Productivity Commission's input should be heavily discounted
Blog Post | Blog of Christine Milne
Friday 25th January 2008, 12:07pm
by ChristineMilne in
This piece was published in today's Crikey email.
The Productivity Commission's clear attempt this morning to influence the outcome of the Garnaut Review may be couched in detached and academic language, but its implications are profound.
The Commission's characterisation of the Stern Review as advocacy rather analysis can be equally applied to this morning's Staff Paper and much of what has been published by this so-called politically neutral and independent body over many years.
We mustn't forget that the economic troglodytes at the Productivity Commission put out a 500 page report in August 2005 the main thrust of which was that any energy efficiency opportunities that exist must largely have already been fully taken advantage of. This is patently wrong. In fact, most experts recognise that increasing efficiency is the cheapest and fastest way of reducing emissions.
Much of the critique in today's Productivity Commission staff paper lies in the application of a discount rate to the value of human life, and the Commission is quite right to say that this is an ethical and moral question. But surely the basic assumption, as Stern concluded, must be that a life today is equivalent to a life tomorrow, and there should be a close to zero discount rate applied. Stern's rate of 0.1% for human life takes into account the risk of the human race descending to extinction. I am one with the UK Tories, whose Blueprint for a Green Economy argues that Stern is "too complacent" in his estimates of climate impacts and emissions reduction targets, and his discount rate is too high.
Anyone putting forward models that value a human death in 50 years time as only 5% of its current worth, as would be the case with a 6% discount rate, is putting forward a position so divergent from cultural norms that it is surely more advocacy than analysis. While the Productivity Commission is not advocating one value rather than another in today's paper, their suggestion that the discount rate should be higher rather than lower is clearly part of their ongoing advocacy campaign to undermine climate action.
If the Productivity Commission staff bothered to follow climate science, they would realise that Stern's choice of the IPCC's upper band of warming is now being proven to be conservative. Climate impacts are shooting ahead of the projections, leaving policy way behind. Now is not the time for more rearguard action to delay emissions cuts.
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Well said. Apropos the final
Well said. Apropos the final paragraph, here's my letter sent to SMH this morning:
Sir Nicholas Stern's most glaring error, apparently ignored by the Productivity Commission ("Think tank questions Stern review on costs", January 25), was to put politics before survival. His review of the climate models concluded that we must keep greenhouse gases below 450 parts per million in the atmosphere to have an even chance (26%-78%) of avoiding two degrees temperature rise. At the time, this was generally accepted as the upper limit for avoiding "dangerous" climate change, which would flood hundreds of millions of people, cause mass extinctions and so on.
Then Stern blinked. He knew that target would demand rapid action and carry significant economic costs. Instead he adopted the more "reasonable" 550 ppm, which according to his own review (Box 8.1 in Part III) would make passing two degrees very likely indeed (63%-99%).
In any case, the point is moot now. Last summer's Arctic sea-ice melt, 39% above the average, and about a century earlier than predicted, clearly shows that these models were flawed. We are now already in the danger zone, with less than one degree warming. Perhaps the Productivity Commission could model the cost of the seven metre sea-level rise that will ensue from the melting of Greenland's icesheet? A moment's reflection would show we must avoid it at any cost.
Jonathan Doig
I am concerned that the
I am concerned that the failure to commit to firm targets at the Bali talks and now the Productivity Commission report will together lower the trajectory of expectation as we approach the release of Garnaut's recommendations mid-year. In terms of setting robust targets for reducing emissions, we don't want those expectations trending down as warming continues its upward climb.
There is also a concern that the report will have a wider influence in providing fodder for the denialists and those who wish to play down the seriousness of environmental threats generally. They're still about – witness an opinion piece by the IPA's Chis Berg in today's edition of The Sunday Age.
While this piece doesn't cite the Productivity Commission report, watch out for others seeking to leverage it to put the brakes on climate change action.
As for the report itself, it would be very interesting to examine more closely the circumstances in which it came to be elevated to public release, having started as an internal paper.
To the 2 Tims. I am enjoying
To the 2 Tims. I am enjoying reading Greensblog! I am new to the world of blogging. I was wondering if you wouldnt mind informing me, if there are any blogs where Greens simply chat about the day to day things they are doing in their lives to help the planet? I well realise the role of this site , but I was just curious? I can find a lot of policy and issue discussion sites but nothing in relation to what the interestiing things individuals are doing?
Following on from the
Following on from the Productivity Commission report, Garnaut himself was quoted on this evening's edition of Radio National's PM emphasising the role of the market in achieving long-term emissions targets and playing down the intermediate targets identified by scientific consensus. With the Productivity Commission's report and now Garnaut's remarks, it looks as if we are being prepared for disappointment later in the year. The transcript is not yet available, but soon will be here. The ACF was quoted in the story, and I look forward to reading responses to Garnaut on this blog.
Darren, Christine's comment
Darren, Christine's comment is here.
Thanks, Tim. Good response,
Thanks, Tim. Good response, but I don't think we should shy away from a firm regulatory hand for fear of being labelled as a nanny-state by those with a free-market agenda. The science tells us that we need a response that can't be left to the vagaries of the market and the shifting judgments of self-interest that entails.
For that reason, market incentives must be combined with adequate regulation to see we meet suitable short-term targets. If we suddenly found ourselves running out of oxygen due to our economic activities, there wouldn't be such deference to the market. That climate change isn't so immediately drastic undermines action to mitigate what will ultimately be a catastrophic result if we fail to act in time.
What I'm a bit unclear about at the moment (and so might others be), is exactly what a suitable total solution might look like. What, for example, are the most positive features of the New Zealand approach, and how might they be augmented to achieve an even better model here? That model is what needs to be communicated in the lead-up to Garnaut's findings.
Brenton - it's something
Brenton - it's something we're currently thinking about.
We'd like to have more discussion around a whole raft of things other than policy.
We're currently working out some models of wiki/discussion/forum type things that will hopefully allow for the kind of conversation you're after, but in the meantime, I can point you in the direction of some of the eco-sites I frequent:
(sorry - I couldn't copy all the links here - if you go to my blog at http://monkeyjedi.blogspot.com - down the right hand column, under 'Eco Info')
Tim 7 , Thankyou so much ,
Tim 7 , Thankyou so much , that is very kind of you. I look forward to further developments re new sites.
Not really only topic, but I
Not really only topic, but I can't find anywhere else to post this.
I would like to get an idea from Greens supporters and members what their position on "small vs big government" is. I know a number of Greens supporters that are somewhat sympathetic towards reducing the government's role in regulating and subsidising private enterprise, and its responsibility for large infrastructure projects, but obviously on the surface this would seem to conflict with the need to better protect the natural environment. I think this conflict can be resolved, and that a party whose main concerns are better care of the environment and improved social justice should be prepared to take on board all possible options for achieving these goals, even if some seem counter-intuitive.
It's a good question,
It's a good question, wizofaus.
I can't speak for other members and supporters, but the party itself doesn't have a specific position on the issue per se. However, we do oppose the part of small government philosophy that aims to radically reduce taxation. We believe that one of the key roles of government is to prioritise issues and direct resources accordingly - use tax revenue to boost public education and health care, social reforms, and environmental protection, to name a few examples.
I don't think we inherently oppose subsidising private enterprise, and we certainly don't oppose regulating private enterprise. We would like to see a shift in the way private enterprise is both subsidised and regulated, though, in order to drive more sustainable and equitable outcomes.
I guess, at heart, rather than big or small government, our main philosophical thrust is participatory government, bringing community input in as much as possible - one of our four pillars is "grassroots democracy".
Does that make sense?
Hmm, well I guess I consider
Hmm, well I guess I consider myself a bit of a "Green Libertarian". I fully support the broad goals of the Greens (and voted that way last election), but strongly question whether many of the specific policies aimed at regulating the economy are actually likely to be beneficial. I agree the "radically reducing taxation" shouldn't be an end in itself, but I think there is scope for achieving the ends that government is best equipped to do at significantly less cost than is done currently, which allows for the possibility of lowering taxes, which if nothing else, is often popular at the ballot box.
Regarding "grassroots democracy" - absolutely. If I could change one law it would be that large scale projects with significant and irreversible environmental impact had to go before a plebsicite. That would include bay dredging, probably the Gunns pulp mill, etc. etc.
All interested parties can then do their best to convince the public of the advantages/disadvantages of such a project, and the people can vote accordingly, weighing environmental risks against economic risks to the best of their judgment.
This strikes me as far more effective than pages and pages of rules and regulations that cost huge amounts of money to monitor, and potentially lead to counter-productive results.
Brenton, if I may be allowed
Brenton, if I may be allowed to do this by the moderator, I suggest you join a yahoo forum I started a few years ago about Peak Oil.
As a spinoff, lots of solutions are being discussed, from energy efficiency to permaculture, how to do stuff, where to buy, when and how, etc etc....
http://groups.yahoo.com/group/roeoz
I'm the moderator, and if you mention when joining up that you were invited here, I'll simply click the appropriate button!
There is a submission to the
There is a submission to the Garnaut Review by Cameron Hepburn and Nicholas Stern that responds to the Productivity Commission working paper.
http://www.garnautreview.org.au/CA25734E0016A131/pages/submissions-gener...
According to the submission:
"The WP asserts that the Review `draws heavily on studies that have a more pessimistic view on climate change and its impacts, and gives little attention to more optimistic views.' If anything, the opposite is true. In retrospect, the Review could be criticised for being overly optimistic in each of the four steps linking human emissions to climate change: (i) future emissions growth, (ii) the carbon cycle linking emissions (flows) to concentrations (stocks), (iii) the climate sensitivity, linking concentrations to temperature increases, and (iv) damages from a given temperature increase."
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