In Climate clippings 106, item 6 I linked to Joe Romm’s part review of Naomi Klein’s new book, This Changes Everything: Capitalism Vs The Climate. Romm promised to look at Klein’s program for action in a second post. I’m still waiting. I’ll recap here Romm’s exposition of Klein.
Romm on Klein
Klein, he says, makes three essential points:
1. Because we have ignored the increasingly urgent warnings and pleas for action from climate scientists for a quarter century (!) now, the incremental or evolutionary paths to avert catastrophic global warming that we might have been able to take in the past are closed to us.
2. Humanity faces a stark choice as a result: The end of civilization as we know it or the end of capitalism as we know it.
3. Choosing “unregulated capitalism” over human civilization would be a “morally monstrous” choice — and so the winning message for the climate movement is a moral one.
The time for ‘evolutionary’ strategies is long past. Now only ‘revolutionary’ strategies will get us there. Unregulated capitalism is a Ponzi scheme, which must collapse. The real choice facing us is a moral one.
Unchecked capitalism is immoral and will destroy civilisation as we know it.
Gareth at Hot Topic
Across the ditch Gareth at Hot topichas reviewed Klein’s book. Ultimately, he says, Klein’s vision is a moral one. She seeks
“an alternative worldview to rival the one at the heart of the ecological crisis— embedded in interdependence rather than hyper-individualism, reciprocity rather than dominance, and cooperation rather than hierarchy.”
In summary:
We need this not only to create a political context to drastically lower emissions but also to help us through the disasters now unavoidable, where respect for human rights and deep compassion will be all that stands between civilisation and barbarism.
Klein seems to be saying that with a mass movement, as with the abolition of slavery, we can prevail.
She’s really saying, however, that to change capitalism we need to change ourselves. But capitalism has shaped us powerfully to suit it’s needs. Weber’s iron cage comes to mind.
I think the problem is a step up from that faced by the slavery abolitionists. Slavery was only about how the new world acquired labour for farming. When slavery was abolished the price of food may have gone up a bit, but I suspect not much. It has been pointed out that with slavery the landowner kept the whole family. Now farm workers in the New World and elsewhere often work for less than a living wage. Farming in Africa is often practiced by women, whereas the men go off to work in the mines and elsewhere.
Yuval Harari in his book Sapiens: a brief history of humankind reckons that the core concept of modern capitalism is growth. Prior to capitalism, in the first millennium for example, economics was a zero sum game. It was assumed that if you wanted to increase your wealth you would do it by diminishing someone else’s, through plunder, or a landowner screwing more out of the peasants. One’s assumption was generally speaking that the future would be worse than the past.
To skip a bit, by the 19th century we had the industrial revolution and a belief in science and progress. The belief that the future would be better than the past was pervasive. At the same time there were also worlds to being conquered through colonialism and imperialism.
Harari says that obviously exponential growth using more energy and materials must stop somewhere. But, he says, capitalists will tell you that only capitalists can run the world they have created and no-one has much stomach for new versions of communism. Just wait a bit, they say, and goodies will flow to all.
I’ve said elsewhere that our future will not be constrained by a limit on energy. Ultimately we will have access to as much as we need or want. With nanotechnology the same may be true of materials. There is a limit, however, on the goods and services provided by nature.
To cut a long story short, capitalism will I think stay. Our only option is to civilise it. Two of the elements will have to be greater democracy and an expansion of the public sector, the things we do collectively for the good of all. And there will need to be limits to wealth.
We must re-imagine the future. Meanwhile the Scandinavians could be nearer the mark than we are.
She’s not a raving revolutionary. She wants to keep markets with greater government intervention and regulation. We are in an existential crisis; she doesn’t know what the next step is, just that we should all take it very seriously and engage. She intends to spend the rest of her life on the problem.
The Conversation has run this interesting article suggesting that we could learn a lot from the Scandinavian Countries re Public policy. It is all about comparing countries with a long history of governing to improve the welfare of the people and accepting high taxes with our far less people friendly policies that help minimize the taxes of the rich.
Funny thing is that people like the Yanks have been saying for years that what the Scandinavians are doing will wreck the economy despite the durable success of the Scandinavian countries. The Yanks and clowns like Hockey don’t seem to understand that good health, excellent education, a fairer distribution of income etc. actually help economies stay healthy.
Worth a read and worth discussion.
The OECD has identified Australia as one of a small number of countries in which long working hours are common. In comparison, parents in Sweden and the other main Nordic countries have working weeks shorter than the OECD average. This is in addition to their substantial paid parental leave and publicly provided child care.
Shorter working hours allow parents from Sweden to pick up their children after work without the time pressures Australian parents face.
Australia will probably move to make child-care centre hours more flexible to suit our long working hours. However, the government should encourage shorter working hours, which are more compatible with family life.
Tonight (Thursday) on Catalyst Dr Jonica Newberry is going to show a segment entitled Falling in Friendship (cf falling in love), which will look at Dunbar’s number, the number of friends we can maintain in an enduring relationship. The Wikipedia spiel is as follows:
Dunbar’s number is a suggested cognitive limit to the number of people with whom one can maintain stable social relationships. These are relationships in which an individual knows who each person is and how each person relates to every other person. Continue reading Dunbar’s number→
This question was triggered in my mind by hearing an interview with Steven Pinker. There was no doubt in his mind!
Our impressions of violence are determined by media reporting, which concentrates on violent acts. There is always newsworthy violence going on, so our impression is of unrelenting violence in society.
However, Pinker looks at the statistics showing the incidence of death at the hands of another human being over time. This was around 300 per annum per 100,000 population during the Second World War, he said. Since then it has declined to less than one, and continues to fall. He also quoted impressive trends over the centuries.
To cut to the chase, there is a very interesting article by Philip Dwyer at The Conversation, with the important insight that violence is a human construct; what counts as violence varies over time and place. I’m reminded of the notorious Adelaide judge who referred to a case of sexual violence with marriage as “a little rougher than usual handling”. Dwyer also points out that while homicide stats in Australia have been steady for decades, assault is increasing.
Still the decline in violence over the centuries in Pinker’s terms is impressive. Dwyer tells us homicide rates:
have dropped dramatically from 100 for every 100,000 people in the 13th century, to ten in 100,000 by the middle of the 17th century (although it was that high in the United States only a few years ago) to rates of around one in 100,000 people in most Western countries today.
The reasons for this deserve analysis, which Pinker attempts. His six trends, five inner demons and four better angels are interesting but must in the end be speculative.
The IEP’s Global Peace Index is researched by an international panel of experts and complied with data collated by the Economist Intelligence Unit (EIU). The GPI ranks 162 countries, covering 99.6% of the world’s population.
The index is composed of 22 indicators, including a nation’s level of military expenditure to its relations with neighbouring countries, as well as the percentage of the population held in prisons.
Thus homicides are but one of 22 indicators.
They note a 60-year down trend for violence since World War II, but a corner was turned in 2008. Each of the last seven years was more violent than the one before.
The 10 most peaceful countries in order, are Iceland, Denmark, Austria, New Zealand, Switzerland, Finland, Canada, Japan, Belgium and Norway. Australia comes in at 15th. Europe is the most peaceful region occupying 14 of the top 20 places. It would be interesting to analyse why Italy at 34, the UK at 47 and France at 48 do so much worse than the rest of Europe.
The United States is near the middle of “medium” occupying 101st place in the company of Haiti, Benin, Angola and Kazakhstan, a distinctly third world positioning. Amongst the OECD countries only Turkey at 128 and Mexico at 138 come out worse. South Korea is at 52, but as far as I can see all the other OECD countries are in the top 50.
The worst in order (worst first) are Syria, Afghanistan, South Sudan, Iraq, Somalia, Sudan, Central African Republic, Democratic Republic of the Congo, Pakistan, North Korea and Russia.
Dwyer says the evidence suggests:
violence is not a purely innate phenomenon and that it is also a question of culture and education. Cultural factors can play a determining role in how aggressive or violent a society is. Aggression, which is often mistaken for violence, can be contained by society and can be channelled into more positive activities.
In this, the role of the state and local community is fundamental. In countries where citizens identify with their local communities and where government is responsive and popular, levels of violent crime are relatively low.
He also says that violence is largely a thing for males aged 20 to 30.
It is said that the brain connections between our emotional and rational faculties only mature at age 24, plus or minus 5 and a little earlier for women than men.
Peabody Research Centre have done a study which found that religious hostilities reached a six-year high in 2012. However, I haven’t seen enough of the study to get a feel for what it is really about.
Dwyer finishes with:
Is the end of violence possible?
No, but cultures and attitudes can be changed by focusing, above all, on education, positive outlets for aggression, and community involvement.
if the UK cut its carbon emissions by 60 per cent from 1990 levels by 2030, as it has promised, its GDP would be 1.1 per cent bigger than if it stuck with fossil fuels, says a study by consultants at Cambridge Econometrics.
About half the gain would come from cheap running costs for fuel-efficient cars, with 190,000 new green jobs and higher wages also helping. The average household would be £565 a year better off.
I find each report has limitations in its own way, so at the end I remain agnostic.
The fourth, the IMF study, looks at carbon pricing in the top 20 emitters. As far as I can make out it comes up with two propositions. First, each country can act on its own, with benefit, no-one has to wait for the world to act. Secondly, it identifies a sweet spot, which varies quite a lot from one country to the next, where net benefits accrue from carbon pricing. In Australia’s case it’s only $11.50 per tonne.
This is all very promising but is not as such a plan for climate stabilisation at safe levels.
The third, the American study, finds the aim of reducing emissions by 40% from 2005 levels by 2035 doable and beneficial. The problem here is in the task identification. The study assumes that the US should decarbonise at the same rate as the rest of the world. It ignores the ‘carbon budgeting approach’ whereby high per capita emitters need to decarbonise rapidly to make space for developing countries to grow their economies. See Figure 5 of this post on the IPCC report. The United States is a Group 1 country, which must decarbonise rapidly:
Figure 5: The climate budget approach
As we saw in this post, two thirds of increased emissions are now coming from emerging and less developed countries. In other words in reality increases from Group 2 and 3 countries are not being offset by cuts in Group 1 countries. Until we get our heads around this issue and address it we’ll stumble along on the road to perdition!
The problem facing Group 1 countries is impossible. The way around it lies in emissions trading between rich and poor countries, as per Figure 6 in that post. This would entail considerable wealth transfer, which could be mandated to be used in greening developing country economies.
Also 40% by 2035 overall is not a recipe for a safe climate, as shown below.
The first study, has two limitations. Firstly it simply does not address the issues of economic costs and social implications. Secondly, it simply accepts the stabilisation pathway for a 2°C temperature increase which sees zero worldwide emissions about 2070. In looking at the IPCC report (same as linked above), I developed this table to relate concentrations to temperature rise. RCPs are Representative Concentration Pathways (RCPs) which are expressed in terms of watts per square metre of radiative forcing (W m-2). Roughly, RCP2.6 represents the 2°C pathway, while RCP8.5 represents our present path.
Figure 1: RCP temperature scenarios
Green indicates a comparatively ‘safe’ climate, orange indicates the increasingly contested zone which clearly carries some danger, and red to indicate breaching the 2°C guardrail which everyone with half a brain accepts as dangerous.
Strictly speaking the green box should be orange, because it sits on top of ‘now’ which is an 0.6°C increase, and the orange box below it should be red, for the same reason.
On the orange zone, the Climate Change Authority in its Review published this wondrous graph, showing that they were well aware of the inadequacies of a 2°C target:
As I said then, in terms of CO2 equivalents we are now at 480. This gives us less than 33% chance of staying below 2°C and about a 10% chance of exceeding a civilisation threatening 4°C. These odds are unacceptable. We are already in an overshoot situation.
This is old information – very old. James Hansen told us at an American Physical Union meeting in December 2007 that we needed to aim for 350ppm in the first instance and then decide where we go from there.
The RCP2.6 path involves a 33% chance of ending up with more than 2°C, odds that should be completely unacceptable.
Turning to the third report, which specifically addresses the financial implications, it too is on 2°C path. The costs numbers when taken in isolation look large (US$45 trillion will be required in 2015–2030 for key categories of energy infrastructure), but in context are trivial:
costs of this magnitude look like “background noise” when compared with the strong underlying growth that the global economy is likely to experience.
These costs will go up if mitigation is delayed:
Costs are also likely to rise sharply with delay. If global action to reduce emissions is delayed until 2030, global CO2 emissions would have to decrease by 6-7% per year between 2030 and 2050 in order to have a reasonable chance of staying on a 2°C path. Such rates of reduction are unprecedented historically and are likely to be expensive (estimates of delay suggest an average annual consumption growth loss of around 0.3% in the decade 2030 to 2040, compared to a loss of less than 0.1% over the same period if we act now).
Fine, and perhaps not yet serious, but I’m afraid completely out of date. In 2011 the Climate Commission published this graph to illustrate the implications of delay:
Figure 4: Emissions reduction options
Under the ‘climate budget approach’ the area under the line must remain constant.
That too would have been based on a 2°C target, but it illustrates that if we delay peaking emissions worldwide, even to 2020, we’ll be in completely uncharted territory.
Chapter Five of the third report gives enormous detail of the policy work that needs to be done. It may be summarised as strong leadership, consistent policy over decades, structural change and perhaps unprecedented international co-operation, even if we start now on a task that is eminently doable and inexpensive; so more than “a bit of political will” is required.
Frankly, our best hope lies in the prospect that solar technology with storage will simply become the cheapest form of new energy, and has the advantage that it doesn’t need a large grid. Nevertheless there will be residual problems – land use and agriculture, transport, ocean acidification etc. Zero emissions transport will require planning and subsidies.
One thing we should realise, however, is that further out our future will be energy rich, not energy-constrained. Saving energy is not a reason for localism and changing the way we live.
So where does that leave Val’s second option?
Firstly, concerted long-term action and international co-operation of the kind we need is not in our DNA. We are designed to co-operate in bands of up to 150 people, the number that our big brains can cope with in terms of knowing in any detail. We are told Fukuyama, Harari for example that bands were relatively egalitarian with a leader answerable to the people. Beyond that we can co-operate in amazing ways, but at the price of setting up hierarchies and privileges, coercive elites. This occurred in general with agriculture and owning stuff, even herds. These problems can be ameliorated in a modern democratic nation-state, with it’s formal mechanisms for election, administration, justice and accountability, but we are still apt to act in the self-interest of that larger entity.
What we need is an infusion of new values and ways of perceiving, thinking and feeling. While not sacrificing individualism we need to feel and act as social beings. We also need to revalue ourselves in relation to the biological and physical systems of the planet, so that we stop acting like the top rapacious predator, the one that has decimated the wild animal kingdom by 52% since 1970. Along the way, we need to challenge a Chain of Being, that sees elite mostly European males as next to the gods and women, children, other races, other social classes, slaves, asylum seekers etc in subordinate positions.
We need to live in nature, not over nature.
While localism and social participation are necessary, the required cultural and existential changes are hard work will happen over generations if at all. The planet can’t wait. That last reference tells us:
Efforts have been made to economically quantify the world’s “stock” of natural capital and the yearly “flow” of ecosystem services they provide. The latest numbers are $142.7 trillion and $48.7 trillion, respectively. By comparison, the flow of incomes through the global economy is currently about $71.8 trillion per year. The research suggests that by 2013 we were eliminating that stock of natural capital at a rate of about $7.3 trillion per year, and that the flow of ecosystem services would be $23 trillion higher if not for human practices like deforestation, burning fossil fuels, and the like.
And underneath all this, there is the point that these creatures and the ecologies they inhabitant have an intrinsic moral worth irrespective of the dollar sign that markets can place on them. “Wildlife is and should be useless in the same way art, music, poetry and even sports are useless,” author Richard Coniff recently wrote in the New York Times.
And the climate can’t wait.
We need hierarchies to get things done, a collective will not build a battleship, but we need to civilise them and render them accountable. We even need coercive powers, to counter the selfishness of states. The only supra-national entity that the major powers take notice of is the World Trade Organisation, not the UN. We need it to police international agreements, to oversee international carbon trading, and what Quiggin’s third report calls “border carbon adjustments”.
I never thought I’d say that!
The bottom line is that we must act if we want a future for our grandchildren, and cost, the only certain Armageddon is if we do nothing or not enough. We are heading into uncharted territory but indications are that there will be benefits and the net costs are unlikely to be as bad as pessimists might think. We just don’t know. And the groupie, local stuff, well there are reasons for doing that, but it won’t solve climate change as such.
It may be Abbott’s but it is not a solution. The numbers will be negligible.
Cambodia’s Interior Ministry spokesman Khieu Sopheak said his country wants to take far fewer refugees than expected after an initial pilot program that could involve only a handful of people.
“It would be 20 or 10 or 50 or 100 or something like this. Not 1000 as people have said,” Mr Khieu Sopheak told the Phnom Penh Post.
Only people willing to go will be shipped to Cambodia.
Long Visalo, secretary of state at Cambodia’s foreign ministry, told journalists that before refugees slated for resettlement on the Pacific island of Nauru are selected, Cambodian officials will go there to brief them on the country’s difficulties and traditions.
Cambodia is one of the world’s poorest nations.
“We will explain to them about Cambodia … the country is like this or this, a lecture for them and then they will decide if they want to come or not,” he said.
Cambodia certainly is poor ranking 183rd in the world in terms of per capita GDP. While a signatory to the UN convention Cambodia currently hosts only 70 refugees and 20 asylum-seekers. It has not always been exemplary in the treatment of its own minorities.
Immigration Minister Scott Morrison told RN’s AM that four or five would be resettled at first. It seems altogether possible that volunteers will be found given the horrific stories coming out of the Nauru detention centre:
Greens senator Sarah Hanson-Young said women inside the centre were regularly required to strip and exchange sexual favours with guards so they could have access to the showers.
She said there were also allegations children had been forced to have sex in front of guards at the centre.
The UNHCR is not happy. They are deeply concerned at the precedent set by the Cambodian agreement:
“This is a worrying departure from international norms. We are seeing record forced displacement globally, with 87 per cent of refugees now being hosted in developing countries. It’s crucial that countries do not shift their refugee responsibilities elsewhere,” said UN High Commissioner for Refugees António Guterres. “International responsibility sharing is the basis on which the whole global refugee system works. I hope that the Australian government will reconsider its approach.”
UNHCR has consistently advocated for asylum-seekers to have their claims assessed and to benefit from protection in the territory of the State where they arrive, or which has jurisdiction over them.
“Refugees are persons who are fleeing persecution or the life-threatening effects of armed conflict. They are entitled to better treatment than being shipped from one country to the next,” Guterres added.
It’s over 6 million who are internally displaced, approaching to 7 million people, and over 3 million who have fled over the borders – and, of course, these are known numbers. There’s always some leeway with this but we know of at least that many people. So it’s a severe humanitarian crisis.
The UNHCR are looking for another $1.8 billion to deal with the Syrian refugee problem. Abbott might give a damn if he’s honestly concerned about humanitarian issues.
Bernard Keane has been tracking the numbers at Crikey. Since the Hilton Hotel bombing in Sydney in 1978 a total of 113 Australians, at home and abroad, have died from terrorism.
In a New Matilda exclusive Chris Graham brings us the shocking death toll of Australians on Australian soil at the hands of Muslim terrorists – zero!
In the 10 years from 2003 to 2012 a total of 417 people in Australia died from falling out of bed, 230 from falling off ladders and 198 from falling off chairs. Rational analysis tells us that we are more at risk from ourselves and our loved ones than from terrorists. Suicides come in at 22,800 and homicides at 2,617. Somewhere between 700 and 1000 women and children have been killed by their parents or partners.
The toll from car accidents (excluding pedestrians and other vehicles) was 8,500 in the 10 years.
As of mid-September, 129 Australians have been killed at work, compared to 125 people killed to the equivalent point in 2013, Safe Work Australia statistics show. The mining sector has already exceeded the death toll for the whole of 2013, with 12 people killed, and the construction industry has already claimed 18 lives, already one more than for the whole of 2013. Transport, the biggest sector for workplace deaths, is also performing worse than 2013, while agriculture, second biggest, is tracking around the same as last year.
The rise in workplace deaths this year defies years of improved workplace safety data: the incidence of workplace deaths rose from 2003-04, peaked in 2007-08 and has fallen dramatically since then, with an overall incidence rate in 2011-12 nearly half of what it was in 2002. Even so, 186 Australians went to work in 2013 and didn’t come home…
Here’s a graphic of select causes of death in 2003-12:
There are some preventable health and social justice issues that jump out of the statistics. Indigenous Australians, for example, are seven times more likely to die from diabetes than are other Australians. Keane questions our resource allocation priorities.
Problem is that many causes of death are ‘normal’ in terms of our emotional reaction, unless someone near to us is involved or there is emotional engagement for some other reason. Terrorism is, of course, designed to strike fear.
Our spooks have used this fear to gain ‘improvements’ to the security laws. Matthew Knott has an excellent explainer at the SMH:
So what’s in the new laws? They cover four main areas:
greater protection for intelligence officers who commit crimes while conducting operations;
cracking down on the leaking and publication of information about secret operations;
expanding ASIO’s access to computer networks;
making it easier for Australia’s spying agencies to work together.
The second is likely to have a chilling effect on reporting. For example, if a reporter was tipped off that surveillance equipment was being installed in the East Timor cabinet room under an Australian aid project, he or she would be reluctant to report it and risk up to 10 years jail.
On the third, it seems the spooks will be able to go anywhere they choose on the internet.
Labor has waved these laws through in the Senate, leaving critique to the Greens and some of the cross-bench:
The bill passed the Senate, 44 votes to 12. The Government, Opposition and Palmer United Party voted for the legislation, along with the Motoring Enthusiasts Party Senator Ricky Muir, and Family First’s Bob Day.
The Greens, Senators Xenophon, Leyonhjelm, and Senator John Madigan were all opposed.
This spineless approach from Labor bespeaks political pragmatism rather than principle.
Rob Oakeshott tells us he “poked power in the eye and got an almighty punch on the nose in return.” He laments the influence of the monied class in politics, which he sees as subverting democracy.
Swan is very clear about how a small but growing number of very rich people penetrate the political system in a reflective chapter of his book, The Good Fight. There is a negative review in Newscorp and an amazingly positive one in Fairfax. Who would have thought! I’m not sure they read the same book! I’ll not attempt a review here. Rather, I’m focussing mainly on his chapter Enemies worth having and his paper The 0.01 per cent: the rising influence of vested interests in Australia originally published in The Monthly, now included in an appendix.
Swan accepts the market economy and the value of entrepreneurship, and accepts that many business leaders are concerned about the national interest as well as the welfare of their corporations. Unfortunately a growing number, he says, suffer from ‘the blindness of affluence’ based on materialism and selfish individualism, and are aggressive and ruthless in pursuing their ends. He says:
Many of the winners from our prosperity just don’t see poverty and injustice any more, let alone the persuasive case that a fairer society produces an even more prosperous economy. The logic and the economics put forward by Joseph Stiglitz and Thomas Piketty, and in Australia by people such as Andrew Leigh, are ignored. And in their world, higher quality universal education and health services are a drain on the budget, not a platform for a fairer and more prosperous economy. (Emphasis added)
Such selfish corporates preach competitiveness and productivity for the economy as a whole, but in practice are only interested in the short-term benefits to their own corporations. What they are seeking is wealth transfer to them from consumers and taxpayers.
This small but growing group throw their weight around quite directly. The classic case was the public campaign over the mining super tax, where they sought to destroy a government rather than offer up one cent. They blatantly lied about consultations that had been held with them and mounted a $20 million media blitz against the Government.
In this case their bluff was called by Gillard when she attained power. She told the miners that the tax would be implemented in spite of them. They had a choice of entering discussions to have an input, but only on condition that they withdrew their campaign. This worked and the discussions were amicable.
I’ll leave it to others to judge whether the miners nevertheless got much of what they wanted. I’ll just note that it is a super profits tax and that the industry pays considerable normal royalties and taxation. Nevertheless the point in question is that the minerals are owned by the people, not the companies, and the people should get a fair reward.
This example encouraged the club industry, where the independents, Oakeshott and Windsor, were certainly spooked by their campaigning against the proposed pokies legislation. The extent to which the Labor Government was similarly spooked is not clear.
The tobacco industry is one case where the Labor Government stared the industry down.
A case where the industry won hands down was the superannuation industry. The fees accruing to the funds management industry are in the range of $20 to $40 billion each year. The industry can thank Labor for creating the industry and Labor had just approved a graduated increase from 9 to 12%, thus increasing the size of the industry by a third through that decision alone. Swan details how he planned to close the super tax loophole for the very wealthy, looking for funds to pay for the NDIS (National Disability Insurance Scheme).
John Brogden, head of the Financial Services Council, requested a meeting, which was arranged with Swan, Shorten and advisors. Brogden advised that his industry had a media campaign against the Government ready to go, and if they altered super in any way at all they would launch it.
Swan told Brogden he didn’t play that way and terminated the meeting, but in fact in the end he soaked the universities instead.
In looking at the Henry tax review a Business Tax Working Group was formed. When considering reducing the corporate tax rate, Swan wanted to pay for it by rescinding a raft of business tax concessions. The BTWG insisted that it be paid for by consumers with an increased GST. The BWTG subverted the consultations by backgrounding the media, producing negative press commentary. In the end nothing happened.
Business too lined up against carbon pricing and the greenhouse mafia appear alive and well in the current consideration of the Renewable Energy Target.
Swan sees the conservative political parties as tools of business with sections of the media playing their part.
Swan says you enter politics to make a difference and if you forget the little people you sacrifice part of your nation’s soul. Strange he doesn’t mention what happened to unmarried mothers under his watch, but he does regret that fiscal discipline is a brutal game and often brings into play what he would call Labor values.
In the end he gives himself a tick. A bit over a month after he resigned as Treasurer the ABS Household Income and Income Distribution data was published showing that inequality had fallen again between 2009-10 and 2011-12.
According to Swan, Obama described income inequality as the defining issue of our time. I wonder whether he too would get a koala stamp!
A key feature of the government’s approach to unemployment is the constant vilifying and harassing of the unemployed. It may be a good strategy for diverting attention from government stuff-ups and appealing to voters darker side but there are no signs that it is reducing real unemployment , creating jobs, preparing people for more productive work or helping to share the available work in a fairer way.
This post asks whether there are smarter, fairer ways of dealing with unemployment. It also presents some useful employment and unemployment welfare system data.
Finland and South Korea are among the world’s leaders in education. So it is worth asking what these countries do that is different. This TED article tries to answer that question by asking what they are doing that is right? What they found was two very different systems. Continue reading What the Top Education Countries do→
Robert Menzies left Australia in far worse financial shape than he found it, at least according to current treasurer Joe Hockey’s favourite debt and deficit benchmark. Having inherited budget surpluses from the Chifley Labor government, the Menzies Coalition government ran small budget surpluses from 1949-50 to 1957-58.
But then Menzies’ “irresponsible profligacy” began, running budget deficits for the last nine years of his reign.
Menzies was interested in nation building rather than obsessing about budget deficits.
So, what was Menzies up to? He clearly wasn’t obsessed with the budget deficits or worried about numbers of public servants that so concern Hockey. The economy grew quite steadily, often growing at more than 6% in real terms. Unemployment was mostly around 2% or less, and only 1.6% when he retired. Over his time in power, you couldn’t even argue that Menzies was trying to balance the budget over the business cycle.
Menzies was interested in nation-building. He not only wanted rapid population growth, but he wanted infrastructure growth and growth in the health and education services that make a society both cohesive and productive.
Like any successful corporate leader, he was willing to use long-run debt financing to fund long-run investments. Menzies knew that a lot of his budget spending was for capital projects that would deliver benefits for decades, so why should he have funded them entirely out of one year’s revenue?
Hockey, on the other hand, wants to fund a big increase in infrastructure spending with no increase in tax and no increase in debt. He wants to fund more capital spending by cutting spending on essential services and income support for poor people.
The simplistic notion that a deficit is evidence that a government is “living beyond its means” is complete economic nonsense. Leaving aside that historic and international evidence provides no support for the claim that budget deficits cause long-run economic problems, the argument is contradicted by the corporate decision making that politicians pretend to emulate.
Historically substantial levels of public debt have been normal:
Commonwealth net debt stood at 12.5% of GDP in June. The following graph shows net debt projected out to 2013-24:
Government ministers are fond of household and corporate analogies.
It is perfectly normal for a family to borrow money to buy a house, up to 27 to 30% of annual income. Corporates that do not have debt of 30 to 60% of net worth are said to have ‘lazy’ balance sheets. Unless they take on respectable levels of debt, growth prospects are usually minimal.
Parents of a school wanting to build a swimming pool or other optional facility typically need to borrow money otherwise they will never get the use of the facility while their kids are at school.
Where would Brisbane be without the Story Bridge? According to Wikipedia the successful tender was ₤1,150,000. From memory the debt was finally paid off in 1997, when the payments were actually negligible.
Hockey, Abbott, Cormann and company take us for fools, insult our intelligence and generally carry on in a reprehensible manner! They are not acting in the national interest.
Late last year Joe Hockey asked the Productivity Commission to investigate childcare and early learning. They brought down a draft report last month. Laura Tingle takes up the story:
The commission’s terms of reference talked about improving the flexibility and affordability of childcare which, in turn, would help workforce participation.
The headlines generated by the draft report focused on the possibility of childcare subsidies extending to nannies, and the fact the PC dumped on the PPL scheme, suggesting its funding be instead put in to subsidising childcare.
But the 904-page report actually shakes up a lot more of the “givens” in the wider policy debate.
It recommends directing subsidies back through childcare providers, for example, ending one of the Howard-era payments that tried to politically leverage spending by putting it instead in taxpayers’ hands.
It deals both with particular structural problems in the childcare market and how these play into the shortages of places that terrify any new parent. For example, caring for babies younger than two costs roughly twice as much as it does to look after older children, yet most providers cross-subsidise to entice parents in the door but in ways which partly explain the lack of places for really little kids.
The commission’s report also deals with the effective marginal tax rate disincentives in the welfare system to parents returning to work and how structured subsidies exacerbate these problems.
The big surprise, however, was the Commission’s finding that improved childcare accessibility isn’t going to lead to any significant improvement in either participation or productivity. This is counter-intuitive and brings into question the social and economic efficacy of the paid parental leave scheme. Nevertheless the Commission comes up with the novel idea that subsidies could be justified in the interests of the well-being of children.
Tingle says:
That is, childcare has tended to be debated as a workforce issue, or as an entitlement issue for parents, rather than one that frames the discussion as one about government subsidies directed at the welfare of children.
Childcare has snuck up on us as a new “entitlement” in the past few decades that now sees governments meeting two-thirds of total costs, without the community ever having a real debate about what the community benefits – as opposed to the benefits to individual families – might be.
Tingle says we haven’t ever really discussed the issue, or how we best target set dollars to maximise outcomes if children’s well-being is the target, rather than the workforce.
Tingle perhaps missed a series of discussions probably at least 10 years ago, from memory, largely via Radio National’s Life Matters program on whether child care was good for children.
Early childhood education practitioners I talked to at the time were largely negative about long day-care. On the other hand, there was evident value for development and learning for children to be exposed for part of the week to the stimulus provided by quality child care. The tipping point between positive and negative is not a matter for generalisation, rather it depends on individual circumstances.
I note here that Queensland’s preschool education provisions introduced in 1971 by some talented and respected early childhood educators opted for a model that had five 2.5 sessions per week with each preschool having two groups either split to mornings and afternoons, or splitting the week at Wednesday lunchtime. The sector achieved a 90% participation rate, with some children also attending childcare during part or the whole of the rest of the week. The preschool year has now been replaced by a full prep year starting children 6 months older.
There was also detailed examination of institutional delivery provisions at the time when Maxine McKew was working for Julia Gillard, then minister for education, when Labor policy was to deliver childcare in association with schools. I know McKew was talking to some well-credentialled people about imaginative, indeed exciting delivery modes. Apparently she was cut off at the knees by Gillard and the initiative was dropped as a cost saving measure.
I’ve never heard the real story on what happened. McKew did not generate much public debate on the issues, just worked away quietly, perhaps too quietly. I’ve long suspected that her relationship with Gillard was basically dysfunctional from the start for whatever reason.
Tingle’s main point, however, is that this government’s MO is the grab for solutions without working through a proper public policy development process. I don’t see that changing.
This one is worth doing properly. Research from decades ago indicates that early childhood education opportunities have a lifetime impact on personality styles and individual life chances. In my humble opinion the lack of appropriate early childhood experiences shows in many of our politicians. Many were almost certainly bullies in the sandpit!
From reviews it seems there was a lack of chemistry between Gillard and McKew, but from the book their relationship seems professional enough within McKew’s portfolio responsibilities.
Labor went to the election promising 260 new centres to be associated with educational institutions, presumably principally schools. 38 of the centres were targeted for ‘hot spots’ of special need. It’s not clear from the text whether these 38 were built, but expressions of interest were called for the remaining 222.
In the event the money was spent on cleaning up after Eddy Groves and the collapse of the ABC chain.
There was a proposal to include the childcare centres in the Building the Education Revolution funding (halls and libraries) but Gillard chose not to run with it. There was a problem McKew says, in that for every centre with hopelessly long waiting lists there was one down the road struggling to fill places. Quality varied immensely and the stories from some centres curdled the blood. There was a national accreditation body, but it was operating at the limits of effectiveness, in other words in practical terms it was virtually useless.
McKew then turned to the task of cleaning up the existing system which was a mess of different provisions and standards across the country. She appointed and worked with an Expert Advisory Panel, which looked at everything from staffing ratios, to program and curriculum standards and systems for accreditation and supervision under the rubric of a National Quality Framework. McKew says that this was successful, but few in the community may be aware of its existence.
On staff ratios, the norm was 1:5 for under twos. McKew wanted 1:3 but the states and territories would only come at 1:4. Every centre with 25 or more children would employ an early childhood teacher by 2014. In addition, at least 50% of other staff would need to have or be working towards a diploma in early childhood education and care.
The critical meeting, co-chaired by McKew and Gillard, was held in mid-2009 under the auspices of COAG. McKew says:
Gillard brought a calm rationality to proceedings, and with appeals at times to ‘the collaborative spirit of COAG’, she locked in a transformative agreement.
Mission accomplished, it seems, and McKew went off to work for Anthony Albanese.
Climate change, sustainability, plus sundry other stuff
The big surprise, however, was the Commission’s finding that improved childcare accessibility isn’t going to lead to any significant improvement in either participation or productivity. This is counter-intuitive and brings into question the social and economic efficacy of the paid parental leave scheme. Nevertheless the Commission comes up with the novel idea that subsidies could be justified in the interests of the well-being of children.