Good morning, this is Eleanor Ainge Roy bringing you the main stories and must-reads on Wednesday 16 May.

Top stories

Ecuador bankrolled a multimillion-dollar spy operation to protect and support Julian Assange in its central London embassy, employing an international security company and undercover agents to monitor his visitors, embassy staff and even the British police, according to documents seen by the Guardian. Over more than five years, Ecuador put at least $5m (£3.7m) into a secret intelligence budget that protected the WikiLeaks founder while he had visits from Nigel Farage, members of European nationalist groups and individuals linked to the Kremlin. Other guests included hackers, activists, lawyers and journalists.

“Operation Hotel” – coupled with parallel covert actions – ran up an average cost of at least $66,000 a month, and had the approval of the then Ecuadorian president, Rafael Correa, and the then foreign minister, Ricardo Patiño, according to sources. Correa has defended the decision to give Assange political asylum and described the UK’s behaviour towards Ecuador as “intolerable”. Last month, the US Democratic National Committee filed a lawsuit against the Russian government, Donald Trump’s campaign and WikiLeaks, alleging a conspiracy to help swing the 2016 US presidential election for Trump.

The North Korean regime has called off high-level talks with Seoul and hinted it could also pull out of a planned summit with Donald Trump, in protest against joint exercises by the US and South Korean militaries. The North said the manoeuvres represented a “flagrant challenge” to the joint declaration by Kim Jong-un and the South Korean president, Moon Jae-in. Analysts said the language used in the North Korean warning was mild by the regime’s standards, but it marks the first significant setback since Kim began a diplomatic opening in March, and could be a sign of brinksmanship to come in the run-up to the Kim-Trump summit scheduled for Singapore on 12 June.

The Coalition’s and Labor’s duelling income tax plans will both lead to a system that increases the burden on poorer households because they don’t sufficiently address bracket creep, which disproportionately affects those on low and middle incomes, new modelling reveals. But the Coalition’s plan will erode the tax system’s progressivity a little more than Labor’s, because it will leave the top 20% of households paying a noticeably smaller proportion of personal income taxation by 2027-28, according to the Australian National University. With concerns about a looming financial crisis, Labor has promised to return the budget to balance in the same year as the Turnbull government would, and deliver larger surpluses over the forward estimates and medium term, to build a buffer against any global economic shocks.



Australian millennials increasingly think big businesses and politicians do more harm than good, a new survey has found. The annual Deloitte survey of Generation Y, roughly defined as those born between 1983 and 1994, found that only 45% believed business had a positive impact on society, down from 72% last year, while 44% believed businesses behaved ethically, down from 54%. The scorecard for politicians was even worse – 63% of Australian millennials believe politicians have a negative impact on society. Only 23% said they had a positive impact. The top five issues of personal concern for millennials were: terrorism (31%), climate change and the environment (30%), income inequality (24%), unemployment (23%) and war (22%).

The families behind a wave of suicide bombings in the Indonesian city of Surabaya were all members of the same religious study group and radicalised their children through home schooling, investigators in East Java have said. Chief Inspector Machfud Arifin said the three families were all connected through a Sunday evening group, adding that they met each week to study Islam and watch jihadist films. The content of the films included footage from Syria and Iraq, as well as Isis attacks in France, and was intended to encourage those in the group to commit terrorist attacks, he said.

Sport

Essendon, now sitting on a plebeian two wins and six losses, weren’t supposed to be in rebuild mode. But based on their uninspired output so far this season, they have looked streaky, panicked, and more like a development team headed for a wooden spoon. The answer is not usher the coach, John Worsfold, out of the door, writes Justin Robertson.

There was a sense of deja vu with last week’s decision by Indian cricket chiefs to stonewall a bid to play the Adelaide Test under lights. The Board of Control for Cricket in India are not convinced by the day-night format, and doubt its place in the future of the game.



Thinking time

The writer Tom Wolfe, who has died aged 88, was a great dandy, both in his elaborate dress and his neon-lit prose. The Guardian looks back on the man who became a bestselling novelist in his fifth decade with The Bonfire of the Vanities (1987), and who spent most of his life as that extremely rare thing: the journalist as international celebrity.

Alex, a homosexual Iranian refugee, was detained on Manus Island for a number of years. Because of his sexual orientation, Alex has experienced even greater torment than other refugees. Behrouz Boochani, a journalist and Iranian refugee held on Manus Island, spoke to him for Guardian Australia. “He was raped twice. The prison officials, however, completely ignored his complaints. Covering up rapes and sexual harassments has been the policy of the Australian government during these years.”

“I have something a bit creepy to confess and I’m sure I’m not the only one: before I ever met the Australian playwright, writer and comedian Nakkiah Lui, I was watching her from afar,” writes Nayuka Gorrie. “I first saw her on sketch show Black Comedy on the ABC. For the first time in my life I wasn’t looking at the familiar black female tropes … Lui’s women have agency. Lui’s women have sex. Lui’s women are political.” But Lui’s work has been criticised by Quadrant, News Corp and the director of the Sydney festival. “The message for the young black female comic writer seems to be: don’t make art,” laments Gorrie.

What’s he done now?

Donald Trump has angrily tweeted about the fake news media, striking a discordant note hours after a tweet regarding the first lady’s hospitalisation. “Can you believe that with all of the made up, unsourced stories I get from the Fake News Media, together with the $10,000,000 Russian Witch Hunt (there is no Collusion), I now have my best Poll Numbers in a year. Much of the Media may be corrupt, but the People truly get it!”

Media roundup

Simmering tensions between WA and Canberra have erupted into “open warfare”, the West Australian reports, with the federal environment minister, Josh Frydenberg, accusing the WA government of being slow to take action to protect swimmers and surfers against a spate of shark attacks.

The Age splashes with Karen Ristevski’s daughter Sarah being called as a prosecution witness against her father. Karen was found dead in 2016, and her husband, Borce, has pleaded not guilty to her murder.

A a glut of apartments in Brisbane has led to massive discounts, according to new research obtained by the ABC. One northern Brisbane apartment is currently selling for 40% less than its 2010 price.



Coming up

Former Melbourne school principal Malka Leifer will face an extradition hearing in the Jerusalem district. Victorian police want to bring the 54-year-old, who was arrested in Israel in February, back to Australia to face 74 charges of child sexual abuse.

The shadow treasurer, Chris Bowen, will deliver his annual post-budget National Press Club speech today, outlining Labor’s plans to return Australia to surplus and set the economy up to deal with future shocks.

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