John Quiggin

Despite Fukushima and the failure of the US “nuclear renaissance”, nuclear power still has plenty of fans in Australia. A question which opponents routinely ask is “where are the nuclear power plants going to go?”.

That’s obviously a difficult question, but there’s a subtly different, and even nastier, question behind it, namely “How should we decide where a nuclear power plant should go”. There are obviously all kinds of issues to be resolved. For example, should it be on the coast, and therefore potentially vulnerable to a tsunami? Should it be near or far from population centres?

If we in Australia made a decision to go for nuclear power, then decided to answer all these questions from scratch, it would take years, maybe a decade or more before we even picked a site (look how long we took over the much easier question of a site for the national capital). And, until we answered the siting question, any estimate of the costs of nuclear power would be a stab in the dark anyway. A plant located in the centre of the Nullarbor would be about as safe as you could get, but hopelessly uneconomic.

So, the obvious answer is; Look at what other developed countries have done when faced with the same problem. But it turns out there is a small difficulty. The answer, according to the US, Britain and every other developed country I’ve looked at, is “put your plant next to an existing one, so there won’t be any more trouble than you already have”.

Of course, it’s logically impossible that they always worked that way. But, as far as I can tell, the last time a new site was picked for a nuclear power plant in a developed country was in the 1970s, before Three Mile Island, let alone Chernobyl and Fukushima. Even supposing that experience were relevant, it’s lost in the mists of time – the decisionmakers involved are long since gone, and any records they left are probably buried in the archives.

So, unless we can solve a problem that every other developed country in the world has chosen to duck for 30-odd years, we will never even get to the starting gate with nuclear power.

That’s the title of my latest piece in The National Interest.Teaser follows

Although much remains uncertain about future developments in Greece and beyond, one thing can be predicted with certainty: no Greek government will voluntarily abandon the euro. The only parties favoring such a move are the (old-style Stalinist) Communist Party of Greece and the neo-Nazi Golden Dawn, neither of which has any chance of being part of a government. It is almost equally certain that no Greek government will take any further steps to implement the austerity measures previously agreed with the “Troika” of the European Central Bank, the European Commission and the International Monetary Fund.

New elections to be held on June 17 are most likely to produce substantial gains for the Coalition of the Radical Left (Syriza) at the expense of both the traditional governing party of the Left, PASOK, and the rejectionists of the Communist Party. Syriza advocates rejection of the current austerity package but is equally opposed to withdrawal from the euro. Given large enough gains, Syriza could potentially put together a government with support, or at least tolerance, from PASOK and the conservative but anti-austerity Independent Greek Party.

But the election outcome may be indecisive, perhaps leading to a government of national unity. Such a government would have little power to do anything decisive one way or the other.

The least likely outcome is a swing back to the traditional parties, with PASOK and its conservative counterpart the New Democracy Party gaining enough seats to form a coalition government. Even such a coalition would be unlikely to have the political will to enforce further austerity measures. On the other hand, it would certainly not abandon the euro.

I had a fun interview with Sophie Roell of The Browser, talking about Five Books with the organizing theme of Utopia. It’s partly a plug for Zombie Economics, which just came out in a new paperback edition in the US, and also in an Australian edition published by Black Inc.

For well over a decade, I’ve been debating the claim made by the Productivity Commission that Australia experienced a productivity surge in the 1990s. My claim has been that the apparent high rate of productivity growth in the mid-1990s was the result of measurement error, most importantly the failure to take account of the increase in the pace and intensity of work that was apparent to everyone (except PC economists) at that time. This view led me to conclude that the supposed productivity gains would dissipate as more normal labor market conditions returned, which was exactly what happened.

In most of these debates, one of my chief antagonists was Dean Parham, who worked for the PC at the time, and is now a Guest Researcher there. Today I heard that Parham had written a new paper on the weak productivity growth of the 2000s. So, I was keen to see what response he would have to my latest work and to my arguments about work intensity. The answer, quite literally is “Nothing”. I have, it appears become an un-person at the PC. Parham doesn’t cite any of my work and, more importantly, fails to mention work intensity at all.

Update The original version of the post contained a somewhat snarky suggestion that Parham had been negligent in ignoring my work. He has written to me to say that this is incorrect. The reason he doesn’t mention it is because, in his view, nothing I have written on this topic, at least since 2004, merits a response.

Further update Dean Parham writes that

the reason I did not mention your work or the work intensity thesis in my paper is that I did not consider it central to the focus of the paper (industry contributions) or even to the contextual motivation of the paper.

Since the contextual motivation of the paper is (as the title suggests) the slump in productivity, I can’t see that this differs from my summary. If Parham thinks my work merits a response, he’s welcome to provide that response here or in any other venue that suits him.

I’ve got some urgent commitments over the next few days, so I won’t be able to return to this topic until later. But in the meantime, here are some of the things I’ve written about this in the last few years. Agree or disagree, I think I’ve put forward a serious case that deserves an answer.

http://www.freepatentsonline.com/article/Australian-Bulletin-Labour/147466277.html

http://johnquiggin.com/2011/08/20/no-hard-and-fast-rule-for-/

http://johnquiggin.com/2012/03/13/enough-of-these-zombie-ideas-lets-be-bold/

http://apo.org.au/commentary/surge-we-didnt-have

This comments thread raises a fun question. If a geomagnetic reversal somehow required the New York Times to be produced in Australia, who would fill the slots of the top reporters and commentators. I’ve started the ball rolling by claiming Krugman’s spot (natch!). But how about Tom Friedman, David Brooks and Maureen Dowd, to name just a few? And there’s no reason to confine yourself to current columnists – do we have a Will Rogers or a Tom Wicker? Feel free to suggest variants.

Just a reminder, this is an occasion for (perhaps mildly malicious) fun, not for defamatory attacks either on NY Times columnists or on their putative counterparts

That;s the title of my latest piece in The National Interest. Here’s the three-para teaser

European Elections and the Debt Debacle

The victory of socialist François Hollande in the French presidential election has been interpreted, correctly, as a repudiation of the austerity policies imposed on the euro zone by his predecessor, Nicolas Sarkozy, in collaboration with German chancellor Angela Merkel, who endorsed Sarkozy in the election.

Hollande’s win was part of a backlash across Europe, with pro-austerity parties from Britain to Greece taking electoral drubbings. Even in Germany, Merkel’s coalition parties were crushed in a state election in Schleswig-Holstein.

It’s safe to predict that Hollande and Merkel will soon come into conflict over austerity. But Hollande’s real opponents in the struggle over European economic policy are not Merkel and the German government but the European Central Bank and its chairman Mario Draghi.

As I wrote before, my immediate (over-)reaction to George Megalogenis The Australian Moment, was driven by the ageist generational clichés that started on page 1, and reappeared periodically thereafter. But I promised to write something about the serious content of the book and here it is.

My one-line summary is that this is probably the best exposition of Australia’s political history, over the period of market liberal reform, and from the viewpoint of the reformers, that we have seen, or are likely to. In particular, it’s better than the main rival, Paul Kelly’s End of Certainty.
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The Australian edition of Zombie Economics, updated and with an additional chapter on Economic Rationalism, is about to go on sale. I’ll be appearing at a launch event at Gleebooks in Sydney on Wednesday (9 May) talking with Jessica Irvine of the SMH.

The launch coincides with the US publication of a paperback edition, with a new chapter on Austerity. The Italian translation also came out recently, and there are versions coming in French, Greek, Portuguese, Korean and Simplified Chinese. Collect them all!

On the whole, this Budget is free of smoke and mirrors trick. Most of the savings that have been announced are real cuts in the deficit rather than accounting gimmicks. There is, however, one big exception. It’s hard to square ‘Labor values’ with a budget that does virtually nothing for education. Rather than face the reality, the government has resorted to some disgraceful spin.

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I spent yesterday in the Budget lockup for Crikey. There’s little real need for a lockup these days. The original justification was to stop people taking advantage of inside information on things like higher tax on cigarettes, but these taxes are now indexed, and changes are mostly either backdated or applied from well after Budget night. Then, for a while, the Budget was the central statement of economic policy. But nowadays, policies are put out all through the year, and most of the Budget measures are leaked in advance. Still, it’s a traditional piece of theatre and no-one seems to mind.

The first piece I wrote, over the fold, was about the implications of the European crisis

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Update On reflection, I went a bit over the top here. Generational stereotypes press my hot buttons, but that’s no excuse for the excess aggression in this post. I respect George Megalogenis as a journalist and, except on this point, I’ve found him to be insightful and thoughtful. So, apologises for losing my temper here. I will try to write a proper review of the book soon. End update

When I started reading George Megalogenis’ new book The Australian Moment I was stopped on page 1 by a piece of generation-game nonsense so silly I could scarcely believe someone as smart as GM would write it. Several people commented that it was unfair to judge a book by its first page[1], which is true, though I don’t see that there is anything wrong with commenting on the first page.

Anyway, after finishing a couple of other books that had jumped ahead in the queue (notably Red Plenty about the hopes for, and ultimate failure of, planning in the Soviet Union), I got back to The Australian Moment last night.

It started well. The discussion of the Whitlam government was excellent with some keen insights and use of declassified US State Department cables I hadn’t previously seen[2]. Then on p29, we get a quote from a young fogeyish Paul Keating in 1970, saying that “husbands have been forced to send their wives to work”. Graciously admitting that Keating is too old to be a baby boomer, Megalogenis nevertheless asserts that he “spoke for boomer men”.

Really? On the standard dating of the baby boom from 1946 to 1964, the youngest of them were six years old at the time, and even the oldest (at 24) were mostly unmarried. I doubt that many of them were worrying about household budgets. In any case, the terminology of “sending wives out to work” was crankily old-fashioned even in 1970. Keating was probably the last (in the sense of latest-born) person ever to use it in Australia. Boomer women joined the workforce as a matter of course when they finished school. The big problem for boomers entering the workforce in the 1970s wasn’t the need for two jobs but the lack of any.

At this point, I went to the index to check whether the generation-game stuff gets any better. It doesn’t. To take one of many examples, Megalogenis touts his own “generation W”[3] as responsible for punk rock, and, in particular the Sex Pistols (fronted by John Lydon, aka Johnny Rotten, born 1956), The Saints (Ed Kuepper, born 1955) and The Ramones, (formed in 1974, when most of Generation W was still unborn).

My point here isn’t that Megalogenis needs to redo his generation stuff with more accurate dating[4], though that would be better than nothing. It’s that any approach to political analysis that classifies people by birthdate is doomed to failure. As I pointed out more than a decade ago,

by the time the members of a given cohort reach their late twenties, their life courses have diverged so much that they cease to form a well-defined group with common experiences. The differences between men and women, rich and poor, workers and bosses, married and single, parents and nonparents count for much more than the commonality that comes from sharing a date on a birth certificate.

So what am I going to do here? If I could I would get Megalogenis to rewrite his book, deleting every reference to generations. Since that’s not possible, I will do the next best thing, and skip a couple of pages every time the word is mentioned. With that omission, the book promises to be a good read.

fn1. In reality, of course, given that it’s impossible to read more than a tiny fraction of the books that are printed every year, we all, quite literally, judge books by their covers most of the time.

fn2. No mention of the rumors, rife at the time, of CIA involvement in Whitlam’s dismissal.

fn3. An amalgam of Gens X and Y, consisting of those born between 1964 and the early 1990s. W stands for “Wogs and Women”.

fn4. If you are going to play this game at all sensibly, you need to split the Baby boom into the Vietnam generation, born before 1954 and therefore, if male, liable to conscription, and Generation Jones, born after 1954, who entered the workforce after the collapse of Bretton Woods. But the best thing to do is not to play the game at all.

Since lots of readers are interested, or, perhaps, a few are very interested, I thought I would mention that the US Department of Energy is beginning an effort to promote the development of modular nuclear reactors in the US. The plan is to choose two designs, with the object of having them in production by 2022. It’s pretty much a foregone conclusion that one of them will be the Westinghouse SMR, a cut down version of the Westinghouse AP1000 which is the only serious contender remaining as far as conventional reactors are concerned. That leaves one spot for another contender, call it SMRX.

I therefore need to revisit my previous conclusion on SMRs, namely, that none of them except the Westinghouse have any prospect of being in operation before 2020. First, I think it’s pretty clear that the designs that don’t make the DOE cut are finished – in a generally dire funding environment, who is going to back a horse that has already placed third or worse. Second, the DOE 2022 date is an aspirational target that is virtually certain to be missed, at least by SMRX. But, if things go well, 2025 is a possibility. So, by then we might have one conventional design and two SMRs in production on a serious scale.

That’s the title of my latest piece for The National Interest. The first three paras are below.

In the wake of the meltdown last year at the Fukushima nuclear plant, the viability of nuclear power has been called into question yet again. The Japanese government has closed down all but one of the country’s nuclear plants (though there are plans to start reopening them), and Germany has abandoned a previous decision to keep existing nuclear plants operating. Concern about nuclear power has also increased in the United States, with most opinion polls now showing a majority opposed to further expansion of the industry.

On the other hand, some commentators have been struck by the fact that the disaster did not cause any direct loss of life and that estimates of the adverse health effects of the radioactive releases are very modest. A striking example is English writer George Monbiot. An opponent of nuclear power before Fukushima, Monbiot has switched to the view that nuclear power should be supported as a response to climate change.

Unfortunately, this debate has taken place without much attention to the economics of electricity production. The critical question is whether nuclear power can be a cost-effective alternative as compared to renewables, investments in energy efficiency or even such long shots as carbon capture and storage. A look at the economic cost of the Fukushima meltdown suggests that the path to a nuclear future is steeply uphill.

I’m too busy to referee another fight over nuclear power today, so I’m delaying opening comments here until tomorrow. The TNI post is open to comments there, so that will give everyone a chance to get started straight away.

On Anzac Day, there are two important things to remember

* Thousands of brave men died at Gallipoli and in the Great War and we should always honour their memory

* The Gallipoli campaign was a bloody and pointless diversionary attack in a bloody and pointless war. Millions of soldiers were killed, and tens of millions of civilians starved and mistreated in a fight over trivial causes that were utterly irrelevant by the time the war ended. The War that was supposed to “end war” only paved the way for the even greater horrors of Nazism and Stalinism. Nothing good came of it.

From what I’ve seen of the last surviving Diggers they were fully aware of both of these things. At one time, it seemed possible that, as the generation who fought in the war passed on, we would forget the first of them. Now the danger is that we will forget the second. We should judge as harshly as possible the political and religious leaders who drove millions, mostly young men, to their deaths, and honour the handful who stood out against the War, including Bertrand Russell and Pope Benedict XV.

* I’ve posted versions of this on previous Anzac Days. There is really nothing new to say, except to hope that we will soon be able to celebrate an Anzac Day without the thought that Australians are still fighting and dying in pointless wars.

Showing my dedication to moving with the times, I’ll be staying up late to guest-tweet on #lateline tonight. Covering French elections, tobacco packaging and, inevitably, Peter Slipper.

Update Turned out to be a complete bust from my POV. The whole show (except for an out-of-place Foreign Correspondent style piece on asbestos in Swaziland) was spent on gotcha questions about Slipper, with Roxon playing a straight bat. Nothing on any of the topics where I could have made a useful comment. Apparently, this was unusually bad – #lateline is a trending topic on Twitter tonight, and not in a good way.

Here’s my first post under the new approach to blogging I’m trying. It’s the intro to an article I just published in The National Interest. They ran it under the headline “The Next Global Collapse” which is a bit more dramatic than the article itself. The deal with TNI is that I can published the first three paras here, to tease your interest. Thinking about how best to work this, it struck me that it would be really great if readers here would follow the link, comment on the article at TNI, then repost their comments here. Perhaps this might just be duplication, but it might also lead to quite different conversations. So, please give it a try

Four years after the near-meltdown of the global financial system, the world is no closer to an adequate system of financial regulation than it was in 2008. Attempts to regulate the market for derivatives have been stymied by a mixture of determined resistance from the industry and the technical difficulties of defining and regulating such complex and opaque financial instruments. The “shadow-banking” system, associated with investment banks, hedge funds and other speculative financial institutions, is as large and dangerous as ever.

Right now, the only thing preventing a new bubble and bust is the memory of the last one. And with the return of massive profits and bonuses to Wall Street, that memory is fading fast. Already, observers are noticing a renewed appetite for risk, fueled in part by the low returns available on relatively safe investments such as U.S. Treasuries.

As in most unwinnable wars, the time has come when the best option is, in the immortal words of Republican senator George Aiken (speaking of Vietnam) to declare victory and get out. But what does getting out mean, as far as the shadow-banking system is concerned?

With a lot of changes going on lately, I’ve taken a bit of time to think about the future of this blog. It will be ten years old in June, which makes it one of the longest running Australian blogs (a few, like Catallaxy, are a little older, IIRC, but their archives seem to have been lost). Those ten years have seen the rise and decline of blogging, particularly individual, independent blogs like this one. The XKCD cartoon linked in this Crooked Timber post tells the story.

The writing was on the wall as early as 2004, when I saw lots of my favorite blogs being assimilated by the Borg that became Crooked Timber. Seeing that resistance was futile, I joined the rush, but have kept this blog going with lots of crossposting, but more specifically Australian content here. Still, group blogs were clearly the wave of (what was then) the future. The most successful in Ozplogistan (the briefly popular name for Australian political blogs) have been Catallaxy, Club Troppo and Larvatus Prodeo. But there haven’t been any new entrants successful enough to attract sustained attention, and now LP is gone.

There are two obvious reasons for the decline of blogging. First, after disdaining everything to do with blogging for years, the mainstream media embraced the idea with enthusiasm five years ago or so, putting much of their content in blog form. The big media blogs now attract much larger audience than independent efforts like this one. Second, there has been the rise of Facebook and Twitter, both of which supply a lot of what attracted people to blogging in the first place. Twitter, in particular, can be quite close to the original form of blogging, based on short (very short in the case of Twitter) links to interesting material found on the web.

So, with the closure of LP and getting booted from the Fin, it seemed like a good time to reassess what I’m doing here. I’ve decided to put most of my effort into work that I can post in larger sites (I’ve had invitations from several, and at this stage I think I will try to play the field, rather than picking just one), but I will make it a condition that I can crosspost here. That will enable the discussion that goes on here to continue, and also make this blog a convenient point to collect all my material.

I’ll close by reproducing this post from 10 years ago

My blog is just about a week old, and I haven’t found the Internet this exciting since I discovered Usenet in the early 90s. Even setting up my website five years ago was not as good. Despite wildly varying ideological views, I’ve had a friendly welcome from bloggers across the board, and I’m already getting links and referrals (My return links will be up soon, I promise). It really seems as if blogs might deliver on the original promise of the Web – certainly the technology seems ideally suited for individuals and small groups, with no obvious way of scaling it up to corporate level. No doubt I’ll get jaded and disillusioned one day, but I hope it will be a long way in the future.

Bob Brown has just announced his retirement from politics. It comes as a shock, but such announcements usually do. I can’t do justice to Bob’s thirty or more years of activism in a blog post, but there have been few people in political life who’ve achieved as much while not compromising their integrity to secure political support. The Green Party which Bob effectively founded and has largely embodied for many years, has made a big positive contribution to Australian political life

Given the rubbish in the comments threads recently, I’m going to be ruthless in moderating this one. There will be plenty of time for critical thoughts on Bob Brown’s political career and on the Green Party. If you can’t wait for a more appropriate occasion, take such comments to the sandpit. Anything in this post that crosses my subjective line will be deleted with prejudice.

It’s time for another weekend reflections, which makes space for longer than usual comments on any topic. Side discussions to sandpits, please.

A new sandpit for long side discussions, idees fixes and so on.

I’m in transit, so can’t respond at length, but I just found out Larvatus Prodeo is closing down. LP made a great contribution, and will be missed.

That’s how Robert Vienneau described me after some of my stoushes last year.

It seems as if my luck is holding in that respect at any rate. While I’ve had plenty of supportive responses after being booted from the Fin, I’m sure not everyone is sorry to see me go. Most of those in the latter class, however, haven’t seen any need to gloat.

I would have been disappointed, however, if Andrew Bolt had not lived down to his usual form on this occasion. Sure enough, as his fans have advised me both by email and in comments here, he’s written a gloating column, expressing the hope that Laura Tingle (a far better journalist than Bolt could ever be, even if he was trying) will be next to go.

Bolt can’t even manage an original line of attack, dragging out the tired misrepresentation of a 2007 blog post that the Telegraph ran last week.

The great thing about having Bolt as an enemy is that you get his fans thrown in as part of the package. There’s something comforting in knowing that, if someone dislikes you, there’s a high probability that they are the kind of person who comments on Bolt’s blog.

Of course, it isn’t much of a distinction to be one of Bolt’s enemies. With the exception of the late Paddy McGuinness (who at least had some style to combine with the vitriol) I can’t think of anyone who is less discriminating in his hatreds.

George Megalogenis is a smart and insightful writer, so I opened his new book The Australian Moment with anticipation. Alas, the very first sentence is the most tiresome of generation game cliches

Every rich nation reveals its character in its most selfish generation – the baby boomers

Showing that invoking the word “generation” instantly reduces your IQ by about 50 points, Megalogenis goes on to support his claim by a discussion of the results of a poll of voters taken in 1972, the year Gough Whitlam was elected, and the year before his government lowered the voting age from 21 to 18.

The baby boom began in 1946, when returning members of the armed services started having big families. The end is usually placed somewhere between 1960 and 1963.

Whichever end date you choose, even the many boomers who were still in primary school ought to have been capable of doing the subtraction that would inform George that anyone born after 1951 (that is, the vast majority of boomers) was not a voter in 1972.

A little while ago, I got a message from the Fin to tell me they wouldn’t be running any more columns from me, as they are bringing in some new commentators. Given my run-in with Michael Stutchbury (then at the Oz, now Editor-in-Chief of the Fin) last year, and other changes at the Fin since he came on board, I wasn’t surprised. Still, it’s the end of a long-running association, which started, ironically (at least in the Alanis Morrisette sense of the term) when Michael was opinion editor there. My first column, advocating the exclusion of food from the GST, ran in 1992. I wrote occasional pieces after that, and I was a regular columnist for 15 years, which is a very long stint by Australian standards, at least for someone who isn’t a full-time journalist.

I’ve enjoyed it a lot, and I think I’ve made a useful contribution, but now it’s time to move on. I’ll certainly continue to take part in public debate, through this blog and other media, but this gives me a chance to stop and think more clearly about where I want to go with this part of my life.