Uber now illegal in Victoria


Today in Melbourne, a court deemed Uber driver Nathan Brenner guilty of driving a hire car without a commercial licence or registration (reported in The Age).

Put simply, Uber has now been clarified as illegal.

Just when we thought the ridesharing momentum was shifting – ACT legalised the service one month ago – Victoria has taken a further step backwards.

This year-long test case sends a strong signal against the growing ridesharing tech giant. There are 11 other drivers facing similar charges. But the real losers here are the Victorian economy and the rights of Australian producers and consumers. As I wrote in the West Australian earlier this year:

Australians should be appalled at this latest government intrusion on exchange. Acceptance of an Uber ride is a voluntary exchange. As with any other free market transaction, both parties understand the risks and agree to the conditions. To require permission to willingly trade private property flies in the face of a free society.

Although the court is simply interpreting the law, these rules are outdated and desperately in need of change. The Victorian government needs to get out of the way of this potential economic revolution.


On e-cigs, it’s don’t ask; don’t question; just ban and regulate


We already know that in Australia, it’s ban first, don’t bother questioning later. If they were to ask, they might learn many things:

There have been hundreds of studies testing the quality and safety of e-cigarettes. Any search in a medical journal database yields countless results. Some people have even helpfully summarised and provided links to the various studies, and published them online (like this one covering the hundreds of studies published in 2014 and 2015).

Studies which show that for current smokers, e-cigarettes are a significantly beneficial. Last month, more evidence came out challenging the consensus that e-cigarettes entice users to take up cigarettes. From Reason:

never-smokers rarely become regular vapers… there is no evidence that never-smokers who vape are therefore more likely to become smokers or that the rising popularity of e-cigarettes has given a boost to conventional cigarettes. To the contrary, vaping and smoking rates are moving in opposite directions.

That is why it is so sad to see the growth in the US e-cigarette market slowing significantly. The reason is predictable; confusion propagated by public health experts, and the regulatory regimes that follow:

The industry also is awaiting final rules from the Food and Drug Administration, which could require federal approval for nearly all flavored liquid nicotine juices and e-cig devices.

“That’s creating stagnation,” said Dimitris Agrafiotis, chief operations officer at Mountain Oak Vapors, referring to the relative safety of his products when compared to cigarettes. “We have a big uphill battle if we can’t accurately describe our product.”

E-cigarettes is the free market solution for those that wish to quit smoking. But thanks to an abundance of laws, such as new laws in New South Wales coming into effect this week, the effectiveness of e-cigarettes in Australia is all the more limited.


Perspective on what people want

While I’m not one to normally cite the United Nations, Bjørn Lomborg in today’s Australian has mentioned a current UN survey into the issues that are the most important to people around the world.

Climate change is currently rating 16th out of 16 issues, and is a long way behind A Good Education, Better Healthcare, Better Job Opportunities, An Honest and Responsive Government and eleven others.

The results certainly gives a good sense of perspective about the priorities of a majority of people in developing nations.


Confused about carbon targets? You should be


Back in August, then-Prime Minister Abbott announced the Coalition government would pursue a 26-28 per cent carbon reduction target (without specifying how it would be achieved), an announcement he described at the time as “economically responsible”.

However, when Labor announced in July a 50 per cent renewable energy target, an emissions trading scheme and murmured darkly about the need for an emissions reduction target in the 40’s, the government opposed it claiming it would increase electricity prices. After Bill Shorten last week formally announced a 45 per cent emissions reduction target, the government described it as either mad or heroic.

So while the Coalition’s almost 30 per cent target is nothing to be concerned about, Labor’s 45 per cent target is apparently entirely unacceptable. If that wasn’t already enough of a stretch, Prime Minister Turnbull’s Monday announcement that the Coalition government’s target might increase made this even worse.

The prime minister has also now announced the doubling of ‘clean energy’ research from $100 million to $200 million over the next five years, and the diversion of $1 billion from the international aid budget towards climate change, up from the $200 million announced last year. (Presumably he hasn’t read Bjørn Lomborg’s work criticising aid substitution here and here). Thankfully, the PM has decided not to sign a new agreement on fossil fuel subsidies, even though Australia doesn’t actually have any.

In July, Turnbull helpfully pointed out that all government measures to reduce emissions, whether by regulation, emissions trading scheme or a renewable energy target, are in fact a tax. While he probably wouldn’t repeat such a statement now, it is probably the clearest contribution to the debate so far.


Plain packaging is 3 years old today

So how is the Gillard government’s theft of intellectual property working out as a policy to inhibit smoking?

Not well.

Here is a picture based on data collected by states (or in the case of Victoria on behalf of the state).


Here is is a picture that highlights something we’ve been on about at Catallaxy Files:


Here is the ABS data on household expenditure:


So we have state-based data, tax-based data (via Treasury), and ABS data all showing that plain packaging didn’t work as advertised. That is all government data – not industry data or private sector estimates of smuggling etc. The Australian governments (federal and state) own data.

By contrast the Nanny State has produced evidence that people don’t like the packaging. Well, yes. Given that the packaging was deliberately engineered to be unattractive that is hardly surprising.

This post first appeared at Catallaxy Files.



Paris climate talks: Just 10 days until it’s all over

Between 40,000 and 50,000 people, who are very concerned about carbon emissions and their effect on the environment, have travelled to Paris for the annual UN climate change talks.

Even Bill Shorten and the Greens are there, despite not being part of the government and therefore not making any decisions.

The charade of these annual talks has been captured in this booklet from the Global Warming Policy Foundation which sets out the seven stages of these meetings: The Hopes, The Last Chance, Time is Running Out, The Circus, The Deadlock, The Breakthrough at 5 Past Midnight and The Cold Light of Day.


Levity aside, there is a real danger that the world’s top politicians, wherever they sit on the political spectrum, gathered together in the City of Love under the gaze of the media and thousands of activists, will make decisions that have serious long term implications for the world economy.

Given the sympathies of Prime Minister Turnbull, a great result for Australia would be if no additional funding commitments are made, and no binding commitments or agreements signed that could constrain future economic growth.

Whether we are so lucky, time will tell. Hopefully it is only 10 days until mainstream political debate in Australia returns to the discussion of spending, revenue, taxation, superannuation and the other issues that governments should be talking about.


The deafening failure of open-plan classrooms


Walking around Australian schools today, it is hard to miss the large, barn-like rooms housing hundreds of students.

We were promised ‘agile learning areas’, built on collaboration, flexibility and student-centred learning. What we got was far from a conducive learning environment.

It seems, however, that we may finally be waking up to the failure of another progressive educational fad, with The Age reporting that while schools ‘knocked down walls to revolutionise learning‘, they are now putting them back up to reduce the noise, distractions and disruptions.

On a teaching placement, I regularly observed a class of more than 50 students in an open-plan environment. Chaos is the only word that could be used to describe it. Students routinely went missing, noise levels were extremely high with conversation rarely on-task, and concentration and focus was almost non-existent. One student even flat-out refused to do work at all, declaring ‘my home is my learning environment; school is my play environment’.

Student complaints included that it is ‘so noisy I can’t even feel myself think!’, ‘you can never hear the teacher even if you try’, and ‘I don’t even bother listening because no one is quiet while the teachers are talking’. The negative impact of noise is supported by recent research showing that 50-70 per cent of children learning in open-plan classrooms were unable to hear their teacher very well, or at all, when the other classes were doing activities.

Research shows that children learn best when their environment is orderly and engaging. The establishment and enforcement of clear rules, expectations and boundaries help children build a sense of self-control, responsibility and accountability for their actions.

Open-plan classrooms fail this test. They are an environment more synonymous with chaos than with learning, and the sooner we recognise this, the better.


Budget emergency continues, with no end in sight


Various economic forecasters have been chancing their arm at predicting the federal budget position, in advance of the mid‑December Mid-year Economic and Fiscal Outlook (MYEFO) statement.

The prognosis is that the budget is still looking in a sickly state as ever:

A top budget expert warns Australia is inexorably drifting towards bigger government because the federal government appears unwilling to curb spending despite tax shortfalls that will contribute to $120 billion of budget deficits over the next four years.

Predicting deficits as far as the eye can see, Deloitte Access Economics partner Chris Richardson blames China’s slowdown and falling national income from commodities for 90 per cent of the deterioration, which has worsened the fiscal bottom line by $38 billion since the May budget.

In the mid-year update in a fortnight, Treasurer Scott Morrison will most likely unveil an underlying cash deficit in 2015-16 of $40.3 billion – some $5.2 billion more than foreshadowed in the budget and a significant deterioration from last year’s deficit of $37.9 billion, Mr Richardson estimates.

There is something of a mixed picture concerning how various economic aggregates, such as wage growth and output growth, will shape the forthcoming budgetary outlook to be revealed in MYEFO, but one thing is almost depressingly certain.

The budget emergency, which the former Treasurer Joe Hockey once diagnosed, persists as a result of overspending pressures, and without reforms to reduce expenditures the harder the task of budget repair will become.


Is this the next step, following mandatory data retention?

Draft national security legislation revealed last Friday would add little value to Australia’s efforts to combat terrorism, and will be a significant regulatory burden on the telecommunications sector.

According to the exposure draft, the Telecommunications and Other Legislation Amendment Bill 2015 would if passed compel carriage service providers to “do their best” to

protect telecommunications networks and facilities from unauthorised interference, or unauthorised access, for the purposes of security. Carriers and carriage service providers must notify changes to telecommunications services or telecommunications systems that are likely to have a material adverse effect on their capacity to comply with this duty 

Since such service providers would naturally “do their best” to see that their networks are uncompromised, it is unclear what is added by the bill. It is fuzzy law at best, and would be remarkably difficult for a person to know if they are meeting their legal obligations.

While the national security benefits are unclear, the proposed regulatory burdens are not. For instance, section 314A(3) of the bill requires carriage service providers to notify the government (the “Communications Access Co-ordinator“) of its intention to implement a change to telecommunications services. Sections 315A and 315B could potentially see the Attorney-General issue directions to carriage service providers to “cease using or supplying… carriage services” or “to do, or to refrain from doing , a specified act or thing within the period specified in the direction.”

From mandatory data retention, to online piracy legislation, 2015 has seen a suite of burdensome but ineffectual laws passed at the intersection of technology, telecommunications and national security. If passed, these new proposals would add to that list.


Top 3 articles from last week you must read


George Will

1. Andrew Roberts in CapX last Monday advised policy makers to listen to the advice of the Confederation of British Industry – and do the exact opposite

2. George Will in the Washington Post on Friday described the collapse of the constitutional separation of powers in the United States, and the battle to wind back the executive-dominated “administrative state

3. And also on Friday, Matt Ridley and Benny Peiser in the Wall Street Journal told readers what to expect from COP21 in Paris. For your complete guide to the climate debate, read here ($).