A fundamental element of the collapse in the electoral standing of the Liberal Party, perhaps even more important than the disunity, disloyalty, and factionalism, certainly of greater longer-term significance, is how it has completely lost sight of what a Liberal stands for, what a Liberal believes in.
It is fashionable, of course, in Liberal circles, to attempt to draw some “authenticity” by reference to Menzies. Let me suggest that Menzies would be turning in his grave with the policy drift of the current lot of politicians presenting under the Liberal banner.
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| An abuse of power ... and an anti-Liberal intervention in the market. Credit: James Davies |
Liberals
have traditionally believed in small government, low regulation, and
reliance on markets and market processes. It is therefore most
concerning that these defining beliefs have been so easily jettisoned,
as a short-term political expedient, in what is just the last
manifestation, but just one of many, of what they claim as an “energy
policy”.
The “true” Liberal response to the climate challenge
would and should be – and has been on a couple of previous, but
opportunistic, occasions, under the likes of Howard and Turnbull – to
put a price on carbon via a “pure” emissions-trading scheme. This would
be the most cost-effective response by charging, in simple terms,
polluters for their pollution.It is a particular, and indefensible, inequity in our present system to see those who pollute our rivers, or dump asbestos on a vacant lot, and so on, charged, fined, even jailed, for such activities, yet a coal-fired power plant can pump alarming quantities of CO2 into our atmosphere and be “protected” in doing so.
The two key elements of
the Morrison government’s so-called energy policy are very
anti-Liberal, indeed, socialist – leaning on, bullying, intimidating,
otherwise attempting to regulate power prices, and the “Big Stick” of
threatening forced divestiture of some of the assets of the “gentailers”
(principally AGL, Energy Australia and Origin) if they “fail to
comply”.
In the minds of some in the government, a parallel is being drawn between the activities and abuses of the Big Three power companies and the Big Four banks, not just in terms of their electoral unpopularity, but also particularly in the sense of their exercise of oligopolistic market power, and abuses of their “social licences”.
However, this may work in crude, point-scoring, electoral terms, but it is probably unwise to exaggerate, as more detailed analysis of their actual relative price-fixing activities and profitability (against assets and equity) may suggest some caution.
In the minds of some in the government, a parallel is being drawn between the activities and abuses of the Big Three power companies and the Big Four banks, not just in terms of their electoral unpopularity, but also particularly in the sense of their exercise of oligopolistic market power, and abuses of their “social licences”.
However, this may work in crude, point-scoring, electoral terms, but it is probably unwise to exaggerate, as more detailed analysis of their actual relative price-fixing activities and profitability (against assets and equity) may suggest some caution.
Morrison’s
short-term difficulty, having sold Energy Minister Angus Taylor as
“minister for getting electricity prices down”, is that, even at their
“toughest”, they are unlikely to have much discernible impact on power
bills by the time of the next election. But they will have sold out on
their traditional beliefs and standing to do so.
The concept of forced “divestiture” not only burns their credibility as traditional Liberals, but would represent a significant and, to most, an indefensible abuse of executive government power.This issue has been floated before and formally assessed by parliamentary committees considering the Misuse of Market Power Bill in 2014, by the Harper Review of Competition Policy, the Australian Competition and Consumer Commission, the Law Council, and others – and generally rejected.
The concept of forced “divestiture” not only burns their credibility as traditional Liberals, but would represent a significant and, to most, an indefensible abuse of executive government power.This issue has been floated before and formally assessed by parliamentary committees considering the Misuse of Market Power Bill in 2014, by the Harper Review of Competition Policy, the Australian Competition and Consumer Commission, the Law Council, and others – and generally rejected.
The parliamentary committee referred to “disadvantages
outweighing potential advantages”, risking “significant disruption and
economic damage, with unpredictable consequences for competition”.
The
Harper Review, building on the earlier Hilmer and Dawson reviews,
expressed concern about the likely impact on the efficiency of the
businesses and potential harm to consumers. More recently, Harper has
criticised the “hasty” introduction of the divestiture power in relation
to the energy sector, "arguing that the aim of market intervention
should be to block anti-competitive conduct, not to restructure the
industry”.
The ACCC described it as “an extreme measure”, preferring other “means to restore competition to a level which serves consumers well”. The Law Council has described it a “truly draconian”, carrying a “serious risk that it will create several less efficient businesses”. Lawyers Ashurst have described it as “an extraordinary and invasive power”.
All this also seems so inconsistent with Morrison’s recent speech dubbed his “Sermon on the Murray”, apparently built in the Menzies tradition. Has he really lost all sense of what it means to be a Liberal? Or will he say or do anything, including jettisoning all previous beliefs, just to win?
The ACCC described it as “an extreme measure”, preferring other “means to restore competition to a level which serves consumers well”. The Law Council has described it a “truly draconian”, carrying a “serious risk that it will create several less efficient businesses”. Lawyers Ashurst have described it as “an extraordinary and invasive power”.
Overseas
evidence suggests that such a power has only ever been used sparingly
in the US, and not yet in the EU and Canada, even though the power
exists.
All this would lead you to conclude that this latest
manifestation of an “energy policy” by a Liberal-controlled government,
dumping virtually all that it once believed in, and advocated for, and
adopting all that it once abhorred, has been simply proffered out of
political desperation, risking very serious potential consequences for
the power sector, that is of such fundamental significance to our
broader industrial base and to households.All this also seems so inconsistent with Morrison’s recent speech dubbed his “Sermon on the Murray”, apparently built in the Menzies tradition. Has he really lost all sense of what it means to be a Liberal? Or will he say or do anything, including jettisoning all previous beliefs, just to win?
Voters will probably ensure that he forfeits his right to govern.
*John Hewson is a professor at the Crawford School of Public Policy, ANU, and a former federal Liberal leader.
Links
*John Hewson is a professor at the Crawford School of Public Policy, ANU, and a former federal Liberal leader.
Links
- ACCC baulked at splitting up Big Power too 'extreme' and unnecessary
- Malcolm Turnbull asked to front Reef inquiry
- Australia won't lift 2030 Paris target as minister heads to summit
- 'Scientific fact': NSW Liberals highlight climate difference from Feds
- School strikers are going places but the dole queue isn't one of them
- 'New weapon': courts offer hope for driving serious climate action
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