You are here:
Home> November 2006 editorial a web journal of urban and political
Editorial: November 2006
Don’t sacrifice workers on altar of climate change
According to a recent Climate Institute survey, 54 per cent of rural
Australians believe the government should do more to reduce climate
change. Let’s accept the earth is warming. The Institute and its survey
respondents are still grappling with an illusion - in fact, the
Australian government is impotent to ‘reduce’ climate change. Even if
climate trends are influenced by human activity, Australia’s carbon
emissions amount to less than one percent of the world’s total. What
Australia does has little impact one way or the other.
Environmentalists like to dramatise Australia’s role in climate change
by damning our relatively high carbon emissions per capita. This means
little on a global scale, however, given our small population. Many
share the spurious assumption that climatic patterns on the Australian
continent are driven by local emissions. If man-made carbon build-up is
affecting our climate, it is due to emissions in more populous parts of
the world, particularly Europe, the United States, Japan, emerging
giants like China and India, and larger developing nations like Brazil
and Indonesia. It is mostly sourced in the northern hemisphere. The
notion that Australia must act now to save the planet is delusional. As
we are often told, climate is an interconnected, global system.
If we were to shut down our coal-fired power stations, estimate some,
these emissions would be replaced by China in under twelve months.
Confronted with such realities, environmentalists insist action is
necessary to join and encourage a global effort to combat the problem.
In other words, Australia’s contribution is essentially symbolic and
suasive. Hence they support the Kyoto Protocol.
Would things be different if Australia had signed Kyoto? The US senate
declined to ratify it, major developing nations like China and India are
exempt from binding targets, and most EU members have fallen short of
theirs. The EU-15 won’t even get close to achieving their target of
reducing emissions by 8 per cent below 1990 levels by 2012. Some
forcefully that Kyoto is falling apart. It is increasingly
possible to be both a greenhouse-believer and a Kyoto-sceptic. In any
event, Australia’s signature would have had no impact whatsoever. This
is as true on a symbolic, suasive level as it is on the level of real
Following a recent spate of unseasonably hot days and bush fires, in the
context of prolonged drought, Greens leader Bob Brown smugly asserted
that had we listened to him, none of it would be happening. This is
nonsense. But these events have induced a heightened degree of public
concern, mostly of the ‘don’t just sit there, do something’ variety.
Doing his best impersonation of a weathervane, John Howard has started
squandering taxpayers’ dollars on enquiries and flashy projects.
The temptation to clutch at straws seems irresistible. Opinion polls are
now showing majority support for Kyoto as a quick fix. If only it were
that simple. Climate change is not a single issue but a series of
complex questions: is the earth warming; how much; what is the cause;
what are the consequences; can anything be done; what should be done?
Environmentalists leap blindly from the first to the last of these,
without much thought for the others. Yet legitimate differences of
opinion swirl around this cluster of questions.
The risk is that Green
propaganda, spouted routinely by like-minded journalists, will channel
public concerns towards a dangerous overreaction. Recent media coverage
of the Stern review was appalling. The ink was barely dry on Stern’s
highly technical 700-page report when most commentators rushed to
declare ‘it changes everything’. No need for reflection and analysis.
This is of a piece with their reverential treatment of Al Gore’s film
An Inconvenient Truth, hailed everywhere as something akin to a
fifth gospel. Whatever you call this, it isn’t journalism.
While progressive commentators hate to concede that Australia emits less
than one percent of the world’s carbon, they love Stern’s estimate that
it will cost one per cent of global GDP to avert disaster. This sounds
trivial. When apportioned to individual domestic economies, however, the
costs of Kyoto are substantial. Several studies assess slower growth or
contraction should we adopt Kyotoesque caps, taxes and emission (or
permit) trading schemes. Last July, the Australian Bureau of
Agricultural and Resource Economics (ABARE) estimated that should we
reduce emissions by 50 per cent below 1990 levels by 2050 - a Kyoto
target - our GDP in 2050 would be 10.7 per cent lower than otherwise.
Gore’s film is devious on this score. Its all too brief treatment of the
economic issues surrounding climate change dodged the 800-pound gorilla
- Kyoto means economic dislocation. The Sydney Morning Herald’s
economics editor, Ross
Gittins, is one greenhouse believer who does not
fudge the economic downside:
… depending on how you go about it, achieving a
big reduction in emissions could involve significantly higher costs to
consumers and losses of economic growth and jobs. The economic risks are
heightened for Australia because we're such a big exporter of fossil
fuels, particularly natural gas and coal, as well as that “congealed
energy” known as aluminium. Were we to get tough with our
energy-dependent export industries before other countries, we could
simply drive them offshore.
The price for stunted growth is always paid by the same people - blue
collar or unskilled and semi-skilled workers, their families and their
communities. They are the expendable fodder of progressive zeal.
Blue-collar workers stand to suffer across the whole economy, but damage
would be concentrated in sectors like mining and power generation.
The coal industry employs 25,000 directly and many more indirectly. It
contributes around $12.5 billion to our GDP per annum. Suburbs and
regions living off these industries - the Hunter region of NSW for
example - would face a grim future. Environmentalists get off on
punishing corporations, but it is workers who cop it in the neck. Of
course, Stern asserts that short-term pain is necessary to avoid long
term cataclysm. But that assumes his forecasts are accurate, and that
his remedies are workable and necessary. Kyoto’s record doesn’t inspire
How magnanimous of our green-tinged elites to risk thousands of workers
for a symbolic gesture.
Despite the media frenzy, there is a better way. In the real world, each
country will fashion a policy framework adapted to its own needs and
conditions. The common objective should be transition to a lower
emitting energy sector with a minimum of socio-economic dislocation. In
Australia’s case, Kyotoesque measures are tantamount to using a
jackhammer to crack a walnut.
Actually, Stern’s views are more nuanced than the media coverage
suggests. Speaking on ABC Radio National’s breakfast program on 3
November, Stern said: ‘You can say that all coal-fired power stations in
Australia after some date should be carbon capture and storage. You can
do it by taxing, you can do it by carbon trading, you can do it by
regulations and standards. But people have got to have an incentive to
use these new methods or many of them would not do so.’
Regulations and standards? This raises the interesting question of why
environmentalists, of all people, insist on a so-called ‘market’
solution. If the virtue of markets lies in their efficient allocation of
resources, emissions trading regimes achieve the opposite. Through
government intervention, they distort otherwise efficient markets for
non-economic ends. Stern claims global warming represents ‘market
failure’. So why must we address the issue with the oppressive apparatus
of a phony market? Can it be that anti-industry environmentalists are
more interested in forcing a transformation of social values than
cutting carbon emissions?
In one of the most
sensible contributions to this debate, Robert
Samuelson was spot on: ‘The trouble with the global warming debate is
that it has become a moral crusade when it’s really an engineering
problem.’ The real, as opposed to the symbolic, key to reducing carbon
emissions lies in the successful approach to other forms of airborne
pollution over recent decades: the development, application and
diffusion of new technologies.
Gregg Easterbrook of the Brookings Institution has written extensively
on climate change issues. He is a greenhouse believer who thinks ‘the
case is closed’ on man-made global warming. Yet he is no fan of Kyoto.
‘This is the Big Thought that‘s missing from the global warming debate’,
writes Easterbrook. ‘There may be an optimistic path that involves
affordable reforms that do not stifle prosperity. Greenhouse gases are
an air pollution problem, and all previous air pollution problems
have been addressed much faster than expected, at much lower cost than
projected.’ In short, ‘the Kyoto Protocol might not have been right for
the United States, but a mandatory program of greenhouse reduction is.’
As Stern concedes, governments can simply mandate the use of carbon
capture and storage (CCS) and other technologies as they come on stream.
The incessant cry that ‘we can’t wait that long’ is meaningless when
Australia’s contribution to global emissions is minuscule. True, some
argue the real measure of this contribution should include emissions by
foreign economies burning Australian coal. Given half the chance, they
would shut down our coal industry. This all flows from the false
assumption, however, that if we stopped exporting coal, those foreign
markets would evaporate. In fact they will be supplied by other, less
On the one hand environmentalists exaggerate Australia’s importance as
an emitter, while on the other they seek to destroy what little
importance we have as a solution. Any real influence Australia can exert
comes from our position as the world’s largest coal supplier, accounting
for 29 per cent of global exports. This is our platform for attaching
conditions to the purchase of Australian coal and for promoting the
dissemination of CCS and other technologies as they emerge. As Labor’s
resources spokesman Martin Ferguson says, this means ‘more than
a thousand climate change conferences’.
What is needed is a national plan, and perhaps a national body, to
coordinate the right mixture of tax breaks, concessions and subsidies
with a phased timetable for the mandatory adoption of technological
improvements. Whether our prime minister, addicted as he is to
short-term opportunism, can carry this off is open to question.
For its part, Labor should think again about Kyoto. Otherwise this
faltering agenda will loom as large a threat to working families as the
This editorial was republished by
On Line Opinion, Australia's e-journal
of social and political debate.