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January 15, 2011
Australia has a contradictory de facto industry policy--support the mining industry and shift the economy to a low carbon one. It is contradictory because the attempt to set prices for global carbon emissions failed, due to ‘coal' – or, rather, the fact that coal is cheap and abundant, the mining industry is powerful, and the owners of coal mines and their clients are strongly opposed to any tax on carbon. Coal has been the engine of the economy for a very long time because it is cheap and abundant, and it provides cheap electricity for the economy.
The shift to a low carbon economy is as trans formative as the transformed from an agrarian to an industrial economy. In his Industrial Policy Comes Out of the Cold at Project Syndicate Justin Yifu Lin says that historical evidence shows that in countries that successfully transformed from an agrarian to an industrial economy – including those in Western Europe, North America, and, more recently, in East Asia – governments coordinated key investments by private firms that helped to launch new industries, and often provided incentives to pioneering firms. He adds:
the lesson from economic history and development is straightforward: government support aimed at upgrading and diversifying industry must be anchored in the requisite endowments. That way, once constraints on new industries are removed, private firms in those industries quickly become competitive domestically and internationally. The question then becomes how to identify competitive industries and how to formulate and implement policies to facilitate their development.
In Australia renewable energy industry is anchored in the requisite endowments. The question of how to formulate and implement policies to facilitate the development of the renewable energy industry is continually sidelined by the coal industry.
So we have ad hock mickey mouse proposals that are soon dumped, rather than a fully fledged industrial policy that deals with the transformation to a low carbon economy in a systematic way. The Coalition is dead set against any substantive action on climate change, such as pricing carbon.
King Coal have gotten used to doing things the way they wanted to do things. Their public stance is one of don't mess around with us, we're in charge here. This is not a dynamic industry, in the sense of innovation and change. They want to do things their way, they want to do things the old-fashioned way, they don't want to change, and they don't believe they need to.
This is an industry that is used to getting by on political muscle and not on compromise. It presents itself as a hapless collection of hard-working guys just trying to keep the lights on for us, as the Greens and the environmentalists are carrying out a “regulatory jihad” against coal. Coal is on the wrong side of the innovation curve — it is a 19th century fuel that has thrown itself into the 21st century with sheer political muscle.
The coal mining states--Queensland, NSW, Victoria-- do not see the need to think differently about their future because the era of coal is coming to its close. They are keeping up the fiction that the long term economic health of the state is dependent on coal. A fiction because these states are a resource colony for the rich mining corporations that are pulling the coal out of the ground as fast as possible. They are only interested in getting more years of profits from the black rock--- not the warming of the planet. That market failure the coal industry gladly supports in order to avoid any reasonable regulator regime. Why CO2 pollution is a great boon for civilization because it increases plant productivity. They are playing a short term game.
Big Coal is more powerful today than ever. As Jeff Goodell points out:
The triumph of coal is deeply connected with an anti-science agenda, and always has been. Over the years, the industry has argued that.... air pollution from coal plants doesn’t cause an increase in heart attacks; that mercury, a potent neurotoxin emitted from coal plants, does not cause neurological damage; that mountaintop removal mining does not hurt the environment; and that burning coal does not heat up the atmosphere. All these arguments fly in the face of science — and, often, in the face of common sense. But it doesn’t matter. Coal is an empire of denial.
They are playing a short term game of block, block, block and talking up the state subsidizing nuclear power. "Clean coal" increasingly looks to be a promotional slogan designed to help spiff up coal’s image from a relic of the nineteenth century to a viable fuel source for the twenty-first century.
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Now, that's not a happy thread starter!
But the meme is very powerful one. Australian have been saturated with news that we avoided the nastier side effects of the 2007-8 crisis because of North East Asia's continued purchasing of our coal. Australians aren't all smart, but most are cunning.
They'll say, "They are going to build lots more coal fired generators, things go to wrack and ruin therefore, any way, so it may as well be our coal as someone elses, for our own short term sake".
The critical point in this thread starter is actually the deliberate discouragement of investigation of alternatives, couled withthe dumbing down of education and media; what ever happened to the "clever country"?
Can we be consumers AND citizens anymore, is a question I'd begin to ask, when we live in a world where resources, humans and markets even, are or are defacto, commodities.