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dreaming California « Previous | |Next »
September 25, 2009

It will be realistic to assume that the G20 summit in Pittsburgh will not deliver much by way of regulating the power of global financial capital or reducing global heating. Despite Kevin Rudd’s priority, as part of his “creative middle power diplomacy”, to sell the American foreign policy establishment on the benefits of the G20 as the “driving centre” of a new global framework, little will happen in Pittsburgh.

Its business as usual for finance capital. The big banks feel confident that they can count on the government to bail them out – for who would now risk “another Lehman”? They are too big to fail and they can more or less ignore calls for lower leverage and greater regulation.


The G20 are talking about global limits on bankers’ bonuses and IMF reforms to include China in the context of Europe’s marginalisation, not the grand bargain on climate change. That will be avoided as lowest common denominator politics is back in Pittsburgh Will they have the courage to agree to reduce the subsidies that encourage the use of fossil fuels? Remember the fossil fuel lobby.

In contrast, we have action on energy in California. Ronald Brownstein says in The Atlantic that:

The collapse of the state’s (latest) real-estate bubble has sent California’s economy into free fall. A short list of the state’s current problems would include surging unemployment, struggling schools, and a budget deficit larger than the entire budget in almost every other state. But on energy and climate change, the story is very different. .... The state emits only about half as much carbon per dollar of economic activity as the rest of America. It generates significantly more electricity than any other state from non-hydroelectric renewable energy sources like solar, wind, and biomass. California registers more patents associated with clean energy than any other state and attracts most of the venture capital invested in U.S. “cleantech” companies exploring everything from electric cars to solar power generation.

Though some of California’s edge can be traced to the state’s natural advantages, particularly a temperate climate that does not require as much heating in the winter or cooling in the summer, the difference is also rooted in conscious policy decisions.California’s experience says the evolution to a lower-carbon, more energy-efficient economy is possible and compatible with economic growth, but that the change requires endurance, consistency, and flexibility.

Says something about Australia doesn't it. It is not accepted that Australia's economy would boom thanks to the push to cleaner technology; nor is it accepted that 33 per cent of that nation's electricity should come from renewable sources by 2020. Australia has shown no interest in "bending the curve,” to reshape how we produce, sell, and use energy by attacking the problem from all angles.

| Posted by Gary Sauer-Thompson at 8:40 AM | | Comments (12)


That so much of the renewables technology in California was built by Australians also says something about Australia.

It's depressing that so much of the renewables technology in California was built by Australians. It is also depressing that no Australian state is willing to play the innovative role of California in the US.

you'd think that SA would bite the bullet and take the lead, given the disaster facing its wine industry from increasing salinity due to low flows in the River Murray. Its future looks bleak with climate heating.

Unlike California SA has little legacy as an environmental pace-setter. Nor do you get much a sense among investors and entrepreneurs in SA that clean energy might be the Next Big Thing. You cannot say that SA is the solar market in Australia or that it is leading Australia in developing a constituency for continued change and innovation in energy.

Does SA have a cleantech community? Not really. The state's legislation has not created markets and the market has not created communities, unlike California, where enough industries have found ways to profit from the state’s first waves of reform to create a durable constituency for continued change and innovation.

It's also depressing that we're hearing so much about how filthy China is, yet China has renewables projects comparable to California's, also using Australian technology.

What the hell is wrong with us?

California has a long history of progressive politics, not to mention the role that higher education has played in the State's economy. However, direct democracy, seems to have been a mixed blessing, and the cause in part of the current financial problems. I thought this editorial in The LA Times was an interesting summary.

What does it say about Australia? Rudd + Co have failed to use regulation to create markets and then to use markets to create renewable energy constituencies.

That has been what California has been good at.

Anybody who could entertain a group like the G-20 sticking its legislative nose into the remuneration decisions of Australian public corporations has clearly never had a job; they do not understand how the world works. This is not the role for national governments, and especially not supranational gabfests.

The issue of incentive structures in finance companies and investment banks is important. But it is important for the Boards of those public corporations and the shareholders of those corporations, NOT our national parliament, and in no way a bunch of pansy Belgian dentists.

This country needs to increase its sperm count and wake up that we all are shareholders in companies, even if only through our super.

A citizenry that sits back and waits for the state to do everything, will find itself gradually enserfed by that state. Australians need to begin a mass shareholder democracy movement, and take the fight right up to the faces of corporate boards. We also need to start demanding the sacking of ASIC bigwigs who are too gutless to have a go at corporate crooks.

And any Australian who thinks it appropriate that a bunch of girly Europeans should be bossing our corporate boards around should be ostracised to Adelaide, Cunamulla, or Goulburn for 12 months.

The global financial and economic crisis indicated the need for global action to save finance capital from the consequences of its excesses.


I don't know to whom that post was directed, but it has nothing to do with mine. In fact, it is just gibberish

Kenneth Davidson has a good article in The Age on the Rudd government's climate change policies. He says that

Arguably, the Rudd Government sees climate change opportunistically as a weapon with which to beat the Opposition, rather than as a greater threat to Australia's security than either the Great Depression or World War II....Underneath the political argy-bargy, the policies are the same. The policy priority on both sides is to look after the interests of the largest polluters in the interest of protecting jobs by not undermining the competitiveness of the coal, aluminium and other big polluting industries against their competitors overseas.

He adds that we have a corporate establishment intent on maintaining the status quo, obsessed with short-term profit rather than long-term sustainability, defending an outmoded market ideology which refuses to contemplate incorporating carbon pollution taxes into the cost of production and naively believing that technology such as carbon sequestration will solve the climate problem.

California may well be on the way to becoming a failed state.