Home > Economic policy, Environment > Can any evidence convince the right?

Can any evidence convince the right?

July 7th, 2014

Along with nearly 60 other Australian economists, notably including John Hewson, Justin Wolfers and Harry Clarke, I’ve signed my name to a public statement urging agreement on a fair, economically efficient and environmentally effective policy to price and limit carbon emissions.

I’m not naive enough to expect that this will have much of an effect, any more than previous statements of this kind I’ve signed. The problem is not, as you might think, that there is serious disagreement among economists on the issue. Opponents of market-based policies to limit carbon emission have tried in the past to organize counter-statements, and have failed miserably. Outside the set of IPA hacks, most recently seen defending the ludicrous claims of the tobacco lobby, there is essentially no disagreement on this (although there is plenty of dispute about the best design, the optimal price and so on).

The problem is, rather, that there is no evidence, and no clever way of framing the issue that is going to convince the tribal right to go against their shibboleths on this issue. If there were, the actual experience of a carbon price of $24/tonne would have done so. In the leadup to the introduction of the carbon tax/price, Tony Abbott described it as a ‘wrecking ball’ that would destroy the Australian economy. Two years later, the economy is still here and not even the government pretends that removing the carbon tax is going to yield any significant benefit.

And the same is true more generally, notably in the US. This NY Times article by Brendan Nyhan makes the point

Once people’s cultural and political views get tied up in their factual beliefs, it’s very difficult to undo regardless of the messaging that is used.

While this is always true to some extent, it’s far more true, at present, of the right (in English speaking countries) than of the left, and far more true of the right today than in the past.

In the end, there’s no way to persuade those on the political right to accept factual truths about (for example) climate change, without also persuading them to abandon the political right.

Categories: Economic policy, Environment Tags:
  1. Newtownian
    July 7th, 2014 at 21:15 | #1


    This item suggests the worm may be turning in one key media at least.

    But is it a hoax or exaggeration? I couldn’t find anything on this report or its implications for journalistic ‘balance’ in the Guardian – which seems odd.

  2. Megan
    July 7th, 2014 at 21:21 | #2

    I think you may have borked the quotes around the last paragraph?

    What about straight out regulation as a solution for GHG emissions? As we did with Ozone gasses.

    Why the fixation on “the market”, when it is the market that got us into this situation?

  3. Collin Street
    July 7th, 2014 at 22:59 | #3

    It’s not inherent in the Right, I think, it’s just a natural phenomenon that happens whenever a social movement starts to falter. Or companies too, come to that.

    IME, there are people out there who are… well, useless, I guess. Weak sense of self, so they try and affiliate with anything that’ll give them an identity and purpose, but unimaginative and also quite aggressively confrontational, so they’re really no good in strategic planning positions and terrible as supervisors. Hard workers, if they’re told what to do, but you don’t want them making the decisions, because they’ll either fuck things up or piss someone off, usually both.

    [and they won’t apologise, either. unimaginative means “can’t imagine errors”, aggressively confrontational means “won’t say sorry even if they knew they needed to”.]

    Anyway. Healthy groups get enough people to fill all the “important” positions, but if your social movement hits a rough spot or starts to falter… your useless people will come in at the same rate, but the good ones will start to get picked up by other organisations, and you might start moving some of the “good hard reliable workers who identify themselves strongly with the organisation’s mission” into some of the key roles. After all, they put the hours in!

    … this gets worse, because there’s a feedback effect, too: if many of your co-members are difficult to deal with, you’re more likely to leave, and — again — the people whose identity hangs on being junior assistant umpire trainer for the koo-wee-rup grass-eater’s league ain’t the ones who quit.

    And the activist Right has been in trouble for years.

    [how do I know this? because I’m one of these people myself. Not as bad as some, and self-aware enough to spot my own negative tendencies [which I fix by making sure I’m not the one making final decisions or supervising others too closely], but still.]

  4. wilful
    July 7th, 2014 at 23:11 | #4

    The only solution at the moment is to note that the majority of Australians (who aren’t terribly political) also seem to think that far right ideology isn’t good for them and their country, and to wait for the next election to roll around. Anything done by one Parliament can be undone by the next one – my only fear is that Labor, under Blib Shiftin, will be as jelly spined as we’ve come to expect, and campaign next time around as right-wing, jut not quite as right-wing as Toned Abs.

  5. bjb
    July 7th, 2014 at 23:13 | #5

    Megan :
    Why the fixation on “the market”, when it is the market that got us into this situation?

    Primarily because over the last 25 years or so the political class (at the behest of their masters) have swallowed the belief that the market is the only means of doing anything. Back in the day when many pollution controls were put in place there wasn’t the same blind belief. Frankly, I think many academic economists have a lot to answer for in this regard – Picketty quite rightly pings them on this in the first few pages of his book.

  6. John Quiggin
    July 7th, 2014 at 23:45 | #6


    Quotes fixed.

    I’ll write a bit more about why I (mostly) favor market solutions for CO2 emissions.

    An exception, which the Climate Change Authority reported on recently, is vehicle fuel efficiency, where I think standards is the way to go.

  7. Midrash
    July 8th, 2014 at 00:00 | #7

    There’s a problem when there probably aren’t 2 people in the BBC who have any basis in their own expertise to express a view on what JQ has joined in calling “carbon” pollution. They probably parrot the vacuous nonsense about a consensus of 97 per cent of so-called climate scientists: no doubt including graduate students studying tree rings. But have they the capacity to assess the IPCC’s 20 or so different models which produce different predictions? (Mind you it’s a bit like the more conventional faiths: It’s logically possible that one of the mutually contradictory religions could be correct).

    Did you see the pathetic Stephen Long Four Corners where as someone blogged he abandoned any semblance of his economist’s sceptical logic and failed to acknowledge that Australia can, always could, rely on the market to give us the benefit of the renewables which are really going to work for us – almost certainly solar in its various guises (though I don’t see why wind shouldn’t be used to store water for hydro…). When we have spare capacity in coal generation what on earth are we doing subsidising renewables (by mandatory targets for renewables which add costs to consumers)? How could he accept that employing lots of people was an argument for solar? Why not tread mills? And, as a blogger noted, it is idiotic to think the pollution from diesel might be a reason why it may be the outback miners who lead the way in adopting solar technology.

    The Coalition’s stupidity was not to go for a simple carbon tax about 2006 when it needed to show its climate believers’ credentials. If applied to imports and kept to a low level it could have been a nice little GST surrogate increase that Canberra could keep and use to good effect.

  8. Midrash
    July 8th, 2014 at 00:15 | #8

    Don’t any of you believers who accept the IPCC line wonder why its models are so numerous and so different? Obviously all fiddled with to ensure they point to rising temperatures and rising CO2 in the atmosphere or they wouldn’t be in the game. But its clear that there are natural phenomena they simply don’t include. Does it not give you pause when you consider just the simplest of interesting facts about the oceans and the atmosphere – like there being about 300 times as much CO2 in the iceans as in the atmosphere? And does it even seem plausible that any models have accurately captured up to date the vast modern phenomenon of burning tropical forests or the huge takeup of CO2 annually in tree growth? And so on with 50 etcs….

  9. Midrash
    July 8th, 2014 at 00:20 | #9

    PS respect John Hewson as an economist if you like (and he’s on pretty uncontroversial ground supporting a market mechanism) but do be careful you don’t let him manage your mobey or your political party.

  10. Midrash
    July 8th, 2014 at 00:21 | #10


  11. John Quiggin
    July 8th, 2014 at 00:23 | #11

    Exhibit A for the thesis of this post: Midrash

  12. Megan
    July 8th, 2014 at 00:34 | #12

    @John Quiggin

    I look forward to that.

    But to tip my own argument on its head – and thinking of something that is both “life and death” and immediate, ie refugees:

    We hear that we have a refugee “problem” caused, not by actions in which we are complicit but by “people smuggler’s business model” needing to be “smashed”.

    If that is a “problem” caused by a “business model” then the “market” solution would obviously be to undercut them by removing their “market” advantage. In other words, we would offer a safe and free pathway to asylum from their ports. They would instantly have no “market” and there would be no reason for any more asylum seeker tragedies at sea.

    But “we” (the ALP/LNP duopoly) have gone for “regulation” – ie set up structures of “deterrence” to punish the refugees (customers/victims) so as to change the “business practices” of the “people smugglers”.

    The fact is that our rulers advocate the “market” or “regulation” as they please – as long as they get what they wanted to achieve in the first place.

  13. July 8th, 2014 at 01:29 | #13

    “Can any evidence convince the right?”

    I wrote a poem about this with reference to experience from 1995-now.

    In particular, the reason that environmentalists adopted market-based solutions was because the right pretended to beleive in the market. That was a huge waste of time. The important sources of GHGs are basically created or removed by governmental fiat within the limits of existing and proposed technology, and the market is a post hoc justification.

  14. Garry Claridge
    July 8th, 2014 at 07:02 | #14

    Good on you and thank you John 🙂

  15. Ikonoclast
    July 8th, 2014 at 08:38 | #15

    The market “solution” has failed to materialise. There has been no progress in reducing GHG emissions. Indeed, emissions have increased while we fiddled with attempting market solutions. It’s a bit like the fable of the farmer and the field mice. While the farmer talked about getting neighbours, cousins, brothers and so on the help him reap the field, the mice knew it would never happen. Only when the farmer determined to directly do the job himself, did the mice decide he was serious and so they moved on. Equally, whilst people talk about getting the market to help reduce emissions, we know it will never happen. Only when the people decide to do the job directly by democratic law, regulation, taxes and changing personal behaviour, will it happen.

    A free market, so far as it exists, works more or less “naturally” for the trading of goods or “goods”. People want “goods” and are willing to pay for them. GHG emissions being a negative externality are a form of “bad”. There is no natural trade in “bads”. To set up a trade in “bads” an artificial market has to be created to make “bads” tradable. It is the gross artificiality of any such market for a “bad” that leads to the convoluted trading “logic” of such a market. And it still must be hedged with regulation and compliance measures if it is to be managed properly. By reason of its unavoidable complexity and artificiality it becomes gameable through myriads of loopholes.

    A nation can unilaterally implement taxes, tariffs and regulations. The simplest regime is a carbon tax, a carbon tariff and attendant regulation and compliance measures. Nations that do not implement a carbon tax will face tariffs and assessment delays when exporting to nations with a carbon tax.The carbon tariff would be offset by carbon tax credits where the exporting nation has a bona fide carbon tax. This approach would have a snowball effect internationally. Once several significant nations implemented this regime, it would become the norm and standard. It would be more difficult to trade internationally without a bona fide domestic carbon tax.

    I am amazed that so many economists can’t see that trading “bads” is nothing like trading “goods”. (* See note 1.) Trading “bads” involves working against the current of the natural and even imperative human drive to acquire “goods” for life and amenity. Trading “goods” involves working with this natural current and is consequently more naturally facilitated. On the other hand, regulation, compliance and pigovian taxes are the direct and effective way to deal with negative externalities and other “bads”. The market is not the suitable tool for such jobs. Using the free market to deal with negative externalities is like trying to use a screwdriver to hammer in a nail.

    * Note 1 : I am not that amazed. Bourgeois economics is largely an ideology not an empirical discipline.

  16. ZM
    July 8th, 2014 at 09:24 | #16

    “PS respect John Hewson as an economist if you like (and he’s on pretty uncontroversial ground supporting a market mechanism) but do be careful you don’t let him manage your mobey or your political party.”

    John Hewson took the Liberal party to the 1993 election with a policy for a 20% (if I remember rightly from a recent forum) emissions reduction from 1990 levels by 2000. We are far behind this aspiration now. He has invested in efficient light bulb production and other things.

    In terms of ‘managing’ other people’s money in a trust-worthy way – what about the investment and superannuation and banking companies investing in anthropogenic climate change causing industry and endeavours? Should they be allowed to ‘manage’ people’s money in ways that cause the damages we have been told to expect with anthropogenic climate change? Anthropogenic climate change has been public knowledge for a long time now.

    For people who have investments or superannuation that they think might be invested in climate change causing industries or endeavours – John Hewson has very bravely started to mount a case with regard to fiduciary trust. I hope that it is alright to mention here, but Efforts by people like yourselves with investments/superannuation implicated in climate change can assist this fiduciary trust case, there should be details about how you can help at the ‘are you the vital few’ website.

    I hope eliminating people’s rights to claims from environmental damages and such things, do not feature in the TPP trading negotiations that are being kept from public scrutiny.

  17. Hermit
    July 8th, 2014 at 10:03 | #17

    From what I can work out so winter in eastern Australia so far has been about 2C warmer than the long run average. What if summer is 2C hotter than average? Since climate concern is correlated with weather I think the PM is on a hiding to nothing. Like overtaking on a blind bend with double lines you are taking a massive gamble. I’d go for the ETS each way bet (ie stay inside the lines) then procrastinate. That gives both carbon pricers and antis time to position themselves.

  18. Doug
    July 8th, 2014 at 10:05 | #18

    to Ikonoclast

    emissions in the areas of economy that were subject to the carbon tax were reduced – problem was the scope to the tax was limited.

  19. Troy Prideaux
    July 8th, 2014 at 10:11 | #19

    I could be naive, but I think the primary reason why the US appears to be more open to action at the moment is (1) there’s more obvious and reported physical climate changes happening within that actual landmass – especially those creating crises and (2)we (in oz) are all too used to droughts & bushfires – even if they occur at unusual times. There’s enough of a complacency to just accept them as natural events.
    The hard right don’t appear to believe in science or even physical evidence. They need hard political persuasion that will result in adverse repercussions if their minds aren’t altered.

  20. John H.
    July 8th, 2014 at 10:49 | #20

    I think this issue is going to haunt the coalition, or would if Labor had maintained their position. I’m not quite as pessimistic as Mr. Q because when it comes to votes politicians will change their position and manufacture any number rhetorical tricks to hide their past position. What is odd is how quickly Aus public opinion seems to have shifted on this issue. Not just the average punter either, business leaders are also upset that the coalition has abandoned a structure which gave them some degree of certainty re future costs. Perhaps I’m too optimistic because my impression is that Australians now want to do something about this issue and recognise that Direct Action is doing next to nothing.

  21. James Wimberley
    July 8th, 2014 at 11:40 | #21

    I look forward to JQ’s arguments for market solutions. This is the standard position of economists. The problem is that there is little evidence that carbon taxes or cap-and-trade schemes of the right severity are politically feasible. Kyoto, the ETS, and the short-lived Australian carbon taxes worked up to a modest point, but were just too small to drive the transition.

    The policies that have really worked have been far more statist: the German EEG and its degressive FITs, Chinese policies to support spectacular growth in wind and solar, European petrol taxes and fuel economy standards, and American and Japanese research. If we are seeing rapid growth in electric vehicles, it’s because of large pump-priming subsidies in all the major markets. If civilisation survives, it won’t be be because a carbon tax priced coal out of business, but because renewable energy got cheap enough to bankrupt it without one.

  22. Ikonoclast
    July 8th, 2014 at 13:33 | #22


    I agree. A tax at the right rate would have worked and still would work.

    James Wimberley is also correct in stating that statist solutions re. GHG and renewables are the solutions to show promise to date. Taxes are part but not all of the statist solution. Removing the MASSIVE subsidies that fossil fuels currently get would also help enormously. In Australia, fossil fuel subsidies run at $10 billion to $15 billion per annum. This dwarfs any help given to renewables. Probably now, renewables just need a level playing field with negative externalities properly priced via pigovian taxes backed by a proper regulatory and compliance regime. That would do the trick.

  23. may
    July 8th, 2014 at 15:20 | #23

    it’s a mystery to me how the idea that the market is,or can be efficient,has actually come to be.

    i suppose it’s all to do with what you call efficient.

    but on a personal level two examples can be pulled from the top of the pile to show what i mean.

    i use to foliar feed my house plants, one of those plastic spray bottles you can buy for about $2.
    they are rubbish.
    the top breaks if you look at it and the spring gives up the ghost.
    generally(if i’m lucky) they last about two months.
    so i go and buy another one,after all,it’s only around $2.
    i haven’t added up what the total cost has been but it is not insignificant for what i have gained in return.

    if i could i would buy a good quality metal spray bottle for around the amount of money i have so far invested in the junk, i would.

    the market does not provide.

    car door handles, the design of.
    every make has a different type of door handle.
    if the market was as efficient as the ideology claims,surely by now, that industry would have settled on the demonstrably better type?

    this is about carbon abatement , who is looking at the emissions brought about by market inefficiency?

  24. July 8th, 2014 at 15:39 | #24

    Financial War: IMF Pushes Ukraine to ‘Voluntarily Committing Suicide’ by Michael Hudson – originally published on Global Research, includes video which was originally published on RT.

  25. Tim Macknay
    July 8th, 2014 at 15:42 | #25


    Pigovian taxes are market-based mechanisms. Fuel taxes are market-based mechanisms. The RET is a market-based mechanism. The German EEG is a market-based mechanism. Feed in Tariffs are market-based mechanisms. If these things are ‘statist’, they are no more so than emissions trading schemes.

    There’s plenty of scope to critique the merits of emissions trading schemes as a climate change policy mechanism, but can we at least be clear on what is and isn’t a market-based mechanism?

  26. Ikonoclast
    July 8th, 2014 at 16:42 | #26

    @Tim Macknay

    Indeed, the items you mention are all market based mechanisms. I was not clear enough in delineating such matters in my post, so my mistake. Perhaps, the delineation needs to be made between direct levers and indirect levers. A pigovian tax is a direct lever. Make the tax punitively high enough and coal burning would cease almost immediately (as an example). An ETS is an indirect lever. The actual price is not being set in a statist way, only the pricing mechanism or pricing market is being set up in statist way. The actual price setting is then being left to the market. So the intervention is both less direct and arguably less statist in a sense (with market players being left more operating room to set a price).

    My argument is that these indirect methods are slow acting and ineffective when we need to effect an emergency change to prevent a climate catastrophe. The indirect method can be more easily gamed and has more compliance difficulties. Taxes are simple, direct and effective and will work straight away if set at the right level. Admittedly, an ETS with a government mandated floor price gets closer to what is required. But again I ask, why create a setup for market players to make money out of doing away with a negative externality when a direct tax will do the job and place the revenue at the disposal of the people via their democractically elected government. The ETS lets rich people make more money and game the system. Oh, of course, that’s why it’s favoured.

  27. Tim Macknay
    July 8th, 2014 at 16:52 | #27

    They say you get what you pay for – last time I went to my local big box hardware store there was quite a range of spray bottles at varying price points. Maybe if you went up the price scale a bit, your spray bottle might last longer. I use a 1.5l pump spray bottle to foliar spray my plants – I think it cost around $12, and it’s lasted me for years. There’s also the second hand market – a quick scan of several internet shopping sites turned up hundreds of old antique metal spray guns, at least some of which of which are presumably in full working order. 😉

  28. Tim Macknay
    July 8th, 2014 at 17:04 | #28

    Fair enough. I’m not particularly inclined to (re)enter a debate about the comparative merits of carbon taxes and emissions trading schemes – I generally agree with Prof Q’s previously stated view that either can be useful (or, by implication, less than useful), depending on the scheme design. But I’m sure you’d agree that these issues have been well and truly gone over before.

  29. Donald Oats
    July 8th, 2014 at 17:05 | #29

    Local power generation is the transformative technology, it is entering the energy market rapidly, and there is little that the coal fired generators can do about it. Local generation, especially solar rooftop panels, mean that in Australia at least, California as well, the peak power periods no longer provide the profit-making mechanism of maximum energy price due to peak demand. Instead, the peak power periods in our summers tend to correspond to the perfect conditions for local solar energy production, blunting the traditional grid demand which would have once driven good profits for the central power producers.

    While changes to the RET might cause a small temporary downturn in alternative energy industry in Australia, in hindsight it will appear as nothing more than a blip on the curve: the genie is well and truly out of the bottle. Alternative is no longer “alternative” in a disparaging sense: it is another significant operator in the overall energy production and distribution marketplace.

    Meanwhile, the jokers in power think they can stop it. I’ll bet that more than a couple of the Liberal/National players get heavily involved (on the quiet) in the alternative energy market, even as they mock the climate scientists and tear down their good work. After all, money talks and profit is profit.

  30. Ken Fabian
    July 8th, 2014 at 17:23 | #30

    Watched 4 Corners last night – I think the notion that failure to invest in the low emissions economy will be a serious problem for Australia is true. Unfortunately the problems with intermittency were glossed over and the “energy storage problem is solved” claims were overstated and these will provide the excuse for opponents of action on climate to discredit the whole program. Also, as per standard media procedure, the essential foundation of the Abbott government’s position – rejection of mainstream science on climate, and blanket dismissal of the economic costs of climate consequences inherent in fossil fuel use – was not given any real scrutiny.

    My 2 cents worth – the energy storage options that come with solar thermal can only be realised by major investment in solar thermal and, so far, that hasn’t happened. It’s been strongly resisted by the energy incumbents. Most solar is rooftop PV and, whilst I expect to see home energy storage to be part of future PV home packages, it’s not really available at costs that are attractive – yet. The incumbent energy sector has too much invested in energy that will be damaged by cost effective energy storage to be motivated to tackle the storage problem themselves, and have much incentive to maintain the perception that it’s beyond solving, to help stall on the needed energy transition. Yet I think that it’s role will ultimately be as the provider of energy storage services using technologies that work best at large scale – that as much as being the owners and operaters of future renewable energy production.

    And I think there hasn’t been much attention to the value of existing fossil fuel infrastructure as backup to renewables – a valuable part of the transition whilst those storage technologies are developed and put into place. Preferably with planning and forethought, coming out of broad acceptance, from the top down, of the absolute need to shift into low emissions energy.

  31. rog
    July 8th, 2014 at 18:00 | #31

    @Midrash People like Midrash just talk for the heck of it

    the vast modern phenomenon of burning tropical forests or the huge takeup of CO2 annually in tree growth?

    This is another myth, that CO2 is like fertiliser. The two critical elements for plant growth are water and nutrients, without these no amount of CO2 will be of use.

  32. rog
    July 8th, 2014 at 18:03 | #32

    @Ken Fabian And my 1.5 cents worth is that right wingers like (or need) to identify with strong leaders, or the appearance of strength, and aren’t interested in facts as such.

  33. sunshine
    July 8th, 2014 at 19:41 | #33

    Rich old white folk still call the shots ,but not for much longer .Who pays the piper ? Now-days people can choose the music that suits their ear best. Psych research shows the need to ‘fit in’ rates higher than the need for truth. Alot of what passes for economic problems are really social ones to do with caring and sharing rather than with scarcity .For now its still the short term maximum growth model for fortress Australia.

  34. BilB
    July 9th, 2014 at 07:33 | #34

    The “Rich old white folk” who ” still call the shots” are what I call the Command Generation. The problem here in our technologically advanced world which is environmentally threatened in an unprecedented manner, is that, when averaged, the science knowledge of this generation is insufficient to make properly informed and intuitive decisions. And the ability of the Command Generation to “catch up” is severely diminished.

    Sadly the Command Generation have all of the greater number of senior administrative roles, the greater share of wealth, and the most direct access to influence of power.

  35. rog
    July 9th, 2014 at 08:11 | #35

    Martin Wolf on climate change

    The political debate for sensible policy will be won if and only if two things happen: first, people must believe the impact of climate change could be both large and costly; second, they must believe the costs of mitigation would be tolerable.

  36. Ikonoclast
    July 9th, 2014 at 11:09 | #36

    @Tim Macknay

    I agree that “these issues have been well and truly gone over before” in the debate sense. The big question is why the debate has not been finalised and an effective method, be it a well designed tax or a good ETS, been applied to the problem? We will all have our answers to why this has proved politically impossible. My answer is that the the rich capitalist oligarchs of the old school (fossil fuels, internal combustion engine autos and traditional media) have blocked progress. They have blocked progress by propaganda, disinformation campaigns and buying politicians with campaign contributions.

    But, as even Marx noted, Capitalism itself is revolutionary. I suspect that these old guard capitalists are about to be superseded by new guard capitalists in the renewable energy field and other areas like electric autos. Even under capitalism (not my favourite system BTW) there will be a transformation. I just fear the transformation has been delayed a bit too long and there is now more climate and environmental damage in train than we can easily deal with. It’s going to be an uphill battle now, difficult but still not impossible, so let us hope.

  37. July 9th, 2014 at 12:44 | #37

    The public statement is a list of “economists in Australia who’s any future utterances on the economy or economic policy it would be wise to totally ignore.”

    “The usual suspects were there — climate hysterics such as Clive Hamilton and John Quiggin ”

    “Do these people have the slightest idea what they are talking about? The answer seemingly is no”

    Ross Gittins :


    “factual truths about (for example) climate change”

    no one is arguing the climate doesn’t change; it always has and always will.

  38. Ken Fabian
    July 10th, 2014 at 09:55 | #38

    My 1.25 cents worth – might the impacts of the relatively small amounts of solar to date on daytime peak demand, and the likely intrusion of relatively small amounts of storage on evening peak demand be better thought of as a market imposed Carbon Pricing mechanism?

    How much will renewables force fossil fuel generation into intermittency and how much will that add to the market price for carbon intensive energy?

    Will ‘free’ market forces ultimately create the much needed price signal a transition to low emissions requires, and become a defacto Carbon Tax that no Conservative government can repeal?

  39. Hermit
    July 10th, 2014 at 10:54 | #39

    @KF some far reaching ideas there many aren’t thinking about yet. If intermittent power goes large due to non-intervention factors such as rising gas prices or cheap batteries there will be losers. For example penniless seniors in 1960s built hotbox homes when the temperature is 47C and electricity is under time-of-use pricing. If we end up paying standby fees (aka capacity payments) to backup generators we could have two lots of subsidies..for green and intermittent power then dirty but on-demand power.

    Then of course fossil fuels will get expensive due to high extraction costs or depletion. In Australia we’ve decided domestic gas must be at word parity prices next year. More and more of our petrol will be refined in Singapore with crude from overseas oil wells. Even abundant coal is getting harder to exploit as we see in the Galilee Basin. Carbon will price itself but in an overdue and chaotic way.

  40. Tim Macknay
    July 10th, 2014 at 12:39 | #40

    The carbon tax has just gotten a repreive. PUP, apparently dissatisfied with the Government’s treatment of its proposed amendments, has voted with the Greens and Labor to reject the repeal of the carbon tax.

    Interesting times.

  41. Megan
    July 10th, 2014 at 13:00 | #41

    Looks like we still have a shred of function left in our democracy.

    Of course, the repeal will eventually go through but it looks like attempts to play Muir and PUP for fools and strong-arm them backfired on the LNP.

    As I understand it Palmer’s demand was that a guarantee be put in place forcing full price reductions be passed on to consumers. Not a good look for the LNP to appear to be stopping such a guarantee.

    Madigan said this morning that he had been misled in negotiations.

  42. Collin Street
    July 10th, 2014 at 13:13 | #42

    Apparently the clerk of the senate thought that the mechanism for enforcing the guarantee would count as a tax, couldn’t be put in by the senate.

    Nasty procedural stuff-up from Palmer, but if it leaves you better off — and the stupidity the government put themselves through hardly hurts them here — is it really a mistake?

  43. Tim Macknay
    July 10th, 2014 at 13:33 | #43

    @Collin Street
    You have to wonder. The policy wonks and parliamentary draftspeople in the Commonwealth bureacracy are usually pretty alert to inadvertently introduced taxes.

    On the other hand, the stupidity of Brandis’ proposed amendments to the Racial Discrimination Act do make me wonder if the Government’s legislative drafting is being done by teenage advisors on secondment from the IPA, instead of professionals.

  44. Tim Macknay
    July 10th, 2014 at 13:42 | #44

    @Collin Street
    I have to admit, I’m struggling to see how the enforcement mechanism in the Government’s bill can be construed as a tax. Will have to have a closer look at it.

  45. sunshine
    July 10th, 2014 at 14:06 | #45

    It is so often said that Abbottt cant negotiate. He’s an authoritarian crash or crash thru guy – Clive wont respond to that too well. Bob Brown said that for the entire meeting he had with him (during the talks to see who would form govt after the election ) Abbott had his feet up on the desk with the soles of his shoes facing him.

    The budget seems a case of extraordinary over-reach .They may have blown their cover unnecessarily ,it could be a good thing in the long run.I think they could have easily just continued Australias slow but steady progress to the Conservative/Libertarian Right by small increments. You have to wonder how they could have been so wrong . It must be massive hubris ,bought on by an easy run into office and surrounding themselves by powerful yes people .

  46. July 10th, 2014 at 14:08 | #46

    Thanks John for signing that public statement. But don’t you think there should be more pressure groups working more closely on this matter?

  47. may
    July 10th, 2014 at 15:23 | #47

    Tim Macknay :@may They say you get what you pay for – last time I went to my local big box hardware store there was quite a range of spray bottles at varying price points. Maybe if you went up the price scale a bit, your spray bottle might last longer. I use a 1.5l pump spray bottle to foliar spray my plants – I think it cost around $12, and it’s lasted me for years. There’s also the second hand market – a quick scan of several internet shopping sites turned up hundreds of old antique metal spray guns, at least some of which of which are presumably in full working order.

    oh ta.

    i’ll try that.
    i’ve been looking in the big box garden section.

    damn right you get what you pay for—i don’t mind paying for quality but it irks when cheap is worse than nasty,it’s downright useless.

    apologies all– been re reading Zom Ecs and i was ranting about microeconomics and this topic is macroeconomics. der.

    well i nevah–our prime minister and the con party being called out as double crossers.
    that’s harsh.
    everybody knows of their kindness and gentility.

    erm Megan?
    with all respect to your knowlege in this subject(vastly over my head)

    it’s balked, not borked.

    i know because i got pulled up by a pedant (bless’em) for the same thing.

  48. Tim Macknay
    July 10th, 2014 at 15:38 | #48


    damn right you get what you pay for—i don’t mind paying for quality but it irks when cheap is worse than nasty,it’s downright useless.

    Yep it’s pretty damn irritating.

  49. Ken Fabian
    July 10th, 2014 at 19:53 | #49

    It will be kind of ironic for the “least cost” saviour from rising energy prices requires subsidy to protect it from solar in a ‘free’ energy market, although subsidy was how it was built and operated for most of it’s existence.

    I think it’s too late for elimination of subsidy to PV to prevent it’s ongoing uptake, with a permanent loss of daytime peak demand from the grid looking inevitable and irreversible. Going by proven performance our Conservatives are hostile enough to renewables and climate action to want penalties for solar owners, except there are far too many of them and a canny politician knows – from experience now – that’s going to be an impossible sell. And going by performance the Labor alternatives will talk as much or as little of the talk as they deem least electorally disadvantageous whilst compromising on as much of the walk as needed to appear judiciously conservative; trying to please everyone with the result of pleasing no-one.

    Actually conceding that existing infrastructure should be used, intentionally with planning and forethought, as the interim, intermittent backup during a deliberate transition to low emissions – while storage and adaption to time of use pricing catches up – would be a step in the right direction. Except that for that kind of depth of planning there is a requirement for actual acceptance that fossil fuels confer an unacceptable burden of future consequences and costs that makes such a transition necessary; climate science denial and obstructionism is unfortunately alive and well in Australia, and at the highest levels. It really is an insidious and destructive force in energy politics. Even worse IMO when it’s hiding behind a facade of taking the issue seriously simply because it’s practitioners find that more effective.

    Another area of concern is local, private energy supply agreements, where the sunny excess gets sold at below grid retail price to the shaded neighbors. How is this to be facilitated? What kind of network charges should apply? Or should those who do so be able to make use of the poles or pipes to run their own wires in similar style to pay TV cables? Might be another kind of ironic if the News Ltd subsidiary Foxtel’s success in forcing owners of power poles to make them available to other businesses becomes the legal precedent that allows it.

  50. Megan
    July 10th, 2014 at 20:47 | #50


    Now you made me think twice (always a good thing) – no, it’s definitely “borked”.

    But that is in the “Urban Dictionary” sense of ‘broken’ by mistake as opposed to ‘balked’ as in hesitated.

    Tim and Collin, I haven’t had much time to look into it either, but the ‘Clerk of the Senate’ story makes me think there’s more to it than the establishment narrative is saying so far.

    If Palmer stuffed up then the LNP did equally or more so by not getting it right before trying to put it up as an amendment that would get through.

    As an aside – IMHO the Greens are making a bad tactical error by bagging their (supposedly) cross-bench colleagues the PUP while making themselves look more and more like a junior coalition partner to the ALP – “ALP Lite” will not fly as a ‘brand’ and if the Greens think it will they are poorly advised. They got to the 14%ish level by being distinct from the ALP and it seems they are determined to wreck that.

  51. may
    July 11th, 2014 at 11:50 | #51

    Megan :@may
    Now you made me think twice (always a good thing) – no, it’s definitely “borked”.
    But that is in the “Urban Dictionary” sense of ‘broken’ by mistake as opposed to ‘balked’ as in hesitated.
    Tim and Collin, I haven’t had much time to look into it either, but the ‘Clerk of the Senate’ story makes me think there’s more to it than the establishment narrative is saying so far.
    If Palmer stuffed up then the LNP did equally or more so by not getting it right before trying to put it up as an amendment that would get through.
    As an aside – IMHO the Greens are making a bad tactical error by bagging their (supposedly) cross-bench colleagues the PUP while making themselves look more and more like a junior coalition partner to the ALP – “ALP Lite” will not fly as a ‘brand’ and if the Greens think it will they are poorly advised. They got to the 14%ish level by being distinct from the ALP and it seems they are determined to wreck that.

    cripes,i’ll have to check.

  52. J-D
    July 13th, 2014 at 12:31 | #52

    I’ve never looked at any of the IPCC models and have no plans to do so. I don’t need to examine any models to understand how it is that human burning of fossil fuels makes the planet hotter than it would otherwise be. Can you explain any way it would be possible for humans to burn fossil fuels without making the planet hotter than it would otherwise be?

  53. July 15th, 2014 at 21:54 | #53

    Why did you apparently finger poor old Ross Gittins for the rubbish you linked to? It was nothing to do with him. It was Terry McCrann.

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