The opportunity cost of destruction

With much of Australia suffering catastrophic fires and the beginning of a new war with Iran, lots of people are thinking about the idea that such disasters are good for the economy, because of the work generated in rebuilding homes, producing war materials and so on.  In my book Economics in Two Lessons, I explain why this is wrong (this is one point where I agree with Henry Hazlitt’s Economics in One Lesson. Here’s a link to  Chapter 6: The opportunity cost of destruction

US President Eisenhower got it right when he said

Every gun that is made, every warship launched, every rocket fired, signifies in the final sense a theft from those who hunger and are not fed, those who are cold and are not clothed.

And the same is true for the destruction visited on us by Morrison, Trump, Murdoch and the rest of the global denial industry. The workers who will be needed to rebuild homes, farms and infrastructure could instead be employed producing useful new things. Those forgone alternatives are the opportunity cost of destruction

Slow burn

That’s the headline for my latest article in Inside Story. Summary graf

Hundreds more deaths will result from the particulates created by Australia’s current crop of bushfires

At the time of writing, at least fourteen people have been killed by this season’s bushfires. And with most of January and all of February still to come, the number is sure to rise. But these dramatic deaths are far outweighed by the hundreds, perhaps thousands, of deaths that will ultimately result from the toxic smoke blanketing Australian cities.

The most dangerous component of bushfire smoke are tiny particulates, no more than 2.5 micrometres in diameter, known as PM2.5. Over the past twenty years, studies have shown that high levels of PM2.5 have contributed to millions of premature deaths in highly polluted cities like Beijing and Delhi. Sydney, Canberra and other Australian cities have recently joined this list. In 2016 alone, exposure to PM2.5 contributed to an estimated 4.1 million deaths worldwide from heart disease, stroke, lung cancer, chronic lung disease and respiratory infections.

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Open forum for climate denialism

Following some recent discussions, I decided to relax my usual policy of banning climate denialists. So, I’m opening a forum where anyone who thinks they have something useful to contribute on the topic. Some rules

  • Real names only, no pseudonyms. If you have something to say on this topic, own it.
  • If your point is on this list, don’t bother making it.
  • For the moment, only climate science arguments, not policy claims like “Australia only contributes 1 per cent”.

Initially, at least I’d prefer to leave the field open to sceptics/deniers. The rest of us can have our say a bit later.

To prevent spam/trolling etc all posts from new contributors will be moderated.

Mainstream media remains quiet on Scott Morrison’s untimely holiday

That’s the title of my latest column in Independent Australia, which came out on Thursday. The news has just come in that Morrison is to curtail his trip and return home. Strikingly, it was the lead headline on news outlets, including the ABC, Guardian, and Fairfax/Nine that failed to report Morrison’s absence for days, then buried the news in stories leading with other topics.

All of that led me to some ill-tempered Twitter exchanges (the usual kind of Twitter exchange, I guess) with a variety of journos, including Lenore Taylor and Katharine Murphy, who gave equivocal denials that the PM’s Office had ordered their papers not to report to the trip, before closing the discussion, and declining further comment.

The core of the problem, I think, is that I’ve given up on Labor. Hoping for the Greens to replace them as the major left party may be forlorn, but it’s more likely, in my view, than that Labor will propose a policy remotely appropriate to the crisis we face.

But that’s not a tenable position of you want to be a political correspondent for a major newspaper. You can back one or other of the major parties, or be neutral between them, but you can’t suggest an alternative to the existing system. This piece by Katharine Murphy makes the best of the case for pushing Labor to improve, but it doesn’t convince me.

It’s already been stated that Labor won’t proposed anything to limit coal exports, which are Australia’s biggest contribution to the global climate disaster. Even achieving a 45 per cent reduction on 2005 emissions, as proposed in the last campaign will require much sharper policies than could have been applied if Labor had won, especially if we rule out accounting cheats.

A hypothetical Albanese government will be starting in 2022, with three more years of rising emissions outside the electricity sector. We’ll need organised shutdown of coal-fired power, a massive investment in renewables, reforestation of land cleared under Coalition lawa a government-driven electrification of the coal fleet. Does that sound like Albo to you.

About the only way this could happen is if the Greens somehow give Labor such a scare that they stop worrying about a handful of seats in coal-mining areas and start worrying about losing the great mass of their supporters. Giving Labor the benefit of the doubt is the worst thing we can do,

Total failure

The country is on fire. And:

  • The PM disappears overseas. His supporters spin the fact that it’s only his second overseas holiday this year (not second holiday, or second largely recreational OS trip)
  • The media are ordered not to report the fact, or even that we have an acting PM. Compliance is near-total until Twitter outrage puts the issue into the international press
  • Tory-fighter Albanese gives Morrison a free pass. Still hasn’t pushed the government on link to climate change. Would rather bash the Greens over ancient history disputes.

If there has ever been a more comprehensive failure of our political class, I’m not aware of it.

The system works, now and then

Among other activities, I write or sign on to, lots of emails to business leaders and others, protesting against environmental failures, abuses of workers rights and so on. Occasionally that contributes to a win, but hardly ever do I get reply.

I recently wrote to the CEO of Siemens, , protesting against the decision of the Australian branch of the business to work with Adani on rail signalling systems for the rail line to the destructive Carmichael mine. I was quite surprise to get a response, as follows:

Dear all,

Thank you for your mails addressing your concerns on Siemens delivering rail infrastructure for the Adani project in Australia.
I have not been aware of the matter until most recently. Likely given the relatively very small number of the rail signaling business associated with it. But maybe I should have. 
I take your concerns seriously and will look into the matter diligently. This may or may not change Siemens’ view and decision, but all of you who have respectfully spoken up on the matter deserve at least an answer and an explanation.

I will get back to you in due time.
Thank you again for speaking up.

Sincerely,
Joe Kaeser 

I was quite surprised to see a global business like Siemens risking its reputation for such a small deal, especially given the high probability that the deal will fall through, either because the whole project is abandoned or because Adani repeats the longstanding pattern of stiffing its partners. I plan to point this out in a return email.

No takers for a nuclear grand bargain

A while ago, I made a submission to a Parliamentary inquiry into nuclear power and, in particular, the removal of the 1998 legislative ban on nuclear power. The inquiry was pretty obviously a stunt aimed at placating Barnaby Joyce and the nuclear lobby[1], but I decided to take it seriously and ask what would be needed to give nuclear power any chance, economically and in terms of social acceptance, in Australia.

I proposed what’s been called a grand bargain , lifting the ban in return for a commitment to decarbonize electricity by 2040, and a carbon price increasing steadily over time to achieve that goal.

The Committee has now reported, and, unsurprisingly no one is interested in the idea of a grand bargain. In fact, the idea wasn’t mentioned, not even to dismiss it. Nor, as far as I can tell did any of the pro-nuclear submissions say anything about carbon prices.

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Four propositions about conservative voting

Here are four propositions about voting behavior which, as far as I can tell, have been true in nearly all democratic countries for at least the past 50 years. Other things equal, people are more likely to vote for conservative parties if:

  • They have higher incomes
  • They have lower education
  • They live in rural areas or small towns
  • They are members of a dominant racial/religious group

By contrast, lot of commentary on recent electoral losses for the left seems to start from the presumption that “traditional” left voters have all of these characteristics, except perhaps high incomes. However, since these “traditional” voters are “aspirational”, it is assumed that they will vote in line with the income they wish they had. Given the actual preferences of voters like this, the obvious inference is that the left should adopt the policies of the right.

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The CIS vs religious freedom

The Centre for Independent Studies has just issued a report about Australian public attitudes to religious freedom. I’m happy to say that the majority (64 per cent) attitude coincides almost exactly with the one I’ve expressed here, namely that

within very broad limits, what we do and say in our own time is no business of the boss.

That cuts both ways: both offering protection to people whose religious expression offends the boss, and preventing religious organizations from discriminating against employees whose beliefs or life choices aren’t consistent with the religion in question. There are limits of course, most obviously in relation to people whose job it is to represent the organization and its beliefs. But these should be the exception not the rule.

Given its history, (the CIS used to be the leading centre of ibertarian thought in Australia) one might imagine that the poll results would be reported as good news. But this is not the case.

Taking a corporatist line, the CIS argues that individual freedom should be subordinated to the collective rights of organizations to enforce their beliefs, even when they are engaged in in providing publicly-funded services.

The contortions required to reach this point reflect the basic problem underlying this legislation. From the point of view of the proponents, it isn’t about protecting religious belief and expression (what individuals want), it’s about establishing a special, and protected status, for religion.

That is not only contrary to public opinion, but runs directly against the spirit of our constitution, which states (s116)

The Commonwealth shall not make any law for establishing any religion, or for imposing any religious observance, or for prohibiting the free exercise of any religion, and no religious test shall be required as a qualification for any office or public trust under the Commonwealth

In line with its appalling performance on most issues, the High Court has read s116 down into insignificance. But there is nothing to stop the Commonwealth from prohibiting or severely constraining religious tests, and it should do so, particularly in relation to publicly funded organizations.

Yes, the world is paying attention to Australia’s climate inaction

That’s the title of my latest piece in Inside Story Opening paras

Like their counterparts in many other countries, members of Australia’s political class are frequently accused of living inside a self-regarding bubble. That’s certainly true when it comes to climate policy. But bubbles can be punctured by shocks from the outside, and one arrived earlier this month in the shape of a demand from the European Union, led by France, that Australia must make stronger climate commitments if it wants a trade agreement with Europe.

Before looking at the EU position, it’s worth considering how far removed from reality our political class has become. As bushfires raged through October and November, a bipartisan consensus emerged: any discussion of the relationship between the fire catastrophe and climate change, let alone any suggestion of a policy response, would be divisive and unnecessary. Many media outlets were happy to go along with it.

The same willingness to ignore the deeper issues extends to climate-related policy more broadly. As energy minister, Angus Taylor has repeatedly and egregiously misled the public about key aspects of his portfolio. He has denounced renewable energy, made spurious claims about the benefits of coal-fired power, and promoted the government’s claim to be observing our emissions-reduction commitments while vetoing any policy action that might promote that goal.

For all of this, he has had a free pass from Labor and most of the media. Their attention has been focused on a series of trivial scandals, culminating in the publication of a forged document used to accuse the Sydney City Council of hypocrisy. These transgressions may or may not cost Taylor his job, but their pursuit will do nothing to tackle the climate emergency.

More over the fold

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