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| ‘Climate change is left to the side of the economic debate – and especially so under this government.’ Photograph: Sam Panthaky/AFP/Getty Images |
This week was a prime example of how economics and, by extension,
politics doesn’t cope very well with the issue of climate change.
The news that Australia economy went backwards in the September quarter was greeted with alarm by politicians and then used as a reason to push their policy barrow. And most of the barrows were piled high with coal.
The treasurer and the prime minister in their press conferences on Wednesday made great mention of the need to keep electricity prices low for the economy to grow.
Malcolm Turnbull especially was in full Tony Abbott 2010 mode out of a desire to cover the silly back flip on the issue of investigating whether or not to introduce an emissions intensity trading scheme.
When asked about the prospect of GDP growth going backwards he immediately responded by suggesting the issue was for Bill Shorten to “explain why he is proposing to increase the price of electricity”.
Never mind that such a scheme would more efficiently price emissions than does the current system, for now we remained trapped in an idiotic netherworld where any mention of pricing carbon (no matter how oblique) must be greeted with shrieks of horror, with the prime minister leading the chorus.
And while you do wonder if Malcolm Turnbull ever looks in the mirror in the morning and asks himself how it all came to this – or whether he first rings Cory Bernardi to ask whether he is allowed to look into the mirror and ask such questions – the broader issue is that this netherworld is one that inherently sees action on climate change as a negative for the economy.
And by contrast, the economic impact of anything that will cause climate change is seen as inherently positive.
The deputy prime minister, Barnaby Joyce, for example, took the decline in the GDP growth as further evidence of why investment in the Adani coal mine was essential.
He argued in favour of a $1bn government loan to build the railway from the proposed mine site to Abbot Point port saying “you need that money to flow. If the loan facilitates this happening or expediting this process then I’ve got no problems with the loan”.
The problem is if you loaned any company $1bn to build something it would also get income flowing, and it also would create jobs – jobs that would not only be less harmful to the environment, but also more likely to exists than the fanciful 10,000 that have been spruiked by both the federal and Queensland governments.
Talk of jobs and growth from mining investment or the cost of jobs and growth from pricing carbon always quickly skips past the reason why anyone would actually wish to price carbon or be against a coal mine.
Climate change is left to the side of the economic debate – and especially so under this government.
The topic was all but ignored in the 2015 intergenerational report, and any concerns about the impact of the Carmichael mine on the local environment due to water use, or the on the Great Barrier Reef, let alone on the climate, are quickly trammelled by those championing economic growth.
The issue is treated similar to how politicians in the past used to flick away suggestions about inequality by arguing that there had to be a trade-off between growth and equality.
Now economists realise that equality actually promotes economic growth, and so too are economists realising that climate change must be considered within economic growth – not as a trade-off, but because the impacts of climate change are so great they must be an essential component of policies geared towards economic growth.
Last month a group of economists including Nobel laureate Joseph Stiglitz, signed “the Stockholm Statement” which seeks to guide policymaking.
The statement notes as one of its core principles that “Environmental Sustainability is a Requirement, Not an Option”.
Earlier this month, former chief economist of the World Bank, and also a signatory of the statement, Professor Kaushik Basu, told me that governments when crafting economic policy makers “should build in right from the start the need to protect the environment to make sure they’re not damaging the climate”.
Professor Basu, who has also worked as an advisor to the Indian government, also dismissed suggestions that economies like India need not worry about climate change. He argued that “there is really no conflict between the interests of the poor and activism on the environmental front”. Indeed he noted that “it is the poor who take the brunt of the bad karma on this – it hits the poor”.
The lack of spine displayed by Malcolm Turnbull this week on carbon pricing and the glee by both the federal and Queensland government towards he Carmichael mine highlight that politics remains wedded to the belief that economic growth trumps concerns of climate change.
Unfortunately such thinking only makes the problem worse.
Viewing investment in a coal mine as the solution is like a smoker suggesting another cigarette at least will alleviate the nicotine withdraw.
This week the Queensland Premier Annastacia Palaszczuk, argued that “the life of this project will be anywhere between 50 and 60 years. That means generational jobs.”
But given the current trajectory of climate change, those in 60 years will be only shaking their heads in wonder that a politician would be so naive as to talk of economic growth without thinking what that type of growth would do to the planet.
Links
The news that Australia economy went backwards in the September quarter was greeted with alarm by politicians and then used as a reason to push their policy barrow. And most of the barrows were piled high with coal.
The treasurer and the prime minister in their press conferences on Wednesday made great mention of the need to keep electricity prices low for the economy to grow.
Malcolm Turnbull especially was in full Tony Abbott 2010 mode out of a desire to cover the silly back flip on the issue of investigating whether or not to introduce an emissions intensity trading scheme.
When asked about the prospect of GDP growth going backwards he immediately responded by suggesting the issue was for Bill Shorten to “explain why he is proposing to increase the price of electricity”.
Never mind that such a scheme would more efficiently price emissions than does the current system, for now we remained trapped in an idiotic netherworld where any mention of pricing carbon (no matter how oblique) must be greeted with shrieks of horror, with the prime minister leading the chorus.
And while you do wonder if Malcolm Turnbull ever looks in the mirror in the morning and asks himself how it all came to this – or whether he first rings Cory Bernardi to ask whether he is allowed to look into the mirror and ask such questions – the broader issue is that this netherworld is one that inherently sees action on climate change as a negative for the economy.
And by contrast, the economic impact of anything that will cause climate change is seen as inherently positive.
The deputy prime minister, Barnaby Joyce, for example, took the decline in the GDP growth as further evidence of why investment in the Adani coal mine was essential.
He argued in favour of a $1bn government loan to build the railway from the proposed mine site to Abbot Point port saying “you need that money to flow. If the loan facilitates this happening or expediting this process then I’ve got no problems with the loan”.
The problem is if you loaned any company $1bn to build something it would also get income flowing, and it also would create jobs – jobs that would not only be less harmful to the environment, but also more likely to exists than the fanciful 10,000 that have been spruiked by both the federal and Queensland governments.
Talk of jobs and growth from mining investment or the cost of jobs and growth from pricing carbon always quickly skips past the reason why anyone would actually wish to price carbon or be against a coal mine.
Climate change is left to the side of the economic debate – and especially so under this government.
The topic was all but ignored in the 2015 intergenerational report, and any concerns about the impact of the Carmichael mine on the local environment due to water use, or the on the Great Barrier Reef, let alone on the climate, are quickly trammelled by those championing economic growth.
The issue is treated similar to how politicians in the past used to flick away suggestions about inequality by arguing that there had to be a trade-off between growth and equality.
Now economists realise that equality actually promotes economic growth, and so too are economists realising that climate change must be considered within economic growth – not as a trade-off, but because the impacts of climate change are so great they must be an essential component of policies geared towards economic growth.
Last month a group of economists including Nobel laureate Joseph Stiglitz, signed “the Stockholm Statement” which seeks to guide policymaking.
The statement notes as one of its core principles that “Environmental Sustainability is a Requirement, Not an Option”.
Earlier this month, former chief economist of the World Bank, and also a signatory of the statement, Professor Kaushik Basu, told me that governments when crafting economic policy makers “should build in right from the start the need to protect the environment to make sure they’re not damaging the climate”.
Professor Basu, who has also worked as an advisor to the Indian government, also dismissed suggestions that economies like India need not worry about climate change. He argued that “there is really no conflict between the interests of the poor and activism on the environmental front”. Indeed he noted that “it is the poor who take the brunt of the bad karma on this – it hits the poor”.
The lack of spine displayed by Malcolm Turnbull this week on carbon pricing and the glee by both the federal and Queensland government towards he Carmichael mine highlight that politics remains wedded to the belief that economic growth trumps concerns of climate change.
Unfortunately such thinking only makes the problem worse.
Viewing investment in a coal mine as the solution is like a smoker suggesting another cigarette at least will alleviate the nicotine withdraw.
This week the Queensland Premier Annastacia Palaszczuk, argued that “the life of this project will be anywhere between 50 and 60 years. That means generational jobs.”
But given the current trajectory of climate change, those in 60 years will be only shaking their heads in wonder that a politician would be so naive as to talk of economic growth without thinking what that type of growth would do to the planet.
Links
- As climate disaster looms, Malcolm Turnbull needs to stop appeasing and start leading
- The day the Australian economy ran out of luck (if only temporarily)
- Are workers right to be sceptical about productivity improvements?
- Markets are predicting an end to interest rates cuts. But markets can get it wrong
- It's time to focus on the redistribution of wealth to poorer workers
