The triumph of Trumpism

The recent chaos around One Nation (including Fraser Anning, reactions to the Christchurch atrocity and the Al Jazeera sting and the reactions to it, show how thoroughly Trumpism has conquered the Australian right. Most obviously, any doubts anyone might have had about Hanson and One Nation have been resolved. She and her party are racists (or in some cases, opportunities riding the racist bandwagon) trading in lunatic conspiracy theories and the rhetoric of the terrorist alt-right. Nothing really new here.

The truly revealing outcome is the reaction of the mainstream right. It’s divided into two groups: those (most notably Tony Abbott and the entire National Party) who have maintained their support for an open alliance with Hanson, and those like Morrison and (Oz columnist) Paul Kelly who have taken the line: Racists are bad, but the Greens are worse.

Read More »

How Britain kicked coal

Despite the chaos of Brexit and the difficulty of expanding renewable generation in a country where sunshine is in notoriously short supply and there is strong resistance to wind turbines, Britain has just about ended its use of coal-fired electricity. The last coal-fired power stations are set to close by 2025, but the process is almost complete already. How was this achieved?

I found a useful graph from OFGEM, the British electricity regulator showing developments since 2006, when coal (graphed in orange) supplied around 40 per cent of UK electricity. By 2018, it’s negligible. The graph at the site is interactive, so you can easily get actual numbers.

It turns out that generation from gas and nuclear plants has been virtually constant over the period since 2006. These sources displaced substantial volumes of coal-fired power during the second half of the 20th century.

The elimination of coal has come from two main sources. First, total electricity use has declined, reflecting increased efficiency. Second, wind (offshore and onshore) has expanded to the point where it is now about as a big a source as nuclear.

I have some other thoughts about the UK case, but for now I’ll leave this open for comments.

Economics in Two Lessons, in Chinese

I’ve just heard from Princeton University Press that Economics in Two Lessons will be translated into Chinese. The publisher is  Ginkgo (Beijing) which has had some big successes with recent translations.

Apparently, the book was well received at the London Book Fair, which is a trade event focusing on deals like this, so there may be more translations coming.

PUP has offered me the option, when the translation is prepared, to look at a sample. If there are any readers of this blog who are also readers of Chinese (it will be in Simplified not Traditional characters), I’d welcome an informal evaluation

Rights of Nature, but not natural rights ?

There’s an interesting article by Anna Grear in Aeon, criticising the idea that Nature should have human-style rights, and linking to the website of the Centre for Humans and Nature, which has lots more interesting discussion.

I’ve recently written a contribution to a forthcoming book by Tim Hollo, in which I take the opposite view. My central point is that corporations are routinely treated as persons for legal purposes, and that the effect is frequently harmful to Nature. There is in my view, no reason in principle, not to give legal standing to representatives of Nature, similar to that given to the representatives of social constructions like corporations. A lengthy extract over the fold.

If property rights are social constructions, what implications can we draw in relation to rights for Nature. On the one hand, we can rule out essentialist objections, along the lines that the concept of property rights cannot encompass rights for Nature.
There are, of course, practical issues that must be resolved. Neither Nature in general, nor particular species and ecosystems have the kind of agency required to exercise and defend property rights. Rather these property rights must be exercised by humans, bound by obligations to act in line with the interests of Nature, and these interests must also be defined by humans. There is nothing particularly unusual here. Our current system assigns property rights to infants, who are in exactly the same position.

The same is true of property rights assigned to more-or-less abstract collectivities such as BHP or ‘the people of Australia’. While the people represented by these collectivities may have a role in choosing their representatives, they must rely, most of the time on the fiduciary and constitutional responsibilities that bind these representatives.
On the other hand, having rejected the idea of ‘natural’ property rights for people, we must reject this idea for Nature also. Whether or not people (individually or collectively) have moral obligations to Nature, these obligations do not translate directly into property rights/

Rather, any assessment of property rights for Nature must ultimately be pragmatic. Would the creation of property rights for Nature serve to promote the achievement of fairer and more sustainable outcomes (bearing in mind that these terms will themselves be contested). Alternatively, would these goals be better served by an expansion of the current system in which the protection of the natural environment is part of the responsibility of governments, operated primarily through legislative and regulatory constraints on environmentally damaging activities?

The case of bankruptcy law provides an instance where there would appear to be at least a prima facie case for assigning property rights to Nature. There have been numerous instances where mining companies have done substantial environmental damage before declaring bankruptcy and passing the responsibility for any cleanup on to the public in general. In a few cases, such as that of Linc Energy, the damage has been such as to lead to criminal charges.

However, the protections of corporate and bankruptcy law mean that, even in cases like this, the costs fall on the public rather than on the directors and shareholders of the company. Linc was fined $4.5 million and the cleanup costs estimated at $72 million (Smee 2018). The CEO and main shareholder, Peter Bond, dismissed the fine as meaningless and stated that the company would not have to pay anything (McKenna 2018). As always under limited liability, Bond’s own liabilities were confined to the value of his shareholding, which was lost when the company went bankrupt.

An explicit assignment of property rights to Nature might have changed this. If environmental damage were regarded as constituting an unpaid debt to Nature, it might be possible to force a company like Linc into insolvency well before it ran out of cash. Moreover, the offence of trading while insolvent is more clearly established as a basis for prosecution than are the laws under which Linc and its directors are currently being pursued.

Similar problems have arisen in the United States, where mining companies have been permitted to engage in ‘self-bonding’ to cover the costs of reclaiming abandoned mine sites. That is, rather than posting a bond, the companies were allowed to promise to pay the costs of reclamation out of their own assets. As more and more companies (particularly coal miners) have gone bankrupt, governments have been left to pick up the bill. In West Virginia, more than 60 per cent of the future cleanup bill is associated with bankrupt companies.

The problem is made worse by the inadequate level at which bonds are set. In Kentucky, for example, forfeited bonds covered only half the estimated cost of reclamation.
The practice of self-bonding has come under increasing attack. In Wyoming, which has the largest open-cut mines in the United States, proposals are being put forward to limit self-bonding to firms with a strong credit rating and significant remaining production. In practice, very few coal companies are likely to meet the criteria.

This shift is welcome. However, the outcome is a long way from that which would arise if Nature had explicit property rights. In that case, the normal outcome would be that mine owners were required to pay compensation for damage to natural assets as that damage occurred, or even in advance, as is typically the case when mining activities impinge on the value of privately owned land and other assets.

Why headlines are always wrong*

Update: After some pushing, I got the headline fixed.

Original post follows

I’ve complained in the past about the fact that writers in newspapers and magazines generally don’t get to choose their headlines. I’ve read that this is a hangover from the days of hot metal typesetting, when the headline had to be chosen to fit the layout of the paper, determined at the last minute by the sub-editors. Whatever the case, the tradition has endured.

I’ve rarely been happy with the headlines chosen for me, but most of the time they are not bad enough for me to complain. Today was an exception. Following my interview on the dairy industry, which was the subject of this post, the ABC ran a story which focused on a simple piece of arithmetic, quoted as follows

Professor of economics at the University of Queensland John Quiggin said if milk prices kept up with inflation, consumers would have to fork out an extra 46 cents a litre.
“If you maintained the real price of milk with 20 per cent inflation [across nine years] that would be around $1.56 today,” he said.
“Of course there is no economic law that says that all prices should rise at the same rate.

That was accurate as far as it went, though of course none of the points I actually wanted to make got through. The problem was with the subeditors, who highlight the sentence ending “$1.56 today”, and ran the piece under the headline Economics professor says milk should be $1.56 a litre in 2019, something dairy industry hopes for. I’ve complained, but nothing is going to happen on a Sunday, and probably nothing will be done anyway.

This reminds me of a more tangled case, which involved me in a silly Twitter fight recently.


Read More »

Islam is part of Western civilisation

As the arguments about Western civilisation roll on, I’m struck by the assumption, seemingly shared by both sides of this debate, that the Islam and the Islamic world aren’t part of “Western civilization”.

Islam is an Abrahamic religion, standing in essentially the same relationship to Christianity as Christianity does to Judaism. That is, Islam claims to be the completion of the prophetic mission of Christianity, just as Christianity claims to represent the fulfilment of the promise of the Messiah to the Jews. In each case, the older religion rejects this claim [1].

These disputes have occasioned persecution and bloodshed right down to the present day, between and within the religions. On the other hand, all of these religions have promoted learning and encouraged acts of charity. However you weigh up the achievements, follies and crimes of Western civilisation, it is absurd to deny that all three of its major religions have shared in these things.

Ever since Muhammad claimed power as an armed prophet in the 8th century, Islamic states and rulers have been part of the European struggle for control of the Mediterranean and the countries around it. In this context, Muslims appear sometimes as the targets of crusades or the instigators of jihad (the two words have essentially the same meaning), and sometimes in alliance with (further distant) Protestants, such as Elizabeth I, against Catholics.

A striking effect of the exclusion of Islam is that courses on “Western Civilisation” reproduce the discredited notion of a “Dark Age” between the fall of the Roman Empire and the Renaissance. This period coincides almost exactly with the Islamic Golden Age, which carried the torch of Western civilisation for hundreds of years, giving us algebra, universities and much more.

Read More »

What’s happening to the Australian Dairy Industry

I just recorded a radio interview for ABC Toowoomba on the dairy farmers’ campaign against supermarkets selling milk for $1. Here are my notes for the discussion

Consumer prices have increased 20 per cent since 2010, when the milk price was $1.30/litre, so to maintain the real price, the current price would have to be around $1.56.

Dairy producers in Australia have been under continuous pressure to increase herd size and reduce costs, with those unable to do so having to leave the industry or accept declining incomes. I first researched this topic in the early 1980s, when farm numbers had already fallen by about 50 per cent.

Since 1979, the number of dairy farms in Australia has fallen from 22 000 t0  5700. In Queensland the number has gone from 3000 to less than 400.

However, because of increased herd size the number of cows hasn’t changed much . Milk output per cow increased rapidly up to about 2000, so total production grew over that period before stabilising

The “cost-price squeeze” affects most agricultural producers but the problems of dairy farmers are exacerbated by the market power of supermarkets and their use of milk as a “loss leader”.  The decision to raise the price charged to consumers represents at least a symbolic step away from that practice.