Mandatory internet data retention comes into operation today

Simon Breheny and I have been arguing the case against data retention since it was first mooted by the Gillard government – it violates the privacy of every Australian just in case they are later accused of criminality, it will be used for more than just anti-terror policies, and there are alternative policies and approaches which better respect individual liberty. You can read the IPA’s submission to the parliament’s data retention inquiry here.

But all the critiques aside, data retention is shaping up to be a case study in poor policy implementation.

Internet service providers have long argued that retaining that amount of data would be prohibitively complex. In fact, one of the most striking things about the whole debate has been the gap between how easily government has suggested implementing data retention would be and how ISPs have said it would be.

No surprise then that Fairfax is reporting that 80 per cent of ISPs are not actually going ‘live’ with data retention compliance today, but have applied for extensions of 18 months. There is widespread confusion about how much data is to be retained, and no transparency on how the ISPs will be compensated for storing masses of information on their customers’ activity.

Implementation was going to always be a problem with data retention. But it is hard not to conclude that the implementation problems ISPs are now experiencing are the direct result of the government’s lack of conceptual and technical clarity about how data retention relates to current ISP practices.


Climate change: Cruz 1, Sierra Club 0


The United States Senate’s Judiciary Committee is currently investigating ‘How Over-Regulation Harms Minorities’ and a nine minute exchange last week between Subcommittee Chairman and Texas Senator Ted Cruz and Sierra Club President Aaron Mair is well worth a look.

The Sierra Club is a prominent and active proponent of human-induced climate change and made a submission to the inquiry arguing the disproportionate effect of air and water pollution on “low income families, communities of color and other historically marginalized and oppressed populations.”

While the video speaks for itself, in a nutshell Senator Cruz asked how the Sierra Club dealt with the fact that satellite data shows no demonstrable increase in global temperatures over the last 18 years. The Sierra Club chairman’s response was a classic (but it has to be said not particularly effective) example of obfuscation and deflection with Mr Mair repeating the statistic that 97% of scientists agree with human-caused global warming.

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Meet Angus Deaton: the latest recipient of the Nobel Prize in Economics

Angus Deaton, Dwight D. Eisenhower Professor of Economics and International Affairs at the Woodrow Wilson School of Public and International Affairs and the Economics Department at Princeton University

Angus Deaton, Dwight D. Eisenhower Professor of Economics and International Affairs at the Woodrow Wilson School of Public and International Affairs and the Economics Department at Princeton University

Overnight it had been announced that Angus Deaton of Princeton University is the latest recipient of The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel ‘for his analysis of consumption, poverty, and welfare.’

In selecting Deaton to win what is commonly referred to as the Nobel Prize in Economics the committee adjudicating this award aptly selected an economic optimist, which is refreshing given the way in which recent debates are filled with worries about inequality, environmental degradation, the ‘new normal’ of low growth, and so on.

Born in 1945 in Edinburgh, Scotland, and having commenced his economic studies in the late 1960s, there is a lot of intellectual ground that Deaton has covered over these last few decades. Those interested in summarising commentaries about his key works can read through the Nobel Prize announcement website here.

If there is one major highlight, though, it would be his magisterial book The Great Escape: Health, Wealth, and The Origins of Inequality, which highlights in no uncertain terms how humanity as a whole has progressed by living wealthier and healthier lives than ever before:

The greatest escape in human history is the escape from poverty and death. For thousands of years, those who were lucky enough to escape death in childhood faced years of grinding poverty. Building on the Enlightenment, the Industrial Revolution, and the germ theory of disease, living standards have increased by many times, life spans have more than doubled, and people live fuller and better lives than ever before.

Deaton doesn’t flinch from explaining that problems still exist throughout the world, and he cites the likes of inequality in advanced countries and health problems in the developing world as examples, but these do not overshadow the fact that things are getting better for the masses over time.

The reaction to Deaton winning the Nobel Prize by the economics profession has generally been positive, with many noting the originality of his work using, for example, consumption data as a measure of economic progress.

For further reflections about the work of Angus Deaton, read the comments of Tyler Cowen, Lynne Kiesling, Alex Tabarrok, and Ian Vásquez.


Section 18C amendments to be debated on Thursday

Senator Matthew Canavan joins the list of senators who will support amendments to section 18C

It’s been less than a week since the IPA’s James Paterson gave this advice to Malcolm Turnbull, and the prime minister now has a terrific opportunity to support free speech in Australia. As reported by Latika Bourke in the Sydney Morning Herald today:

The [Racial Discrimination Amendment Bill 2014], put forward by Family First senator Bob Day, is listed for debate on Thursday morning. It is co-sponsored by Liberal senators Dean Smith and Cory Bernardi and Liberal Democratic Party senator David Leyonhjelm.

The Day amendment would remove the words ‘insult’ and ‘offend’ from section 18C of the Racial Discrimination Act 1975. In May, the prime minister indicated his support of such changes, saying on the The Bolt Report that the idea of removing those words “would not have any negative impact.

A move to restore the Coalition’s 2013 election promise to repeal section 18C would always be preferred. However, this modest and uncontroversial compromise would be smart step in the right direction, and remove the worst elements of section 18C.

See the factsheet the IPA put together on Senator Day’s Racial Discrimination Amendment Act 2014 here.


New study shows high taxes affect choices about where to live and work


An interesting new study illustrates what many economists have long recognised, and that is that choices about where we live and work may be influenced by tax rates imposed by various governments.

The paper, co‑authored by the Canadian Taxpayers Federation and Americans for Tax Reform, investigated which factors influenced major ice hockey players to play for certain teams:

Players want to play for certain teams for a lot of reasons; the weather, the coach, the other players on the team … but they also consider the taxes they will have to pay. Like everyone else, NHL players don’t just care about how much they get paid, but how much they get to keep. High taxes might prevent your team from getting that key player it needs, but they also stop other high income earners from moving to your city.

An interesting feature of the study is its reference to the effects of National Hockey League (NHL) rules capping player salaries upon the ability of teams in high‑tax jurisdictions to attract new, quality players. As they put it:

The salary cap limits the ability of a wealthy team in a high-tax jurisdiction to attract top players by paying them more. The advantage of attracting players with higher pay shifts from wealthy teams to teams in low-tax jurisdictions.

There are now a few studies which look into the behavioural responses of sports players to differences in tax, both within a country and across countries, including this study of football players in the European market, and this study that looked at the responses of baseball players to different tax settings in the United States.

What they do show, all in all, is that people with incredible sporting abilities are fairly much like the rest of us in most other respects: they want due reward for their efforts, and they don’t want those rewards dissipated by excessive tax burdens.


Economic growth more important than tax reform


Chris Berg in The Sunday Age argues that the key economic debate is on growth:

The new Turnbull government should stop talking about tax reform.

Tax reform is a poor use of its political capital. It is a waste of the goodwill Malcolm Turnbull brings to the prime ministership. The challenge Turnbull faces is not to make our tax system slightly more efficient. The challenge he faces is how to make the economy grow.

When he became Treasurer, Scott Morrison stated that the Commonwealth has a spending problem, not a revenue problem. That is, the government wants to focus on spending cuts rather than tax increases.

This is excellent, as far as it goes. But in truth our real problem is growth.

The International Monetary Fund estimates that the Australian economy is going to grow just 2.5 per cent this year. Back in the Howard years, growth averaged 3.7 per cent a year. The Reserve Bank governor has publicly speculated that our lower growth might be the new normal.

If you want to blame the stubborn budget deficit on anything, blame it on this. John Howard, Kevin Rudd, Julia Gillard, Tony Abbott, Malcolm Turnbull: they’ve all been riding the waves of our growth figures.


Top 3 articles from this week you must read


Brendan O’Neill

1. £5.8 billion for “climate aid”? Bjørn Lomborg slammed the British government’s tragic misuse of money in The Telegraph this week

2. Andrew Bolt warned in the Herald Sun that our universities are breeding a generation of “ideological stormtroopers” determined to shut down debate

3. And at The Spectator, Brendan O’Neill told of the inhumanity of political correctness, and the crowd of students who cheered the Charlie Hebdo massacre.


Lomborg: ‘climate aid’ is immoral

Climate Change

David Cameron

Read this article from start to finish. Bjorn Lomborg’s masterful and concise take down of ‘climate aid’ is an absolute must-read:

When we think of aid, we picture taxpayer funds being used to help battle malnutrition or poverty, or perhaps respond to HIV or build schools. Of the aid that the OECD analyses – about 60% of total global bilateral development – more than one in every four pounds goes to climate aid and cutting greenhouse gases like CO₂.

According to Cameron, this money helps “the poorest and most vulnerable”.

But they don’t want climate aid. The UN has asked more than 8 million people across the world what they want. Both for the entire world and those living in the poorest countries, climate comes 16th out of 16, after 15 other priorities.

Instead they clearly tell us their top priorities: Education is the top demand for the world’s most disadvantaged, followed by better healthcare, better job opportunities, an honest and responsive government and affordable, nutritious food.

Climate campaigners often point out that that these other problems will be made worse by climate change. Malaria will become more endemic; food will become scarcer; weather disasters will become worse.

This can be true, but the same argument goes for almost all problems: More malaria not only kills, but reduces school attendance, depletes health systems, erodes economies and make everyone more vulnerable to most other problems.

Moreover, climate aid is one of the least effective ways of helping. The Kyoto Protocol’s carbon cuts could save 1,400 malaria deaths for about $180 billion a year. Just half a billion dollars on direct malaria policies like mosquito nets could save 300,000 lives. Investing directly in agricultural research and better farming technologies will help agriculture much, much more than any carbon cuts. Extreme weather mostly hurts the poor because they’re poor: the same level hurricane can claim many lives in Honduras yet leave somewhere like Florida relatively unscathed. Helping people out of poverty is thousands of times more effective than relying on carbon cuts.