The latest news from Lebanon is that a terrible tragedy has happened in the southern Lebanese village of Qana, with the Israelis bombing a building sheltering refugees, killing 54 people, including 37 children.

There have now been something like 523 Lebanese killed, and 51 Israelis killed, in the fighting that erupted almost 3 weeks ago when Hezbollah kidnapped 2 Israeli soldiers. All a terrible waste of lives, and ultimately going to mean nothing in the overall context of the Middle East …only constructive negotiations will solve anything there.

This latest tragedy will add fuel to calls for Israel to back off on its strikes against the Lebanese bases of Hezbollah. I’ve thought Israel highly justified in most of its actions. Destroying Hezbollah and similar terrorist organisations is a commendable objective. Unfortunately, given these groups elect to base themselves in civilian areas, often deliberately sheltering in sensitive locations, even precision bombing is going to kill some innocent people. I hope Israel is doing all it can to choose its targets and attack them in ways that minimise civilian deaths and injuries.

There is a key difference between Israel’s strikes on Lebanon and Hezbollah’s on Israel. Hezbollah’s rockets and missile attacks are deliberately targeting Israeli civilians. I don’t believe Israel is deliberately trying to kill Lebanese citizens.

Update (31/7/2006): Having said constructive negotiations are the way to solve the Hezbollah/Israel problems, I mean from the viewpoint of rational people. I suspect Hezbollah will not negotiate away from its position of the destruction of Israel, so what can the Israelis do but pursue the objective of destroying Hezbollah.

Technorati Tags: Qana. Lebanon, Israel, Hezbollah, civilian deaths

The latest consumer price index figures show prices up 4 percent over the last year and 1.6 percent in the last quarter. PM, John Howard, acknowledges this is not good:

“I have to acknowledge that the inflation figure a couple of days a go was bad, it was bigger than I expected,”

Fair enough. But then he goes on to blame it on the price of bananas:

“And it was caused by this extra increase in food prices, in turn caused by a 250 per cent increase in the price of bananas, which in turn was caused by Cyclone Larry,” he said.

“Now that’s a one off and it will go through the system.”

Now, I’m surprised at the impact of bananas on inflation. I would think it minimal in reality as people would respond to the price rises by substituting other fruits for bananas. At $11.99 a kilo or whatever they are, people just don’t buy bananas in anything like their normal quantities. It is hardly an increase in the cost of living, more a diminution in the normal consumption choices available. I thought to myself yesterday that the impact of bananas on the CPI is more a methodological flaw in measuring price changes rather than a true representation of inflation. The Australian Bureau of Statistics acknowledges the methodology issues in its CPI release, saying they do not make any allowance for short term substitution effects, and the index is calculated from a fixed basket of goods and services.

Funny though, how governments claim all the credit for good economic indicators, but disclaim all responsibility for bad ones, blaming them on international factors, droughts, floods, pestilence, wars and bananas.

Technorati Tags: consumer price index, CPI, inflation, Australian Bureau of Statistics, bananas