temperament. People’s temperament changes and there are biological roots to that change. It’s actually not that radical in the biological sciences; there are recent articles in Nature and New Scientist talking about how fundamental temperament affects our beliefs, for example that liberals and conservatives are quite different people.
“You get civilisation because people have attitudes and behaviour that suits that; they fall because people lose those behaviours. You get economic growth because people are hard working and enterprising and creative; you get economic decline to the extent that they’re not. Everything is driven by temperament, not by government policy but the temperament of the average population; recessions take place because of a change in temperament, the rise in anxiety of the average population.”
BRW: If liberals and conservatives are quite different people, where do you sit in that equation and what does that say about your temperament?
JP: “I’m conservative. I have a temperament that inclines me towards conservative attitudes. I’m morally conservative, I wasn’t when I was younger, but it’s a reaction to my own research. I’m naturally in favour of minimal government; I like the government to stay out of my hair, like most of us, but I’m pretty passionate about it.
“In the present age, the orthodoxy is on the left, if you go to the universities they’re 98 per cent left wing and conservatives like me are an extremely small minority, that’s one of the reasons I’ve never got an academic post. The idea that being liberal makes you unorthodox is crazy when everyone else around you is liberal and you’re liberal – you’re not unorthodox, you’re conventional. I’m not a conventional thinker, I’m an unorthodox thinker who believes in old-fashioned ideas and values.”
BRW: What do you hope to achieve from this book? What would you like people, whether the government or individuals, to do as a result?
JP: “Let’s just investigate and see what’s going on. I’m talking about spending millions of dollars on research, not billions. The thing about theories of history and society in the past is they’ve never been testable, but with biohistory you can. If people can go out and do a bit of science and say this guy’s wrong, I’ll be relieved that we’re not going on a journey of decline. But I think I’m right and I think most businessmen would have the sense of things going wrong. How difficult is it to find young Australians who are really dedicated to their work? We’ve got some and they’re great, but so many of the best staff these days are Asian. Why is that, what’s happened to our youth?”
BRW: With regards to things going wrong and the future of civilisation, where does climate change fit into the picture?
JP: “I think climate change is a serious problem. I don’t think you can massively increase the carbon dioxide in the atmosphere without it having some effect. I’m all in favour of a carbon tax and I don’t see any reason why we should be having such cheap petrol. Carbon taxes I think are very good; it’s a beneficial tax and not distorting.
“But at the same time, if I can draw a crude analogy, if you went to a beautiful beach and saw it was strewn with rubbish, you wouldn’t like it, but if there were an army coming in you wouldn’t worry too much by comparison. The effects of civilisation decline are orders of magnitude worse than any possible effect of climate change. To me what the climate change alarmists are talking about is so mild in comparison to the worse disaster facing us.
“I’m a Liberal supporter pretty obviously but in actual fact in this particular way, the Labor government had it right because what they were doing with a carbon tax was a very market efficient way of reducing carbon dioxide. Whereas with the present policy, Direct Action, the government picking things and we all know that governments are very bad at picking things. The carbon tax is a very sensible idea and I’m in favour of it. It’s not the main game, but sure do it.”
BRW: What is the cause of this civilisation decline?
JP: “It’s to do with wealth. It’s the same thing that occurred in the Roman Empire and every other civilisation. When you become wealthy and urbanised, it changes temperaments and behaviours in a way that makes people less disciplined, less hard working, in the end less enterprising. It takes a few generations to take place and epigenetics explains why that happens. People think that technology is going to save us but in fact technology makes it worse because it makes us so rich.”
BRW: Yet you said that Jim’s Group was investing heavily in technology – can it also be a force for good?
JP: “Technology makes it worse to the extent that it makes everybody rich and that makes us have too much food. But technology that makes us understand the science to fight against those effects would be a good thing. If we could find a way to reverse it so people would not be inclined to eat too much and naturally want to eat less and be more disciplined in their lives, that would be a good thing.
“Technology is very exciting – Jim’s Group right now is investing heavily in new efficiencies and systems and I love it and think it’s fantastic, but we’ve got to use it in good ways not bad ways. Nitrogen-fixing technology is fantastic and helps us feed the world but it also makes it possible to have huge explosions and devastating wars.
“I believe in our technological civilisation, I believe it’s worth preserving, I absolutely do. I have 10 children, every single one of my children is alive and healthy. Do you know what an extraordinary thing that is in historical terms? I’ve been married more than once and nobody’s died in childbirth – isn’t that fantastic? There are so many good things about our modern world but we need to work to preserve that, we can’t just assume it’s going to remain the same because I don’t believe it is.”
BRW: Digital disruption has destroyed the business models of a lot of traditional industries. Is Jim’s Group vulnerable to digital disruption?
JP: “We’re in a phenomenally strong position because we’re dealing with services and it’s not a thing you can disrupt digitally. If you’re in manufacturing you can go overseas, if you’re answering phones you can go overseas, but the sort of thing we do with building fences and tagging electrical equipment and mowing grass, technology just makes our job better.
“In the last year we had 88,944 unserviced leads, which is 19 per cent of our total leads, that we could not handle because of the volume of work and demand for our services. In dog washing and fencing, close to half of our leads are unserviced. Demand for our services is phenomenal. We’re still growing but we can’t grow fast enough to meet the demand. Technology is wonderful for us because we can do our jobs more efficiently and we can give better service, our level of complaints is a fraction of what it used to be. Being so large, with 3,400 plus franchisees we can afford to invest in technology in a way that our competitors can’t.”
BRW: If not digital disruption, then what about disruption from social change? For example, more people are living in apartments now and don’t need their lawns mowed.
JP: “I wouldn’t say living in apartments is relevant. Maybe you don’t mow lawns but you’re still going to need cleaning, building maintenance, plumbing, electricals, dog washing – if you’re in an apartment, you really don’t want your dog smelling bad. Apart from cutting the grass, there’s little difference.
“Our biggest difficulty is not customers, it never has been, even during the global financial crisis our leads went up. Our biggest difficulty is finding enough quality franchisees. The best thing that happened to Jim’s Group is a really serious recession like back in the 90s that throws a lot of quality middle management people out of work. It’s cynical and I actually wouldn’t vote for it because I’d vote for the country rather than my company, but the reality is we do better in tough times. We had one year in the 90s in that recession we had to have where we grew 40 per cent in a single year. The demand for our services is effectively infinite.”
BRW: As an entrepreneur, what are you hoping from next week’s federal budget?
JP: “My biggest concern is the national debt. It just frightens me that we’re paying more than we can possibly pay back and I think for the long term that’s horrifying. I’d like to see us balance the budget. If we can’t balance the budget, we’ll go the way of Greece; it’s just shocking. To me the greatest achievement of the last Liberal government was paying off the debt and that would be my top priority.
“Obviously, with reducing taxes I think there are things that should be done in that area. Very high company tax is costing us dearly, overly high income taxes are obviously also a bad idea. I’m not saying that I should pay less tax, I’m just saying that the way taxes are collected are very destructive. Our current taxes hurt the economy and discourage people from doing things in business.”
BRW: How can you both cut taxes and balance the budget?
JP: “We should change our taxes to things that aren’t so destructive. Company tax is a very difficult one because when you try to reinvest in your company you’ve got to pay very high tax. I would transfer taxes. We should tax land for example, particularly property above a certain level. I own millions of dollars worth of property and it’s quite reasonable for that to be taxed; the unimproved land value, that is. You can’t avoid the land tax because if you own the land you can’t disappear the land. We should introduce a federal land tax and obviously we should also look at raising GST.”