Friday, March 25, 2011

A public service broadcaster propagates some strange economics

On the ABC "Green" site, unsurprisingly. The writer obviously has some grasp of economics but makes some elementary blunders. Take the first sentence in the excerpt below: If that were true, why are forests and stands of trees bought and sold?

And take the last paragraph reproduced below, the claim that burning down cities would benefit the GNP. It is an old fallacy. The writer has obviously never read Bastiat. In summary, the available economic energies (labour etc.) would not change. It would produce much the same in sum with or without a conflagration. Instead of building new houses (say), it would have to rebuild old ones. There would be no necessary impact on GNP at all -- but there would of course be a great loss of assets. See also here for a another refutation of this old fallacy

I suspect that the writer just liked the idea of burning down houses. Greenie forest management policies frequently accomplish just that -- via their opposition to bushfire prevention

A tree growing in a forest has no standing in economics. As far as conventional economics is concerned, it has no "economic" role. Of course, it provides a vital role in the earth's life support system, but this is of interest to scientists and not economists.

As soon as the tree is cut down, it acquires status in economics. Its significance grows as the tree is broken up into smaller components, such as paper or match sticks. The more it is destroyed, the more important it becomes to economic calculations.

Gross National Product (GNP)

Economic and political life revolves around the GNP or Gross National Product. GNP is the measure of financial transactions within a country's economy - the total flow of goods and services produced by the economy over a specified time (usually a year) - and it is derived from calculating the total income of a country's residents, whether the incomes come from production in that country or from production abroad. There is also a calculation of the Gross Domestic Product (GDP) but this distinction is not very important for the main argument here: the inadequacy of conventional economics to take the environment into account.

The GNP is simply a measure of financial transactions; it makes no value judgment on whether the transactions were socially useful or what impact there may have been on the environment.

Crime and car accidents increase the GNP because of the increased work for police, ambulances and prisons. A reduction in crime reduces the GNP. Similarly, a good way to increase Australian GNP would be to burn down Sydney and Melbourne each year. GNP would grow because of the extra work for fire brigades, undertakers, architects, builders, and plumbers. There would be little to show for all this annual effort - but there would be a higher GNP.


Thousands of angry ordinary Australian​s turn up to an anti-tax rally -- and the usual Green/Left smears begin

Jo Nova

In Canberra YESTERDAY over 3,000 people went out of their way, coming in on 30 buses from more than 1000 km away, to let Julia Gillard know that Australians do not want her Carbon Tax. The news made every major broadcast for several minutes. Protesters were referred to as “climate skeptics” (mostly).

Other rallies around Australia got hundreds of people even though they were organized in a hurry, with no advertising, and with no pre-formed coalition of networked groups. There was a very good crowd at the Perth rally on a hot day during business hours, and one heckler (John Brookes). The mood was striking.

This is random shoe-string grassroots action at the last minute and look what it can achieve. It’s just beginning.

The photo gallery at the Australian makes it clear how decidedly normal most people were and what their main messages are. This is mainstream Australia rising up, yet already the Big-Green-PR machine is at work, doing all it can to deny the undeniable.

As I drove home in Perth after our rally, ABC news-radio didn’t mention that 3,000 people had gathered, nor that protests had happened all over the country, they may have said that earlier, but all I heard was how Tony Abbot was under a “cloud” for having spoken at a rally with “extremists” — The Telegraph headlined it too.

Labor MP Nick Champion, Labor Party backbencher, gets press time for his free shot at calling them “extremists“. It’s just another form of name-calling, and if the media had any standards they would not propagate the namecalling without demanding he substantiate it. (Do write and tell me if any journalist asked Champion to explain why it’s extreme to ask for major policies to be put to an election first, or why we ought to expect some achievable outcome when we pay billions — other than earning brownie-points for the UN). Does the word “extreme” mean anything?

Fans of the big scare campaign are masters at avoiding the substantive issues, and filling the available media time with trivialities and name calling. The protesters are obviously angry ordinary Australians. That there are a few odd people or marginal hanger-on-ers among thousands is predictable, and green rally’s have their own variety.

The “witch” and “bitch” signs were unfortunate. The unstatesmanlike anger expressed in those messages is a byproduct of the long suppression of these voices. That anger needs better direction. That will come.

But as much as Labor might wish that today’s rally was a minority group of extremists, this is the start of the pendulum swinging. I stopped to shop at a butchers on the way home inadvertently wearing a No Carbon Tax shirt, and the business-man’s eyes lit up “Were you at the protest?” He’s angry and he’s one of tens of thousands who couldn’t be there today.

Many people I spoke to after the rally were keen to help. We need to start networking, with lists. The message was that many people wanted to put posters up and spread the word.

On another front, many businesses are still afraid to speak out against the Carbon Tax (what business — apart from solar and wind — would benefit from it?) But Bluescope Steel’s Graham Kraehe is pulling no punches. Finally, at least some businesses are stepping forward. If they all said the obvious, the carbon tax would be dead tomorrow.


Leftist group attacks broadcaster over climate

How much of the CO2 in the atmosphere is the product of human activity is moot. Molecules don't have fingerprints on them. There have been much higher levels of CO2 in prehistoric times so the best guess is that human activities are unimportant.

ACTIVIST group GetUp is taking on Sydney shock jock Alan Jones, demanding the broadcaster withdraw comments disputing the science of human-induced climate change.

The organisation is launching proceedings with the broadcast watchdog, demanding Jones publicly and immediately revoke what it calls fabricated statements.

"It's wrong for ultra-conservative shock-jocks like Mr Jones to deliberately mislead their audience," GetUp's acting national director Sam Mclean said today. "We have standards in this country which demand the truth from our broadcasters."

Action is also planned against another Macquarie Radio broadcaster, Chris Smith, organiser of today's anti-carbon tax rally in Canberra.

Under the Australian Communications and Media Authority's (ACMA) code of practice, broadcasters are required to make reasonable efforts to ensure that current affairs material, presented as factual, is reasonably supportable and to correct errors of fact at the earliest opportunity.

GetUp has set its sights on Jones over his comments that nature produces nearly all of the carbon dioxide in the atmosphere. Jones has said that human beings produce .001 per cent of the carbon dioxide in the air.

GetUp argues that statement is factually inaccurate and prominent climate scientists have agreed that humans have contributed at least 28 per cent of atmospheric carbon dioxide.

"Alan Jones' complete disregard for providing a balanced view of climate change on his show is unacceptable," Mr Mclean said, adding that his organisation's research indicated the broadcaster had not interviewed any climate scientists who believe in the concept of human-induced climate change. "This is completely unhealthy for public discourse and a perfect example of why the ACMA code was created in the first place."


Australia tops index ranking for maintaining strong fiscal balance

Among other things, Australia doesn't print great gobs of new money, unlike Britain and the USA

A NEW study names Australia and New Zealand the leaders in "fiscal responsibility" among top industrial nations, while the United States plumbs the lower rankings at number 28.

The Sovereign Fiscal Responsibility Index, developed at Stanford University, said mounting indebtedness and budget deficits put the United States in a class with troubled economies like Ireland (number 29) and Italy (27).

But Australia and New Zealand, followed closely by Estonia, Sweden, and China, stand at the top for their capacity to maintain strong fiscal balances decades into the future.

"There is great potential for a fiscal crisis in many countries, including the United States, if they don't start addressing the structural deficit challenges that lie ahead," said David Walker, the former chief US government auditor who oversaw the creation of the index.

"The index also shows that countries that engage in dramatic and comprehensive reforms can dramatically improve their fiscal prospects," said Mr Walker. "New Zealand ranks number two after engaging in such reforms in the early 1990s when it faced a currency crisis."

The SFRI weighed 34 members of the Organisation of Economic Co-operation and Development and the four rising "BRIC" economies - Brazil, Russia, India and China - on a mix of current fiscal strength, fiscal sustainability over the next 40 years, and transparency in fiscal governance.

Unsurprisingly, countries with high reserves, low debt and balanced budgets generally ranked high. Powerful economies with high sovereign debt levels like the US, Japan, Germany, and France were all in the bottom third. Britain, which has slashed spending to work its way out of fiscal crisis, was ninth.

Supported by Mr Walker, who was US comptroller general from 1998-2008, the study is likely to feed into pressures on the Barack Obama administration to cut spending in order to move toward a balanced budget.

Indeed, Mr Walker cited the conclusions of a recent high-level panel, the National Fiscal Responsibility and Reform Commission, to highlight the low US rank in the index. In January, the commission recommended a mix of budget cuts, tax increases, and deep reforms to programs like social security to address the government's troubling long-term deficit outlook.

If the commission's conclusions were calculated into the US outlook, it would rank eighth on the index, Walker said. "The US needs to engage in comprehensive and timely reforms to restore fiscal responsibility and sustainability and to avoid a debt crisis that would be felt around the world," the study said.

"Countries such as Australia and New Zealand that have implemented strong fiscal rules have seen declining debt levels and reasonable government spending." "They reveal the power of good fiscal governance."


ALP goes to water as boats threaten sovereignty

THE Gillard government has made a spectacular mess of policy towards illegal immigrants and is now in danger of forfeiting a key element of Australian national sovereignty.

The key to the boatpeople phenomenon is to realise that it is not about refugees. It is instead a determined illegal immigration. Piece by piece, the illegal immigrant industry is bending back the Gillard government, breaking its will and breaking its policies.

It was the Rudd government that changed policy decisively in August 2008. It closed the offshore processing centre in Nauru and abolished temporary protection visas.

As a result, people-smuggling to Australia got back into business big time. In the 2 1/2 years since the government changed policy, nearly 11,000 boatpeople have arrived. Last year, asylum applications to Australia increased by 76 per cent. Among industrialised countries overall there was a decline. In 2009, while the global number of applications was static, they increased in Australia by 30 per cent. With the end of the monsoon season, there have been some six boats this month alone, carrying more than 330 people in total.

The government deals with this matter in a consistently dishonest fashion, giving up morsels of information only under pressure. Here are some facts. In the year to August 2010, some 45 per cent of illegal immigrant boatpeople had spent more than three months outside their country of origin. Of this 45 per cent, some 88 per cent had spent more than a year outside their country of origin.

In other words, they were not fleeing directly from persecution. Many Afghans who have come to Australia have never lived in Afghanistan, or at least not for a very long time. Life in Australia is infinitely preferable to Pakistan, but deciding to migrate to Australia is not the same as being a refugee.

The vast majority of the world's refugees will never achieve permanent resettlement in a foreign country. Nor does the refugee convention envisage that they should. Rather, they should be protected as near to home as possible until they can safely return.

Everything the government tells you about this matter is likely to be a wrinkle on the facts, a spin, an angle, and it is likely to contain much less than meets the eye.

For example, Julia Gillard went to the election promising to turn back the boats and set up a regional refugee processing centre in East Timor. There is little prospect of that centre ever coming into existence and no prospect of it ever having an effect on the illegal immigrant trade.

Recently, Immigration Minister Chris Bowen trumpeted an agreement with Afghanistan that would allow failed asylum applicants to be returned. The problem was the Afghan government thought it meant no such thing.

So, how many failed Afghan asylum-seekers have been returned against their will since 2007? Absolutely none. How many Afghans have gone back voluntarily? The answer is five.

More than 80 per cent of illegal immigrants arriving by boat come with no documents, yet nearly all need documents to get to the country they take the boat from. This naturally makes security checks extremely difficult. It also underlines what everyone in the field knows already, that the entire process of granting someone refugee status is almost completely subjective and easily scammed. There is a whole industry based on learning the right answers to questions Australian officials ask. In the first nine months of last year, more than 40 per cent of Afghans were rejected as refugees in their primary assessment but after all appeals were exhausted 96 per cent were accepted. Yet in the same period, some 9577 Afghans applied offshore to come to Australia as refugees and only 951 were accepted and given visas.

What is happening on Christmas Island exactly parallels what has happened in Europe in the past couple of decades. A determined illegal immigration presented itself as an asylum issue and gradually beat back the will of European governments to enforce control of their borders. This determined illegal immigration often used extravagant protest and even self-harm techniques to engage European compassion.

And it worked, just as it is working on Christmas Island. Bowen fatuously declaims that no one engaging in riots and breakouts will benefit from their actions.

Exactly the reverse is true. The government has effectively surrendered its policy and moved hundreds of people to mainland Australia. The Age newspaper obediently called for the end of mandatory detention.

Here are three other lies from the government. It says mandatory detention is not meant as a deterrent. Yet when, in April last year, it suspended asylum applications by Sri Lankans and Afghans, it was precisely to achieve a deterrent effect. Since the government now will not send any Afghans home, this is the only deterrent. The illegal immigrants know this and are whittling it away.

Second, Bowen, who recites cliches like a metronome, keeps talking about "an international solution for an international problem", by which he means the Bali process. But we have had co-operation, often expensively bought, on this issue from our neighbours for many years.

What changed is that Australia put the ultimate prize of permanent immigration to this country back on the table for people-smugglers to sell. It is an Australian problem and the only solution is in Australia's hands: no permanent resettlement in Australia for those who arrive illegally.

Finally, Bowen actually slanders the Howard government for its compassion. John Howard stopped the boats with his Nauru processing centre because illegal immigrants came to believe that going to Nauru would not get them to Australia. Once the trade in boats stopped, Howard then generously let the remaining people on Nauru come here. That is not remotely like Christmas Island where everyone knows if they get there they get to stay in Australia.

Once the government caves in on mandatory detention, as it surely will soon enough (if by no other means than speeding the process up), the numbers coming to Australia illegally will increase by the thousands.

With chain family migration this will be tens of thousands of people self-selecting to come here, not being selected by our program (which I have always argued should be bigger).

That is a catastrophic loss of Australian sovereignty and a comprehensive failure by the Gillard government.


1 comment:

Paul said...

In the end Illegal immigration has us over a barrel. The only real way left to stop them coming is to stop them landing, and the only sure way to do that is to turn them back out to sea and if they continue to try and land, fire on them. Are most Australian people prepared to countenance that? We would, in effect, have to accept a few dead boatloads by our hand to really send the message. I know this won't happen, and I'd not be comfortable with it, but more to the point, THEY know this won't happen, and they are very comfortable with it.