Month: January 2015

LNP needs a Plan C

John Quiggin104 Comments

There’s been a lot of discussion about the fact that the Queensland LNP needs a Plan B, in case they are returned to government, but Campbell Newman loses his seat of Ashgrove.

No one seems to have noticed that they really need a Plan C, for the case when neither party wins an absolute majority, which would almost certainly imply a loss for Newman. A couple of points arise here

* Both Newman and Labor leader Anna Palaszczuk have ruled out a minority government. But with Newman gone, some other LNP leader might say his position was inoperative

* The Governor needs to call on someone to attempt the formation of a government. That could be Newman, Palaszczuk, some other LNP figure or even an independent.

Abbott, Knight and Bishop

John Quiggin104 Comments

In making my predictions for 2015, I was tempted to predict that Abbott would last out the year, mainly on the basis of inertia, but decided it was too risky (Commenter Fran B sensibly went the other way). I’m already glad of that: even before Sir Phil, it seemed as if he was on the skids.

Assuming Abbott goes (still not certain, but looking more likely with every hour), Julie Bishop looks like a sure thing to replace him. She has looked pretty good as Foreign Minister (if you’re willing to overlook a massive cut in foreign aid), but that’s relatively easy, largely a matter of not messing up. If she does take over, she’ll need to do more than that.

To demonstrate that there’s a real change, she’ll have to break with Abbott on some major issues. Presumably that will include dumping Hockey and the most unpopular of the 2014 budget measures, but most of those are already dead.

The really big break would be to return to some kind of bipartisanship on climate change. There’s some precedent, given the way she stood up to him over going to the Lima meeting. But it would entail a break with the (numerous) denialists and tribalists in the party room and the broader party apparatus (including the Murdoch Press and bodies like the IPA). Still, if she could carry it off, she would be a force to be reckoned with.

Queensland election

John Quiggin38 Comments

In the opening days of the Queensland election campaign, I thought the most likely outcomes were either a narrow LNP victory or a minority government of some kind*. But the campaign has been a disaster for the LNP and for Campbell Newman in particular. He is now in the ludicrous position of refusing to answer any questions, except to repeat scripted lines about jobs. And he is suing and being sued by all sorts of people, mostly from groups traditionally associated with the political right.

The big issue has been asset sales, and again the LNP strategy has been bizarre. Having cut services in breach of all their promises, they are now promising to restore them (notionally funded by the proceeds of asset sales) but only in electorates where the LNP wins. Labor has avoided matching these promises, and has offered a package that’s fiscally sustainable in the medium term, even if it doesn’t really address the fundamental problem of inadequate revenue. With public opinion solidly against asset sales, that should be enough to neutralise the LNPs perceived superiority in economic policy.

Newman’s main calculation, I suppose, is that holding an election in January ensures no one will pay any attention (though he had the hide to say that this is the most important election in Queensland’s history), and that may be right. Still, I now think that an outright LNP win is unlikely and that there is little chance of a minority LNP government being formed. There’s even less likelihood of Campbell Newman being re-elected in his own seat.

Labor leader Annastacia Palaszczuk has also (very foolishly, IMO) ruled out a minority government, but I doubt that she would be willing to follow through with another election if she had the option of forming one.

* I’m avoiding the silly phrase “hung Parliament”. By analogy with a “hung jury”, this implies a Parliament that is unable to produce a workable government. In reality, the existence of a disciplined majority, effectively at the command of a quasi-presidential leader, has generally produced bad government, particularly in a unicameral system like that in Queensland. By contrast, minority governments have often run their full term, and been more transparent and open than their majority counterparts.

No pennies for Tenpenny

John Quiggin68 Comments

Following up on my earlier piece about anti-vaxer Sherri Tenpenny, I’m pleased to report that all the commercial venues that were booked for her potentially lucrative “seminars” have cancelled. It appears the bookings were made by her Australian contact, pro-disease advocate Stephanie Messenger, under the name of a bogus anti-SIDS charity. Apparently, charges of to $200 a head were proposed.

What free speech issues arise here? As I argued previously, I don’t support a ban on Tenpenny visiting Australia, and having come here, she should be free to organize and address public meetings, open to anyone to attend (and heckle!). But there’s no reason to permit her to make money out of her evil lies. As regards potential venues, if they take her money, they are complicit in her activities.

It’s worth observing that this balance only works if there is a substantial public sphere in which freedom of expression is guaranteed, leaving private businesses to make their own choices on matters like venue hire. The privatised world favored by propertarians is one in which freedom of speech and thought is subordinated to the rights of property owners. In the US, for example, the absolutist opposition to government restrictions on free speech goes hand in hand with the right of employers and landlords to sack or evict anyone whose opinions (or even abstinence from favored political organizations) they don’t like.

Ernst and Young oversell privatisation

John Quiggin30 Comments

Ernst and Young, leading consultants to the Queensland government have released a report claiming that electricity costs would be lower under privatisation. Although the report was commissioned by private infrastructure lobby group Infrastructure Partners Australia, it’s just a rehash of the same line EY have been pushing for years in similar reports commissioned by pro-privatisation governments. The central claim is that electricity prices have risen more in Queensland and NSW, under corporatisation than in Victoria and SA, under privatisation. What they don’t tell you is that this merely offsets increases imposed in the leadup to privatisation, with the result that retail prices are much the same in all four states, and far higher than when the process of market reform (supposedly to reduce prices through competition) began in the 1990s. Here’s the response I issued:

Media Release

Professor John Quiggin, of the University of Queensland criticised the Ernst and Young report on privatisation of the electricity industry.
The Ernst and Young report ignores the biggest factor leading to higher electricity prices throughout Australia: the failed process of market reform, corporatisation and privatisation of which the LNP government’s asset sales is a part,Professor Quiggin said.
Although the problems have differed from state to state, there is no evidence that states which undertook full scale privatisation in the 1990s have performed any better. South Australia has some of the highest electricity prices in the world, and Victorian prices are comparable to those in NSW and Queensland.

Living to 150: A quick reality check

John Quiggin97 Comments

Our fact challenged Treasurer, Joe Hockey raised some eyebrows when he suggested that we need to reform Medicare because children born today might live to 150. He got some support from University of New South Wales faculty of medicine dean Peter Smith, who cited the increase in life expectancy over the last century, from 55/59 (for men and women respectively) in 1910 to 80/84 today.

There’s an apparent paradox here: If life expectancy is 80/84 years today, how can a newborn child expect to live 150 years. The answer is that “life expectancy” is nothing of the sort. It’s the average age at death if current age-specific mortality rates remain unchanged. On average, people born in 1910 actually lived well beyond their “life expectancy” because death rates fell through their lifetime. So, if medical progress continues, people born today may live, on average, well past 80/84.

But how much more? Unfortunately, on past indications, not much more. Most of the 20th century extension of life expectancy came from a reduction in death rates for the young. A 65-year old in 1910 could expect to live to 76/78 (since death rates don’t change much over a decade, that’s an actual expectation not just a statistical construct). Today, that’s increased to 84/87, from 11/13 years of extra life to 19/22. For Hockey to be right, over the next 100 years or so, the conditional expectancy has to rise five-fold, to 85 years. The basis for all this, it seems, is a 2011 press release of the kind we see every week or two announcing a breakthrough that might, perhaps, lead to a cure for this or that disease.

But even in the unlikely event that this extension of life occurs, what possible relevance could it have to the amount we should pay for medical care today? Even under current rules (which would certainly change with extended life expectancy) Hockey’s hypothetical Methuselah wouldn’t be eligible for the age pension until 2085 and (given the anti-aging breakthrough he hypothesises) wouldn’t seriously burden the health care system until well into the 22nd century. Coming from a government that dismisses concerns about climate change as a problem for the indefinite future, this solicitude for Treasurers yet unborn seems misplaced.

Update Via Twitter, I discover that the source of Hockey’s claim is someone called Aubry de Grey, who is obviously in the tradition of wealthy British eccentrics, with his own foundation, journal and so on; a much more appealing instance of this kind of thing than Lord Monckton, but still not to be taken seriously.

Further update Defending Hockey’s silliness, Mark Kenny makes the point that what Hockey actually said (restating de Grey) was that it is “remarkable that somewhere in the world today, it is highly probable, a child has been born who will live to be 150”. This shift from mean to maximum helps the demographic plausibility of Hockey’s case, but only marginally (we still need an advance of nearly 30 years on 122, the longest lifespan ever recorded), but it makes the argument even weaker. Suppose that some child in, say, China is going to live to 150. What possible impact can that have on our health system. More generally, what can it matter to the budget if a handful of people live very long lives. It’s the average (measured by numbers like life expectancy at 65) that matters. As an indication of the minuscule scale of the fiscal problem posed by those with very long lives, there are currently only about 4250 Australians aged over 100, amounting to about 0.02 per cent of our population.

Yet further update It’s worth pointing out that, with pension age eligibility rising from 65/60 when the age pension was introduced around 1910 to 70/70 by 2035, men will have lost half of the extra retirement years gained from higher life expectancy and women the whole gain. The big problem we face is underemployment of prime-age workers, not the fact that we aren’t dying early enough.

Increasing trend keeps on increasing

John Quiggin104 Comments

Unsurprisingly, 2014 was the warmest year so far in the incremental record, as measured by NOAA and NASA. A few quick observations

* It’s silly to base global judgements on local observations. Still, living through January 2015 in Queensland, it’s easy to believe that the warming trend has continued into the New Year

* There’s nothing special about a calendar year. The first part of 2014, particularly February, was cooler than the rest of the year. So, it’s a safe bet that the 12 months ending Feb 2015 will be even warmer than the 12 months ending Dec 2014

* The biggest source of short-term fluctuations is the El Nino cycle, responsible for the very warm year in 1998 that is the basis for so much silly talk about “no global warming for x years”. 2014 was the first record year without a full-scale El Nino, though it kept threatening to emerge. Predictions are mixed for 2015.

* Of course, this long-expected news had no effect on denialists. But, like anti-vaxers, they are no longer getting the kind of “balanced” hearing they have counted on for so long, at least outside the Murdoch press. It’s now generally recognised that climate science denial isn’t a scientific viewpoint but a tribal shibboleth, and this is reflected in news coverage.