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Weekend reflections

October 30th, 2009

It’s time again for weekend reflections, which makes space for longer than usual comments on any topic.

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  1. Sukrit
    October 30th, 2009 at 18:45 | #1

    Sukrit, you’ve been banned until you apologise and retract for previous violations of the comment code. And posting this kind of nonsense is not going to encourage a reconsideration

  2. Jamie Johnson
    October 30th, 2009 at 18:58 | #2

    I was thinking that not since Doug Anthony (he was once my local member) has the role of junior minister been so besmirched until the current crop of junior Federal Ministers took the oath. Ben Eltham’s article on Kate Ellis http://newmatilda.com/2009/10/27/you-crazy-kids was just another excellent example of a young(ish) Federal Ministers pushing an agenda that is at best discriminatory (where is at that act when we need) but more pertinently fails to address any major issues within her portfolio.

    The primary offender would be Peter Garret doing what can only be described as the abnegation of all that once inspired a generation of devotees for the sake of party unity and a fat pay cheque.

    Meanwhile, the young turk, Bill Shorten, has perfected the art of sounding totally reasonable while (as this week’s Q and A amply shows) not only not saying anything of importance but in fact subtly supporting the apparatus of oppression we all voted to overturn.

    And as for Tania Plibersek, who’s career I have followed with some interest as the acquaintance of a mutual friend, the person whom I knew prior to 2004 has somehow morphed into Christopher Joyce and is the only Federally Minister actively over seeing a reduction in stimulus spending in an area that is probably the most socially needy within the current Australian context.

    The senior ministers have a little more go; I appreciate the battles Nicola Roxon fights, and for some strange reason like Stephen Smith and think Steven Conroy is finally fixing the mess Bob Collins created.

    But as for my current Federal Member, perfect new Labor fodder; young, attractive, intelligent and irrelevant.

  3. nanks
    October 30th, 2009 at 19:25 | #3

    Sukrit :
    Physicist Howard Hayden’s one-letter disproof of global warming claims.

    In my opinion he hasn’t sukrit. The way I see it he’s produced some real howlers eg ‘cooling phase’ lol and, his idea of what a tipping point does is totally at odds with basic nonlinear dynamics. And it goes on and on.

  4. Ken N
    October 30th, 2009 at 19:38 | #4

    This is relevant to a discussion we had a while back. I made the point that many climate scientists were embarrassed by exaggerated claims made by politicians and activists.
    Seems I am not alone in that view.
    http://www.timesonline.co.uk/tol/news/science/earth-environment/article6896152.ece

  5. Donald Oats
    October 30th, 2009 at 20:30 | #5

    The Superfreakonomics cops a lesson in simple economics at Realclimate.

    I especially like the illuminating graphic of the Earth with the tiny black square on it :-)

  6. Donald Oats
    October 30th, 2009 at 20:42 | #6

    Just read Hayden’s letter. Nothing to see, move along, nothing to see.

    Sadly he should have read a little bit about plate tectonics and perhaps mucked about with the physics of an Earth with most of the landmass joined up, and with an early age sun – the solar output was signficantly lower in the time of early Earth – and then he might have appreciated why 8000ppm (and I suspect that figure isn’t accurate: at least, it isn’t in any of my geology, paleontology or paleoclimatology books) wouldn’t necessarily have caused a runaway heating effect. Very toasty though.

    Some of the big changes in ancient climate occurred when landmasses separated, allowing ocean currents to pass from south to north (or vice versa) between early continents. Surely emeritous professors have enough free time to do some reading up before shooting off these scatty letters.

  7. October 30th, 2009 at 21:53 | #7

    Sukrit, they can try and censor us, but that won’t make what they are trying to inflict on us right;

    “a highly critical assessment of the European Union’s emissions trading scheme which estimates it has cost consumers up to E116billion ($190bn) since 2005, with little environmental benefit.

    The study, prepared by Britain’s Taxpayers’ Alliance, says climate change policies there form 14 per cent of household electricity prices and that electricity generators have made windfall profits at the expense of low-income earners and the elderly. “

    Of course there is little environmental benefit to an ETS, next they will be telling us it is possible to control the weather or that mankind can change the climate at will.

    If Australia turned off every machine in the country and shot all its livestock, it would make no difference to the increase of carbon going into the atmosphere.

  8. SeanG
  9. Alice
    October 31st, 2009 at 06:42 | #9

    I wasnt going to respond to Sukrits stupid post but Im glad JQ took affirmative action. Unfortunately it dragged up Tony G out of the compost heap of climate change deniers.

  10. October 31st, 2009 at 08:51 | #10

    OK Alice answer me this one question.

    If Australia turned off every machine and light bulb in the country and shot all its livestock and banned every man, woman and child in Australia from exhaling carbon, it would make NO difference to the cumulative carbon in the atmosphere. So, considering an ETS is trying to ‘turn off’ 10 to 20% of the same things, what effect is it going to have?

  11. nanks
    October 31st, 2009 at 09:03 | #11

    @Tony G
    are you saying that adding carbon to the atmosphere makes no difference to the amount of carbon in the atmosphere? I’m a little unclear about the point you are making. Unless it’s a variant of Zeno’s paradox of motion.

  12. October 31st, 2009 at 09:46 | #12

    Nanks
    “are you saying that adding carbon to the atmosphere makes no difference to the amount of carbon in the atmosphere?”
    Yep, Carbon in the atmosphere is increasing by 1.5% a year and the amount Australia adds makes no difference to the amount of carbon accumulating in the atmosphere?”

    If Australia shut down carbon emissions by 100%, carbon in the atmosphere would still increasing by 1.5% a year

    The science is settled on that fact.

  13. nanks
    October 31st, 2009 at 10:12 | #13

    @Tony G
    then you are doing a variant of Zeon’s paradox tonyG – you could say exactly the same thing about any subset of carbon emitters. So if you believe that motion is possible then you really should stop that particular line of argument to keep some sort of consistency.

  14. TerjeP (say tay-a)
    October 31st, 2009 at 11:05 | #14

    I think Bill Shorten did a good job on Q&A in defending the ALP position on asylum seekers. My only disappointment was that Tony Jones ignored the audience member that essentially asked why we don’t have an immigration tariff instead of a quota.

  15. Fran Barlow
    October 31st, 2009 at 13:50 | #15

    @Tony G

    Your position is palpably absurd.

    If Australia’s emissions fell to zero then world emissions, of which Australia’s are a subset would also fall.

    Let’s try a simple exercise

    Year 2010 World Emissions = 100 Australia’s emissions = 1.5

    Alternative 1 (A1) Australia’s emissions fall to zero during this year following Sean G’s proposal, but every other country increases by 1.5%

    Year 2011 World emissions = (100-1.5)1.015 = 99.9975

    Alternative 2 (A2). Australia, like the rest of the world also increases emissions by 1.5% during this year

    Year 2011 World Emissions = 100*1.015 = 101.5

    Alternative 3 (A3). Australia cuts emissions by 20%

    Year 2011 World Emissions = 99.7*1.015 = 101.5 = 101.1955

    Rank Scenarios in Ascending order of world emissions: A1, A3, A2

    Conclusion: SeanG’s claim that

    If Australia turned off every machine and light bulb in the country and shot all its livestock and banned every man, woman and child in Australia from exhaling carbon, it would make NO difference to the cumulative carbon in the atmosphere.

    is refuted.

    The deeper the cuts, the lower the total of world emissions

    Secondary conclusion: Sean G is either dissembling or innumerate.

    Observation. If everyone stopped exhaling carbon they’d be dead and so the demand for the goods and services within Australia would fall to zero. There would thus be a sustained fall in every subsequent year, realtive to the b-a-u position. That is simply obvious.

  16. TerjeP (say tay-a)
    October 31st, 2009 at 13:53 | #16

    I’d be interested to hear what people think of my proposed senate reform:-

    http://blog.libertarian.org.au/2009/10/30/an-upper-house-by-sortition/

  17. Fran Barlow
    October 31st, 2009 at 13:57 | #17

    A further note since Sean G carelessly refers to the cumulative carbon in the atmosphere.

    The uptick in CO2 concentrations in the atmosphere has been about 1-2ppmv per year over the last thirty years or so. Given that the current total is about 387ppmv, that’s nothing like 1.5%, and thus we have further proof either of SeanG’s ignorance of matters germane, or his innumeracy or his dissembling to make a point.

  18. Alice
    October 31st, 2009 at 14:30 | #18

    @TerjeP (say tay-a)
    Actually Terje…not a bad idea. My only problem is who sorts those placed by sortition ie who chooses the names to go in the barrel??? Its those sort of semi bureacrat roles that can be politicised undoing all the good in the idea.
    I do agree there is way too much partisan politicking in the current system. Two herds demonstrating “groupthink groupspeak” in both herds (woe betide the rogue bull even if the rogue bull is right). You are right – there isnt enough genuine debate in the upper house.

  19. Kevin Cox
    October 31st, 2009 at 14:52 | #19

    #16 TerjeP

    What you are trying to solve is what Soros calls the agency problem. http://www.ft.com/indepth/soros-lectures

    The problem is that those we appoint to represent us, whether they be elected representatives, board members etc. unless they act in a moral (sharing, looking after others, etc) way can cause more harm than good because they tend to act in their own interests. We see it most obviously with our current political parties where they act in ways that the believe will get them elected another time – not what is best for us the people.

    It is made doubly worse in Australia where the politicians by and large represent their factions within their political parties and if they represent anyone it tends to be their groupings who determine if they will get preselected or deselected.

    So to the extent that your suggestion makes agency issues less of a problem it is worth considering. Alternatively we can try to persuade our existing representatives to act in the best interests of the country as a whole not in their own interests or in the interests of the party. This acting in the best interests of the people not in their own interests is what we used to call leadership and moral courage. This attitude is certainly what most politicians profess. Perhaps we can encourage them by applauding them when they show leadership?

  20. Fran Barlow
    October 31st, 2009 at 14:57 | #20

    Given that Sean’s position appears in many iterations in the filth merchant blogosphere, an allegory may be in order.

    There was once this chap named … oh let’s call him “Sean” … anyhoo this fellow had struck it lucky and coinvinced a whole bunch of people — 193 of them in fact — that he was an estimable fellow — a man of wit and style worthy of patronage. Every month all 193 of his patrons would contribute to Sean’s bank account by direct payment, the aggregate sum of $150. Each year on July 1 the contributors would gather at the local bowling club to hear Sean deliver his annual pitch for funds, in his inimitable style.

    Well the day of the unoffocial AGM rolled around, and as Sean looked at his bank account, he felt pretty please. He had accumulated $10,000, with the promise fo more to come. Anyhoo he stood up before the crowd and began his schtick. He bagan talking about Rand and Hayek and made a witty remark about banking regulations from 1913 and computer modellers.

    Sadly, just as he was getting to the pitch for funds he noticed this chap sitting in the audience. He was slightly rotunf, and had some outrageous melanomas on his face. He was covered in coal dust and iron filings, and the gas from his nether regions was something nasty. “I told you methane wasn’t odourless” he said turning to the chap next to him.

    Sean was offended, and said: “look here my good fellow, I don’t mean to be rude but what gives you the right to come here and disrupt my pitch? Are you a contributor?”

    “My word I am” said the chap, whose name turned out to be Stralia. I contributed $2.25 last month …”

    Sean’s face turned red. “$2.25 you say? I’m putting up with your profanity for $2.25 each month? Don’t you realise that that is only 1.5% of what I get? You could pay me nothing and it would make no difference at all.”

    “Really” said Stralia acidly. “Maybe I’ll keep my dosh then?”

    “Suits me” said Sean. “You can FOAD for all I care.”

    “Righto” said Stralia, “I’m outta here.”

    And with that, he promptly stood up and left. The chap next to Stralia put his hand up.

    “Begging your pardon Sean” the man began. “My name’s Kiwi and I only contribute 0.14% each month. If Stralia‘s 1.5% makes no difference then my contribution must make no difference either.”

    “You know what Kiwi …” Sean said, still thinking only of his largesse “you’re right. Everyone contributing no more than Stralia can leave. F -off the lot of you. I don’t need your money.”

    At that, 180 of the assembled guests stood up and left, taking with them 43% of Sean’s income.

    Sean was kind of rattled, but he looked at the other 13 and figured they were still an impressive lot. One chap, a fellow with a distinct accent from the Middle East stood up.

    “My name’s Saudi” he began. “You know I only contribute 1.6% and so if 1.5% makes no difference to you, then maybe I should only contribute the bit above 1.5%”.

    “I suppose that’s reasonable” said Sean.

    A hubbub went around the room as the 14 guests recalculated their donations.

    Saudi stood up again and said. “You know, I was thinking, now that I’m only contributing 0.1% …”

    “Yes OK I see where this is going” said Sean in an increasingly exasperated tone, “anyone who after adjustment isn’t contributing at least 1.6% can leave.”

    A further 8 left the room, led by a chic woman with a beret singing Je ne regrette rien, leaving only China, the USA, Russia, India and Japan who between them had been contributing about 57% but would now be contributing 100%.

    “Now just a cotton pickin’ minute” said a man with an accent such as you’d find on The Dukes of Hazzard. “What kinda flim flam is this? It seems to me everyone is gettin a free pass here except the folks that matter most”.

    “Yes yes, I am very much agreeing with that proposition” said a chap with a more sing songy register. “I am not nearly so rich as you appear to be Mr Sean. Why should I be contributing when so many others are of no interest to you?”

    And with that the extra from The Dukes of Hazzard and the chap with the sing songy voice walked out.

    “Old Chinese proverb say …” started Chinab but he thought better of it and left along with Russia too.

    Japan was disconsolate. “You are most unwise Sean” Japan began in measured tones. “You forget that the whole is more than the mere sum of its parts. Sayonara.”

    Sean looked about the empty room reflecting on how many irrelevant people had been there, and he realised only then that even the least of them had been relevant. They were not single line items, but a whole program.

  21. Fran Barlow
    October 31st, 2009 at 14:59 | #21

    oops … sub Tony G for SeanG in the above … Freudian slip …

  22. nanks
    October 31st, 2009 at 15:04 | #22

    I am a fan of some sort of sortition model – a “King for a day” approach. But I think your model is flawed. Firstly those selected serve too long. Secondly it only applies to parliamentarians. The interaction of these two problems gives rise to a decline in the balance of power across the/any nation. By weakening parliament, the private sector and the bureaucracy gain power.

  23. Fran Barlow
    October 31st, 2009 at 16:05 | #23

    I’m for a sortition model + DD, as you know

  24. Alice
    October 31st, 2009 at 17:10 | #24

    @Fran Barlow
    Ooh Fran!! They always suggested Freudian slips made people feel guilty and gave away their real thoughts. Be honest! Have you subconsciously merged Sean and Tony G?

  25. October 31st, 2009 at 18:11 | #25

    Sorry, Nanks and Fran, I meant 1.5% of 1.5ppm.

    Carbon is accumulating in the atmosphere at about 1.5ppm per year of which Australia contributes about 1.5%.

    I still stand by this statement;

    “If Australia turned off every machine and light bulb in the country and shot all its livestock and banned every man, woman and child in Australia from exhaling carbon, it would make NO difference to the cumulative carbon in the atmosphere. Carbon will continue to accumulate at about 1.5ppm per year no matter how much Australia cuts it emissions.”

    You guys are deluding yourselves if you think Australia having an ETS is going to do anything except wreck our economy.

  26. nanks
    October 31st, 2009 at 18:29 | #26

    @Tony G
    but your comment can be made about an effectively infinite number of subsets of carbon emitters TonyG – that’s the real mistake you make. You are arbitrarily cutting the pie at Australia. By allowing this cut you must – to be consistent – allow any other cut. The upshot of which is eveyone is justified in doing nothing.

  27. Kevin Cox
    October 31st, 2009 at 18:32 | #27

    Tony G,

    What if I could show you how Australia could take 1.5ppm out of the atmosphere each year would you then say Australia can make no difference?

    If I now said Australia can take .1 ppm out of the atomsphere each year would you continue to say Australia makes no difference?

    At what point do you say we cannot make a difference?

  28. Alice
    October 31st, 2009 at 18:44 | #28

    @Kevin Cox
    Kevin, Nanks et all..Dont veed the trolls. Tony only ever pops up on his one pet subject…being a climate change antagonistic denier.

  29. SeanG
    October 31st, 2009 at 19:16 | #29

    @Alice

    I think the “G”s can get people confused.

  30. Fran Barlow
    October 31st, 2009 at 19:26 | #30

    @SeanG

    That and the low value you place on ecosystem services, the shared rightwing fundamentalism on matters economic …

  31. Michael of Summer Hill
    October 31st, 2009 at 19:37 | #31

    Tony G, wouldn’t you say Australians do have a responsibility to reduce their greenhouse gas emissions given that they emit 20.58 tons of CO2 per person annually in comparison to the Americans who emit 19.78 tons and Canadians who emit 18.81 tons per person.

  32. SeanG
    October 31st, 2009 at 19:44 | #32

    Fran, maybe you ignore when I say that I am risk averse when it comes to environmental matters. Also, I am not afraid to say that believe in individual freedom which obviously you don’t.

  33. TerjeP (say tay-a)
    October 31st, 2009 at 21:50 | #33

    Actually Terje…not a bad idea. My only problem is who sorts those placed by sortition ie who chooses the names to go in the barrel???

    Alice – under my suggestion anybody could put there own name in the barrel so long as they had collected 100 signatures from fellow citizens stating that they were of sound mind and character. I suspect that there would be a large number of people interested in the job. And sortition would ensure that the final selection was approximately representative of the population. Or at least as representative as the group of self selected candidates. Obviously the selection isn’t perfectly represenative but I feel quite certain the result would be more representative than our current selection by election process.

    So to the extent that your suggestion makes agency issues less of a problem it is worth considering. Alternatively we can try to persuade our existing representatives to act in the best interests of the country as a whole not in their own interests or in the interests of the party. This acting in the best interests of the people not in their own interests is what we used to call leadership and moral courage.

    Kevin – I don’t think we have anything with which to persuade them with. At the end of the day the existing incentives are more powerful than any pleading we might offer. Elections encourage a form of behaviour that undermines many of the objectives of representative democracy. Sortition also has problems which is why I’d want one house selected by election and the other by sortition.

    Alice and Kevin, thanks for taking a look at the idea and offering feedback.

    http://blog.libertarian.org.au/2009/10/30/an-upper-house-by-sortition/

  34. October 31st, 2009 at 21:57 | #34

    “Tony G, wouldn’t you say Australians do have a responsibility to reduce their greenhouse gas emissions given that they emit …..”

    No, because it will do nothing to stop carbon accumulating in the atmosphere at about 1.5ppm per year.

    Australia introducing a new tax called ETS isn’t going to stop carbon accumulating in the atmosphere at about 1.5ppm per year.

    Introducing a new tax called ETS might make a lot of do good useless lefties feel good at night, but it is going to do sweet FA to stop carbon accumulating in the atmosphere at about 1.5ppm per year.

    .

    If you do good useless lefties were fair dinkum about wanting to reduce Australia’s carbon emissions instead of lining your own pockets with a new tax, it is strange you are not advocating the conversion of coal fired power stations in Australia to run on natural gas. Doing this would cut Australia’s carbon emissions by about 35% and we have 300 years of proven reserves of NG.. Coal emits double the amount of carbon as NG and our power stations are the source of 70% of Australian emissions.

    I know converting Australian power stations to run on natural gas will do nothing to stop carbon accumulating in the atmosphere at about 1.5ppm per year, but at least it would keep your filthy ETS taxing hands out of our pockets; and unlike an ETS, converting the power stations will actually reduce carbon emissions by 30% and cost very little.

  35. SJ
    October 31st, 2009 at 22:03 | #35

    MOSH Says:

    Tony G, wouldn’t you say Australians do have a responsibility to reduce their greenhouse gas emissions given that they emit 20.58 tons of CO2 per person annually in comparison to the Americans who emit 19.78 tons and Canadians who emit 18.81 tons per person.

    I’d word this differently (and measure the emissions differently as well, but’s that’s by-the-by).

    Australians have a responsibility to reverse the stupid decisions made in the 70s by a bunch of stupid state Premiers, who participated in an auction to see who could waste the most taxpayer dollars in subsidising aluminium smelters. It’s well past time to cut this off.

  36. SJ
    October 31st, 2009 at 22:10 | #36

    Tony G Says:

    it is strange you are not advocating the conversion of coal fired power stations in Australia to run on natural gas. Doing this would cut Australia’s carbon emissions by about 35% and we have 300 years of proven reserves of NG.. Coal emits double the amount of carbon as NG and our power stations are the source of 70% of Australian emissions.

    I know converting Australian power stations to run on natural gas will do nothing to stop carbon accumulating in the atmosphere at about 1.5ppm per year, but at least it would keep your filthy ETS taxing hands out of our pockets; and unlike an ETS, converting the power stations will actually reduce carbon emissions by 30% and cost very little.

    Tony, the strongest initial effect that the ETS would have would be a switch from coal to gas.

  37. SeanG
    October 31st, 2009 at 22:18 | #37

    Wouldn’t that create a natural gas price bubble?

  38. SJ
    October 31st, 2009 at 22:19 | #38

    Terje, the US has the kind of tenure for senators that you are suggesting. And, as you suggest, the tenure causes them to act in a less “populist” fashion. In fact, they have little to no regard for what their populations want at all, preferring to be one of the most corrupt institutions in modern times.

  39. SJ
    October 31st, 2009 at 22:29 | #39

    Wouldn’t that create a natural gas price bubble?

    No. The ETS increases the price of coal relative to gas. That implies more use of gas, but doesn’t imply a runaway increase in the price of gas. That would not be possible. At some point, the marginal cost of coal + big tax would equal cost of gas + smaller tax.

  40. SeanG
    October 31st, 2009 at 22:34 | #40

    Let me get this straight.

    You increase the price of coal such that people have to switch to gas. There is a certain supply of available gas and while demand goes up eventually price for natural gas will also go up until new fields are are tapped and capacity increases.

    Ultimately the price for energy goes up which hurts companies and consumers and makes us less competitive economically and people with less money in their pocket.

    It means that gas is more expensive and more investment in tapping natural gas is made.

    It is a bubble. What else could you describe it?

  41. Fran Barlow
    October 31st, 2009 at 22:36 | #41

    Fran, maybe you ignore when I say that I am risk averse when it comes to environmental matters.

    You’re not ‘risk averse’. If you were, you’d support mitigation. You’re a reckless risk taker, and not just with your own stuff.

    Also, I am not afraid to say that believe in individual freedom which obviously you don’t.

    I’m not afraid to say it either. The difference is that I don’t just say it. I advocate policies that would underpin it, whereas you want policies that would subvert it for nearly everyone.

    JQ is right. Unless you are lying, you are a delusionist and not just on climate change either.

  42. SeanG
    October 31st, 2009 at 22:42 | #42

    Fran,

    How do you mitigate a risk if we do not know the trigger for an outcome. Look at global warming/climate change. What are the triggers? People such CO2 yet there is a body of opinion that says that CO2 does not impact on global temperatures. If we say – okay CO2 is a primary cause amongst others, what are we to do about it? Then the ETS is not a solution because the cost of putting it together and running it would be a less effective risk mitigation technique than channelling funds into renewable energy R&D at universities and
    in the private sector.

    You are saying that climate change is caused only by CO2. That if we halt the growth of CO2 then climate change will halt as well. This type of logic does not take into account the extreme complexity of the ecosystem and other potential causes of climate change which humankind are responsible for.

    How can you advocate for policies which mean that the government will crack down on every single human being in Australia irrespective of whether or not they want it or it works? What type of person would side with people who have scant regard for democratic liberties or who use overblown rhetoric to ratchet up fears in the community?

    If you believe in liberalism and human freedom then you would advocate policies that extend human freedom rather than constrict it. You are most certainly advocating policies to restrict the freedom of the individual with scant regard to the outcomes of those policies.

  43. SJ
    October 31st, 2009 at 22:46 | #43

    It means that gas is more expensive and more investment in tapping natural gas is made.

    It is a bubble. What else could you describe it?

    That’s not what the word “bubble” means in this context. It’s simply the way the economy works, and the way it should work.

  44. SeanG
    October 31st, 2009 at 22:49 | #44

    Yeah… I am a free market advocate but don’t you think it is slightly hypocritical that those who complain about equity/debt asset bubbles are more than happy to create a commodities bubble?

    One other thing – this is not a free market bubble but rather a government induced bubble and as ProfQ believes that the government is the ultimate risk manager would he then advocate bailing out different companies who will lose out because of this policy?

  45. SJ
    October 31st, 2009 at 22:50 | #45

    OK, Sean, you’re just babbling on incoherently at this stage. Time to stop, now, I think.

  46. SeanG
    October 31st, 2009 at 22:56 | #46

    SJ,

    Think about this logically which I know is very hard for some people on this website.

    You implement a policy designed to increase the price of coal and force energy suppliers and ultimately consumers onto gas because it is marginally cheaper than the new norm of coal price.

    You then increase the demand for natural gas which the supply might not be able to meet ultimately forcing up prices. Private sector companies will invest in new methods of gas extraction all the while people who are consumers – households and businesses – will be paying out ever-higher prices.

    If we stop at this point you have seen an artificial bubble being created not through the free market system but rather through government interference in the economy. Higher energy prices reduce our competitiveness, it skewers investment decisions by the private sector. Why invest in renewable energy when the returns from natural gas are so much better because of government interference? You have falling competitiveness, higher prices, a natural gas bubble which does not reflect the underlying economic strength but an artificial increase in demand via price manipulation.

    This is not sustainable and will be ready for a fall. If that does happen, as the government induced this bubble will they bail out companies who are hurting from it? Why doesn’t the government instead focus on how to improve investment to the renewable energies sector instead of creating a bubble in a market where the price is determined by the financial markets?

    I find it worrying whenever someone advocates creating a bubble economy in commodities.

  47. Michael of Summer Hill
    October 31st, 2009 at 22:57 | #47

    No Tony G, the left wrong are not useless and conversion to natural gas has always been on the cards. Governments from all persuasions around the world are now implementing measures in mitigating greenhouse gases and making those responsible for polluting the atmosphere more or less pay to clean up the mess.

  48. SeanG
    October 31st, 2009 at 22:59 | #48

    Those who are responsible provide the energy that has driven the global economy from the industrial revolution and indeed earlier than that. Cheaper energy has helped with the growth in global prosperity and now you believe that those who provide the energy should be punished for allowng you the priviledge of being able to flick a switch and turn on a light!

  49. SJ
    October 31st, 2009 at 23:08 | #49

    If we stop at this point you have seen an artificial bubble being created not through the free market system but rather through government interference in the economy.

    I repeat, that’s not what the word “bubble” means in this context. It’s simply the way the economy works, and the way it should work. I encourage you to google “financial bubble”, and report back the results of your research.

  50. SeanG
    October 31st, 2009 at 23:13 | #50

    SJ,

    Having lived through a bubble and and now living in the burst I can assure you I know exactly what it is.

    Think about this logically because you yourself have just said that an ETS will force energy providers from coal to gas. This will create a bubble. Natural gas prices in the commodities market will rise not because demand will rise but because traders will see that governments are forcing companies to go to the natural gas market. This is a bubble in the commodities market which is very dangerous. What happens when companies shift towards natural gas and the price then collapses once massive new supplies are tapped? How many billions will be lost?

    All this energy and effort and money and brainpower should be focused on how to make us more efficient in using fossil fuel and in creating a pipeline of renewable energy development which is in its infancy but which, like the Dot.Com, needs massive investment to achieve that critical mass which can allow it (over ten years) to be a serious provider of energy.

  51. Kevin Cox
    November 1st, 2009 at 05:43 | #51

    I have just listened to the last Soros lecture and he makes many good points http://www.ft.com/indepth/soros-lectures Soros has long argued that stable equilibrium as a model does not reflect reality and he continues to make a lot of money because policy makers act as though it does.

    I have also listened to a talk by Tim Jackson and read his book – Prosperity without Growth. http://www.earthscan.co.uk/?tabid=92763

    Jackson says to solve the GFC we must invest in ways to reduce the growth in consumption of finite resources while still growing the economy. He says that the current economic system is one where growth comes from consuming more finite resources and that this is unsustainable. Soros says that the global financial system is unsustainable as it has what he calls reflexive feedback in the way we invest in existing assets. What he means by reflexive is positive feedback.

    There is a single solution to both these problems and it does not require any change in the existing economic system – only an addition.

    The addition is to provide zero interest loans for greenhouse gas reduction investment or other investments that reverse consumption of finite resources.

    This will not change the existing economic system – only favour investments in a particular area of the economy. It solves Soros reflexive problem because the loans increase the amount of productive assets rather than push up the price of existing assets. Our current system is one where it is financially cheaper to borrow money to buy existing assets than it is to build a new asset. Reverse this (with some – not all) assets – particularly where we have asset bubbles – and we would find the reflexive forces diminish and financial markets stabilise so making the stable equilibrium hypothesis better reflect reality.

    I would most appreciate any comments on the following slide show. It takes 8 minutes and it shows a financially responsible way to give zero interest loans without causing excessive loans to be created and ensuring that most of the loans get repaid. It can also be constructed to be equitable and reduce the influence of vested interests (those who already possess wealth) while at the same time fairly compensating those (like the fossil fuel burners) whose asset values are destroyed.

    http://www.slideshare.net/cscoxk/zero-interest-loans-for-energy-sustainability

    It is practical, can be quickly implemented and can be constructed so that the whole of society shares in the increase in wealth from the new investments. This should make it politically saleable.

  52. Alice
    November 1st, 2009 at 06:50 | #52

    @SeanG
    Sean
    having read your latest stream on “the guvmint caused the bubble” all I can suggest is an appropriate shiboleth for you

    “liberty, inequality, egocentricity.”

  53. SeanG
    November 1st, 2009 at 06:57 | #53

    Actually Alice, I pointed out that the government’s policies will i.e. future rather than past tense.

    Maybe you should also read where I feel that the best place will be to place our scarce resources of money, time and people – in creating a pipeline of renewable energy projects in order to shift towards a efficient renewable energy supply.

  54. Alice
    November 1st, 2009 at 07:10 | #54

    @SeanG
    Sean – who creates the pipe for the pipeline?? Do we all wait for all those free market private sector profit hungry merchants to extract the last of the cheap coal oil and uranium before they ask Gunns for wood to burn cheaply spilling their negative externalities on us all as they go… and then and only then consider renewables…

    As Keynes said, in the long run we are all dead.

  55. Alice
    November 1st, 2009 at 07:28 | #55

    Seeing as this is “no topic” – Im going to sidetrack. Ive had reason lately to visit HSC economics papers and Ive come across some ideological clunkers of questions. Who the hell selects the syllabus??

    Which is an example of reform in a factor market?
    a) intyroduction of a quota on imports
    b) expansion of government welfare programs
    c) removal of minimum wage levels for specific industries
    d) Implementation of quality control testing fo finished goods.

    Now I know all you economists can find the right (baloney) answer. How fashions change eh? It was a mere decade and a half ago that the Japanese were being hailed the production management kings of the universe. Poor old Total Quality Control . Its apprently not efficient any more….

    Believe me…it gets much worse

    Such as (from 2007 paper) -

    “Discuss the impact of sustained fiscal surpluses on resource use and economic activity in the Australian economy”

    With a nice little blurb added in a box saying “The federal budget has moved from deficit to surplus. The ongoing savings have changed the government debt burden and allowed changes in government spending and taxation.”

    You get the picture on the sort answers they want from students – surplus always good deficit always bad.

    Ha ha ha – shame its SO out of date across the globe.

  56. SeanG
    November 1st, 2009 at 08:11 | #56

    @Alice

    Keynes – a great Liberal.

    Obviously you wouldn’t like him then.

  57. Donald Oats
    November 1st, 2009 at 08:38 | #57

    A good student in subjects like economics should presumably be able to argue both sides of the fence, as many issues have an array of things to consider. A great student should be able to then quantify to some extent the impacts of the various things considered, and arrive at an “all things considered” conclusion. They don’t necessarily have to arrive at the “right” answer, but at least demonstrate that have the skills to think through an economics problem. My guess here is that multiple choice style examination questions encourages both student and exam creators to play the Beauty Contest game, which is a bit discouraging.

    In an area where I know (a bit :-b ) more about the subject – mathematics – I have never seen any great value in multiple choice for problems that require some reasoning skills. Perhaps a multiple choice question for testing student’s knowledge of pertinent definitions; even there though the examiner loses insight into why students fail to get definitions correct, beyond the self-evident failure to successfully memorise the definition. A written answer may reveal which parts of a definition students get confused by, and indicates where a lecture course might need a bit of refinement, perhaps.

    When it comes to proving a mathematical theorem, a written answer allows the better students to demonstrate better proofs to whatever one was expected by the examiner. A slightly incorrect proof that uses a novel or powerful line of reasoning that is capable of proving the theorem is worth a high mark, as it illustrates that the student has a mature grasp of the subject matter, and the capacity to take the subject matter further. On the other hand, specious reasoning by struggling students may reveal gaps in the lecture material where some refinement may bring out the ideas more clearly.

    The sometimes cynical part of me thinks that multiple choice slipped into inappropriate areas because: a) it allows a computer to mark exams, or fewer people at least; b) it is impossible to demonstrate cheating by copying the students around you; c) it makes cheating off of the students around you much easier – no more messy writing to read, just look for the big tick or cross; d) statistically speaking, there is a floor on the mark that a student will get, since they have the option of randomly picking an answer.

    Item (d) means that there is nearly always a non-zero mark to scale up to a pass, whereas a written exam is sometimes passed in as blank. Trying to pass a blank exam paper takes serious creative effort ;-b

    Then there is the related issue of grade inflation – thanks HECS, thanks private funding models, thanks PR and marketing.

  58. nanks
    November 1st, 2009 at 08:55 | #58

    @Donald Oats
    One problem with teaching has been the introduction of criterion based assessment. Ostensibly brought in to improve transparency the result has been to reduce response variability – effectively penalising the student who provides a clever tangential answer through an individual interpretion of the question. The critical thing now is for total obediance and servitude by the student to the teacher’s intentions.
    A mirror really for a broader social movement.

  59. Alice
    November 1st, 2009 at 09:06 | #59

    @nanks
    Nanks – I agree. The “remove the minimum wage” response occurs year after year somewhere in the multiple choice section. Its always the correct (programmed ideological obedience required) response plus I dont agree with it and nor could additional welfare not be considered a factor market reform when considering those displaced by unemployment if it helps them to return to employment or another income egnerating activity such as self employment faster.

    These responses are a load of one way blinkered nonsense along the “any de-regulation is good and any regulation is bad” lines.

    Myopic, unsophisticated, erroneous, full of cliches (factor market “reform”) and just plain dumb.

    No wonder the profession gets laughed at. No subtlety at all. No room for the smart students to move.

    Just deliver the pap and pat responses they want to hear and leave.

  60. Alice
    November 1st, 2009 at 09:11 | #60

    @nanks
    Nanks = yes to the “criterion based assessment” which is why I always ignore marking guides. In unis I know hours and hours are sepnt on these things and they can run to pages and the distribution of half marks even and Ive never found one to be a good predictor of the range of student reponses. Had I stuck dutifully to all the marking guides Ive read I would long ago have been sacked for exceptionally high failure rates – when the only person that should have been sacked was those who ever imagined they could anticipate the full range of correct responses in a student essay style question.

    Don – the correct answer to the mc advance is a) it can marked by computer.

  61. Alice
    November 1st, 2009 at 09:23 | #61

    @nanks
    I know why marking guides came into existence supposedly to standardise differences between markers in the mid to late 1990s but since then their volume has risen exponentially, they are probably part of accreditation and are in my opinion an enormous waste of time.
    I once had a lecturer who predated the dastardly things (marking guides) and he used a fantastic little macro that adjusted for differences in the std deviation of markers very nicely and it all took two seconds so the one hideous marker in our team …stopped getting complaints about him to the students association (which never seemed to have any affect at all on his extreme stinginess with marks).

  62. TerjeP (say tay-a)
    November 1st, 2009 at 09:24 | #62

    SJ :Terje, the US has the kind of tenure for senators that you are suggesting. And, as you suggest, the tenure causes them to act in a less “populist” fashion. In fact, they have little to no regard for what their populations want at all, preferring to be one of the most corrupt institutions in modern times.

    SJ – US senators currently serve six year terms, the same as Australian senators. If they are more corrupt than our senators it has nothing to do with length of tenure.

  63. Fran Barlow
    November 1st, 2009 at 09:42 | #63

    @nanks

    Interesting piece Donald. Speaking as a teacher, there are always challenges when devising marking schemes. One wants

    a) a valid measure of the student’s grasp of the key skills and content in the program
    b) a maintainable system — i.e. not too demanding of markers’ time
    c) one that would be as consistent as possible regardless of the marker so as to ensure procedural fairness
    d) one capable of providing constructive feedback to students, since reporting and assessment are parts of student learning

    I would argue that criterion-based assessment is the structure that offers the best prospect of achieving all of the above. That said, one needs to be especially thoughtful in devising and specifying the evidence sought in assessible items. Inevitably, there is a trade-off between explanatory detail in the rubric and (b) and (a) above, since, (if explicit pace (d)) it affords greater scope for assessment to be challenged. Sometimes less is more.

    Of course complete marker discretion can be very subjective and can subvert (a) and (d). Cross marking and resort to sample papers in which markers evauate them and exchange opinions on how to weigh evidence can be useful if all of the markers are familiar with the course outcomes and the context in which they are delivered, but this begins to subvert (b) may not assist (d) and may not be technically feasible in all settings.

    On the question of multiple choice, it is possible to design these things so as to make them challenging and resist copying. Online with one question per page with, for example, 8 subtly different options, it would be difficult to get much advantage either. A problem here is that for those whose first language is not English, one might be testing language rather than substantive course content. For some courses however, MC would not be apt — a course called Exploring the PostModern in narratives of gender probably would loiok silly with one.

  64. nanks
    November 1st, 2009 at 10:15 | #64

    @Fran Barlow
    Fran, having devised many such assessments at the tertiary level myself, spoken at innovation in teaching conferences, sat on the faculty boards introducing criterion based assessment at UQ etc etc I am still suspicious of the actual – rather than the potential – impact.
    There is a lot to like about criterion based assessment and the attendent scaffolding that good course design provides. However I have noted – particularly in secondary teaching – an interpretive rigidity can easily creep in whereby by reliability of assessment (in the statistical sense) is given priority. The upshot of which is that creative responses are stymied – and entire classes of response are invalidated.
    A classic example would be in media studies/art or English or similar where the criteria demand a particular set of attributes are used to create a product eg in English one would be asked to use many different sentence structures. However the use of many different sentence structures in a piece of critical or creative writing is not necessary for the production of high quality work. So a brilliant piece of writing (or film etc) can get a poor mark because it failed on a particular critierion (formal variety). Now one may argue that bad luck – the criteria are there for all to see – but this misses the point, the point being that an entire class of valid responses are removed from the response set. In other words reliability has been mistaken for or stands in place of validity. A similar problem – more or less subtle – can take place even in what appears to be a straighforward technical subject like IT.

  65. Fran Barlow
    November 1st, 2009 at 11:47 | #65

    @nanks

    A classic example would be in media studies/art or English or similar where the criteria demand a particular set of attributes are used to create a product eg in English one would be asked to use many different sentence structures. However the use of many different sentence structures in a piece of critical or creative writing is not necessary for the production of high quality work. So a brilliant piece of writing (or film etc) can get a poor mark because it failed on a particular critierion (formal variety).

    I quite take your point, though the challenge here is to map the criteria both to the course outcomes and to weight them in some consistent fashion. I’m not sure why having a variety of sentence structures says much about the creativity of a particular piece, beyond what might be dervied from the structure of the passage as a whole. Structures appropriate to the text type likely audience, purpose of the text along with the felicity of sentence and paragraph collocation etc. would surely be most salient.

    On the other hand, if one were evaluating the work of a LOTE/ESL/limited literacy student for literacy purposes, demonstrated capacity to shape and locate clauses would be pertinent.

  66. nanks
    November 1st, 2009 at 11:58 | #66

    I agree Fran – in practice however I have seen the sort of ‘error’ I identify quite often. I’m not really saying toss the baby out with the bathwater as I think there are great strengths to the modern criteria based systems. However the problem I point out is serious and I believe needs to be discussed more widely. My experience is that it occurs more often than not. A challenge I often put forward to other teachers was – could you give both ‘maximalist’ and ‘minimalist’ students the highest grade?

  67. Alice
    November 1st, 2009 at 16:48 | #67

    I have done nanks – if the mathematics of macro is done properly it can be effective and minimalist. Alas modern macro texts have dumbed down and removed large chunks of the maths….

  68. gerard
    November 1st, 2009 at 17:46 | #68

    One problem with teaching has been the introduction of criterion based assessment. Ostensibly brought in to improve transparency the result has been to reduce response variability…

    This semester I started taking some econ courses for the first time. I almost spewed when I saw that my Micro lecturer had given me zero marks for an exam question because I had reversed the price and quantity axes (on an extremely simple diagram) from what was in the textbook – even though all of the details were fully correct. answers have to be so “standard” that the lecturer is spared the intellectual labor of flipping axes on a 2D graph!

  69. Alice
    November 1st, 2009 at 18:04 | #69

    @gerard
    In fact your lecturer was wrong and you were right Gerard. Thinking matehmatically they would be reversed in terms of the independent and dependent variable. Tthat was an error in early mathematical models (the mistaking of price and quantity in terms of dependence) but they had done so much work they kept it. A unique abberattion that persisted through time. Perhaps you should appeal.

  70. Alice
    November 1st, 2009 at 18:07 | #70

    @gerard
    Except Gerad – youb have economics texts and should have noted the difference early in the semester (unless you didnt see the diagrams – how else can it be explained?). I wouldnt give you extra marks even if you did appeal.

    Convention dictates you follow economic methodology!

  71. nanks
    November 1st, 2009 at 18:29 | #71

    @Alice
    lol – but you should appeal as you were correct – however you shouldn’t expect a lecturer to notice that sort of mix up – marking can be quite boring and onerous,leading to auto pilot. Problems can arise when a lecturer gets defensive – and also when students do too!

  72. gerard
    November 1st, 2009 at 18:30 | #72

    well I’m not sure that when it comes to price and quantity either can be singled out as a dependent or independent variable generally speaking. but in any case it shouldn’t make a difference. the information contained in the stupid graph is exactly the same, it’s just like switching the right and left sides around an equals sign. of course now I realize that convention is more important in economics than simple reasoning. the lecturer needs to do very little real work since the whole course is bought from a US supplier – textbook, slides, exams and answers, all conveniently pre-packaged for the paying consumer.

  73. gerard
    November 1st, 2009 at 18:37 | #73

    of course I assumed the lecturer was marking on auto-pilot so had made a mistake. I did see the lecturer about it but was told that if it looks different from the textbook then it’s wrong. If this were a real subject I would appeal but it’s just Basic Micro so I couldn’t be bothered.

  74. nanks
    November 1st, 2009 at 19:05 | #74

    @gerard
    that’s what I like to see gerard – form over substance lol

  75. SJ
    November 1st, 2009 at 19:43 | #75

    Terje Says:

    SJ – US senators currently serve six year terms, the same as Australian senators. If they are more corrupt than our senators it has nothing to do with length of tenure.

    That’s the theory, but it doesn’t translate well into practice. I know, I know, you’re a libertarian and so are unconcerned about such things, but anyway, there it is.

    Byrd has been there for 50 years, Inouye for 46, Kennedy 46 (until his death this year). A quarter of them have been there for 20 years or more.

  76. Alice
    November 2nd, 2009 at 08:22 | #76

    @nanks
    Gerard – you would have been skating on thin ice with your lecturer. Didnt you notice all the other graphs in the text with P on the vertical and Q on the horizontal (come on there is more than one and it should go through at least the first 6 chapters except where you put costs on the vertical (so – its still in dollars)…
    Gerard – its like labelling the curves demand and supply round the wrong way!! And Gerard I agree

    “whole course is bought from a US supplier – textbook, slides, exams and answers, all conveniently pre-packaged for the paying consumer.”

    Unfortunately often the case. Even Bernanke has put his name to a hollow lite little prepackaged textbook with no mathematical explanations (or few and grossly insufficient) doing the rounds now…Alas the pushy intrusion of the market for crappy textbooks into unis..as long as there is a new edition every semester so you lot (students) cant buy a second hand version. There is not enough time for any academic to write a decent one (go back to the past for that and keep them as collectors items).

  77. ABOM
    November 2nd, 2009 at 09:17 | #77

    Like Rothbard’s The Mystery of Banking…

  78. gerard
    November 2nd, 2009 at 09:56 | #78

    Gerard – its like labelling the curves demand and supply round the wrong way!!

    No, it’s not. Re-labelling the curves would change the information in the graph. Switching the axes does not change the information, as long as everything else in the graph is also flipped. It’s like saying 2=1+1 instead of 1+1=2, exactly same information as long as you’re not an idiot. No I didn’t read the textbook because there weren’t enough copies in the library and there’s no way in hell I’m forking out $110 for that piece of rubbish (uni textbooks are a complete scam industry especially it seems in econ). anyway I understand there’s a convention, but in the question Q was the left side and the convention in maths is that the left-side of the equation corresponding to the y axis so I assumed… but anyway I think I’ve done enough whining about this matter for now

  79. Alice
    November 2nd, 2009 at 10:29 | #79

    @Alice
    Like the original Samuelson Economics ABOM. First published in the 1948. Ninth edition in 1973.

  80. Ernestine Gross
    November 2nd, 2009 at 15:59 | #80

    gerard, IMO you should ask for a remark, stating your case clearly. I assume that the question did not include something like: Draw the picture of A as shown in textbook B. In other words, I assume that the purpose of an introductory micro subject is still to introduce students without a mathematical background to the idea of finding a mathematical object to make an idea precise. Copying a diagram from a text is obviously not consistent with this objective.

  81. Alice
    November 2nd, 2009 at 18:02 | #81

    @gerard
    Gerard

    ” but in the question Q was the left side and the convention in maths is that the left-side of the equation corresponding to the y axis so I assumed…”

    I do think you have an arguable case based on this information here then..

  82. SeanG
    November 3rd, 2009 at 06:51 | #82

    @Alice

    What on earth makes you think that the government can act even faster? The ETS is about forcing the private sector to make those changes. A carbon tax etc etc is all about forcing private sector forces to make a switch. Instead of saddling an economy in a way which can reduce overall growth and prosperity and reduce the capacity for investment in renewables, we should do everything we can to invest today, to build up a pipeline of human talent at universities to work on projects to make solar, wind, geothermal etc more efficient.

  83. Donald Oats
    November 3rd, 2009 at 07:47 | #83

    Actually, Australia has had a dedicated few that have quietly chipped away at research problems in alternative energy technology, design, and even policy. In fact we have had (and still do have) a number of excellent research academics who have attracted and helped some very capable students to master the field. It is the next step that is a big hurdle – those successful students who wish to build and sell alternative energy products find it necessary to go to other countries, like China for example, in order to obtain the funding for their entrepeneurial plans.

    My opinion on this is that our policies concerning the promotion and development of alternative energy manufacturing and development are chopped and changed in unpredictable ways, often without much in the way of justification. It doesn’t provide a sufficiently stable policy environment for companies to risk startup in Australia, or for financers to provide initial capital.

    It takes a huge investment of time and energy to establish a company and to move beyond potential to profitable business, so risking the marriage and family life against it is best done in a supportive environment, and Australia doesn’t offer such an environment except in fits and starts. More’s the pity.

  84. Alice
    November 3rd, 2009 at 16:19 | #84

    @SeanG
    Refer to the latest thread Sean. Im tired of debating the benefits and costs of Govt with you freedom fighters. You only see the costs and want to go on about them incessantly.

    I see bigger costs in the markets without a government Sean. I especially dont want to discuss the ETS with people who are ideologically opposed to it rather than intelligently opposed to it (because they have done some research). Its just too boring Sean.

    Same old same old. No regulation, no government intervention, no ETS in any way shape or form, no taxes.

    In short, its a boring predictable formula. I dont want to debate with a pre packaged fomula of objections. Been there, done that.

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