Wayne Swan’s $3.2b CPRS con job
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On Sunday night, Wayne Swan released a page of some gobbledegook numbers that Treasury purportedly put together that asserted that our greenhouse gas proposal had a $3.2 billion hole in it. The media outlets, gifted with the Treasurer’s page of assertions, which contained no supporting analysis, uncritically reported the Treasurer’s claims. It now appears that the Government never intended to provide any supporting analysis of the Treasurer’s assertions. The Treasurer’s claims have now been repeated in the media, so the Government’s stunt has worked. As we all know that an untruth will, through the course of re-reporting, become a truth. This media stunt was transparently designed to detract attention from the $50 billion hole that we identified in their CPRS. This is a $50 billion hole that the Government has not been able to explain, even after two months of Treasury officials pouring over our work to find a flaw that is not there. So the Government had to fabricate a problem as a distraction, and to put the heat back on the Opposition. This has also worked. The last thing the Government wants is for the Coalition to come up with a more economically responsible, greener proposal and one that is more consistent with core Coalition values of smaller Government. If the Opposition did produce such a policy this would raise serious questions about the Government’s understanding of emission trading and their economic credentials, and it would give the Coalition something to rally around. At the same time Treasury couldn’t risk conceding that, after years of analysis and millions of dollars of taxpayer funds, they have missed a cheaper way of achieving greenhouse gas cuts. So the Government and Treasury are both motivated to bury any alternative better than theirs. Let’s be clear, there is no such black hole. It’s a good old fashion beat up. Aside from the $50 billion of savings in our scheme, we have clearly stated in our report (page 41) there are substantial permit revenues left over in the order of $3 billion per year after the first year of the scheme. It is for Government to decide who should be the recipients of these funds, and to what extent. We did not make a call on how that ought to be allocated. Also, the Government seems to have ignored, obviously because it suited their position, the extra royalties gained from a more vibrant resources sector under our scheme, which quickly rise to around $1.5 billion per year, which was also clearly stated in the report. The Government also seems to have ignored the higher tax revenues that result from faster growth under our approach (page 42). For all its criticisms of our analysis the Government has yet to be fully transparent about its own use of permit revenues. All parliamentarians should insist on a complete account of permit use before voting for the CPRS legislation. Australians deserve at least this courtesy. The challenge is now on the Coalition to demonstrate that they have the capacity to develop economically sound policies and to defend them. In my experience this takes courage as inevitably, economically sound policies will cut across some powerful vested interests. If the Coalition is waiting for big industry, many of whom have been looked after in the CPRS deal and who are unwilling to risk their gains by supporting a Coalition alternative, which has yet to be defined, the Coalition will be waiting for a long time. The Coalition needs to stand up for Australia, and particularly for the thousands upon thousands of small businesses who employ most of us, because the Government is not. |
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25 Comments
I would have thought this deserved top billing by a considerable margin over today’s Bernard Keane. Hope it’s not that petticoat showing again.
I’m not very comfortable with this article. It reads like an advertisement to me. The first sentence was a doozy, and I’m unsure of the intent of this statement:
“numbers that Treasury purportedly put together”
Are you suggesting that someone other than Treasury prepared the analysis?
I agree with Evan Beaver, the tactic of dismissing the Treasury’s figures while touting their own as ‘true’ is somewhat pompous. The rest of the article is simply a selling job for the coalition and sounds as if it comes from a PR firm.
…”designed to detract attention from..” Hmmm. Illiterate as well as innumerate. That’s the Tories for you.
There actaully is a black hole. A big one that the government won’t talk about.
Their projections were based on a lower (2007 estimate)population base in 2050. It’s been raised the target will mean a further 25% drop as the population size will affect the target line. This makes the idea that we can achieve these targets without nuclear a sick freaking joke.
Either the labor party are lying through omission about this or they’re too freaking stupid to understand it.
SwanDive is too stupid to even been talking about this. This is fast becoming the biggest joke this century.
Here for the population details and what it means.
http://www.catallaxyfiles.com/blog/?p=6490
What a pathetic attempt to support the Coalitions ‘rabble without a cause’, attitude. Its a bit too late for the author to try and convince us the disorganised, disloyal conglomeration of Libs are now suddenly one voice. It will not work.
Why is that Raymond? It’s no longer who has the better emissions policy but who is proposing it. (Another deep thinking, environmentally conscious leftie). LOl.
“Somewhat pompous”, Frank. They’re a private consultancy, i.e. not taxpayer-funded like Treasury. They’ve just had their professional integrity, which is to say, their livelihood impugned, wrongly it would seem on the face of it. What are they supposed to do, lie there and take it?
If I wanted unsupported press-kit cut and paste I wouldn’t go to the trouble of subscribing to something other than the normal run of Australian media. If you want to defend your modelling, discuss your modelling and, perhaps, favour us with a graph or two and an actual point by point refutation of Mr Swans arguments.
Altakoi
I already told you that SwanDive’s projections are screwed.They dead. They’re bullshit. It should be up to him to recalibrate them and explain the additional 25% drop emissions to meet the target due to out of date population projections.
When you’re examining something closely, you’re ‘poring’ over it.
Not ‘pouring’.
Sheesh.
Evan, Frank, Raymond … What do you say to Mark’s point that Access simply wishes to defend its own work? The writer clearly identifies whom he is representing. What’s wrong with that?
Oh, did you just assume that because Labor is Labor and Coalition is Coalition that therefore one of them must be pro-environment and the other anti-environment? Excuse me, but that’s pretty dumb without looking closer at the evidence.
… and (I forgot to say) that you condemn Access Economics by association. They did some work for the evil Coalition, therefore they must be evil and want to burn up the whole world. Grow up.
So James you are the only adult here, how fortunate we are to be in your presence. Take your happy pill, your liver is a little dirty this arvo
Raymond: no I’m not the only adult here, I only named three of you. Altakoi also criticised the piece but did so rationally by asking for a more detailed refutation of Swan’s criticism.
And I made my criticism pretty clear too. They seem to be accusing the Treasury of fiddling the numbers to favour the political party. That’s a very serious insinuation and in direct conflict with the APS code of conduct.
Further, this is not coalition policy. We can argue till we’re blue in the face over whether or not Access’s modelling is ‘right’; it matters nought until the coalition adopt this publicly as policy. It’s pretty simple. Turnbull just needs to herd the cats of his party.
C’mon people, this is economic modelling we are talking about. A mere $3 Billion here or there is well within any reasonable margin of error that one could assume. Change the assumptions and you get a different number, but to interpret this change as a ‘hole’ in the other analysis is just silly. Politicians love to play this game though, it’s not like it is the first time that a politician has used different modelling assumptions to try and discredit the policy of the other side. It’s stupid and relies on the ignorance of the target audience (voters..) to work, but all sides have carried on like this for as long as I can remember.
Any private organisation involved in doing the modelling would know in advance that this would be the almost certain tactic chosen by the side that didn’t commission the work, so with due respect it’s a bit too late to get offended by the politicisation of your work. It’s part of the Faustian bargain that is entered into when you supply a political party with ammunition. Hopefully you factored in the risk to your reputation when you set your fee.
As to the substance of the proposal, I think it shows that a nationally focused ETS is a bad way to try and get action on climate change. Indeed your scheme is cheaper (for Australia) and in principle would lead to less net emmissions (our emmissions - bought permits) from Australia than the Labor CPRS. However, from a global perspective your proposal is unworkable. Who is it that is actually going to be reducing there emmissions such that we can buy the generated permits with our coal mining company tax revenue? Your scheme makes the assumption that the developing world will be able to provide permitsto the developed world such that we don’t actually have to do anything ourselves. That is simply not going to happen.
A scheme to reduce emmissions that doesn’t actually reduce emmissions, but relies on an external source of permits, might make sense economically if that is the set of assumptions you start from, but if this is the best we can do we have seriously lost our way somewhere.
Er, James and Evan, it’s Frontier Economics, not Access.
And Evan, I can’t find anywhere that Price accuses Treasury of ‘fiddling the numbers’, which would indeed be a serious offence. His main beef is with the Treasurer and what he’s done with the numbers (he asked for) from Treasury - a subtle but crucial difference.
In my defense, I’ve got the flu. Thanks for the correction Mark.
They seem to be accusing the Treasury of fiddling the numbers to favour the political party. That’s a very serious insinuation and in direct conflict with the APS code of conduct.
Are you actually going to try and spin the idea that Ken Henry isn’t a political player : a water carrier for the ALP. I don’t think even Rudd would deny that seeing it’s so obvious. Treasury is about as politically compromised that it’s ever been under Henry and the Dept. has essentially become a mouth piece for ALP policy.
I think you’ve got the cart before the horse a bit there Tee. Government would have asked Henry/Treasury for advice on how to deal with the GFC. Treasury would have given what they considered their best advice. Government followed it. When Henry is questioned about the policy later, he is also being questioned about his advice. He will of course defend it, which gives the impression that he’s defending Government policy.
wot Messers Squid/Butler sed, can’t write english & probably ain’t that hot in Rithmetrik neither.
How long before Frontier, deservedly follows Ergas off that cliff? Still too many empty seats on that bus.
Thanks for the correction Mark. Frontier Economics. I do that with names all the time. Remind myself of the senile father-in-law in Joseph Heller’s “Good as Gold” who can never even get the name Gold right.
Treasury may have said a point needed clarifying. Swan would be unlikely to send Frontier a polite letter asking for clarification. I don’t see any need to go down the “that’s a very serious accusation” road. Would Swan exaggerate, select truths, or lie? Of course he would.
The real significance of the posts on this topic is not the so-called coalition’s so-called climate change policy and lack thereof, it is what it tells us about how this scum-sucking Howardite rabble actually thinks.
After a decade spent perverting the public service, grooming creatures like Godwin Grech, their Howardite mind-set won’t let them recognise the fact that there has been a return to public service independence and professionalism.
The attack on the Treasury Secretary is a typical Howardite response to not having a policy, not having a clue and not having a future.
(((Oh, did you just assume that because Labor is Labor and Coalition is Coalition that therefore one of them must be pro-environment and the other anti-environment? Excuse me, but that’s pretty dumb without looking closer at the evidence.)))
James McDonald: That’s the whole point in these discussions James…why does it have to be political all the time. Why can’t commentators judge on the issue rather than build some sort of political bias just for the sake of it.
That’s what shits me about politics…truth is always scarce on the ground.