Treasury Secretary Jacob Lew has issued a categorical warning that the US will default on its $US16.7 trillion ($17.8 trillion) debt and throw the world into turmoil unless Congress agrees to raise the legal debt ceiling by October 17.
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”Congress is playing with fire. If the US government … chooses not to pay its bills on time, we will be in default,” Mr Lew told NBC’s Meet the Press. ”Anyone who thinks that the United States government not paying its bills is anything less than default hasn’t thought about it very clearly.”

Mr Lew said the Treasury had exhausted its normal funds in May and had been ”creating room” by resorting to one-off tricks but these had run dry. The government will have just $US30 billion by October 17, half what is needed to cover needs over subsequent days.

”That is a dangerously low level of cash and we’re on the verge of going into a place we’ve never been,” he said. ”Even getting close to the line is dangerous.”

Mr Lew’s dramatic comments mark a further escalation in the game of chicken on Capitol Hill. They suggest the White House has ruled out a drastic fiscal squeeze to balance the books if there is no deal, and is unwilling to contemplate exotic loopholes – such as a $US2 trillion platinum coin – to circumvent the will of Congress.

Goldman Sachs said any bid to balance the budget overnight would require savage cuts, stopping economic recovery in its tracks, going far beyond the shutdown, which has led to the 800,000 ”non-essential” staff being sent home. ”We estimate that the fiscal pull-back would amount to 9 per cent of GDP [gross domestic product],” Goldman Sachs said. ”If this were allowed to occur, it could lead to a rapid downturn in economic activity if not reversed quickly.”

Expected tax revenues over the month following October 17 will cover just two-thirds of federal spending. The sheer force of the fiscal shock would be ruinous.

The US Treasury warned last week the dispute could lead to a ”catastrophic” collapse. ”Credit markets could freeze, the value of the dollar could plummet, US interest rates could skyrocket, potentially resulting in a financial crisis and recession that could echo the events of 2008 or worse,” it said.

Republicans have accused the Obama administration of whipping up hysteria to browbeat Congress. ”It is irresponsible for high-ranking government officials to stoke fear into the marketplace,” said Senator Orrin Hatch.

House Republicans have refused to raise the debt limit unless the White House agrees to roll back the Affordable Care Act, dubbed ”Obamacare”. Speaker John Boehner said at the weekend he did not have the votes to raise the debt ceiling unless Mr Obama gave ground, though there were signs Congress was starting to crack, with moderates floating a compromise based on tax reform.

Bank of America said the Republicans’ tough line was a high-risk strategy since Mr Obama believed he was on stronger political ground. ”The President is very unlikely to agree to cuts in his proudest legislative achievement,” the bank said. ”He does not have to run for office again, while they are all up for re-election next fall. Surveys show Americans strongly disapprove of the shutdown and put more blame on Republicans. Ultimately, we expect them to drop the effort to weaken the Affordable Care Act, but this could take a while.”

The risk for the world is that headstrong Republicans do force the issue.

Mr Lew’s warnings suggest the White House may call their bluff, calculating that they will suffer greater opprobrium. Whoever is to blame, it is no way to run a railroad, let alone a superpower.

Telegraph, London

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The Australian Diamonds underscored their vast improvement, holding off a fast finishing New Zealand on Monday night to defeat their arch-rivals by five goals in the fourth netball Test at Melbourne’s Rod Laver Arena.
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The 52-47 victory allowed the Diamonds to clinch the series and reclaim the Constellation Cup for the first time since 2011. The Australians lead the series 3-1, with just one Test to play in Canberra on Sunday.

After leading by 10 goals at the final break, the Australians became sloppy in the mid-court and the Kiwis grabbed their chances. The New Zealanders found movement in their goal third and quickly cut the margin to three.

It was the steady hand of team leaders and defenders Laura Geitz and Bianca Chatfield, who were able to stop the Kiwi roll. A late intercept by captain Geitz pushed the ball to wing defence Renae Hallinan which allowed the Australians to score against the flow.

The Australians then pushed the lead back out to five.

After a tight opening quarter, the Diamonds used their fast ball movement to open up their own attacking circle. Australian shooters Caitlin Bassett and Natalie Medhurst again showed their enormous potential as a long-term pairing.

Medhurst was awarded the most valuable player on the court for her impressive mid-court work and excellent passing into her shooting partner as well as 12 goals from 14 attempts.

It was Medhurst, along with Kim Ravaillion at centre and Kimberlee Green at wing attack, who fed the ball cleanly to Bassett, who continues to live up to her potential and showed growing confidence in her own movement and ended the night with 40 goals from 44 attempts.

The Silver Ferns had started the match with a massive surprise, goal shooting legend Irene van Dyk on the bench and, surprisingly – in such a critical match – did not take the court all night.

Diamonds coach Lisa Alexander praised her team’s ability to steady when New Zealand launched a strong comeback.

The Australians had dominated to lead by 10 goals at three-quarter time, but the Silver Ferns hit back hard in the opening minutes of the last quarter to cut the lead to three points.

Alexander said she was delighted her young team had stood strong when they were put under pressure.

‘‘The girls out on court tonight really faced their foe head on,’’ she said.

‘‘The Silver Ferns were much more disciplined tonight and also made life difficult for us through the midcourt and in our goal third.

‘‘I thought we found a way to score and use our pace still, but I thought we were patient too.’’

New Zealand coach Waimarama Taumaunu was still concerned about the number of penalties her side gave away.

She believed her team had at times been able to slow down Australia’s high-pace game but believed the Diamonds had got away from her team ‘‘in patches’’.

She said her shooting combination of Maria Tutaia and Cathrine Latu had given away too many penalties.

AAP

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Google wants to partner with Australian government services. Photo: Tamara Voninski Google Australia managing director Maile Carnegie wants the company to be more involved in Australia’s digital economy future. Photo: Danielle Smith
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Google’s new Australian boss Maile Carnegie has expressed frustration that the broader economic benefits of the national broadband network are not being recognised as the global internet heavyweight has positioned itself behind the high-speed infrastructure project.

In her first interview since taking charge of Google Australia in July, Ms Carnegie has outlined plans for Google to better contribute to Australia’s digital economy.Read the full interview

”I look at the energy around the NBN. At the moment, it’s focused around cost. I’d love to talk about the benefits and how we can change the rhetoric, from cost to disruption.” she said. ”It feels like we could be on the cusp of renewal but I’m frustrated that we’re not recognising the benefits.”

As the former Australian boss of consumer goods multinational Procter & Gamble, Ms Carnegie’s appointment underscores Google’s shift from technology company to recognising its role as an advertising and marketing business.

On the subject of Google attracting attention for the low rate of corporate tax paid in Australia, the company insists it takes a global approach to tax rules.

”We comply with tax laws in Australia and paid over $2.5 billion in corporation tax globally last year, with an effective global corporate tax rate of almost 20 per cent,” Ms Carnegie said.

Elsewhere, she pointed to the British government’s push to have most public services online – and the cost savings and efficiencies drawn from this – as an example of where Australia should be heading. Ms Carnegie wants Google to partner with the Australian government in such initiatives.

She said she had reached out to Communications Minister Malcolm Turnbull since the election.

”We’ve had a good relationship with the Liberals and I’m sure that will continue.”

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A couple of high-fives with twin brother Josh and a dream fulfilled – now Brett Morris is intent on widening the gulf between Australia and its challengers in the World Cup.
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The St George Illawarra winger was included in Tim Sheens’ 24-man Kangaroos squad on Monday, with Bulldogs centre Josh also earning a spot for a maiden World Cup voyage.

They received the good news together via social media after returning to Sydney after a weekend getaway in Melbourne.

But it didn’t take Brett long to get back to business, claiming Australia’s main challengers in the rugby league World Cup, which starts on October 26, were hosts England and holders New Zealand. He said both nations would field their strongest sides in years.

The Kangaroos clash with England in the opener at Cardiff’s Millennium Stadium. Fiji and Ireland are the other two teams in Pool A.

”We’ve always been favourites and they’re probably going to have that tag on us again, but there’s definitely going to be some high-quality sides,” Morris said.

”It’s probably going to be the strongest World Cup in recent times.

”The English side … is probably the strongest side they’ve had in a very, very long time. The Kiwis won the last World Cup and they’ve got better since then, so we’re going to have to do our best if we want to beat both those sides.”

Australia slumped to a shock loss to New Zealand in the 2008 World Cup final at home, fuelling Ricky Stuart’s exit from the top job.

Morris made his Australian debut in 2009 and has been a fixture ever since. He said the bulk of the squad would still be motivated by that loss at Suncorp Stadium when they arrive in Britain next week.

”I think you could tell [that] by the way they talked about the games coming up and the feeling they were still hurting,” Morris said. ”But I think it’s more about excitement [now] and everyone’s very excited about the chance to play in a World Cup.

”Playing as a kid you always dream of playing in a World Cup.”

Australian squad: Bird, Boyd, Cherry-Evans, Cordner, Cronk, Farah, Fifita, Gallen, Hayne, Inglis, Jennings, Lewis, B. Morris, J. Morris, Myles, Papalii, Parker, Scott, Slater, Smith (capt), Tamou, Tate, Thaiday, Thurston.

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Ange Postecoglou knows the shape of his back four as he heads into Saturday night’s derby clash with Melbourne Heart.
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He’s just not sure how the rest of his side will line up as he seeks to cope with the absence of the midfielder central to his team’s structure, Mark Milligan.

Milligan is away with the Socceroos in Europe so will miss the Etihad Stadium season opener, and quite possibly the round two clash with Adelaide the following Friday. Postecoglou is weighing up a plethora of options as he decides who will partner Leigh Broxham in one of the two deeper midfield roles.

Jimmy Jeggo lined up alongside Broxham in the most recent pre-season friendly, the 1-0 loss to Adelaide, but Kevin Muscat, Postecoglou’s assistant, was adamant after that game that nothing was set in concrete and a different combination could be chosen for the Heart clash.

Postecoglou has no shortage of options.

”There’s still a couple of things I am tossing up and much will still depend on training this week. It’s not just about replacing Millsy in the middle of the park, but how we set up in the front half of the pitch as a result. The back four will probably stay as it is and Broxy will be one of two in the centre. The rest I will decide later in the week.

”Jeggo is an option, but we could drop Mitch Nichols a bit deeper and get him to play there if we wanted. Maybe even Scott Galloway could be considered,” the coach said, although Galloway is away on Young Socceroo duty and does not return to Melbourne until Wednesday.

Nevertheless, the fact that he would consider the teenage defensive utility for such a role shows he is held in high regard.

”I think eventually he will be best suited as a full-back, but he’s good enough to play further up the park if needed.”

Where Nichols slots in will also affect the forward line. Postecoglou has a number of talented attackers to choose from – Archie Thompson, Connor Pain, James Troisi and the fit again Gui Finkler – as well as Nichols, so playing the latter deeper would give one of them an opportunity that he wouldn’t get were Jeggo selected.

Postecoglou says he is happy with the way Chilean international Pablo Contreras has fitted in in a short time with the club and he is looking to him to provide leadership as well as being able to play out from the back.

”He’s a real professional. His family is settled now and they have found a place to live. He’s training well and we have managed to get almost two full games out of him in a short time to help him get to know his teammates.”

Also missing on Saturday will be striker Kosta Barbarouses, Victory’s New Zealand international. The All Whites are holding a one-week camp in Los Angeles before taking on Trinidad and Tobago in Port of Spain on October 15. It is a crucial part of the Kiwis’ preparation for their playoff in November against a Central American opponent for a place in the World Cup.

Heart coach John Aloisi will be able to sit on the bench and defender Patrick Gerhardt is eligible to play. The bans they picked up at the end of last season were served in the pre-season.

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