Abbott’s Davos Disaster

By Alan Austin                                                                                                      [h/t IA]

AUSTRALIANS WATCHED TONY ABBOTT fly off to Switzerland this week to deliver an important speech to world leaders with muted anticipation. Commentary in advance ranged between frank pessimism and outright dismay.

It is clear now the PM failed to live up to those expectations.

Fortunately, the damage done to Australia’s reputation was limited by most media declining even to mention the Abbott embarrassment.

The New York Times has extensive coverage of the World Economic Forum (WEF) in Davos, with a dedicated web page and many feature articles exploring the key themes and major players. None mentions Abbott — who, by virtue of the high regard for his predecessor, finds himself the accidental president of the G20 for 2014.

Le TélégrammeL’Humanité  and Le Parisien in France published stories from the WEF but completely ignored Abbott. L’Agence France-Presse filed multiple reports profiling the contributors, but excluding Abbott.

Le Figaro focussed on the speech by International Monetary Fund director Christine Lagarde who addressed constructively the new dangers – nouveaux risques – threatening global recovery. These are, she said, deflation in Europe, tapering of US monetary policy and distortions in global financial markets.

With an embarrassed cough, Le Figaro noted Abbott’s address as a footnote, quoting him as calling for more free trade, an idea that was a long way from the agenda – très loin de la thématique – of earlier gatherings.

Les Echos did mention the keynote speech, reporting that the thrust of Australia’s G20 presidency will be free trade. It noted it was odd Abbott didn’t mention the World Trade Organisation.

The Guardian in Britain headlined its piece “Does Tony Abbott always make the same speech?” andreported that it “struck a familiar tone and was criticised for being inappropriately partisan.”

Indeed, Abbott’s reputation as a buffoon appears to have preceded him to Davos.

The Financial Times UK’s economics editor, Chris Giles, tweeted:

‘Sign of the times. [Iran’s President Hassan]Rouhani packed out the hall. Everyone is leaving before Tony Abbott explains Australia’s ambitions for the G20 in 2014.’

Abbott’s speech confirmed the nagging suspicions many have had since he assumed the prime ministership, following one of the most manipulated media campaigns in any democracy in living memory.

It repeated all the trite slogans that worked in Western Sydney:

“You can’t spend what you haven’t got.”

“Markets are the proven answer to the problem of scarcity.”

“No country has ever taxed or subsidised its way to prosperity.”

“People trade with each other because it’s in their interest to do so.”

“Progress usually comes one step at a time.”

Unfortunately, I am not making this up.

Riddled with indicators of ignorance, the speech confirmed Abbott knows little about contemporary economics.

He quoted, for example, statistical measures from China:

“China’s growth is moderating, but likely to remain over seven per cent.”

He seems quite unaware that economists no longer trust statistics from China.

All economies today use strategic borrowings, at different levels, from different sources and for different purposes. Managing borrowings is a major challenge. Abbott’s glib admonition “You don’t address debt and deficit with yet more debt and deficit” displayed a dismissive attitude to this complex reality.

There was no sense of understanding the challenges the WEF faces in 2014, let alone having insights into ways forward.

What little strategy Abbott advocated seemed contradictory. He asserted that the global financial crisis (GFC) “was not a crisis of markets but one of governance.”

And then boasted of Australia,

“To boost private sector growth and employment, the new government is cutting red tape …”

Okay. That makes sense.

The prize blunders arrived, however, when Abbott directly attacked the stimulus packages of the Rudd/Gillard administrations:

“In the decade prior to the Crisis, consistent surpluses and a preference for business helped my country, Australia, to become one of the world’s best-performing economies.”

Partly correct.

In 1996, Australia was the 6th-ranked economy in the world. But by 2007, after 11 years of a Coalition government, it had slipped back to 10th place. Still, that is one of the best.

Abbott continued:

All economies today use strategic borrowings, at different levels, from different sources and for different purposes. Managing borrowings is a major challenge. Abbott’s glib admonition “You don’t address debt and deficit with yet more debt and deficit” displayed a dismissive attitude to this complex reality.

There was no sense of understanding the challenges the WEF faces in 2014, let alone having insights into ways forward.

What little strategy Abbott advocated seemed contradictory. He asserted that the global financial crisis (GFC) “was not a crisis of markets but one of governance.”

And then boasted of Australia,

“To boost private sector growth and employment, the new government is cutting red tape …”

Okay. That makes sense.

The prize blunders arrived, however, when Abbott directly attacked the stimulus packages of the Rudd/Gillard administrations:

“In the decade prior to the Crisis, consistent surpluses and a preference for business helped my country, Australia, to become one of the world’s best-performing economies.”

Partly correct.

In 1996, Australia was the 6th-ranked economy in the world. But by 2007, after 11 years of a Coalition government, it had slipped back to 10th place. Still, that is one of the best.

Abbott continued:

“Then, a subsequent government decided that the Crisis had changed the rules and that we should spend our way to prosperity. The reason for spending soon passed but the spending didn’t stop because, when it comes to spending, governments can be like addicts in search of a fix. But after the recent election, Australia is under new management and open for business.”

Two stupidities.

First, it was precisely that extensive rapid spendingthrough the GFC which saw Australia rise from 10th-ranked economy in 2007 to the world’s top ranking by 2012, a reality all those present with an awareness of the G20 economies would have known.

Secondly, attacks on domestic opponents are never acceptable abroad.

In New York last October, Abbott was roundly condemned for a political attack on Kevin Rudd.

American Academic Clinton Fernandes said he created an image of

“… coarseness, amateurishness and viciousness.”

Political scientist Norman Ornstein surmised:

“Perhaps you can chalk it up to a rookie mistake. But it is a pretty big one.”

Clearly, Abbott has learned nothing from that humiliation three months ago.

Abbott then continued to spruik domestic politics — the commission of audit, paid parental leave, cutting the numbers of pensioners, and infrastructure, especially roads:

“… because time spent in traffic jams is time lost from work and family.”

He concluded with a final hypocrisy — following his attack on Labor for spending so much on infrastructure during the GFC.

He gobsmacked anyone still listening with this:

“Then, there’s the worldwide ‘infrastructure deficit’, with the OECD estimating that over 50 trillion dollars in infrastructure investment is needed by 2030.”

Several questions arise.

Why such an appalling performance? Where are his advisers? Does he think he needs no advice? Or is the whole Coalition this amateurish and oafish — or worse?

And why, as ABC News highlighted, is he still battling Kevin Rudd and Julia Gillard?

Does this reflect self-doubt about his capacity in the role? They had a vision for the nation; he does not. They had plans to improve the prospects for pensioners, students and people with disabilities; he does not. They nurtured the economy; he cannot. They had character, integrity and authority; he simply does not.

Perhaps it confirms that Abbott knows deep down that the 2013 ‘win’ was illegitimate — that it was secured only by deception and dishonesty.

Perhaps it is time for his party to consider the matter of leader.

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Why Australia is doomed: a case study of voting against self-interest

I’ve signed a couple petitions on Change.org and now get the odd email pointing to new petitions that may be of interest.

One that stood out asked for signatures to support the National Broad Band Network as was outlined by the ALP. It was created by Nike Paine, titled, “The Liberal Party of Australia: Reconsider your plan for a ‘FTTN’ NBN in favour of a superior ‘FTTH’ NBN”.

I signed it straight away. How could I not? The Coalition’s FTTN NBN is a joke, offsetting costs to another time to be fixed by a future government.

Yesterday, I received a follow up email regarding this petition, which has done pretty good, gaining 190,000 signees. A figure that the incoming minister, Malcolm Turnbull, has shrugged off. In the email, Turnbull is quoted as saying “wasn’t there an election recently…”

What struck me in this email was that Nick went on to write;


“I voted Liberal this time around, because I felt they would do a better job than Labor overall. I really want them to engage with people on this issue. It’s going to be a tough fight, but one we can win if all of us ensure the new government hear us.”


Ahhh… okay.

The Coalition’s FTTN NBN was far from a minor party platform. The Coalition have been ramping up their criticism of the ALP’s approach for the better part of a year and made their alternative plan one of the few genuine differences by which the voter could identify them… That’s how we got stuck with ‘Mr Internet’ and his dismissal of this petition.

It’s like me voting for Mr Abbott with the expectation that I might be able to sway him to Labour’s stance on, for interest stake, marriage equality or genuine climate change mitigation. I disagree with the Coalition on these two points, their NBN and a military response to refugees, hence why I chose not to vote for them.

It was nothing to do with a generic aligning to a particular party, I am very much a swinging voter (none are particularly likable), but entirely because these were the options. If the Coalition’s NBN plan was bad enough to motivate Nick to create such a petition, then it should have been important enough to vote against on election day.

On hearing that, my interest in this petition waned. Mr Internet has this one pegged.

Nick, you voted for the entire package, not parts of it. Surely you have childhood memories of a caregiver reminding you to eat your vegies as well. The same applies here.

Australia, 2013: The flat earth society… Good for international relations?

“Nobody has a monopoly on what is a very hard problem, but I don’t have much patience for anyone who denies that this challenge is real. We don’t have time for a meeting of the Flat Earth Society. Sticking your head in the sand might make you feel safer, but it’s not going to protect you from the coming storm.  And ultimately, we will be judged as a people, and as a society, and as a country on where we go from here.”

– Obama, Remarks by the President on Climate Change, June 2013

Australia disagrees.

We have actually elected the new Prime Minister of the Flat Earth Society, for a meeting to run its course of the next three years.

Am I being harsh?

The individual in mind is notorious for his dismissal of anthropogenic climate change and global strategies to decarbonise economies. His direct action approach is akin to quadrupling the annual Australian forestry industry with the most optimistic assumptions, but worse in that it relies upon methodology that is highly uncertain and difficult to measure; soil sequestration. This, as a voluntary contribution from farmers with modest returns for the efforts seems far from a compelling strategy.

Australians voted in such a person, arguably not in favour of him personally, but rather against the frayed ALP. That, and the nice ideas of scrapping tax and persistent xenophobia regarding desperate refugees.

So yes, I’m drawn to such a conclusion and haunted by fear summed up but the last sentence of the quote above.

What will future Australian’s think of us who, when the world actually started building up some momentum on action on climate change, now including China and the US, both of which are showing genuine progress, we ducked out of the procession and down the nearest ally to hide out and have a few cigarettes?

The current Australian government does not speak for me. It is one that promotes unreasonable levels of individualism that stands in direct contrast to the evidence that shows increased equality and social mobility are positively correlated with happier, safer and healthier societies. It is one that promotes ideas such as the great northern development and direct action with total disregard for the empirical environmental evidence to the contrary. It is one that points to surplus in its most recent period as example of fiscal management, while ignoring that this came as a quick cash grab on what would have otherwise remained sources of revenue into the indefinite future, that is, privatisation.

It will be a government that provides much fuel for writers like myself, but will I be able to or will I simply balk?

Coalition’s carbon policy based on failed Labor scheme

By Penny van Oosterzee, James Cook University

 

The government and the Coalition both want to manage land to reduce greenhouse emissions. But it’s not working. Flickr/Indigo Skies Photography

Australia’s two major parties have promised to reduce the country’s emissions by 5% by 2020, with two different approaches. Labor has used carbon farming as part of its approach; the Coalition is making it a centrepiece. But analysis of Labor’s approach shows it is likely to fail, whoever pursues it.

The Coalition has promised to tackle carbon emissions through Direct Action, and without a price on carbon or an emissions trading scheme. The plan hinges on reducing emissions at the lowest cost, which may include managing soils, forests and farming, energy efficiency, carbon sequestration or cleaning up power stations.

Direct Action will use and expand the current government’s Carbon Farming Initiative to achieve these emissions cuts, using the initiative as a platform to deliver an Emissions Reductions Fund.

But the initiative hasn’t come under scrutiny in its current role, let alone as a centrepiece for delivering Australia’s climate commitments. So, what is the Carbon Farming Initiative, and is it ready to take a starring role?

The Carbon Farming Initiative is the first national offset scheme in the world to include carbon credits derived broadly from natural resource management. It includes avoiding greenhouse gas emissions such as methane and nitrous oxides from managing livestock, crops and savanna burning, and sequestering carbon from reforestation and avoided deforestation.

It also includes planting trees to encourage carbon sequestration. At a landscape scale the scheme could transform regional Australia and provide major biodiversity and conservation benefits.

Farmers and foresters generate carbon credits for emissions reductions. Polluters can then buy these credits, known as Australian Carbon Credit Units. Presumably, the Coalition would purchase these credits under Direct Action.

That’s how it’s meant to work. Let’s have a look at whether it’s actually working.

The success of carbon farming depends on uptake. Treasury provides two scenarios for uptake of carbon farming based on two global action scenarios. The first is based on medium global action for stabilising greenhouse gases at 550 parts per million by 2100. The second is an ambitious global action scenario aiming to stabilise at 450 parts per million. The ambitious scenario is what Australia, and the world, agreed at Copenhagen in 2009 would avoid dangerous climate change.

Under the medium ambition scenario Treasury projected the carbon price to start at around A$23 per tonne in 2012-2013, with carbon farming delivering 6 Mt CO2-e (carbon dioxide equivalent, which allows us to account for other greenhouse gases).

The ambitious scenario fetches a carbon price starting at A$47 per tonne with 9 Mt CO2-e delivered by the land. Avoiding deforestation and reforestation makes up about two thirds of land sector abatement in both cases.

Carbon farming has now been running for nearly two years. What has it delivered? The answer is astonishing: virtually nothing.

Around 46,000 carbon units (each equivalent to a tonne of CO2-e) have been issued. This covers a little less than 1% of reductions needed for the year 2012-2013 under a medium ambition scenario, and about 0.5% of the ambitious scenario.

Why has carbon farming failed to achieve anything? One of the main reasons for this situation is that it’s not cheap to create offsets. In fact the idea that the land sector can provide low cost abatement is a bit of a furphy.

Under carbon farming, offsets are generated by developing a baseline level of emissions and crediting reductions from the baseline. The process is complex. Steps include:

  • becoming a recognised offset entity
  • opening a registry account
  • undertaking a project according to approved methodologies
  • submitting regular audit reports
  • applying for carbon credits and having them issued.

Rigorous “integrity standards” are required including permanence obligations, which guarantee sequestration of greenhouse gases for 100 years. Australia is one of the few in the world to have such a stringent rule and it is one of the major obstacles to investment. Others use tried and true risk-based approaches such as insurance, which allow for shorter contracts.

Also, carbon credits are considered financial instruments. This triggers policy frameworks established Australia’s Corporations Act and other legislation.

Even before you step on the carbon farming treadmill there are costs associated with registering legal rights to carbon. In Queensland, for instance, you need to contract a surveyor to map and register one stand of forest. This might cost in the order of A$500-$10,000 or more depending on the complexity of the forest stand and whether you are registering the whole property or not.

At year three after planting (based on the wet tropics forests which have high sequestration rates) you might have sequestered 10 tonnes of CO2-e per hectare. Your cumulative return might be in the order of A$230 (or about A$76 per year) per hectare. This return would not cover the costs of registering legal rights to the carbon, let alone the cost of survey and plan preparation or the costs of establishing the forest.

If it is high-environmental-value forest, surveying and planning might be in the order of A$25,000 to A$67,000 per hectare.

With the government bringing forward a floating carbon price that links the European Union’s carbon price, currently at around A$6, you can expect enough from carbon farming for lunch (one good lunch, or three sandwiches).

Ultimately to invest in carbon farming requires two things: an ambitious global action agenda, and certainty of the investment environment for decades. Both the government and Coalition have committed to a 5% reduction of greenhouse emissions below 2000 levels by 2020. This correlates more or less to the medium ambition scenario (and an acceptance of dangerous climate change).

Certainty might be guaranteed under an emissions trading scheme that has global links in a world of high ambition. Under the Direct Action policy, however, the first round of money to purchase lowest cost abatement would be July 2014. And this would be a year before the policy would up for review.

Given this, the chances of carbon farming delivering effective abatement from the land might be about zero.

Penny van Oosterzee is a director of a company that receives funding from the Biodiversity Fund for a rainforest restoration project.

The Conversation

This article was originally published at The Conversation.
Read the original article.

Industry is shifting away from an Abbott styled “future”

The Australian Financial Review surprised me with a scathing article in reply to Tony Abbott. So much so that I was left wondering if Mr Abbott is even too out there for industry. It is great to see that Marcus Priest, in his post, Smoke and mirrors with carbon figures, just is not buying the claims.

In reply to the fear propagation about rising carbon pricing modelled over the coming decades, Priest wrote;

“Even if it ever reaches this level – which is debatable– companies are expected to reduce their carbon intensity offsetting the rising price.”

Which of course, is the aim of carbon pricing. It’s not expected that industries would be emitting as much greenhouse gases per unit of output in 2020 or 2050 as they are today, meaning that it is not a reasonable comparison.

And I could not help but chuckle when the director of the company that Tony Abbott was claiming to be hindered by the carbon tax was quoted;

“The industry and the communities it supports have a very bright future under carbon pricing,”

But it is not like Mr Abbott often lets reality get in the way of a good camp fire story about the carbon tax to scare the audience…

Will a voluntary ‘Green Army’ really pack a punch?

At 19, I had left school a couple years ago and gave the prospect of university no serious thought. For me, the only sensible option that I felt was open was a trade or traineeship of some sort.

In the end, I selected a retail traineeship with a large company, which promised managerial certification to those who excelled in this initial year of training.

I had done well enough. However, I remember the day my involvement in this traineeship ended.

The course overseer came into the store I worked in and asked me to complete a 250 word essay and I would have the level 2 certificate in my hot little hand. Anyone familiar with NewAnthro knows how easily I can put together as many words (in fact I’m half way there now), but yet I refused to.

The store kept me on, however, yet part-time and I turned back to schooling and went to uni instead…

Why didn’t I complete it, you may ask? It would have looked good on the CV of a young bloke such as myself, if nothing more.

I just couldn’t do it.

The life of a retail trainee

In this role, my wage was pathetic – lower than any part time worker of 16 filling a weekend position around school. One other trainee who was actually 16 scrapped in just shy of $5 per hour. The two of us both worked more than 50hrs a week each to make ends-meet. Worst of all, we were largely fodder for the jobs no-one else wanted. The store manager even had the other trainee wash his car in working hours! At $5 per hour, he was getting a good deal – especially as it was the company paying for it.

There’s just over 250 words and my reason for rejecting any accreditation on offer. We were told our wages were docked to pay for our training. Yet it was easy to see, from the amount of trainees going through and the frustrations that many shared with me, that the company was making a killing on cheap labour.

The reason I bring this up is that I’ve only recently become aware of the cogs behind the Coalition’s “Green Army”. Their method brings back memories of more than a decade ago.

Troops without cause

This Green Army is to be made up of trainees and volunteers. The incentive for the workers is apparently the reward of doing a good job (and maybe some piece of paper for their efforts). For the government, the incentive is clearly getting a crappy job done on the cheap.

School leavers and work-for-the-dole candidates are to make up this team.

I have been a school leaver, I have worked a traineeship and I am environmentally motivated. But how would I fair day after day, regardless of wind, rain or harsh sun, digging up weeds, planting seedlings and collecting rubbish in a short term role akin to community service?

Strapped to a mast or collecting samples in a pit, my work is always interesting. However, I get variation and recognition for my effort, which I doubt could exist in the Green Army
Strapped to a mast or collecting samples in a pit, my work is always interesting. However, I get variation and recognition for my effort, which I doubt could exist in the Green Army

Working in environmental research today, I do a lot of field work, from soil sampling to establishing new research facilities. It is often hard work, but I get my respite when I return to the office with data to manage and validate.

There will be none of this for the Green Army and unlikely to be much job prospects following the short term position as what they were trained to do will be done cheaply by new recruits after them.

I simply cannot see how this initiative will attract ongoing voluntary effort from young people when the prospects of the first few groups to finish prove to be little better than their own. Why would a young adult run around in the rain or heat in a high-vis vest for 6 months to obtain marginally better job prospects?

Sure, not all people in my position would have turned down the little report as I did – a certificate is better than none – but who is really benefiting from this initiative?

“Green Fodder”

When it changed so as employers could not dock the wages of trainees in my position, I saw the initiative quickly reduce in size. This tells me that the company was not doing it to obtain a high quality body of staff, but rather cheap fodder.

The “voluntary” in the Green Army rings alarm bells, at least to me. The Coalition are betting on a great uncertainty for the basis of their environmental package – one that seems to be based on exploiting cheap labour options.

I doubt the Green Army will be washing many cars, however I wonder if they would ever be to meet and maintain their desired troop numbers. If not, it is nothing but another failed act just waiting to happen.

Infographs: 2013 Australian Federal Election -The Direct Action Plan in 2020

I have a new page devoted to my media on the upcoming federal election.

Over the coming day’s I’ll be adding a number of infographs to this page that I have been working on over the past month. Please feel free to download these infographs and repost them elsewhere. The same goes for the posts (link or repost).

DAP-1

Abbott, have you forgotten about human rights?

Tony Abbott has released his proposed plan to tackle boats full of refugees – navy firepower, named Operation Sovereign Boarders (sounding straight out of some super-macho Matthew Reilly styled story).

Since when has this situation been a national emergency, when Australia takes on so few people in need? I suspect about as long as Australia collapsed into economic ruin with the intoduction of a carbon price – Tony’s falling sky that never happened. Maybe the slogans and demonisation of asylum seekers has gone on so long that Mr Abbott now believes his own spin.

Most troubling about this move is his references to asylum seeking as “illegal”? Since when is it illegal to be displaced and how can one be displaced if they cannot move from conflict without falling into a wall of guns? Where have basic human rights disappeared to?