Federal Treasurer says: still too few kids

Evoking some very conservative comments from the spokesman for the Federal Left

AUSTRALIA faced a huge budget shortfall in 40 years because the fertility rate was still lagging behind the ageing of the population, it was predicted yesterday. The Federal Government says it has made some progress, but an ageing population will still mean Australia faces a budget deficit of $35 billion in 2047. Treasurer Peter Costello yesterday released a five-year update on his inter-generational report of 2002, which considered the challenges of an ageing population and a smaller proportion of workers to meet the cost burden.

"Demography is working against us," Mr Costello said in a speech to the National Press Club. He said Australia was in the middle of an economic "sweet spot" but could begin to feel the pain of massive demographic pressures as soon as 2010. Mr Costello said that despite some good progress, Australia's ageing population would place enormous strains on government intentions to provide health, aged care and pensions, "Australia is pretty much at the best point, at the sweet point, in the demographic transition now," Mr Costello said. "After 2010 the dependency ratio, the ratio of children and older people to people of working age, is expected to increase more rapidly as the baby boomers reach age pension."

He said more babies, more women in the workplace and some key government decisions had carved a huge chunk out of future budget deficits, but Australia still faced an annual budget deficit of $35 billion a year in 40 years' time. This was down from the predicted $50 billion in budget deficits Mr Costello was predicting five years ago. But the Treasurer said more had to be done to lift Australia's fertility rate. Mr Costello said the current baby bonus -- a cash incentive -- was a better way to help struggling families, as was the childcare rebate. While making forecasts over a number of areas, which could effect the budget bottom line, Mr Costello said the "inexact variables" such as climate change were too unpredictable to be included in the report.

Opposition Treasury spokesman Wayne Swan said Mr Costello was ignoring how important productivity was to improving future budgets and allowing governments to provide health and aged care and pensions. "The most fundamental way that we can improve living standards and create more wealth is to grow the economy faster," Mr Swan said. "To do that, you've got to lift productivity . . . that's the only sustainable way, in the long term, you cope with the economic challenges of the ageing of the population."

Australian women were still having fewer babies than the replacement rate of 2.1 babies per woman, but there had been a slight improvement in recent years to lift the fertility rate to 1.8.

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Animal activist absent in court

It sure took a long time to get this one into court. Michael Darby commented on it (scroll down) in 2003

An animal rights activist being sued for almost $500,000 has not appeared in court to defend himself. Ralph Hahnheuser, 42, a former Animal Liberation South Australia activist, did not appear in the Federal Court in Melbourne yesterday to answer a civil claim lodged against him by two sheep exporting companies.

The exporters, Rural Export and Trading (WA) and Samex Australia Meat Company, lodged the claim against Mr Hahnheuser over an incident in November 2003 when he placed shredded ham in sheep feed at feedlots in Portland. Mr Hahnheuser has said he acted to make the sheep unacceptable to Muslim consumers.

As a result, about 70,000 sheep for export were delayed at the Portland feedlot for two weeks and another 1800 were not exported at all. Justice Peter Gray said he found the extent of the companies' claimed loss on the 1800 sheep "staggering". The civil case continues today.

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Howard slaps down EU climate criticism

Prime Minister John Howard says the European Union (EU) should get its own house in order before it criticises Australia over greenhouse emissions. EU Environment Commissioner Stavros Dimas has claimed political pride is the only reason Australia has refused to ratify the Kyoto Protocol. Speaking at a meeting of the United Nations intergovernmental panel on climate change, Mr Dimas urged Australia to sign up to the protocol - a move which he said would boost international efforts to address climate change.

But Mr Howard says 12 of the EU's member countries are not on track to meet their Kyoto targets, citing Italy, Spain and Portugal as examples. "You've got the spokesman for a group of countries lecturing us about not having signed Kyoto," he said. "Yet the great bulk of the countries on whose behalf he speaks are falling well behind their Kyoto targets, and are doing less well than Australia in meeting them."

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Gunns court case gets green light

Tasmanian timber giant Gunns' fourth attempt to sue environmentalists and green groups will be allowed to proceed after the Victorian Supreme Court lifted a stay of proceedings. Gunns first attempted to sue 20 defendants in 2004, claiming anti-logging protests had damaged its business. Today the court allowed a fourth version of Gunns' statement of claims to proceed against 14 remaining defendants, including the Wilderness Society. But Gunns was ordered to pay some costs for six defendants dismissed from the case, including Greens Senator Bob Brown and the party's Tasmanian leader Peg Putt.

Senator Brown says the case has been a traumatic experience for defendants and is now likely to drag on for many years. "It is going to be an immense burden on them, both on their ability to get on with their lives and their well being," he said. "But that's the action that Gunns has taken."

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More of that pesky "drought"

Bus, road trains stranded as highway submerges

Flooding on the Great Northern Highway in Western Australia's north has been causing problems for motorists over the weekend. A Greyhound bus, with just two passengers on board, was stranded outside Fitzroy Crossing for most of the weekend, unable to pass with the road 700 millimetres under water. Six road trains delivering supplies to towns in the region were also stuck at Fitzroy, unable to get through.

Local emergency services volunteer Andrew Twaddle says one truck got stuck when he swerved off the floodway. "They got the grader and the tractor from Gogo station and a loader from the community out there at Bayulu and hooked the three machines up to it and pulled him back up onto the highway," he said.

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A coming apocalypse always has plenty of believers

People often ask how I can be sceptical about the claim that global warming is the major threat of our time, requiring urgent and massive action. After all, many scientists believe it and I am not a scientist. It's a good question, but I think I have a good answer. History shows that scientists are not always right. Sometimes they get caught up in the non-scientific enthusiasms of their time. History also shows that one of those enthusiasms, which crops up constantly, is a desire to believe in the approach of some kind of apocalypse. Of course, I have no way of knowing if the carbon crusade is a case in point. But it shares some of the characteristics of previous apocalyptic movements, which provides grounds for cool scepticism.

An apocalyptic movement comparable to the carbon crusade was the belief the world would soon run out of resources. According to the 1984 book The Apocalyptics by the American journalist Edith Efron, in 1970 scientists at the Massachusetts Institute of Technology, one of the world's great centres of learning, produced the so-called SCEP report that acknowledged there just wasn't enough data to make such a prediction. Two years later the institute completed another report, Limits to Growth, commissioned by the Club of Rome, a group of people fearful for the planet's future. This time the conclusion was very different: a computer-modelled graph "showed natural resources, the industrial output, the food supply, and the population crashing somewhere near the year 2005 and continuing to crash for years . On the basis of these findings, the study called for an immediate cessation of all economic growth". Limits to Growth caused an international furore and was a bestseller in many countries, moving 3 million copies worldwide.

Although the resource issue was more widely debated among scientists than global warming, the similarities between the two are many, including the faith in computer modelling and the media treatment. The media largely ignored the moderate report (SCEP) and seized upon the alarmist one ( Limits to Growth). Something similar has happened with the carbon crusade. In 2005 the House of Lords select committee of economic affairs produced a report urging a cautious economic response to climate change, because its implications are so unclear. That report is well regarded by many economists but was largely ignored by the world media. The alarmist report produced the following year for the British treasury by Sir Nicholas Stern had the opposite fate: the world media have embraced it even as an increasing number of economists have been scathing in their condemnation.

On March 21 Bjorn Lomborg, the author of The Skeptical Environmentalist, gave evidence to the US Congress house committee on energy and commerce. Lomborg believes humanity is warming the globe, but noted that academic papers have described the Stern report as "substandard", "preposterous", "incompetent", "deeply flawed" and "neither balanced nor credible". There's an emerging consensus among economists (for example in the leading journal World Economics) that Stern vastly inflated the likely damages from climate change and vastly underestimated the cost of the action he recommended.

To see such work hailed so effusively and widely, and to see its author received by Australia's top politicians just this week, are two indications to the sceptical observer that the carbon crusade is about apocalypse as much as it is about science.

There's a widespread view that we need to evoke the precautionary principle with climate change on the grounds that it's better to be safe than sorry. But when we talk about the precautionary principle, we need also to evoke another concept: opportunity cost. Money devoted to climate change is money not devoted to other problems. So the right question is this: given our current state of knowledge, which of the problems facing humanity deserves most of our attention?

Several years ago, Lomborg set up a project known as the Copenhagen consensus to determine this. Its starting point was to ask how we might best spend $US50 billion ($62 billion) if we wanted to make the world a better place. (As it happens, the amount of money spent on global warming research since 1990 is now about $US50 billion.) The project has compiled a list of problems that are real, urgent and solvable. Here are some of them, ranked by a panel of top economists, including four Nobel laureates. When reading them, bear in mind that if the world were to adhere to the Kyoto Protocol and thereby postpone warming by just five years to 2100, the cost would be $US180 billion annually.

According to Lomborg's evidence to the Congressional inquiry "preventing HIV/AIDS turns out to be the very best investment humanity can make . For $US27 billion, we can save 28 million lives over the coming years." Investing $US12 billion would probably halve the number of people dying from malnutrition, currently almost 2.4 million a year; $US13 billion would reduce deaths from malaria, now a million a year, by the same proportion. UNICEF estimates that just $US70-80 billion a year could give all Third World inhabitants access to the basics such as health, education, water and sanitation.

The need to believe in an apocalypse is a base craving unfortunately rooted in the human psyche. We need to resist it with another human attribute: the power of reason.

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