Zeitgeist

I don’t imagine John Howard reads this blog, or even my columns in the Financial Review, but it was striking, after the discussion we had here to see him make an explicit link between climate change and the severity of the current drought. This is big progress even on his position of month ago, where he was still trying to have a bit each way.

It will be interesting to see how denialists in the commentariat and blogosphere, most of whom are also Howard partisans, respond to this.

Also, while I’m praising Howard, the training package he announced recently was a good thing, and seems to mark an abandonment of the silly idea that it’s OK to finish your education at year 10. Not everyone needs a university education, but failing to finish school (or achieve an equivalent outcome) and get some sort of post-school qualification is a recipe for low wages and regular unemployment.

49 thoughts on “Zeitgeist

  1. Hermit – “I don’t think voluntary 50% energy cuts are likely; they go way beyond the feelgood factor of longlife light bulbs.”

    No neither do I. That is why we should starting charging more for large electricity users. You get the first 20kWhr per day at normal or slightly discount tariff then the next 20kWhr is 1.5 times the tarif and the next 20 2 times the tariff and so on. The extra money earned from large users would be used to fund interest free loans for people wanting to reduce their bills. This would stop the McMansions with black roofs and no eaves or insulation running 20kW airconditioners all day to make up for their incredible deficiencies in design.

    We can’t have a totally nuclear future anyway. In Australia we have a surplus of base load and nuclear power in only baseload. We need more peaking power to cope with the McMansion’s airconditioning in summer. Nuclear power is no use here.

    Lets say we only implement the electric cars and trucks. At the moment there are huge generators spinning away generating nothing but consuming energy. They are called spinning reserve and are required by law to be in place to support the grid in the case of a large generator failing and dropping off the grid. V2G cars in combination with flywheels and redox batteries could take the place of this wasteful practice and supply the spinning reserve. The half life of Australia’s car fleet is about 10 years. For about the same cost and the same time frame as a nuclear reactor we could acheive the same greenhouse reductions without any of the problems of waste and proliferation that nuclear power brings. It also would go an enormous way to eliminating our dependance on oil something that nuclear power cannot do.

    Just replacing our tranport fleet with battery electric vehicles and plug in hybrids that are V2G capable and nothing else would be better for everyone than nuclear power – except of course the mining industry.

  2. Well, Don Wigan, what is happening to your and your children sounds like it is exactly in accord with Social Security legisation.

    Even since Youth Allowance was introduced, the rate of payment for all allowees under 21, and for full-time students under 25, has been affected by the income of their parents.

    See section 1067A of the Social Security Act 1991.

    I particularly like:
    1067A(4) A person is independent if the person is at least 25 years old. This age will be progressively reduced over time. ha, ha, ha!

    Undersection 66L of the Family Law Act, a parent can be obliged to support their adult children to enable them to complete their education.

    If you don’t like the “de-facto” route another way to gain independence is for the young person to earn $17667, by their own exertion, in 18 months after leaving high school. You can employ your children in your own business, or get a friend to employ them. I’m sure you can see my drift. Just make sure that that the correct taxation returns lodged.

  3. To proust, we’re not talking about upkeep, we’re talking about rights to a higher education. We’re already providing backup support because the rate without clawback is not adequate for country students in the city even with allowances.

    I assume you like a support system that encourages less dependency. What is the point of my wife working (for roughly $15,000pa) and paying taxes, if by not working my children can claim something nearer to the full rate?

    Thanks for that, Redmond. I’ve already found one loophole for my elder daughter. Apparently if she’s been working part-time for 15 hours a week for more than two years, she can claim the independent rate. She has been, even though the week by week hours fluctuate. If successful, it will only leave me with one still penalised – so I guess there’s hope.

  4. My father was financially quite able to provide for me as a Uni student, he just didn’t see why he should. I had to declare myself ‘divorced’ from him in order to claim Austudy.

    And for those who think I should have worked my way through uni, well firstly I did, and secondly I challenge anyone to put in 30+ contact hours, then study on top of that, then earn enough for rent food and beer on a $12/hr job.

  5. What is the point of my wife working (for roughly $15,000pa) and paying taxes, if by not working my children can claim something nearer to the full rate?

    No point whatsoever. But the great Australian entitlement culture has bred our perverse system that churns ever increasing amounts from the slightly-better-off to everyone below them.

    You liked it well enough when you were on the receiving end. If you don’t like it now that you’re having to pay, I suggest you reconsider your whole attitude towards the bloated Australian welfare state.

  6. Except that’s rubbish. The ‘entitlement culture’ is one of downward envy, whereby the freebies from government are increasingly working their way up the economic scales. Things like first home buyers grants going to million dollar homes, baby bonuses etc going to household with $100k incomes.

    Oh, as for Australia being ‘bloated’, well that’s rubbish too. Australia has managed a highly targeted welfare system that Howard is only slowly destroying.

  7. Receiving end? What receiving end?

    As to the bloated Australian welfare state, a lot of that’s a matter of politics.

    I guess one problem with welfarism today is that it’s not often related to need or hardship. And those that miss out are pretty annoyed at those, who can afford to, getting more. The $4000 baby bonus hardly represents the new age of enlightenment. And the first home buyers grant is really an abuse. And that’s before we even get to the massive handouts to the GPSs, which seem to have been done at the expense of state schooling.

    Though if you’d read my original post you’d see that one of my concerns was that in all probability the cost of compliance and review is likely to exceed that saved by skimming a bit off lower income earners.

    To put it in a practical way, when my brother’s child applied for Austudy in 1991, the cutoff point for parental income from memory was $56,000. Now it seems to be about half that. Nothing you say will convince me that the costs have come down in 15 years.

  8. wilful, the freebies are largely going to people with children and disproportionally to poorer people with children (I believe you can now make more than $40,000 per year from welfare if you have a few kids).

    There is some justification for giving tax breaks to those who breed in the lower-middle-to-upper echelons of the income scale, since they are paying for the upbringing of children whose economic activity, on average, is likely to benefit society as a whole. But encouraging second-generation welfare bludgers to produce third-generation welfare bludgers is simply perverse.

  9. I have been surprised by the evident growing belief that the current drought in Australia is due more to global warming than to the regular El Nino cycle which plays such a major role in my own country.

    A few years ago I attended a conference on natural disasters at the UN centre at Gigiri outside Nairobi. During the conference a UNEP representative addressed us. He complained about the continued environmental degradation in Africa and how control legislation was being ignored.

    When he finished I stood up and challenged him to walk along the road back to Nairobi. When he reached the squatter camps alongside the road he should call the people together and instruct them to stop destroying the trees for firewood and stop polluting the streams with sewage and household effluent.

    I continued and told him that the only way to save the environment was to reduce poverty. The imposition of punitive measures was more likely to have the opposite effect. I was applauded.

    When I returned to South Africa I wrote an article African Renaissance or descent into anarchy? It was published in the SA Journal of Science.

    The situation in South Africa has gradually worsened. Robbers are murdering people in their homes. Our streets, highways and shopping centres are no longer safe. Our children are migrating to other countries. The poor and disadvantaged communities have nowhere to go. Their suffering is even greater – unemployment, hunger, malnutrition, disease and crime are their daily lot.

    Against this background, a small group of uncaring and unpatriotic scientists and environmental lobbyists have succeeded in persuading the government of alarming and speculative consequences of alleged clkimate change.

    They go on to claim that the only way to prevent this happening is to impose costly restrictions on our industries that can only have one result. The costs of their products will increase, and they will lose international competitiveness. Some industries may be forced to close down. There will be more job losses, more poverty and more crime.

    On closer examination an even more alarming picture starts emerging.

    The Intergovernmental Panel on Climate Change (IPCC) was established 18 years ago. Despite a massive research effort it has still not been able to produce any proof that global warming is the consequence of human activities. The nearest that it can get is to maintain that an international consensus exists. This claim is also false. There are many conscientious scientists who maintain that the postulated consequences of global warming are no more than untested hypotheses.

    When these scientists speak up they are labelled as fringe scientists, or more recently, as ‘climate denialists’ who should be hauled before international tribunals and tried for crimes against humanity.

    Scratch a little deeper and the reason for this hysteria becomes exposed. The continued prosperity of the European nations is under increasing threat from the growing economies of the developing nations. What better way to reduce their competitiveness than to insist that the developing nations, including South Africa, impose economically restrictive measures to control greenhouse gas emissions based on unproven science?

    Regrettably, some South African scientists have chosen to accept these alarmist theories without question. Environmental lobby groups see this as an opportunity to advance their case. All of this regardless of the effect that punitive measures will have on increasing poverty, malnutrition, disease and crime.

    The situation is very serious indeed.

  10. Don Wigan: you were on the receiving end of welfare largesse when your income was $35,000 last year and your children were receiving study allowances. Now as your family income has increased you’ve discovered the almost 100% effective marginal tax rates that are a consequence of our spectacularly generous welfare system.

  11. Notwithstanding the above remarks, I personally don’t have much of a problem with the structure of the tax system in Oz, although I think it is still a little high across-the-board. My biggest issue is with the prevailing attitude that it is somehow the responsibility of the government to fix everything.

  12. Well if the government isn’t going to fix the tax system, I’m not sure who will!

    Overall I also think that the system generally works, better than in most countries, and there is an awful lot of tripe spread about without any empirical evidence to back it up regarding the failures of the current system. Which is not to say there aren’t plenty of areas for healthy reform – which Howard wont undertake, he’s far too interested in bullshit that lowers productivity and increases regulation like IR ‘reform’.

    I jsut did my personal income taxes for last year, and the moronic complexities, all based on my family situation, were driving me nuts and crashed the eTax program. All the fault of Howard, quite directly.

  13. Actually, proust, the most generous freebies are for retirees – a retired couple with no kids to support can earn well over $70k a year and still get a special tax break plus a pensioner concession card that gives them cheap medicine, transport, rates and car rego.

    A couple fully dependent on welfare would have to have 5 dependent kids to get $40k – not really that much to support 7 people on while paying the mortgage.

  14. A couple fully dependent on welfare would have to have 5 dependent kids to get $40k – not really that much to support 7 people on while paying the mortgage.

    No, but a couple fully dependent on welfare should not be encouraged to have 5 kids in the first place. At current rates, they get 6 months welfare payments just for popping the buggers out. That’s a lot of beer and cigs.

  15. Add onto that $40K per year any rent relief (another $10K (?)), cradle-to-grave medical costs ($100K-$250K (?) each, assuming they don’t contract some really expensive exotic disease), 12 years of schooling per child (ok, let’s say 11 years, given the demographic) at an average cost to the state of $5,000 (?) per student per year.

    That’s just the big items. Total cost to the state, assuming a 60 year lifespan, is over $4,000,000. That’s probably conservative. (I finessed the issue of declining welfare payments for the parents when the kids leave home by assuming enough of the kids would also go on welfare to make up the difference).

  16. So these cradle to grave medical costs, if they wern’t insured by the state, they’re basically f*cked, right? And if they didn’t have free education, they’d not be able to contribute at all to society.

    Ah I don’t know why I’m posting. Anyone who thinks free education is a bad thing is clearly a damn fool. Content edited – JQ

  17. I think Will Alexander’s comments should be taken seriously, not least by social democrats. The idea that a 60% reduction in emissions can be achieved by 2050 merely by marginal adjustments here and there (eg smaller cars) with only a one-off 3% reduction in welfare (per JQ) seems way off the mark. What is the standard of living in countries with 60% less energy use + emissions than in Australia (per capita)? Zimbabwe last week achieved a further 50% cut in energy use from an already c50% cut since 2000, and the results are not pretty. Will may be over the top with his conspiracy theory, but John Howard shows a realistic appreciation that it will be easier to get China and India to move to green energy by persuasion than by the big stick approach of Kyoto, especially when he shows the way to replacing coal by nuclear.

  18. Will Alexander
    Spot on with the comments about drought and global warming in Australia.
    This is the original home of drought and flooding rains.
    The trick is to save the water in the good times and release it in the bad.
    I would consider Global warming to be a low order problem in Australia, let alone in Africa with the problems that you describe.
    The good news is that somebody will soon post the answer to the problems your country is facing……

  19. Proust, Don Wigan wasn’t on the receiving end of the benefits when his children were getting them – nor would he be paying much towards them now, if it weren’t for other people’s children getting such things now.

    It comes down to a fallacy in JQ’s idea – or presentation of the idea – that “failing to finish school (or achieve an equivalent outcome) and get some sort of post-school qualification is a recipe for low wages and regular unemployment”.

    The thing is, the only reason for that is the increased competition from others who do have those credentials. It’s not as though there is much actual skill imparted that is of any benefit, at least at the bottom end. If less constraint and funding were applied for this sort of education, lo! less would be needed.

  20. Hmm,
    Welfare bludging has now reached the rnks of the loyal and trusty lmc, in an endeavour to encourage them to breed and keep voting for the government eh. Whatever happened to the ‘incentivated employee’, scion of the ‘rugged, self insuring against risk’ individual ,so beloved of the think tanks. Must be making some of them squirm! Hence the angst about ‘welfare churn’. Oh well, Howard’s aim, quite properly for a politicain, is to keep winning, and he knows even if the silly economic libertarianas don’t, that their prescriptions might feel great in the ‘tanks’, but out there in voter land, they stink.

  21. Ah I don’t know why I’m posting. Anyone who thinks free education is a bad thing is clearly a damn fool. Content edited.

    wilful, I neither advocated nor opposed free education or healthcare. I merely put a price on it, in the context of questioning the sanity of a social system that provides the greatest breeding incentive to those least able to afford it.

    stoptherubbish – people’s expectations of their government is very cultural. As a broad generalization, Europeans and to a lesser extent Australians blame their governments rather than accept personal resposnsibility for their own circumstances In contrast, US residents tend to accept personal responsibility before passing the buck to the government. FWIW, all of them have “free” public education.

    As someone with strong libertarian tendencies, I vastly prefer the US attitude.

  22. “Now as your family income has increased you’ve discovered the almost 100% effective marginal tax rates that are a consequence of our spectacularly generous welfare system.”

    I think you misunderstood my original complaint, proust. My complaint was not about the taxation system, but about “our spectacularly generous welfare system”, which on my experience could be more accurately labelled ‘spectacularly miserly’.

    And I used the more personal lament to highlight uncle milton’s concern that despite all the rhetoric about cutting welfare costs they keep going up. It is little wonder that they do when the cost of investigation, review and compliance is likely to exceed the cost of allowing the benefit.

    As to the marginal tax rates increase (which has about doubled my tax liability on last year) I have no complaint whatever. As a taxi driver, laughingly classified as ‘self-employed’ under the system, I seem to have a lower tax rate than PAYG wage and salary earners. Certainly I can claim more expenses. And I get mature-age offsets.

    Whatever the faults with the taxation system ( and currently ours seems closer to the Piggy Muldoon dog’s breakfast than to the ‘Unchain My Heart’ model promised) it has not damaged me personally very much. I just hope that isn’t the reason they’re now going after my daughters allowances.

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