The good news on climate

John Quiggin36 Comments

Climate policy under the Abbott-Turnbull government has been so uniformly grim that it’s sometimes hard to remember how well things are going elsewhere in the world. A few of the most notable developments

* India has ratified the Paris Agreement, a big step for a country which not so long ago was disclaiming any responsibility to act. The EU will follow suit next week, and the agreement will enter into force 30 days after that.

* (H/T James Wimberley) Renewable electricity investment in 2015 was “more than sufficient” to cover the growth in global demand, according a new report by the International Energy Agency (IEA). Unfortunately, fossil fuel capacity is still growing, adding to overcapacity, particularly for coal. But once this idiocy ends, the combination of growing energy efficiency and new renewables will be sufficient to see electricity-related emissions peak and then decline.

* Despite a 60 per cent reduction in the crude oil price, oil demand has barely moved. Admittedly, supply has also been slow to respond, but capital expenditure has been slashed, suggesting that we will see reduced oil production in future.

There’s still the chance of disaster. Should Donald Trump manage to get elected as President of the US, the whole process will be set back (though withdrawing will be difficult to do in a 4-year term of office) as will just about everything else. Currently, that chance is estimated at 30 per cent and falling, which is much better than it was a week or so ago, but still way too high.

But if that can be averted, there’s every chance that the world can reach peak CO2 emissions by 2020 and reduce emissions drastically after that. If that requires sanctions to bring a handful of recalcitrant governments into line, those governments will have well and truly earned it.

The LNP/ONP coalition government: who’s in charge?

John Quiggin49 Comments

I’ve found the reaction of Malcolm Turnbull to the South Australia blackout too depressing to discuss, but I suppose it’s time to talk about it. Turnbull was depressing for three reasons

First, there was the absurdity of failing to distinguish between transmission failures (pylons destroyed by storms) and intermittency. Reading the comments of Turnbull and others, it seemed as if the reasoning process was something like “wind bad for electricity system, so must cut back on wind power”). I gave up on expecting any substantive difference between Turnbull and Abbott quite a while ago, but this silliness coming from the alleged “smartest guy in the room” was depressing.

Then there’s the substantive political content. Turnbull and Frydenberg have already any ruled out kind of carbon price, even the emissions intensity mechanism proposed by the Climate Change Authority (of which I’m a member) as an evolution of Direct Action. When doing this, Frydenberg justified his position by saying that an energy transition, presumably to renewables meant that the government’s targets were achievable. Now, even this fig leaf has been stripped away.

Finally, and worst of all, it’s one more step in the capitulation of rightwing neoliberalism to the rising tide of tribalism. In the LNP-ONP coalition I described a month or so ago, it’s now clear that One Nation with its associated faction within the government (Bernardi, Christensen, Abbott and others) has the upper hand. ONP Senator Malcolm Roberts tweeted to Turnbull that it was “Good to see you coming around to One Nation’s position“, and he was spot on. Doubtless he’ll have many more occasions for similar tweets in the future

The polls suggest that the public reaction to all this is unfavorable, but unfortunately it’s a few months too late. We’re stuck with this for another three years.

Homesteading

John Quiggin85 Comments

In my final post on Locke’s theory of appropriation/expropriation, a while back, I mentioned that his latter-day successors, Nozick and Rothbard didn’t offer any improvement. I said at the time I would spell this out a bit more. I’ll start with Rothbard who is more politically relevant, and also, in my opinion, more interesting. As an example, at least during his 1960s flirtation with the radical left, and at the time he developed the theory of ‘homesteading’, he favored reparations for slavery.

The core of Rothbard’s position is that appropriation of property justifies ownership even without the Lockean proviso that ‘enough and as good’ is left over for others. Rothbard doesn’t, as far as I can see, go far beyond presenting this as a self-evident truth, and in any case, I don’t propose to argue about in detail. Rather, I want to look at Rothbard’s choice of the term ‘homesteading’ to describe this process. This choice of term is self-refuting in two ways, one that applies to any historical process of appropriation/expropriation and the other specific to the US.

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Wise in hindsight

John Quiggin50 Comments

My article on the failure of for-profit competition in human services included a hook to the recently published Productivity Commission report recommending more of the same. I haven’t had time to go through the report in detail, but I was struck by reports that the PC mentioned the FEE-HELP fiasco in the VET sector as an example of the way not to go about things.

It’s good to see some recognition of this but what matters here is foresight, not hindsight. So, I thought I’d check back to see what the PC was saying a couple of years ago, when the disaster was obvious, but was still being denied by those in charge of it. Here’s a quote from their submission to the Harper Competition review

The Commission’s study into the vocational education and training (VET) workforce (2011f) found that there had been a rising trend to harness market forces in the allocation of VET services, with principles such as user pays and user choice increasingly underpinning VET policy. The Commission suggested that, as the VET sector becomes increasingly competitive, a move towards greater managerial independence for public providers would give them the autonomy and flexibility they need to respond.
The Commission (2011f) also noted that opening up of the VET sector had not been a complete success, with some stakeholders raising concerns about quality assurance, monitoring and enforcement (especially in the international student sector).

Going back to the 2011 report, there is indeed a box referring to problems with international students, which drew a lot of attention at the time. But there’s nothing to suggest any awareness of the broader problems, which were already apparent*, let alone any capacity to predict them using the PC’s analytical framework.

* I wrote a report for the National Council on Vocational Education Research in 2012, making many of these points, and drawing on several years of evidence from Victoria. I was roundly derided for my pains by the private provider lobby.

Worse than the Bourbons

John Quiggin35 Comments

I have a couple of pieces in The Guardian. The first, which came out a few days ago, points out the consistent failure of market competition and for-profit firms to deliver human services effectively and equitably. The second gives the mainstream economic analysis of the problem, in terms of market failure and the mixed economy, developed 40 to 50 years ago, and ignored by the policy class of today, which takes the assumptions of market liberalism (aka neoliberalism) for granted. My summary:

The problem is that the political class, along with much of the economics profession, have done worse than the Bourbons, of whom Talleyrand observed “they have learned nothing, and forgotten nothing”. … Our leaders, and the economists who advise them, have not only shown themselves incapable of learning from experience, they have forgotten much that we once knew.

Brexit and bigotry (crosspost from CT)

John Quiggin63 Comments

Following my previous post, I’d like to add a bit more to the debate about Brexit and migration. On this issue, a common defence of the Leave campaign is that the central concern was about the need to cut the number of migrants to the UK so as to reduce competition for jobs. The plausibility of this defence has been undercut by recent negotiations, widely reported in the Australian press, but largely ignored by British media.
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New Zealand’s zombie miracle

John Quiggin39 Comments

Twice in the last couple of days, I’ve bumped into the seemingly unkillable zombie idea that the New Zealand economy is doing well and ought to be a model for Australia. Checking Wikipedia to make sure I hadn’t missed anything, I found that, as of 2015, NZ income per person was 30-35 per cent below that in Australia, as it has been ever since the miraculous reforms of the 1980s and 1990s. NZ is down with Italy and Spain on most rankings, while Australia is comparable to Germany (above on some rankings, below on others).

This wasn’t always the case. Before the reform era, New Zealand and Australia had almost identical income levels, among the richest in the world. NZ took a bigger hit from British entry into the EU in the early 1970s but after 50 years, that can scarcely serve as an excuse (and of course, no one is predicted that Brexit will be a gigantic benefit to NZ; rather the reverse)

Then there’s migration. I dealt with this here, but I’ll repost crucial points over the fold.

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Last chance on climate change policy

John Quiggin68 Comments

With August 2016 setting yet another record for global temperatures, the need for action on climate change is obvious. The good news is that most national governments are finally recognising the urgency of the problem. The bad news is that Australia is not among them. Having commissioned a Special Review from the Climate Change Authority (of which I’m a member) and received recommendations designed with the current policy as a starting point, the government’s response has been that it might take another look at the problem in 2017.

I’ve written the statement over the fold in response. Comments very welcome. I won’t engage in discussion; in this context, I’d rather let the statement speak for itself.

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