That request, sweetened by an aid package, was granted. But a similar approach to Tuvalu, made in September but made public only last week, met with bewilderment from Tuvaluans who feel their powerful neighbor has deserted them in a time of need. Many Tuvaluans believe their nine atolls are sinking, and their government last year proposed an emergency migration program to Australia and New Zealand. But "while New Zealand responded positively in the true Pacific way of helping one's neighbors," says Tuvalu official Paani Laupepa, "Australia has slammed the door in our face."

Canberra is playing down reports that it wants Tuvalu-whose 11,000 people occupy just 26 sq. km of land-to process some Australia-bound asylum seekers. A spokesman for Foreign Minister Alexander Downer says "no formal request" was made; Australia has merely been "briefing people [there] as to what we're doing."

But that's not how Tuvalu's Secretary to Government, Panapa Nelesone, saw the "verbal request" for help that came through Australian diplomats in Fiji. He says his government is awaiting "an official approach in writing."

If it ever comes, it's more likely to become a paper aeroplane than to change policy. "This suggestion," says Laupepa, an Environment Ministry official, "is ridiculous and audacious."

Many Australians, too, doubt the merits of the Pacific Solution. Australia is a generous regional aid provider and a strong advocate of good governance, says Greg Fry, a Pacific politics expert at the Australian National University. "But going to small countries and offering quick cash for helping Australia ... puts us in a league with countries like Taiwan that give money for political outcomes." The newly re-elected Howard is adamant that Australia will "decide who comes to this country and the circumstances in which they come." Stopping people from trying will be the hardest part.
-Daniel Williams

Come to Where The Hobbits Are
When the credits roll at premieres of The Lord of the Rings next month, New Zealand won't be billed quite as prominently as Elijah Wood or Liv Tyler. But it's undoubtedly the movie's largest star. While the country won't win any Oscars (there's no Best Setting category), its bewitching performance as the magical land of Middle Earth could bring a far more valuable prize: planeloads of Down Under­headed fans.

"This film will put us on the map," says Lord of the Rings Minister Pete Hodgson, who is capitalizing on New Zealand's stardom with $NZ4.5 million of promotions, from location tours to video games. Given that the film's website has already logged 1 billion hits, he says, it's clear "a lot of people in the world are very keen about this movie." The government hopes they'll be just as keen to visit the official "Home of Middle Earth" -even if the local hobbits, elves, orcs and Ringwraiths are a little hard to find.
-Elizabeth Feizkhah

40 Years Ago in TIME
Australian Prime Minister John Howard last week won a third term. But the Liberal Party leader is a long way short of the eight elections won by his hero sir robert menzies, who was P.M. from 1939-41 and 1949-66. TIME reported on a three-week campaign fought "with gusto" between him and Labor leader Arthur A. Calwell.