Climate clippings 94

Climate clippings_175

1. CO2 concentrations passing 400 ppm

Each year the atmospheric concentrations measured at Mauna Loa Observatory in Hawaii surge as spring turns into summer. We are now at the point where earlier each year they surge past 400 ppm, this year as early as March. By 2016 they will probably remain permanently above 400 ppm.

Dr Pep Canadell says crossing the 400 parts per million threshold will make it more difficult and expensive to limit climate change to two degrees.

The second part of this century we need to reduce emissions to zero and on top of it, to be removing carbon dioxide from the atmosphere so that by the end of 2100, we can stay stable under two degrees.

Canadell is head of the Global Carbon Project at the CSIRO.

2. Bio-energy with Carbon Capture & Storage

Speaking of sucking CO2 out of the atmosphere, bio-CCS is the new buzz word (I’ve also seen BECCS). The Climate Institute has released a report by Jacobs SKM Moving Below Zero: Understanding Bio-energy with Carbon Capture & Storage . Their modelling finds that

bio-energy with carbon capture and storage, or bio-CCS using food wastes, sustainable forest biomass, or crop residues, has the potential to contribute significantly to climate change efforts in Australia.

This process could remove and displace about 63 million tonnes of CO2 equivalent (MtCO2-e) annually by 2050, around 1.5 times current emissions from all cars in Australia. As well it would generate 12% of the country’s electricity.

Globally the process could remove up to 10 billion tonnes of pollution per year by 2050, according to the International Energy Agency.

The report may be downloaded from this page (scroll down). Go here for an interview with Malte Meinshausen.

3. Are coal miners responsible for greenhouse gas emissions?

No, said the Queensland Land Court in its judgement on the giant Alpha coal mine project which would dig up about 30 million tonnes of coal a year from the state’s Galilee Basin.

That’s the central fact in Graham Readfearn’s interesting story about what’s un-Australian.

Burning Alpha coal would generate 1.8 billion tonnes of CO2 over 30 years. That’s more than three times Australia’s annual emissions.

4. Abbott calls climate concerns “clutter”

In the lead up to the G20 meeting in Sydney in February, Abbott said

he didn’t want to “clutter up the G20 agenda with every worthy and important cause, because if we do, we will squander the opportunity to make a difference in the vital area of economic growth.”

The post, correctly, I think, sees Abbott as rolling back environmental and climate initiatives as hostile to economic growth, relying for economic impetus on the fossil fuel industry.

Heather Zichal, until recently President Obama’s lead climate and energy adviser, thinks otherwise:

Zichal suggests that focusing on economic productivity could be the sweet spot that Australia could use to balance climate concerns and economic growth goals. Reducing pollution and emissions from power plants and imposing strong energy efficiency measures on transport and infrastructure can boost energy productivity, save money, create jobs, and reduce emissions. “Ultimately, across all economic sectors, energy productivity is the most reliable, cleanest, and cheapest resource,” Zichal said.

Countries have to front up with their revised mitigation plans by April next year ahead of the Paris UNFCCC conference in December, hence leaving climate off the G20 agenda is simply not an option. Abbott has been told, by Christine Lagarde, managing director of the International Monetary Fund, and other powerful players.

One wonders what we will front up with next April. I predict nothing that would make a difference. We’ll see what others are doing and then do as little as possible.

5. Direst Action is a figleaf

Clive Palmer has spotted the figleaf and plans to pluck it away, says Ben Eltham. The Direct Action funding may be part of the budget, which Labor will not vote down. The Government needs no further legislation to enable expenditure, but Abbott can’t get rid of the dreaded carbon ‘tax’ without legislation. When he comes to negotiate that with PUP Direct Action will be on the table.

Eltham is right on the demographics:

While this [having no climate policy in place] may not unduly trouble the climate sceptics on the Coalition backbench, it also removes the chief utility of Direct Action, which is political, rather than environmental. Direct Action has always been used by the Coalition as a handy tool to deflect unwelcome scrutiny of its profoundly anti-environment attitudes. Without it, the Government will find it increasingly difficult to defend itself against charges of destroying the planet.

In the last Nielsen poll the 55+ group was the only one where Abbott had a clear lead, with LNP/Labor/Green at 49/33/10. This should be causing concern for the future of the conservative parties. For the young it was 32/36/26.

6. Direct Action is not scalable

Lenore Taylor points out that while Direct Action may or may not achieve 5% reductions in emissions by 2020, (most experts say, no) the policy is not scalable when the world gets a bit more serious about climate change mitigation.

according to the available modelling, even if Australia spent $88bn from 2014 to 2050 on Direct Action-type policies, emissions would still rise by around 45%. Most economists conclude that big emissions reductions under Direct Action are just not possible.

7. Green groups to use legal strategies

Given the above and the LNP’s farcical attitude to the Renewal Energy Target Review, green groups see lobbying as a waste of time and are increasingly planning legal challenges.

The Australian Conservation Foundation will be targeting voters in marginal electorates to encourage MPs to take climate change seriously. The aim is to change the current race to the bottom to a race to the top.

Reminder: Use this thread as an open thread on climate change.

Friday salon: Anzac Day weekend

voltaire_230

An open thread where, at your leisure, you can discuss anything you like, well, within reason and the Comments Policy. Include here news and views, plus any notable personal experiences from the week and the weekend.

For climate topics please use the most recent Climate clippings.

The gentleman in the image is Voltaire, who for a time graced the court of Frederick II of Prussia, known as Frederick the Great. King Fred loved to talk about the universe and everything at the end of a day’s work. He also used the salons of Berlin to get feedback in the development of public policy.

Fred would only talk in French; he regarded German as barbaric. Here we’ll use English.

The thread will be a stoush-free zone. The Comments Policy says:

The aim [of this site] is to provide a venue for people to contribute and to engage in a civil and respectful manner.

Bill Shorten gets serious, or does he?

Bill Shorten’s plans to reform the ALP were greeted with unrestrained enthusiasm by Mark Latham, a remarkable event in itself. Others have some reservations or are not so sure.

Laura Tingle pointed out (paywalled) that he actually proposes nothing about senate candidate selection, it’s a matter for the states. He asked the national ALP secretary to work with the National Executive and the WA state secretary “to recommend the best way of giving local party members a meaningful say in the selection of Senate candidates.”

Our work in Western Australia will be used to inform our other State branches in allowing local members to contribute to Senate pre-selection nationally.

Farr said that there would have been discussion within the ALP before Shorten went to press. Shorten is reasonably confident of his reforms getting up, he says. Farr described it as a “well-planned offensive”. Apparently NSW in July are going to consider the union membership link and introduce one-click joining facilities via the internet.

Count me confused. Here in Queensland last year before the election my wife, who is not currently a union member, went on the internet and had no difficulty in joining with one click for the princely sum of five dollars. (She has since made a more substantial donation.)

After the current publicity she rang the Qld office asking if her membership was OK. She had been a union member for years, acted as union rep etc, but is currently not a member. “You’re fine” she was told. Could she vote in a leadership ballot if Shorto gave up? “Certainly.”

Malcolm Farr pointed out on RN Drive that achieving rank and file input to senate selection would be the real prize. At present it can be a sinecure for party and union officials, a privilege they might be expected to relinquish reluctantly.

Shorten is recommending a 70:30 membership/central panel split in selecting candidates. He’s also recommending more primary-style selections, as successfully trialled in Western Sydney.

Shorten wants broader input in a review of Labor’s entire policy platform prior to the 2015 national conference.

He looks forward to a membership of 100,000. I believe it is 40,000 at present.

David Lockwood at New Matilda thinks the union link should remain, indeed should be strengthened and “democratised”.

Union delegates to ALP conferences should be elected by ordinary union members, not appointed by national secretaries. Furthermore, the selection of parliamentary candidates should be in the hands of rank-and-file members of the party and the affiliated unions…

Break the link with unions and the Labor Party

ceases to be an authentic voice for working people, it will lose its core meaning and become nothing more than a pale imitation of the conservative parties.

Lockwood sees Labor as representing working people, not Australians generally. He says there are 1.8 million union members, roughly 18% of the workforce. This has been stable for three years. He sees anti-union laws as an inhibitor of greater membership. This should change, he says.

Shorten said Abbott did not put Labor in Opposition, the Australian people did. It’s hard to see the Australian people handing over the government of the country to an overtly union-based party, however democratised.

Narelle Miragliotta, Senior Lecturer in Politics at Monash University, assembles a catalogue of negativity about the Shorten proposals. The Party is a victim of its own success. Nothing left to fight for, apparently.

Labor has addressed some of the worst excesses of societal disadvantage and inequality when in government. In doing so, it has transformed both the life opportunities but also the political and social expectations of Labor’s former working-class base.

This has left Labor bifurcated and fractured between a progressive and traditional cohort. Increased membership “is unlikely to bridge the policy and cultural divide that separates these voting segments.”

As to a faction-free Labor Party, the bigger it grows the more power aggregates around cliques.

With that sort of negativity we may as well hand over the game to our natural rulers, the Tories.

Most of my working life was spent inside government. I’m not a natural joiner. Now I work as a sole trader providing direct services to capitalists, pensioners, professionals and self-funded retirees. I can’t see a role for a union.

Shorten has a bit of the anti-politician about him. I might go look for that one-click entry portal.

Lower living standards


On the most recent comparable data from the final three months of last year, living standards have gone backward.

While consumer prices increased by 0.7 of 1 per cent during that quarter, household incomes only went up 0.1 of 1 per cent.

That’s what we were told on Radio National yesterday.

Ben Phillips from Canberra University’s National Institute for Social and Economic Modelling says there’s a shift under way in our standard of living. Export prices are lower than they have been, the cost of services such as school education, electricity, and gas are going up. Incomes are not keeping pace.

Household debt is an issue.

Professor David Peetz of Griffith University says that the Bureau of Statistics’ wage price index, a key measure of household income, fell to its lowest level on record in the December quarter. He points out that the labour market is largely non-unionised and hence vulnerable with unemployment increasing.

The question is whether this is a temporary blip or the beginning of a longer trend. Given the commentary from the experts it’s looking like the latter.

In this context it looks as though interest rates will be on hold, given also that the CPI came in lower than expected. That was courtesy of falls in the price of furniture, clothing, footwear and car repairs, not big on my shopping list.

Given that the age of entitlement has ended, Treasurer Hockey is now looking at the Audit Commission big picture.

Fiscal stimulation seems very far from his mind. Hockey says “nothing is free” and warns that spending people have come to take for granted will be wound back. Co-payments and means tests are on the agenda.

I’m in favour of means tests, in moderation, but I fear Hockey’s ‘vision’ is to shrink Australia.

Climate sceptic heads RET review

The law says that the Renewable Energy Target (RET) should be reviewed every two years, so a 2014 review is mandatory.

The law also says that the review should be undertaken by the Climate Change Authority (CCA), which still exists courtesy of the senate. The CCA in a draft report on the emissions target suggested the current 5% emissions reduction target was not enough if we are to pull our weight in the world. In the text they appeared to favour a 25% target, but recommended at least 15% pointing out also the an additional 4% could be added courtesy of Kyoto credits.

I believe the RET has been one of the more successful factors in restraining emissions.

Giles Parkinson reported two months ago now that the RET Review will be headed by Dick Warburton, a climate change “denier”. Warburton told RN’s AM program that the science was not settled.

I am not a denier, nor a sceptic actually, of climate change per se. What I am sceptical is the claims that man-made carbon dioxide is the major cause of global warming. I’m not a denier of that, but I am sceptical of that claim.

When asked whether he believed renewable energy had its role to play in Australia’s energy mix Warburton replied:

Yes it does. Renewable energy does have a place to play. The review is asking us to look to see whether it is an efficient and effective way of doing it as we’re doing it at the moment.

warburton_250I understand he did overtly oppose carbon pricing.

In my opinion Warburton is a denier. Given the degree of certainty in the science you either accept the science or deny it. There’s no room left for fence sitting. That being said, Warburton had a fine reputation as a businessman leading Dupont’s Australian operations, was used by the Keating government in industry renewal, has been a member of the Reserve Bank board and has had various company board roles.

It has emerged that Warburton has been the subject of an investigation into his role as a former director of a firm involved in Australia’s worst foreign bribery scandal. I would suggest that Abbott has done his due diligence and found him in the clear.

Both Abbott and Macfarlane have been emphasising their concern over renewables contributing to the cost of electricity. A second panelist is Matt Zema, the CEO of the Australian Energy Market Operator. As such he was responsible for a study recently

that found 100 per cent renewables would be possible in Australia, and concluded that the cost of electricity would be little different to business as usual, although AEMO declined to do a full cost analysis.

Greg Hunt parrots his boss’s concerns:

“We are a government that is unashamedly doing our best to take pressure off manufacturing and households through anything that can lower electricity prices,” he said in a theme frequently repeated by the conservative government.

If they are concerned about the future cost of electricity they could begin by looking at the policy of privatisation, found to be “a dismal failure” by Professor Quiggin.

A third panel member, Shirley In’t Veld, is the former head of WA government owned generation company Verve Energy which

has had a history of snubbing renewable energy and chose instead to invest in the refurbishment of the ageing Muja coal-fired generator. The refurbishment has proved to be a financial disaster, with the WA government admitting that nearly $300 million had gone down the drain.

The fourth member is Dr Brian Fisher, the former long-term head of ABARE until he left for private enterprise in 2006 to head up a fossil fuel lobby group, Concept Economics. At ABARE he gained notoriety for his positions on climate policies and is a noted free-market hardliner. Under Fisher:

ABARE was responsible for the infamous “MEGABARE” model that made Australia a laughing stock in connection to the Kyoto negotiations.

Sounds like a merry crew, Abbott’s idea of ‘balance’, and bound to add to the climate recalcitrance now so common in the Anglo-Saxon world.

There is a question as to whether the LNP deliberately lied and misled the public prior to the election. The SMH cites specific bi-partisanship as late as July 2013. Labor’s view:

“At every possible point, they tried to assure the community that there was a bipartisan consensus around the RET, and therefore the growth of renewables,” Labor climate change spokesman Mark Butler says. “What’s clear now is that it was just an utter falsehood.”

Albo:

“They made it very clear; Greg Hunt staked his reputation on the maintenance of the renewable energy target,” he told said in the island state of Tasmania.

“It’s important for jobs. It’s important in terms of positioning Australia as a clean energy economy into the future.

“We’ll wait and see what they do but we’ll be holding them to account,” Mr Albanese said.

Update: Giles Parkinson tells how the Warburton Review is getting down to business today by looking at what the RET of 20% means. Presently it is a number – “41,000GWh of large-scale developments and an uncapped amount of small-scale generation”. It seems that more than half of that number can be made to disappear by changing definitions.

Climate Change Authority review

In late February the Climate Change Authority published a Draft Report of its Targets and Progress Review.

The full draft report (all 265 pages) is downloadable from the first link above. Unfortunately I don’t have time to read all of it. Clive Hamilton at The Conversation has written an excellent overview. Continue reading Climate Change Authority review

The Qld Government’s People’s Budget Planner

I have just completed and submitted my views re what should be done about the Qld budget in the People’s Budget Planner.
The planner allows you to play with various ways of reducing the state budget using a mix of various tax increases, service cuts and asset sales alternatives.   If you get below the debt budget target it also allows you to spend the interest savings amongst a range of spending alternatives.
The government obviously hopes that playing with the budget planner will encourage people to support asset sales as a better way to bring the budget back to a sustainable level compared with cutting services or, shock horror, tax increases.
The planner does have some serious limitations.  For example, what you get when you click on more details is fairly skimpy.  For example, in the case of selling the ports business there is no indication of how much revenue will be lost and/or what effect this will have on costs to port users.  The details are a slightly extended explanation, what the sale will yield and a few examples of where this has already been done in Australia.
When it came to spending the interest saving there was nothing to give a feel for how much was already being spent in an area.  For example, if you allocated 10% of the total interest saving to improving bike infrastructure you may have been choosing a doubling of the existing budget or something that was barely worth the effort.
Despite its limitations, the planner is useful for helping people understand some of the budget choices and as a mechanism for allowing people to state their preferences.
The interesting thing from my point of view was that the planner showed that the budget could be balanced by simply increasing a range of taxes and charges while doing nothing else.   The planner is worth filling in and submitting if, like me, you think that taxes should be set at levels that allow governments to do their job properly. 

What Business Spectator thinks of our refugee policy

On Maundy Thursday, the Business Spectator lead story was this telling article on the Rudd/Abbott refugee policy by Rob Burgess.  The article starts with:

As many Australians prepare for a holiday marking the most important Christian festival of year, it’s worth remembering that Jesus of Nazareth began life as a refugee, taken to Egypt to escape King Herod’s slaughter of male infants.  

The refugee family eventually went home, so there was no need to transfer the infant to an offshore detention facility – I mean, who’d even think of doing that?”

 And ends with:

While the nation spends a long weekend celebrating the life of the world’s most famous refugee, political leaders might take time to sniff the wind again and realise we’re standing out in our region for all the wrong reasons.

As Fraser sums it up: “Whatever else our refugee policy is, it isn’t Christian.”

In the middle there was a well argued article with useful supporting data that included:

“In years to come, people will look back at the Abbott Government’s practice of locking innocent children up on remote Pacific islands and shake their heads with disbelief,” said Hanson-Young on Wednesday.

It may not take years. Other nations, including key trading partners, are already shaking their heads at Australia’s offshore processing regime…….

” At this year’s human rights dialogue between China and Australia, vice-minister of foreign affairs Li Baodong said China had concerns “especially on the protection of refugees and asylum seekers, the right of the children of refugees in education and other rights … We have also asked about whether these refugees will be illegally repatriated to other countries….”

While the Greens have long used moral arguments to condemn Labor’s and the Coalition’s policy, economic and strategic concerns give added weight to opprobrium from our trading partners.

Recent history shows how quickly a latent dislike of Australia can become manifest – the fury on the streets of Indonesia during the recent phone-tapping scandal was fed by negative stereotypes of Australians that stretch back through the 20th century.

Not only are we remembered as the lucky country that ran the white Australia policy, but our political leaders of the past have (often unfairly) been seen as colonialists seeking to impose a Western order on peoples who, from their own domestic perspective, were throwing off the shackles of a colonial past.

Whatever the roots of our negative image within the region, Australia’s national interest lies in the paring away of stereotypes, not augmenting them with stories of babies flown to Pacific Island prisons.”

Think about how those who used to be excluded by the White Australia policy must see us now:  Here is a country getting all agitated about 18,111 protection visa applications from boat people in 2012/13 despite having a strong economy and an estimated 2013 net immigration of 234,000.  A country that claims to be all about a fair go but thinks its OK to send refugee children to concentration camps in breach of a refugee convention that Australia signed.  A country where both Abbott and Rudd are very public, white Christians being nasty to refugees who mostly aren’t Christian and who would have been blocked from entry under the white Australia policy.

Having an Attorney general who has stated that it is “OK to be a bigot” doesn’t help either.

Progress is being made whenever an important, Murdoch owned business blog is saying, in effect, that our refugee policy is not only non-Christian but also bad for business and our relationship with our neighbours.

Enjoy your Easter.

Appendix:  Refugee Council of Australia’s data on Australia’s refugee performance compared with the 10 best countries:

Graph for Australian self-interest through Asian eyes

Friday Salon: Easter edition

voltaire_230

An open thread where, at your leisure, you can discuss anything you like, well, within reason and the Comments Policy. Include here news and views, plus any notable personal experiences from the week and the weekend.

For climate topics please use the most recent Climate clippings.

The gentleman in the image is Voltaire, who for a time graced the court of Frederick II of Prussia, known as Frederick the Great. King Fred loved to talk about the universe and everything at the end of a day’s work. He also used the salons of Berlin to get feedback in the development of public policy.

Fred would only talk in French; he regarded German as barbaric. Here we’ll use English.

The thread will be a stoush-free zone. The Comments Policy says:

The aim [of this site] is to provide a venue for people to contribute and to engage in a civil and respectful manner.

Follow that and you should be fine.

Climate clippings 93

Climate clippings_175

1.Three reports

First, the Climate Change Authority released a Draft Report of its Targets and Progress Review.

I have a draft post in the bin, which I’ll publish after Easter. Labor are likely to adopt the enhanced targets it recommends, whereas the LNP have confirmed they won’t go beyond 5% by 2020.

Second, I’m working on a post on the IPCC’s second report in the current series, released on 31 March Impacts, Adaptation and Vulnerability. To get a head start you can follow the links from the report website.

I should be able to finalise the post for the week after Easter.

Third, the Summary for Policymakers of the IPCC’s third report Climate Change 2014: Mitigation of Climate Change was released on Monday. I hope to tackle it over Easter, aiming for publication the second week after Easter. The ABC has comment: politicians and Frank Jotzo and John Connor. The Carbon Brief has a lot of useful material.

2. The cost of mitigation

The IPCC mitigation report puts the cost of action at 0.06% of GDP, but calculating the cost is complex, especially when looking at the damage caused by doing nothing.

Researchers Rosen and Guenther find that the economic modelling is not possible, there are too many variables and too many unknowns.

Yet crisis trumps uncertainty, we have no real choice but to act.

3. Trouble in the vineyards

Early ripening is becoming a huge problem for growers and wineries.

growers say they’re having trouble processing their crop because it’s ripening too quickly.

Researchers are blaming climate change, with warmer conditions and drier soils accelerating the ripening process.

4. Microbes cause Permian–Triassic extinction?

The Permian–Triassic extinction event, commonly known as the Great Dying, was responsible for the extinction of roughly 90% of all life on Earth.

According to new research at MIT the event may have been caused by microbes.

The team’s research indicates that the catastrophic event was in fact triggered by the tiniest of organisms, a methane-releasing microbe called Methanosarcina. New evidence suggests that at the time of the extinction, the microbes appeared in massive numbers across the world’s oceans, spreading vast clouds of the carbon-heavy gas methane into the atmosphere. This had the effect of altering the planet’s climate in a way that made it inhospitable to most other forms of life inhabiting Earth at that time.

5. Land clearing returns to Qld

According to The Wilderness Society the Queensland Government has approved the clearing of 30,000 hectares at Strathmore Station in the Gilbert River catchment in the Gulf country, which will add the equivalent of 4.2-6.6 million tonnes of carbon dioxide into the atmosphere, the same as running up to another 2.6 million cars on our roads.

Strathmore wants to clear another 70,000 hectares. Together with another proposed Gilbert River project, IFED’s so-called Etheridge mega farm, the two schemes would clear and flood 200,000 hectares of land.

That would be like bulldozing a 10km wide strip for 200km.

6. Instruments of persuasion

Dr Rod Lamberts of the Australian Centre for Public Awareness of Science at the ANU says it’s time to dump science and facts as instruments of persuasion in favour of advertising and marketing. He says we need to appeal to people’s emotions, which will

have a stronger effect than trying to appeal to their brains via some kind of, you know, fact channel.

But please note, the facts are needed to support the campaign:

If the goal is to affect change, then I believe we need to step more into the realms of advertising and marketing and so on, in terms of delivering messages that are supported by what the science is telling us, but don’t have the science in those messages. (Emphasis added)

Jane Caro agrees on the need for a different approach:

Facts have never changed anyone’s mind about anything, sadly. It’s very hard for scientists to understand this, because they’re highly rational people, but in actual fact, no-one has ever been rationalised out of a belief.

There are only two things that change people’s attitudes and behaviour, particularly their behaviour, and they’re two emotions, and they’re hope and fear.

Again, facts and the science are surely needed to rationalise a changed belief. Beliefs need reason to support them.

Who mounts and pays for an advertising and marketing campaign? We look to governments, but in Australia they are the actual problem.

7. Direct Action less popular than the price on carbon

Meanwhile Essential Media Communications have done a survey of opinion that shows Direct Action distinctly less popular than the price on carbon. In terms of age, there is a tipping point beyond which the doubters predominate and it’s age 55. Abbott’s climate policy may come back to bite.

as the flat-earthers take control of the Federal Government, more Australians than ever have come to the conclusion that the Earth is in fact round.

Changing our policymakers seems the best way home but then Labor needs to offer more than tokenism. In my opinion Labor politicians should be the prime target group. The current mob won’t change without a spell in opposition and transformational ideological renewal.

Reminder

Use this as an open thread for climate topics.

Ending the age of entitlement


“there are no cuts to health, no cuts to education, pensions don’t change…”

That was Tony Abbott at the National Press Club just days before the last election, as reported by Peter Martin.

JOE TO SLASH AGED CASH

was the headline of Samantha Maiden’s Murdoch paper report in the Courier Mail on Sunday.

Budget pain to hit all: Hockey

That was the headline of Laura Tingle’s front page article in the AFR on Monday.

Treasurer Joe Hockey says no group will be safe from cuts in the May budget, as he braces voters for potential changes to the age pension and tighter asset tests.

Large numbers are cascading everywhere. Maiden’s article tells us that 94% of Australians over 70 qualify for either a pensioner concession card or a seniors health care card. Some 78% of the cost of scripts claimed under the PBS is going to concession card holders. Half of the $40 billion age pension bill goes to households with assets of more than $500,000. The $40 billion bill could rise to $70 billion over the next decade.

Labor increased the aged pension from 65 to 67 but that is to be phased in by 2023. The LNP are considering lifting the eligibility age to 70.

Another option is to include the family home in the assets test if it is worth more than $1 million.

Moreover, Hockey reckons the age pension indexation needs to be sustainable. Labor increased the rate and indexed it to average male earnings, which escalate faster than the CPI. Hockey appears to favour a return to the CPI.

Cutting the ‘seniors supplement’ (I get $500 taken off my tax because I’m old) has also been mentioned.

Justin Greber quotes the savings (paywalled) calculated by Stephen Anthony of Macroeconomics. Anthony reckons we need to cut the budget by about 1% of GDP or $16 billion. Overall he says:

the primary focus for the government should be in stemming middle- and upper-class welfare, with the most obvious savings in the aged and family benefits, drugs, industry assistance and removing overlaps between different levels of government.

As to the oldies, he says changing the indexation back to the CPI will save $900 million. Including the family home in the assets test will save $1.1 billion, while cutting the seniors supplement would garner a further $500 million. Peter Martin identifies a further $1.5 billion in carbon price compensation, so in all about $4 billion could be screwed out of the oldies.

Peter Martin also points out that the aged pension has increased by 25% since the indexation changed four and a half years ago, compared to the CPI of 13%.

There’s little doubt that rich old men could contribute a little more.

For context we need to note that the Australian budget is approaching $400 billion.

As a disclosure I’m modestly self-funded with no superannuation. I’d appreciate help with pharmaceuticals but get none other than the normal PBS. In this post I’m not arguing the merits or otherwise of any of the proposed changes. I do think, however, that we could consider paying a bit more tax.

Yet Peter Martin argues that tax increases are already included in the forward estimates because they don’t compensate for bracket creep. The CPI and bracket creep could make our incomes virtually flatline in real terms. He favours increasing the GST.

New Zealand increased the GST in two phases from 10 to 15% without stalling the economy or undue public concern. John Hewson says we are the champions in the OECD in tax concessions, including notoriously concessions to rich retirees and the fossil fuel industry. There are plenty of options available and Anthony stresses the problems are in the out years, not the next budget or two. There should be time for debate.

The Commission of Audit report is said to be available shortly as is a review of the welfare system.

My main worry in all this is that the poor and the vulnerable are going to be hit as well when there really is no need. Also there are sectors where we need to increase spending, such as skills, education including universities, research, innovation and smart industry development. Did everyone see the 4 Corners program on the hollowing out of sophisticated manufacture with the demise of the car industry? That at a time when the CSIRO prepares to cut another 300 jobs.

Meanwhile the Fairfax poll is now 48/52 in favour of Labor. There are some problems for Abbott in the regions, perhaps over foreign investment and trade policies. However, the Labor TPP surge is largely courtesy of a stunning increase in the Greens vote. 26% of 18-24 year-olds now favour the Greens. From 16-39 the LNP vote is lower than Labor, while within the margin for error. It’s the oldies that are keeping Abbott afloat. They don’t always vote in their own interest.

You can use this post as an open thread on politics.

Modelling the cost of mitigating climate change

Forget it, it’s too hard!

That’s what two researchers, Dr Rich Rosen and Edeltraud Guenther of Boston and Dresden respectively, have concluded. They say it’s impossible to calculate the cost of mitigating climate change, there are too many variables and too many unknowns. Modelling which purports to do so cannot and should not be used by policymakers.

Nevertheless mitigate we must! Crisis trumps uncertainty:

“Mitigating climate change must proceed regardless of long-run economic analyses”, they conclude, “or risk making the world uninhabitable.”

Economic modelling of climate mitigation costs against business as usual (BAU) has commonly been used in developing policy after the Stern Review of 2006 and the IPCC’s Fourth Assessment Report of 2007. For example the Australian Treasury modelled the costs of the Gillard Government’s Clean Energy Future package through to 2050.

A complete waste of time, according to Rosen and Guenther.

Nevertheless treasuries in the future will no doubt continue with their best efforts. In the end a cost has to be entered in the budget, including the forward estimates. And no doubt the long-term story will continue to be told in order to convince us that the authorities know what they are doing.

We’ll know, however, that we are being fed a work of fiction.

Climate change, sustainability, plus sundry other stuff