Time to join the generation game? Definitely

John Quiggin1 Comment

A little while ago, I partially recanted my long-standing rejection of the idea that “generations” are a useful way of thinking about such issues as political attitudes. The UK elections showed a very strong age effect, reflecting the way that the politics of nostalgia, represented by Brexit, appeal to the old and appal the young.

The same appears to be true of “Make America Great Again”, at least according to the exit polls. In every racial group, there’s a clear cohort effect, with the younger cohorts favouring the Democrats.

& Exit poll results, by age and race

The Republicans had majority support only among whites over 45.

The age effect would probably be a bit smaller if education and urban/rural location were taken into account, but it’s still striking.

Regarding the political implications I said last time

If current demographic trends continue, and nothing else changes, the political right will be doomed by demography to permanent minority status. That’s possible, but one-party dominance has rarely lasted long in the countries I’m talking about. And, as Stein’s Law has it, if a trend can’t continue, it won’t.

So, a long period of leftwing success would presumably produce a political realignment in which culture war issues are no longer a dividing line. On the other hand, if leftwing governments are elected and fail to deliver on their promises (or worse, implement their promises and fail disastrously) their support among currently young cohorts may be replaced by permanent oppositions.

Of course, this assumes that democratic processes survive long enough for these demographic processes to do their work.

Most favoured customer status

John Quiggin21 Comments

One of the things that annoys about the neoliberal era is the constant advice to “shop around” for the best deal for services we could once assume were fairly priced, like electricity or banking services. A crucial feature of this is that you can’t do this once and for all.  Loyal customers are routinely punished by being left on unfavourable deals while new customers are offered better terms.

It struck me that we could get substantially better outcomes from markets if all firms were required to extend to existing customers any offer made to new ones.* That would greatly reduce churn and wasteful sales efforts, hopefully leading to a reversal of the increase in retail margins we’ve seen in areas like electricity.

This would be the equivalent of Most Favoured Nation status in trade policy, which ensures that all members of the World Trade Organization receive the same treatment. Interestingly, the Wikipedia article on Most Favoured Nation status refers only to an anti-competitive version of Most Favoured Customer status, where MFC status is extended only to selected customers.

I’m a bit ambivalent about suggesting ways to make neoliberalism work better, especially as it is now in retreat, but I think it will be around for a while yet, so reforming obvious failures seems like a worthwhile idea.

 

 

* I can imagine a case for some limited exemptions, for example, for “try before you buy” deals.

Yet more High Court absurdity

John Quiggin24 Comments

In the latest Section 44 news, it’s being suggested that three more MPs or candidates may be ineligible, two because they are doctors and one because they hold shares in a pharmacy business which is a partner in a Linkage project with the Australian Research Council.

For those who aren’t in the research business, the Linkage program involves research which is jointly funded by the ARC, a University and an industry partner.in this case the pharmacy business. That is, the crime allegedly committed by this MP consists of (indirectly) giving money (or support in kind) to a government program, in the hope that the resulting research will be useful to their industry in general or to society as a whole. (Work done for the private benefit of a particular business would not normally be eligible; it would be undertaken as a consultancy). On this basis, a volunteer at (say) the Commonwealth could be disqualified for using government resources.

Doubtless, the defenders of the High Court will rush to say that no such nonsensical inference can be drawn. But, if they had a shred of intellectual honesty, they will admit that, before this nonsense began, no one had ever contemplated the absurdities we have already seen.

The other defence that used to be offered was that MPs with s44 problems should have checked the rules. It ought to be obvious by now (but probably won’t be, given the human propensity for bloody-minded adherence to a fixed position) that no-one can check on the rules. Suppose you are, say, a bank clerk, and the local council banks at your branch. On a literal reading, which is the only kind on offer from this High Court, you would seem to be doing business with the government, and would be forced to quit your job rather than taking leave. Your case is even worse if your employer converts you into a contractor with a business that might continue while you served in Parliament.  Perhaps, based on past precedent, the court would let you off, but perhaps not.

There’s no easy way to fix this. Perhaps people will get sufficiently tired of this nonsense that the massive obstacles to a referendum might be overcome, but I doubt it. The only encouraging sign is that, so far, every member disqualified by the mischief-makers on the Court has been re-elected. Perhaps a few more pointless by-elections will produce some popular resistance.

In any case, the real problem is with the High Court’s entire approach to constitutional interpretation, based on the same kind of literalism that Garfield Barwick used to subvert the taxation system in the 1970s. Barwick was slapped down by changes to the Acts Interpretation Act, but Parliament can’t, I think, tell the Court how to interpret the constitution.  The only solution would be to replace existing justices as they retire, with followers of Lionel Murphy who would start from the commitment to a democratic government and strike down any interpretation (such as the disqualification of most of the population from election) that is inconsistent with that.

Incredible shrinking #Adani still a threat

John Quiggin3 Comments

Adani has just announced another scaled down version of its proposed Carmichael mine, bringing the initial capital cost down to $2 billion, and the estimated  initial output to 10-15 million tonnes a year. As usual, the claim is that financing will close in the near future.

Unfortunately, it is possible that this time the project will go ahead. The Indian Supreme Court has reopened the possibility that Adani may be able to pass on to customers the costs of imported coal for its Mundra power station.

That doesn’t change the fact that the project is economically unsustainable in the long run, as well as being an environmental disaster (though not as big a disaster as in its original version).  But the cost is now low enough that, if Gautam Adani is willing to put in enough of his money, he may find lenders willing to finance the rest.

At this point, it looks as if Labor will have to get off the fence, on which has perched for so long. The world needs to stop opening new coal mines, and Carmichael is a good place to start.