It was almost breathtaking to hear the extraordinary assertions made by some executives and fellow travelers in the finance industry about sovereign risk. If anyone seriously thinks that’s sovereign risk, they’re kidding themselves. Real sovereign risk can be found in countries which don’t look to their fiscal bottom lines are facing. The PIIGS group of countries – and add in Britain and California, which both have huge debt problems – will have to endure decades of difficulties juggling their books to pay even modest pensions to their retiring citizens. In my puzzlement, I wondered what had happened to the superannuation changes.

Were they still around, and what happened to the 2 per cent corporate tax cut which the government had promised as part of its package involving superannuation changes, corporate tax reform and the resources super profits tax? No, they’re all still in place. However the ability of the government to fund the corporate tax cut – which in turn was aimed at easing the impact of a gradual superannuation increase over the next decade – was being jeopardised by the determination of the mining companies to have their way. In the end, I figure the government will find a way to implement all three initiatives, despite the scare campaign mounted by the miners.