South Australia needs an energy industry that can stand on its own two feet

While it has been amusing to see the some of the reaction to Malcolm Turnbull’s recent comments about coal and nuclear, including one think tank describing the former Rhodes Scholar and investment banker as not understanding markets, we should all welcome a broadening of the Australian energy debate.

In reality, the prime minister is merely stating the obvious on both issues – that:

  1. Australian coal exports can help hundreds of millions of people worldwide who have no or limited access to electricity; and
  2. the development of an Australian nuclear industry is worthy of consideration.

Australia, and particularly South Australia, needs industries that can stand on their own two feet and are internationally competitive. According to today’s AFR, a nuclear industry could potentially be worth $35 billion per year, while coal of course earns us at least $40 billion per year in export income, provides over 40,000 jobs, and is responsible for most of the east coast’s electricity.

South Australia alone is said to have 25 per cent of the world’s uranium, and already has Australia’s most expensive electricity. After its last coal-fired power station closes in March 2016, it will gradually start experiencing power supply problems, especially during peak demand periods. Wind is no good for reliable base load power, as the below screen-shot from NEM Watch, taken in the middle of today, shows. So much for South Australia’s much vaunted 1,473 megawatts of wind capacity!


The role of government should be to ensure a level playing field for the various energy sources and technologies to compete, rather than trying to pick energy winners. If Australia can power itself with coal and with uranium, and also help India to reach its extraordinary potential by exporting both, then government should not be get in the way.


ICAC has their own ‘gotcha’ moment


ICAC gets a taste of its own medicine. Chriss Merrit and Sharri Markson in The Australian:

The corruption watchdog’s playbook often involves playing a secret recording or sensational telephone intercept revealing the witness they are interrogating misled the court just moments earlier… The person of interest has been caught out. Red-faced. And has nowhere to hide.

This time, ICAC is the one caught out:

A film recording shows its investigators making a video ­record of a document outside the scope of their search warrant.

ICAC have now admitted they did not have the power to seize the document.

Yet, the video obtained by The Australian shows ICAC officers filming it page by page.

… Senior investigator Paul Grainger appeared to ignore a warning from [David Curd, the man behind the camera] that a document they were about to film did not “relate” to their raid in the Obeid offices.

Mr Grainger is the same officer named in a complaint to the ICAC Inspector, former judge David ­Levine, for allegedly videotaping a re-enactment of a seizure of Margaret Cunneen’s mobile phone when it had already been in ICAC’s possession for a week.

Watch the video on The Australian site here.


In defence of Germaine Greer


Cardiff University

This is the first and only time I have ever written in defence of Germaine GreerThe fact that Greer may cancel a public lecture at Cardiff University in the face of opposition from an online petition accusing her of holding ‘misogynistic views towards trans-women’ should concern anybody who believes that a university campus should be one place where freedom of speech is sacrosanct.

On 22 October, a petition was launched calling for Cardiff University to cancel Greer’s upcoming lecture, Women & Power: The Lessons of the 20th Century, saying:

While debate in a University should be encouraged, hosting a speaker with such problematic and hateful views towards marginalized and vulnerable groups is dangerous.

Within three days this petition garnered almost 2,000 signatures. And so Greer joins the ever-increasing and diverse list of speakers – ranging from lesbian feminist Julie Bindel to French Front National leader Marine Le Pen – who have been ‘no-platformed’ from UK university campuses.

This is not limited to the United Kingdom. Lukianoff and Haidt recently wrote about the institutionalization in America of this new climate of ‘vindictive protectiveness’, warning that microaggressions and trigger warnings had risen quickly ‘from obscurity into common campus parlance’.

Australia is also not immune. The campaign that pressured UWA to withdraw from establishing an Australian Consensus Centre is an example of a ‘No Platform’ mentality creeping into Australian universities. was again used to launch a petition, with almost 6,500 supporters arguing that the Centre should not be supported as ‘Lomborg’s views are dangerous‘.

I may disagree with most of what Germaine Greer says, but that is exactly the reason that I would love to hear her speak. Engaging with thinkers you disagree with, and having your own ideas challenged in the process, is at the core of a university education. Spending your student days wrapped in the cotton wool of agreeable ideas might lead to a safe and comfortable journey through your university degree, but it won’t be an intellectually engaging or rewarding one.


Ai Weiwei vs Lego


In the Drum this week I tackle the stir created by Lego’s decision not to fill an order from the Chinese dissident artist Ai Weiwei on the grounds that they do not authorise “political” art. It’s a fascinating clash: between a company with an anti-political founding myth finding itself smack bang in the middle of the uncomfortable and often unhappy relationship between geopolitical power and business:

Lego is not a company well-geared for political controversy. At first glance their policy on controversial uses of their product is sound and clear. No politics, no religion, no military. Chinese democracy activists won’t get Lego’s approval, but then nor will Klu Klux Klan members. Lego wants to remain above the grubby material concerns of politics.

Such anti-political neutrality is obviously impossible. Whether they like it or not, Lego is a player in the cultural life of the human species, and in a way that any of Mattel and Hasbro’s competing brands are not. Lego profits handsomely from that status. Perhaps a truer form of political neutrality would mean paying no attention to the ultimate use of bulk Lego sales.

I suspect the refusal to fill Ai’s order is more a case of mindless adherence to their no-politics policy rather than a sop to the Chinese state. But if it is the latter, with this controversy they’ve found themselves in the invidious position shared by firms around the world who want to service markets in unfree countries like China.

Read the whole thing here.


Rigorous debate no longer accepted practice universities

If the recent Bjorn Lomborg saga has proven anything, it’s that the standard of debate in Australian universities is in a dire state.

Leighton McDonald-Stuart, editor of On Dit magazine at the University of Adelaide, had a great article in The Advertiser yesterday, on the deterioration of academic freedom at Australian universities:

How do we expect our society to advance when new ideas cannot be discussed because of an unwillingness by some precious, self-centred students?

These same students also want to limit free expression by mandating the use of “trigger warnings”, as well as censoring books they find uncomfortable or challenging. A “trigger warning” is a device that has emerged in the past two decades that seeks to warn a reader where a post traumatic reaction may be induced based on the content.

This has gone from warning of a discussion about rape to now including things such as “how many calories are in a food item” and “drunk driving”. The discussion of these things doesn’t actually harm anyone, it’s just that students now demand to live in a cotton-wrapped world.

Great works such as The Great Gatsby, Metamorphoses and Mrs Dalloway have been banned from university reading lists simply because some self-absorbed students find the content emotionally challenging and upsetting.

Seemingly anything that infringes on a student’s apparent “right” to feel comfortable is cast out and banned from campus (including Mexican themed parties).

Further, the attitudes of the ever-increasing number of “social justice warriors” towards those who they disagree with is creating an environment that is not conducive to the exercise of speech, of free thought, and of debate.

Continue reading here.


Albrechtsen urges free speech reform


Janet Albrechtsen

Columnist at The Australian and IPA board member Janet Albrechtsen has a must-read piece today:

It’s good to hear the Prime Minister has great faith in the Australian people. He is right to say we are able to conduct a civil debate about same-sex marriage.

The wisdom of Australians doesn’t end there, of course. Which is why Malcolm Turnbull should also start a conversation about the proper limits of free speech in this country.

The PM has been quick to reopen the economic debate too. Good for him that he is keen to put his mark on the new government as a reformer capable of conversing honestly with Australians, negotiating with the mixed bag of independents and even extracting a dose of bipartisanship from Labor.

Now it’s time for Turnbull to take a confident step into the cultural arena. Whereas Tony Abbott disappointed many Australians, especially the Liberal base, by dumping an election promise to reform section 18C of the Racial Discrimination Act on the premise that it was causing division within the Muslim community, Turnbull can score an important, long overdue win for freedom.

Read the whole thing here ($).


Sensible words from MIT on divestment


The well-known MIT (that is, the Massachusetts Institute of Technology, not to be confused with the smaller and unrelated Melbourne Institute of Technology) has rejected calls for it to divest from fossil fuel investments.

In a very sensibly argued statement explaining its climate change policy, MIT President L Rafael Reif said, in part, that:

In our judgment, the deliberate public act of divestment would entangle MIT in a movement whose core tactic is large-scale public shaming. This would retard rather than encourage the open collaboration and ability to hear new ideas that are central to our research relationships, central to our ability to help government and business think creatively together, and central to our ability to convene and inform the thinking of those with opposing views.

While MIT is still a climate change believer, and is by no means the only institution to reject divestment, its recognition of the shallowness of the divestment campaign should still be welcomed.

It is a shame that the staff of UWA and Flinders University do not share MIT’s aversion to public shaming and engaging with people who don’t conform to groupthink.


Busting the industry super returns myth


You know the ads – one person on the ascending escalator, the other on the descending. The ad is designed to sell the idea that the returns from industry superannuation funds are better than anything offered by the competition.

There’s just one problem: it’s a fabrication.

Professor Judith Sloan cuts through the industry super returns myth in her column in The Australian today ($):

…the defence of the status quo given by the industry super funds that they are the best performing funds has been blown out of the water by Helen Rowell, member of the Australian Prudential Regulation Authority. As she notes, apples are not being compared with apples when the industry super funds make this claim.

Within classes of assets, there are no significant differences to the returns that the various types of funds earn — something that is hardly surprising. It is the fact industry super funds have distinct asset allocations that has contributed to the average returns being slightly better for industry funds compared with others. (Mind you, there have been some badly performing industry funds, including at least two that have run into serious trouble.)

Here lies the nub of the issue: because industry funds are effectively guaranteed a flow of funds by virtue of their monopoly position in enterprise agreements and their preferred position as default funds in modern awards, they are relieved of the need to manage liquidity to the extent required of other funds. And since their members are younger than those of other funds, they are in position to experiment with asset allocation, particularly in terms of investing in illiquid classes of assets.

But this preferential arrangement for industry super funds is impossible to defend on competi­tion grounds. It is also inconsistent with the principle of choice of funds when it comes to enterprise agreements.


Union membership at lowest rate in over 100 years

Screen Shot 2015-10-27 at 12.19.43 AMAustralia’s union membership is at its lowest point in over a century, according to new data released by the Australian Bureau of Statistics (ABS).

The latest employment data, released today, shows that union membership fell by more than 2 per cent—over 200,000 people—in a single year. The Australian reports:

Trade union membership declined markedly between August 2013 and 2014, according to fresh statistics published by the Australian Bureau of Statistics.

The ABS figures show the number of people who were trade union members in their main job fell from 17 per cent in August 2013 to only 15 per cent in August 2014.

The fall in union membership occurred across the economy, with union membership in the private sector falling from 12 to 11 per cent, and public sector membership falling from 42 to 39 per cent.

This means that Australia’s rate of union membership is now less than a quarter of what it was at it’s peak in 1962 (61 per cent). Since 1992, it’s fallen by over a third, from 40 to 15 per cent.

This leaves the Australian Labor Party (ALP) as the sole place where union membership has flourished—as IPA research has found, 17 of 25 sitting ALP Senators (68 per cent), and 23 of 55 ALP MPs (42 per cent), are former union officials.

This glaring disparity between union membership and political power is a direct result of the deep interconnected relationship between the ALP and the union movement. Such disproportionate influence of a single interest group is a problem for Australian democracy.

For more on union influence in the ALP, read the IPA’s 2015 report: Unions in Labor: A handbrake on reform (by myself and James Paterson)