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ABC News Breakfast -

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(generated from captions) This Program is

Captioned Live. Blood on the

party room floor, the Liberal

leadership battle decided this

morning. The PM visits the

White House to hear about

Barack Obama's new strategy for

Afghanistan. The man accused of

helping to murder tens of

thousand of Jews goes on trial

in Germany. And Doug Bollinger

likely to replace Ben

Hilfenhaus for the second Test

against the West Indies. Good morning. It's Tuesday 1 December. I'm Joe O'Brien. And

I'm Virginia Trioli.. This is

our top story on News Breakfast

- the Liberal Party leadership

will be a 3-way contest this

morning. Tony Abbott last night

declared he will challenge Joe

Hockey and Malcolm Turnbull to

win control of the party. The

three candidates are offering

very different strategies on

the Emissions Trading Scheme

legislation. Mr Turnbull wants

it passed, Mr Hockey says if he

wins he'll put it to a

conscience vote and Mr Abbott

doesn't want it at all. It now

seems pretty clear that we

could change the leader to Joe

and these offensive bills could

still go through the

parliament. So I don't find

that acceptable. I think that

it's important that our party

oppose these bills, that's what

I wanted Malcolm Turnbull to

do, that's the chance that

Malcolm - that Nick and I gave

Malcolm last Thursday, so given

Joe's reluctance, should he be

elected leader, to ask the

party to vote against these

bills, in the parliament this

week, should it come to that, I

will be a candidate for the

leadership tomorrow, regardless

of anyone whols might be a candidate should the spill

motion be carried. Tony Abbott

with that tra traumatic press

conference he called at around

7:157 last night. For more

Melissa Clarke joins us now. It

looks like it will be a three

cornered contest. How did it

get to this? Well instead of

having a tearing down of

Malcolm Turnbull which seems to

be the initial aim, now we've

just got an all in brawl. What

we had yesterday was a series

of negotiations with Joe

Hockey, and those leefding this

push to get Malcolm Turnbull

out of the leadership, the lierftion Nick Minchin, Tony

Abbott, and others, other senior Liberals and they

couldn't get Joe Hockey to

this Emissions Trading Scheme agree to have this legislation,

bill, voted against. It would

be against his public positions

that he's made many times so he

wanted a compromise, he wanted

to allow a conscience vote on

this issue, defer the legislation till February and

then have a conscience vote.

But Nick Minchin and Tony

Abbott couldn't abide by that

and that's what led to Tony

Abbott's comment as we heard

there where he said he can only

abide by a position where the

Emissions Trading Scheme

doesn't become passed. So now

we've got a three cornered

contest. That really throws a

lot of unnorns up in the air.

Everyone was crunching the

numbers on whether it would be

Turnbull versus Abbott or

Hockey, now it's inpointly more

complicated. How cothe candidates stack up against

each other? Well, it's quite an

interesting bunch we've got

here. Look, we start with Joe

Hockey. Joe Hockey is someone

who has had a really stellar

rise through the Liberal ranks

and that's probably been the

real marker of his career, is

his fast rise through the ranks

and helping out as assistant Treasurer with Peter Costello,

he has had a few bumps along

the way, perhaps his career low

light is the gaffes he made

when Peter Costello was when he was acting Treasurer

overseas and he made some

gaffes about the GST, you could

dispute that that and say his bookies - at the moment he's

still the favourite. They still

think he can get the numbers,

most people if they are willing

to put money on it will put it

on Joe Hockey. That leaves us

to turn to where Malcolm

Turnbull stands. He's also had

a quick rise through the ranks

and perhaps crowned as his time

as Environment Minister when he

put in place the national

takeover of the Murray daurling

basin. His career low light no

doubt was the Ozcar affair. The

fake email from Godwin Grech

that really saw his leadership

take a huge battering. And

look, the bookies have been

saying he's a place. You

wouldn't put money on him to

win but you might think he'll

come up second best but the

latest developments put a

question mark over that one. If

we turn to the other main contender, Tony Abbott, he's

had a long career and a lot of

time as a senior Minister in a

senior frontbench, perhaps

capped off most longly with his

implementation of the metty

care safety net when he was

Health Minister in the Howard

Government. But he has put a

few people off sd Australian

welfare to biggest problems

he's had of late was his

disastrous 2011 rereaction

campaign where he managed to

offend Bernie Banton, the

anti-asbestos campaigner and

insult Nicola Roxon and turn up

late. He had a general lit came

out quite poorly after the last

election and that's got to

count against him. He's a bit

of a dark horse here. You

wouldn't rule him out

completely and,000 we've got a

three cornered contest and a

lot of people are frustrated

with how this comes out, he

could well have the votes come

his way. And last but not least

we shouldn't faergt to mention

Kevin Andrews because he's put

his hand up and says he might

be willing to challenge. He won't rule himself out of the

contest even though he's been

dispiss missed by everyone. He

has been a senior frontbencher

and perhaps his own low light

is overturping the Northern

Territory's euthanasia bills

but he got a lot of grief in

the public from his handling of

the Haneef case which was a bit

of a disaster. As for the book

ey, they're seaing this is one

is a Bradbury, and he's the

last man standing, well then

maybe his small ambition there

would come true I don't want to see Kevin Andrews in skates and

one of those skating suits. Finally and briefly,

how will the vote work in the

party room? Well what they will

do is they'll have a spill

motion, the first thing they

have to do is get a spill

motion to succeed. If they

manage to vacate the leadership

then there'll be the three

candidates we presume, Joe

Hockey hasn't said anything publicly confirming it but if

they do have the three

candidates they'll have a vote,

if someone wins a an outright

majority then they've got the

leadership f not, as expected,

they would then knock out the

person with the least votes and

have a run-off, between the

remaining two and then finally

we'd have an answer as to where on earth the Liberals are

heading And it will all be over

within an hour, by 10 o'clock

this morning hopefully? Think

for that. In other news this morning, US President Barack

Obama has finised his strategy

for Afghanistan. And it's expected to involve sending

tens of thousand of extra

troops there. He has been

briefing the UK French and

Russian leaders on the plan. Britain has already announced

it will send a further 500

troops. A White House spokesman

says the President will not ask

Australia for more troops. Mr

President Obama will announce

his plan tomorrow. The PM Kevin

Rudd is preparing to leave

Washington after talks with

President Obama. Climate change

and of course the strategy in

Afghanistan were the main

topics discussed. Mr Rudd also

met with the US President

Barack Obama Secretary of State

Hillary Clinton and Treasury

Secretary Tim Geithner. The new

Honduran President has appealed

for national unitity to end

months of political crisis. Conservative candidate Porfirio

Lobo won the vote which came

five months of the lef wing

President Manuel Zelaya was

overthrown in a koux the United

States has indicated lit accept

the result but many Latin

American nations say the

election is not legitimate. A

former US car work accused of

helping to murder almost 26,000

Jews at a Nazi death camp has

gone on trial in Germany. # 9-year-old John Demjanjuk was

brought by chance to the mun

yrk court WA was wheeled in

covered by a blanket. His

lawyer then filed a motion

against the judge and

prosecutors accusing them of bias. Home owner ace cross the

nation are waiting too find out

if they'll be hit with another

interest rate hike today. Last

month the Reserve Bank left open the possibility of lifting

the cash rate for a third

straight month in December. If

nick commons continue to be

positive. Most economists

expect rates to rise by 25

basis points today. A meeting

of European leaders in China

has failed to persuade the

Asian power house to allow its

currency to appreciate. Chinese

Premier Wen Jaibao has told the

summit that the demands being

made of Beijing to push up the

exchange rate are unfair. The

country's second most powerful

leader says #240ez call on

China to revalue its currency

ought to take a look at their

own policies.

TRANSLATION: Some countries on

the one hand want the Renmimbi

to appreciate but orntd engage

in brazen trade protectionism

against China thch sun fair. In

fact, they are limiting the

growth of China. China's

competitors claim its policy of

devaluing its currency gives it

exports an unfair advantage.

Neighbours like Vietnam are now

also devaluing their currencies

leading to fears of deflation

Or even a trade war but China

says keeping its economy

growing strongly is good for everyone. TRANSLATION: This this international financial crisis

of a kind rarely seen in

history, maintaining the basics

stable of the Renmimbi exchange

rate has benefitted China's

economic development and

benefitted world economic

recovery. The PM's comments are

a slap in the face for China's

biggest trade partner, the 16

member European Union, the EU

sent three senior

representatives to a summit in

southern China including the

Swedish PM who holds the

rotating EU presidency. The

Stadiumit was a final chance to

push for strong involvement

from China at next week's Copenhagen climate change

conference. Wen Jaibao will be

in Copenhagen for next week's climate change conference amid

criticism China's carbon

reduction targets aren't

ambitious enough but what other

world leaders most want to see from China during the

conference is leadership to

convince other developing

nations to adopt low carbon

intensity growth strategies.

Agery protesters have held a

demonstration in the Philippine

capital demanding just for the

victims of last week's

massacre. Over the brutal

murders of 57 people in the

volatile south. Amid the proest

test, President Gloria Arroyo

has announced she'll seek to

remain in politics after her Presidential term ends next

year. The devastates massacre

has led to public outcry. About

1,000 people including

journalists human rights act

vits lawyer and students

marched from the streets of

Manila calling for an end to

what they call a climate of

impunity. Journalists call, our

call is for press freedom and

one of the foundations of any democratic institutions in any

decent society. A week ago

gunmen intercepted a convoy of

people in Maguindano province.

They were on their way to file

papers for next year's

provincial Governor's race. At

least 57 people were killed,

among those arrested was the local mayor Andal Ampatuan

Junior. A lot of blame is being

directed at the Philippine

President Gloria Arroyo. We are

protesting gebs impugnity and

demanding justice for the

victims of the Amputuan

massacre. And all other human

rights abuses under the Arroyo

regime. Unless we do such moves

we don't think the Arroyo

regime has what it takes to

a-Driss the big problems of

impunity and justice in our

community. As the public

outcray continues the President

has announced she'll run for a

sneet in the Lower House next

year a move critics say would

ensure she retapes immunity

against any corruption charges

that could be filed against

her. Kaebor teeb has declared

he will runhood the head for

the Liberal leadership reports the 'Daily Telegraph'. Tony

Abbott is pitching himself as

the anti-ETS candidate,s that

on the front page of the 'Sydney Morning Herald'.

Whereas Joe Hockey has proposed

a conscience vote for MPs on

their Emissions Trading Scheme

according to the 'Age'. The 'Financial Review' says the

party conservatives rallied

behind Tony Abbott last night.

The 3-way leadership contest

will decide the immediate future of the Emissions Trading Scheme reports the

'Courier-Mail'. The the

'Australian' says snoor Labor

figures have urged Kevin Rudd

to move to a snap election to

try to take advantage of the

opposition's disarray. The

'Herald Sun' reports a 7-year-old blind student has

been forced to leave school

because of p bullying. Opposition and

Independent MPs in Adelaide are

trying to extend the South

Australian parliamentary

sitting year. That's on the

front page of the Adelaide 'Advertiser'. A 'Northern

Territory News' says a teenager

has crashed his car into a

suburban garden. The

Commonwealth heads of Government meeting in 2011 will be the biggest international

event in the city since the

defence of the America's Cup

reports the 'West Australian'.

Now that's a long time between

drinks. And finally the

'Mercury' says increased water

and sewerage services will be

capped at 5%. If you'd like to

send us your feedback on any of

the stories we're cover dag and

yes or three hour long

discussion each day on the

State of the Liberal leadership

kicks off again this morning.

It was fascinating yesterday

and we're inundated again today

- P The top stories on ABC News

Breakfast - Tony Abbott, Joe Hockey and Malcolm Turnbull

will contest this morning's Federal Liberal leadership

vote. The candidates all have

difference views on the Emissions Trading Scheme. The

outcome of today today's vote

will determine the future of

the ETS. PM Kevin Rudd has held

talks with the US President

Barack Obama in Washington, the

men spoke about climate change

and the military strategy in

Afghanistan. An 8 #-year-old US

citizen accused of helping to

murder thousands of Jews at a

Nazi camp has gone on trial in

Germany. John Demjanjuk was

brought to the Munich court by

ambulance and was wheeled in

covered with a blarket. In

finance news investors may say

they respect concerned but the

potential for Dubai world to

default on as Ann estimated $60

billion in US in loans could

have ram football clubs across

the globe. The implications are

less severe here in Australia

but a number of local companies

with investments in Dubai will

still feel the pain. Dubai has

borrowed heavily to faupd property induced economic boom which has seen the construction

of some of the world's most

exotic buildings. But now the

debts have to be repaid and

like Ireland and's lane in

recent times dub Jai struggling

to find the money. If Dubai did

default on its debt repayments

this would be the largest

sovereign default since

Argentina's back in 2001. And

while $64 billion isn't huge in

terms of the global financial

crisis, investors are still jittery and Matt Robinson

believes the ramifications of a

Dubai default would be felt far

and wide. It could necessarily

have an impact on investor

tollance and investor sentiment

towards emerging economies and

Middle East in particular. The

likelihood that they would be

willing to take on Middle East

debt in the future comes into

question. Among those

considering their positions on

Middle East debt are Australia's banks with the

Commonwealth joining the other

majors in confirming it does

have an expose dwrur Dubai.

However, according to the

Commonwealth, it does not

expect to incur a material loss

as a result of the recent

announced debt moratorium. But

based on the bank's definition

of material loss, that could

still be more than $400

million. The UEUAE is

Australia's 17th biggest

trading partner. That trade is

spread across the Emirates which AusTrade's Tim Harcourt

says will soften blow of any

Dubai loan default It's a

federation brought together and

we've had very strong business

resource put into Abu Dhabi

because that's increased in

importance and indeed beyond

Dubai and beyond the Emirates

the gulf has become more important in general for

Australian exporters and investors. As Dubai has grown

so to has the presence of the

Australian construction

industry. According to Austrade

there are now over 100 offices

of Australian building

companies led by Leighton

Holdings through its Middle

East subsidiary Al Habtoor Engineering, which is involved

in $4 billion worth of

projects. But there's also been

ample warning that something is

wrong. In mid-2008 there were

just under 1300 construction

projects under way across the

UAE valued at $1.5 trillion. By

August this year, more than

half those projects has been

suspended including a $1.5

billion plan to expend Dubai

airport which Leighton Holdings

was to take part in. I think a

lot of people knew that there

would be some financial issues

from parts of the world

including Dubai but I think the

important thing is that we have

a very diverse trade and

education and trade investment

profile in the UAE and that

will put us in good stead. The

rumblings in Dubai may yet be

felt here in Australia. The

Reserve Bank has repeatedly

warned treel be more hiccups

before the global financial

crisis is totally over. While

borrowersing a New Zealand over

today's interest decision one

Reserve Bank board member has

longer term concerns. Warwick

McKibbin says policy makers

need to move quickly if they're

to top inflation getting out of

hand. It's a sensitive time,

the day before a Reserve Bank

board meeting, which may

deliver a pre-Christmas

interest rate hike. Academic

Warwick McKibbin is on that

board, but he was careful to

focus on the next few years.

Rather than the next few hours.

And he's worried about serious

inflation, caused by countries

including China that peg their

currencies to the 0 interest

rate effect affected US

dollar. We have really a surge

of growth in the developing

countries not affected badly by

the financial crisis, these

economies adopting the policy oofs crisisis economy. That is

a recipe for a big problem down

the road. In my view there

already is a global bubble in

the making and this has to be

addressed very, very quickly by global monetary

authorities. Professor McKibbin

also pointed to the huge global

imbalances caused by Government deficits which would reach

frightening proportions in just

two years. Government debt in

the US will be 100% of GDP in

Japan, 200% of GDP. What does

100% of GDP Government debt

means? That an interest of 5%

you have to take 5% of the

economy to pay the debt

interest per year Australia

will presumably have a

different problem, that of

managing the inflationary

effects of a resources boom

that can't adequately be

controlled by higher interest

rates alone. What we do need is

a way of dampening domestic

demand and a way of hemming the

risk that this boom will go

away like it did last time and

the time before. How? One way

may be a sovereign welt fund

where you invest all of that

additional revenue coming from

the resources boom

offshore Former Treasurer

secondary and Reserve Bank

Governor Bernie Fraser also

believes Australia needs

weapons beyond interest rates.

Like a tax system that doesn't

encourage asset bubbles and

politicians with the guts to

abolish negative

gearing. Negative gearing I

helped persuade Paul keeting to

move in that direction once and

Paul Keating hasn't forgiven me

ever since. Bernie phrasers

also wants to see a fairer tax

system which no longer favours

capital gains over income.

Treasury secretary Ken Henry is

the man charged with the

massive tax reform task. As he

spoke about how Government

budgets work to promote

wellbeing, he was asked about a

measure aimed at the planet's

wellbeing, the xrtion. The

Treasury secretary says reform

could be bought by corn stating

the losers. Without some form

of compensation to maintain the real purchasing power of

Australian households it's

extremely unlikely that such a

policy proposal would gain

political traction. Dr Hennie

says the point of the scheme is

to not not to cut the purchasing power of households

who need to change their

behaviour. We'll take a look at

the markets now.

Now in just a mu minutes Vanessa O'Hanlon will be here

with a look at the national

weather. Over the last few days particularly across south-east

Australia, there's been some

really substantial rainfall, in

fact, something the south-east

hasn't seen and doesn't know how to really describe for a

number of years now. I think

it's called spring rain. It

simply hasn't existed in that

part of the country. And on

this first day of summer she'll

have a look back over the last

month and see what kind of

records have been broken over

that period. And we'll also be

talking to Phil in our dialy

review of the newspapers but

now with sport here the Paul

Kennedy Thank you. Doug

Bollinger is likely to play in

the second Test against the

West Indies at the Adelaide

Oval. The left arm quick who

impressed in the recent one-day

series in India and the recent

shield match will replace Ben

Hilfenhaus. Who has injured his

knee. Hilfenhaus took some

wickets at the Gabba but is

unlucky in that he's been

injured. Victorian clin McKay

has been called into the squad

but will probably be the 12th man. The West Indies will be

without Taylor for the rest of

tour. Swalz has been fined for

her threats of a lines woman at

the US Open a couple of months

ago. She was fined $175,000,

but will only have to pay half

of that. The rest is suspended.

She's also been threatened with

a ban from the US Open over the

next three years if she offends again. And Ireland's still

can't come to grips with losing

that World Cup qualifier to

France over a handball

incident. We'll have one last

look at it. That's Thierry

Henry. Ireland will never get over that. The world's not

going to get over that. That is tearing the international football world apart, that

issue. It really S Wells

there's been some comments

overnight from Sepp blatter

head of FIFA who is in South

Africa, they got the draw in a

couple of days and Ireland has

asked Sepp Blatter if they can

be the 33rd team at the World

Cup. And this is ba he had to

say in response. Can't with be

team number 33 in the World

Cup. They have asked for that,

really! Really, they were

there, they were there, we have

receive a lot of complaints

about fair play, because we

have a fair play code in FIFA

and that's not fair, you know

that it was a mistake and so on

and so on but then fine eel,

they ask for that but I will

bring you to the attention of

the executive committee but

then we will have also Uruguay,

not, Costa Rica, they want to

come also because they say one

of the goals scoredwise not

exactly - it was perhaps, it

was off-side. The difference between that and a

handball. What do you think the

Irish chances are with Sepp

Blatter laughing. We'll have to

stow this conversation until later because I know the three

of us will really want to get

our teeth into it. Hold that

thought. Fair enough. Thank you

for that, Paul. Returning now

to our story on PM Kevin Rudd's

visit to the United States, and

for more North America

correspond Lisa Miller joins us

on the line. It's been a big

decision day in Washington for

Barack Obama, what was Kevin

Rudd's role in all of

this? Well he said quite a few

meeting today. In fact I'm just

standing outside the Australian

ambassador's residence in

suburban Washington DC and the

PM has just turned up here.

It's been a fluid schedule. I

think that's the best way to

put it. In fact he had an unexpected launch with with

Hillary Clinton which has

delayed his press conference,

they met up at the State

department for a little while

and then in front of the

cameras, had a few words to say

and shook each other's hands

and then she extend an vieks to

lunch so he's only just turned up here where he's about to

talk to us and tell us of

course the most important

meeting of the day which was

with the President of the

United States, which of course,

you know, given the environment

and the debate, you can only

imaginewise was mostly a a

about Afghanistan. We know that

the US President has issued his

orders to send more troops to

Afghanistan, that's been announced by the White House

press secondary Robert Gibbs

but do we know if a formal

request was made of Australia

to join that troop

increase? No. Look, I would

imagine that we will hear that

no formal was made. You've

right about Robert Gibbs the

White House spokesman, he has

done a briefing and he has

acknowledged that there is a

need for international partners

to do more but straight away has mentioned that Australia

has already committed more

troops earlier in the year and

I think that's going to be the

message that we'll hear.

Certainly the PM has been very

clear saying that he thinks the

troop numbers are just about

right. I know there was some

speculation in the American

media that because he must be

here here there must be a

request going in but I've been

speaking to Denis Richardson

who is highly doubtful that any

request was made and in fact

this meeting, the timing of

this meeting is slightly

coincidental, it was going to

be a phone conversation and it

was going to be to discuss a

whole lot of matters including

Copenhagen, but because the PM

was basically in the same time

zone as the President it was

the White House who etch tended the invitation and suggested

that they could meet up in

Washington DV. So the

Copenhagen part of the

discussion would have been

interesting too particularly now nah the US President Barack

Obama has decided to attend

that important meeting? Yes,

and attend though only for one

day at the very beginning of

the talks and there's been a

lot of criticism about that and

just whether America's

commitment with the reduction

in carbon emissions is really

worth the time and effort that

was spent waiting for America

to come forthwith some with

something so it will be very

interesting given what is also

going on back in Australia but

you can imagine how impress ed

or happy the PM would be today

knowing what's happening on the

domestic front back there with

the Opposition and he in turn

is shaking hands with the

President of at the White House

and I'm sure he'll probably

make quite a bit about the

differences in that scenario

for both sides The contrasts

couldn't be more stark. Thank

you Lisa. Thanks. Now with

what look at the weather and a

few records for November, here is Vanessa O'Hanlon? That's

right Joe. Good morning. The

first day of summer and we're

putting a record breaking novr

behind us just before 7 we'll

take a look at some of those rainfalls that Virginia

mentioned earlier on but it was

Adelaide's hottest November on

record, Sydney and Melbourne in

150 years and for Canberra,

your records have been going

for 70 years so your hottest

since then. Today's satellite

image, most of the rain and

cloudtive is over the tropics.

It's contracting rain to the

Top End 's with West Coast. Patchy cloud still causing a

few showers over Victoria and NSW east coast, tropical moisture is feeding into the

trough over the tropics. That

trough will weaken tomorrow, in

the south we have a low that

will move further east into the

Tasman Sea, easing the strong

winds over NSW, and a high will gradually clear the south-east,

in WA a weak cold front is

expected to be near the

south-west capes, that will be

around midday bringing light

showers and cooler southerlies.

In Queensland - The top stories on ABC News

Breakfast - a 3-way contest is

expected for the Liberal Party

leadership this morning. Tony

Abbott last night declared he'd challenge Joe Hockey and Malcolm Turnbull to win control

of the party. Three candidates

are offering very different strategies on the Emissions Trading Scheme legislation. Mr

Turnbull wants it to be passed,

Mr Hockey says if he wins he'll

put it to a conscience vote and

Mr Abbott doesn't want the

legislation at all. So if for

more on the rapidly unfolded

events that we anticipate in Canberra this morning, the

presenter of 'Insiders' Barrie

Cassidy joins us frou from

Parliament House. Barrie

Cassidy good morning. This is a

very difficult situation to

call minute by minute. What's

the latest, what are the latest figures that you're

hearing? It's an extremely

difficult situation because

it's not just about leadership,

it's about policy as well and that's what makes this

particular battle more

complicated than any that we've

seen in the past. This point it

is a 3-way battle. You can't be

certain of that because I think

what's forgotten in all of this

is that Joe Hockey has put

certain demands to the party

and those demands on face of it

have not yet been met. Joe

Hockey wants a free vote and he

wants all factions of the

Liberal Party, all sides who

agree to that free vote F that

doesn't occur who knows what

might occur. On the numbers I'm

told that the first thing that

has to occur this morning,

there has to be a spill motion

and that spill motion needs to get up to move on to the next

step. I'm told the numbers

might be around 50-30 something

like that but it could be a

little tighter than that. I

guess that's Malcolm Turnbull's

best hope is that the spill

motion doesn't succeed but

that's not likely That looks

like getting up? Yes, and if

you talk to Joe Hockey's

people, they say that his

numbers for the leadership are

30 for certain, maybe 15 soft

votes, and then five uncertain.

Now that would be a enough to

get him occupy if those soft

votes stayed with him but they

don't call them soft votes for

nothing Then Tony Abbott's

figures are clearly not as

healthy as he might want. It's

really just that conservative

rump going with him? I can't -

it's the some scenario that I

can't really work out in my

mind how Tony Abbott wins. Joe

Hockey, yes you can see that of

course because he has got strong support. Malcolm

Turnbull can win if Joe Hockey

withdraws and you can't rule

out that possibility, I don't

think Tony Abbott can get the

40 or so votes that he needs,

but look we've seen some really

weird things happen over the

last - when Ian Mcfarlane on

the '7:30 Report' said last

night I haven't got a crew what's going on anymore, Ian

Mcfarlane he's the chief negotiator with the Government on climate change and he hasn't

got a clue, so I think we should probably at this point

leave ul option open. We will.

Which means that most of our

conversations this morning

might be hypothetical but

that's kind of where it leaves

us. Does all of this mean then

Barrie that if the spill motion

gets up and then the position

is declared vacant, that Joe

Hockey then will only throw his

hat in the ring if some sort of

vote by hand is taken at that

time on the free vote on the

Emissions Trading

Scheme? Again, that's not quite

clear how Joe Hockey will judge

that all sides of the Liberal

Party have approved a free vote

and there's one other confusing

aspect too - the Joe Hockey

saying that he wants a free

vote this week or is he

prepared to allow this

legislation to be deferred and

then a free vote in February?

That's not clear either. But

keep in mind that the Senate

has now agreed to sit every day

until this is resolved right

through this week if they have

to and they only came to that

position with the support of

some Liberal Senators, so just

what position Joe Hockey is

likely to take and how firm he

is on all of this is still a

little unclear We've been

hearing that even some of

Malcolm Turnbull's closest

confidants have been advising

him to step down gracely the at

this point because his

leadership is now just so

thoroughly undermined but he's

still maintaining that

pugnacious position of his.

Let's listen to what he said

yesterday? You can ask Mr

Hockey about his intentions, I

can only tell you about my

intention, I will be standing

tomorrow. Aim the leader and

I'll be standing tomorrow Yesterday you were

willing to say that that you

had Mr Hockey's support, why

are you not willing to say that

having met with him now? Why

are now not willing to ask me

the question first. I'll tell

you what Tim, the question is -

when more hockey came to see

you today did he say you had

his support. That's the

question. You ask. Come on. Mr Turnbull, do you have the

support of Mr Hockey No, you've

got to ask me did Mr Hockey

tell me I had his support? Did

Mr Hockey tell you that he is a

supporting you in tomorrow's

leadership ballot He is he told

me he would support me tomorrow, in the spill if

there's a spill moved there

will be a spill moved. He told

me that he'd vote against a

spill? Paul Keating often spoke

about throwing the switch to

Vaudeville, I think we've

entered the place now Basaltico

bas Barrie Cassidy. He's

enjoying lms all too much We've

seen the many moods of Malcolm

Turnbull over the last few

days. We saw that performance

on Sunday television and then

we had that almost manic performance yesterday at the

news conference but you have to

say that he's remained chipper

throughout and that's because

he's always seemed that glimmer

of hope for him and that is

that Joe Hockey is a friend of

his, Joe Hockey told him that he wouldn't challenge, of

course what Joe Hockey is now

doing is that he will support

Malcolm Turnbull and oppose the

still motion but then it's all

bets are off because all seats

are empty but even then he

knows that Joe Hockey has put

certain dons party so reme a

remains hopeful that he's still

in this race and as a result as

I say, he's been quite chipper

and that's been his mood

throughout which is contrast I

think to the mood of most of

the people who have to report

on this event. You and Chris

Ullman will be having special

coverage of the Liberal

leadership battle on ABC 1 at

9am. Bring us more numbers

figures if you possibly

can. Thank you. You see, even

when you're in the heart of it

in Canberra it's difficult to

know which way it's going. It

is an extraordinary turn of

events and just speaking to some of the Liberal Party

members including a couple of

moderates overnight, the

bewilderment and the dismay

that they expressed to you

about the situation that their

party is in the palpable. We'll

be hearing from a couple this

morning and we'd love to foe

what you're thinking about this

and other issues this morning. In noer news this morning Kevin Rudd has been in

Washington to hear the US

President's new strategy for

Afghanistan. Barack Obama's

plan to expected to involve

sends tens of thousands of

extra troops to the war-torn

country. Britain has already announced it will send a

further 500 troops, but a White

House spokesman said the

President would not ask

Australia for more troops. Mr

Barack Obama will announce his

plan tomorrow. The new Honduran

President has appealed for

national unity to end months of

political crisis. Conservative

candidate Porfirio Lobo won the

vote which came five months

after the left wing President

Manuel Zelaya was overthrown in

a coup. The United States has

indicated it will accept the

result but many Latin American

nations say the election is not

legitimate. A former US car

worker accused of helping to

murder almost 28,000 Jews at a

Nazi death camp has gone on

trial in Germany. 89-year-old

John Demjanjuk was brought by

ambulance to the moneyic court

and was wheeled in covered by a

blanket. His lawyer then filed

a motion against the judge and

prosecutors accusing them of

bias. Iran says criticism from

the UN's atomic watch caught is

pushing the krun to build new

nuclear facilityings. Tehran yet announced the construction

of ten new uranium enrichment

facilities, saying there needed

to produce electricity. Germany

has warned that Iran could now

face more sangs. Iran

parliamentary speaker has

insisted a diplomatic solution

the possible and home owners

across the nation are waiting

to find out if they'll be hit with yet another interest rate

hike. Last month the Reserve

Bank left open the possibility

of lifting the can cash rate

for a third-straight move month

in December in economic

conditions continued to be

positive. Most economists

expect rates to rise by 25

basis points this

morning. Climate change is a

hot hot issue issue around the

world but fears are increasing

that Pakistan could be one of

the worst affected countries.

It's also struggling with se

fear pressures on its natural

resource. The landscape around

in cash mayor is nothing what

it once was. Lush forests of

tall pine trees used to

surround the village but

they've all been chapped down

for fuel or construction. The

Poms is growing at a very fast

pace and in order to meet their

requirements and needs, there

is widespread exploitation of

national resources this the

region. Pakistan cribs only a

fraction to global warming,

emitting one 35th of the

world's carbon dioxide but

climate experts say the country

will suffer disproportionately from climate change. They're

warning there'll be severe

water shortages in the coming

years that will affect food production. After the

earthquake the cutting down of

trees for reconstruction work

has continued unabated. Which

has given rise to a lot of

pollution. The result is a

severe shortage of clean water

which will certainly become

extremely grave in the

future. The quality of water is

also a concern. In this city

jaupdis and intestinal diseases

are spreading among the people

because of unclean water. Even

the springs have become

polluted because of lack of

proper sewage

facilities. Pakistan will soon

become the world's sixth most

populous country with a growth

rate of nearly 2.7%. The added

pleasure is likely to put more

force on the land. There have

been so many landslides here

lately that the entire region

is in danger. Houses are in

danger of sliding down.

Everyone is suffering. A sad

forecast for a country that

faces the perhaps more

immediate concern of internal

security. 500 extra British

troops have to be sent to

Afghanistan despite the

increasing unpopularity of the war.

The news was deliver on the eve

of US President Barack Obama's

decision on how many extra

proops America will send to

Afghanistan. British troops in

training for the rigors of

Helmand. The men from the first

batallion duke of Lancaster

regiment are fighting their way

through the xouns of a specially created Afghan

village. Another 500 British

soldiers though will soon be

doing this for real. The

soldiers training here in nor

folk today won't be going to

hell mand for another few

months at least but

commanderers in Afghanistan say

the extra troops are vital to

help hold the ground that

they've taken and also to build

on any progress made there. To

be partner... Today the PM

announced that he was now ready

to send the extra 500 British

troops to Helmand? So Mr

Speaker with the three

conditions now met, I can

confirm that we will move to a

new force level of 9500, the

extra troops will deploy in

early December to thicken the

uUK troop presence and from

late January they will make the

transition to the partnering

role with envisage for

them. For the first time, Gordon Brown also included

special forces in his figures

bringing the total number of British troops in Afghanistan

to around 10,000. The defence

secretary and the chief of the

defence staff visited the

troops in training today and

later assured the PM his first

condition has been met. That

the extra soldier do have all

the equipment they need for

hell man, the men here say

their kit has improved. It's

obviously getting betterment

when I joined 22 years ago we

had didn't work at all and the

stuff we've got now is over

100% better. Gordon Brown's

second condition is that

Britain's NATO a lies must also

provide more troops. Today he

said eight had made more

commitments. He also said the

third condition has been met, that the Afghan Government

provide more troops of its own.

But here in Britain, the

military does worry apt the

fall in public support for

their mission. If I had one

concern about morale, it's just

that they look back here and

see what is being said back

here in public, in our media,

and that concerns them because

they need the support of this

nation. All practical support

such as the hypes which became

operatal in Afghanistan today

should help soldiers on the

ground but the news of the

death of another in held mand

bringing this year's toll to 99 won't help gain more public

support. You are watching News Breakfast. It's expected Tony Abbott, Joe Hockey and Malcolm

Turnbull will contest the

Federal Liberal leadership vote

today. They'll have different views on the Emissions Trading

Scheme. The outcome of today's

vote will determine the

immediate future of the ETS. PM

Kevin Rudd has held talks with

the US President Barack Obama

in Washington. The men spoke

about climate change and the

military strategy in

Afghanistan. And an 89-year-old

US citizen accused of helping

to murder thousand of Jews at a

Nazi camp has gone on trial in Germany. John Demjanjuk was

brought to the Munich court by

ambulance and was wheeled in

covered with a blanket. The NRMA paymenters are absolutely

cover witd today as you might

expect. That's the leadership

contest so we're joined by Radio Australia broadcaster

Phil Kafcaloudes to have a look

at the front pages. Good

morning to you both. Yes, it is

covered everywhere. It's about Malcolm Turnbull, it's about

people changing their minds in

fact let's go to start with to

a few of the News Limited

papers. We'll start with the

'Courier-Mail' to begin with.

Three ring circus it says.

Let's go to the 'Daily

Telegraph' and see what they've

got only up - three ring

sishus. From there to the

'Herald Sun', in Melbourne and

see what they come up

three-ring circus again. It's

going to be a three-ring

circus. It's expected to be

that at least. It will be a

three-ring circus.. It probably

will be too. That fits on

beautifully on a tabloid page

you see?. It didn't fit on the

front page of the 'Herald Sun'

as you see there. It's cause

they Goth another interesting

story there not on politics at

all. It does say D-day for the

will be Lib. To the 'Age' and

page 7, an interesting comment

about Tony Wright from the

'Age' and he says right, so

this much is clear, actually,

no it's not. Hold the front

page, the numbers have changed

and Joe Hockey, he's running

for the leadership or he's not.

So known in Canberra knows

exactly what is going on as

we've been hearing this morning

when you spoke to Barrie

Cassidy. It's exactly right. Barrive doesn't know what's

going on, you just throw your

arms up and everyone is

changing their minds. It's

great to have a bit of excitement down in Canberra and

a bit of passion on an issue

like this because it can be so

beige. Or there's no passion I

don't know. I don't think

Liberal voters, or members of

the party, I don't even think

those who are caught in the

centre of it are probably

enjoying it too much. It's a

party tearing itself apart and

it's not good for politics in

this country when you have vun

Government so strongly in the

asendant and an Opposition so

absolute infeebled it can tant

take ut up to that Government.

They're not able to take do

their job now. And Kevin Rudd

at this time, he's in

Washington, he's been at chogment, where is Kevin Rudd,

he obviously feels surf enough

to be on the other side of the

world doing what he's got to do

but if we get back to what's

going to happen this morning,

the free vote, one interesting

thing in the 'Age' story is

that even if there is a change

or whatever, 12 Liberals would

still say yes, if there was a

free vote f Joe Hockey gets his

way 12 Liberals would still

vote for the ETS which is an

interesting point. You mean, Senators? Yes. The Government

would at least get itsern that

it needs And Malcolm Turnbull

will be left there standing

saying "What?." I'm out for

what I wanted. Front page of the 'Australian' is quite

tarring too. It's got a line

there, just on the right side

there, and it's a quote from Malcolm Turnbull yesterday, I

know that you've been running

quotes from Malcolm Turnbull,

it says that Joe and I are very

good friends we talk a lot. We

have very similar views on most

issues, we're very good friends

he says again part two. Our

families are very close. It's a

very good friend of mine part

three. He's a good man. You

don't hear is that very often

about one person talk about the

prepare who could well

committee pose him. How much of

is newspaper talk as a message

to Joe Hockey, you're a good

guy, Joe. I like you, don't

cothis Laura Tingle said in her

comment piece in the 'Financial

Review' that that series of

lines of his about being such a

good friend indicating just how

completely weakened he is as a

leader, that he's got to make

such a desperate pitch to Joe

Hockey directly. To say you're

a mate of mine, you're a

friend, don't do this to me and

that reveals the weakness

itself Did you see the cartoon,

the best cartoon in this whole

thing was on the Saturday

Australian Idol on Saturday. It

was a screamer. It showed a

Burge of Liberals in a life

boat and a diver coming out of

the water saying Joe's

Malcolm's still refusing to

leave the ship. I thought that

was... Anyway I thought it was

good. Gee you're a hard

audience. George is in the

'Australian' page 7, he makes a

comment today. He says this is

not the time for Joe to run and

that is a very interesting

comment to make. It's not the

time. He would be the right

leader at another time. He says

there. And the reason he's

making that comment, he says

that women voters which are the

voters he needs to get over,

young women, especiallily, they

would be appalled by the

Liberal infighting and also by

the Liberal-National fighting

that's going on too, he would

not be getting there. At

another time he wouldle they

would like him but right now

he's putting himself into the

firing line And personally

wouldn't bit better for him to

avoid an ereaction which is

going to be extremely difficult

this next election, and then

sweep into the position after

the them election? None of them

really want it. They're happy

for anyone else to be carrying

this poisoned chalice for quite

some time I was having an eeffectiveny. I was thinking

about this election and I

thought that the last time that

any Government went to an

election with a tax, and

effectively the ETS is a tax,

they almost lost. It was John

Howard, he iz h second

election. First as a PM, now we

always give Governments a

second go. This time he almost

lost it to Kim Beazley because

he went with a GST to that

election. This time warpd

around if the Opposition plays

their cards right, if they're

on-side with the Greens and the

Greens I say that this is not

good for the environment, it's

only a 5 to 25% reduction in

emissions, not enough, then

maybe that's going to hit

through with the electorate if

Joe Hockey puts that strong

enough. Perhaps. Perhaps. But

it's worth thinking about.

You You heard it first? What's

this graphic in the 'Herald Sun'. It's about the betting.

Here we go. This is on page

fivement it's got the betting

as it stands moment at the

moment Tony Abbott, $5. Joe

Hockey $1.20. Turnbull $7.

That's not very good. And the

'Financial Review' page nine,

it says alternative to the ETS,

it says there actually suspect

one. The Opposition was advised

that will are no cost free

alternatives to the ETS. So no

matter what goes through, no

matter what they're going to

cocome up, it's still going to

cost money and the Opposition,

certainly the sceptics or the

people now called sceptics in

the Opposition are saying it's

going to cost too much money. Anything will. The

'Australian's had a good look

at that frontier report that

the Opposition was relying on

other day and in it analysis

says this kind of scheme as considered by Malcolm Turnbull

would be even more expensive

and would cost households much

more. Whichever way you cut

it's going to cost Australians

money. It's a matter of whether

as party you believe you can

zil persuade Australians of the

need for it and that's where

tear left. Sit there quiet Lay

enjoy the show. I love

Vaudeville. Thank you.

Phil. You can watch all of News

Breakfast streamed live every morning.

With sport here the Paul

Kennedy? Thank you Joe. Good

morning. Doug Bollinger is

likely to play in the second

Test against the West Indies at

the Adelaide Oval. He's been

included and picked by Tim

Nielsen to replace Ben

Hilfenhaus who got injured at

the Gabba despite taking a few wickets. Bad lack for

Hilfenhaus. The Tasmanian.

Victorian fast bowler Clint McKay has been called into the

squad. He'll be the 12th map. A

rapid rise for him. He's only

just come to prominence in the

last few months, Jerome Taylor from the West Indies will miss

the rest of the tour. Serena

Williams has been fined for

that outburstot the US Open a

couple of months ago. She's

been fined $175,000 US. She's

only have to pay after that.

The rest is suspended. She's

also been told that if she

plays up again and commits a

similar offence on the tennis

court or against an official,

she will be banned from future

US Opens so look to her to be

on her best behaviour come the

Australian Open next month. To

horse racing now and jockey

Damien Oliver has criticised

racing Victoria after

successfully appeal against a

drug ban, Oliver was facing a

month's suspension after

testing positive to ephidrene

on derby day at Flemington. He

says he took the drug accidental in a herbal

supplement he's been use fog

years. The board overturned the

suspension and issued a Oliver

with a reprimand instead . He's

free to ride in Hong Kong in

that lucrative set of races

coming up now. There's only

soer news about cricket today,

the 'Herald Sun' has said that

Brad Hodge will retire from

first-class cricket after two

more shield games so after

Christmas he's going to stop

playing the longer form of the

game huz he wants to spend more

time at home. Got a 3-year-old

and a 4-month-old I think so

that's the plan there. He'll

play 2020 cricket and one-day

cricket but has just been

starved of opportuni