Mar 15, 2017

How the mining industry parasites helped destroy good energy policy

We're abandoning good policymaking in Australia and parasites like the mining industry are to blame.

Bernard Keane — Politics editor

Bernard Keane

Politics editor

Two quite separate events yesterday illustrated, in painful detail, exactly how badly policy-making in Australia has run off the rails. For a country with a proud record of making tough but eventually worthwhile economic and fiscal decisions over the last 30 years, our process for making decisions has now gone badly awry.

Over in the west, as part of the landslide victory of Labor, Nationals leader Brendon Grylls lost his seat of Pilbara, despite the Nationals overall suffering only a tiny fraction of the big swing against the Barnett government. Despite leading a more independent National Party than the Liberal Party minions back east, Grylls was every bit the traditional advocate for regional boondoggles and wasted spending that we see in the eastern states. But he also supported an increase in mining royalties, and as a result became the target of a $2 million mining industry campaign across all media platforms. Labor opposed the royalty hike as well, and in the end was the beneficiary of the mining industry's largesse.

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44 thoughts on “How the mining industry parasites helped destroy good energy policy

  1. ralph

    Price to roll a PM: $22 million; price to roll a minority party leader: $2 million; price to buy PMship: $1 million; price to get PUP in to Parliament $9 a vote.

  2. 2bobsworth

    Lets hear all about National Interest policies on the LNG debacle from Labour ex Resources and Energy Minister Martin Ferguson.

  3. Roger Clifton

    A carbon pricing scheme would have used market incentives to drive the transition to a low carbon power network without the need for clumsy mechanisms like a renewable energy target. The UMPNER report estimated a carbon price of $30/t would bring nuclear to cost parity with coal. More recently we see the emergence of mass-produced “modular” reactors that may not need a carbon price to compete.

    1. Jimbo

      The modular reactors are still in the experimental stage and have serious safety issues. The company has almost gone broke at least once so they may never see the light of day. Hopefully, they will die the same way that other nuclear power has.

  4. Srs21

    No wonder WA Labor didn’t support it here.They re still smarting from the vile attack when Gillards mob tried it. Brendan Grylls is a brave man. Apparently no one has the money to counter the international owned Aussie mining industry.

  5. zut alors

    ‘….the reformers can’t even keep the lights on.’

    That’s the essence of this farrago. If energy boffins are so goddam clever (& ‘expert’ in their industry) why are we in danger of blackouts? Simple question. Anyone?

    1. Dog's Breakfast

      Dear Zut, you’re usually a very astute commenter. The simple answer to it is that there is vast money in blackouts. $14,000 per MwH if memory serves me correctly!

      1. zut alors

        Onya, Dog’s, I was baiting someone to actually say it.

  6. Michael O'Donoghue

    Brendan Grylls showed that he is a principled politician and that he has some ticker. Ian Macfarlane and Martin Ferguson both had a responsibility to avoid the current predicament. They let the country down, however they are doing very nicely now thanks to the industry that they were previously supposed govern in Australia’s best interests.

  7. Steve Gardner

    Even in a piece in which Keane reluctantly concedes that electricity privatisation has been a colossal 30-year policy failure that has seen prices skyrocket and network reliability destroyed (all while private interests have been enriching themselves) he still cannot let go of the fantasy that privatisation could have worked, and delivered a stable and efficient market for power, if only it weren’t for those nasty miners. But even without the completely predictable mendacity and hypocrisy of the mining lobby, privatisation still would have been an utter failure, because it is in the nature of the private sector to prioritise short-term profits over long-term investment. (and to lobby for its private interests above the national interest.) I wonder what it will take for Keane finally to abandon the shibboleths of neo-liberal economics once and for all.

    1. Grumpy Old Sod

      Here, here.

      1. Woopwoop

        You mean hear, hear, but I agree entirely.

    2. Lee Tinson

      Yep! There was never a chance that a power market would work in the nation’s interests. That’s not how private business works. Still, it looks like Trumble isn’t going to do anything about either renewables or the broken market, based on his press conference this afternoon.

    3. Draco Houston

      That’s just plain Capitalism. The only reason the government ever had control of things like electricity supply was because it was once the path to short term profits. The public good is a side effect that happens by accident. This has been true for the entire modern ages, the neo-libs didn’t invent it.

      1. David Irving (no relation)

        That’s actually completely incorrect. Governments used to control electricity supply because private companies couldn’t run it at a profit. (For example, Tom Playford nationalised the Adelaide Electrical Supply Company because it was going broke, and refused to supply electricity in the country.) In Australia, at least, private enterprise has only been able to run it at a profit after buying the assets and bargain prices then charging like wounded bulls.

    4. Will

      You’re not wrong, Steve. With BK it’s always them bad apples rather than that rotten system. It’s almost hard not to feel sorry for him when he bemoans a ‘three-decade long process’ of energy ‘policy failure on a grand scale’, as if that were an isolated (albeit extended), aberrant incident in an otherwise well elite-managed world. If only! For BK, the corrective to business’s self-harming short-term profit fixation isn’t socialism, but rather the public policy elite’s long term self-rescue programme for capitalism.

      Yes, it’s a delusional and inevitably futile endeavour, but at one level you can’t really blame him. If neoliberalism is the problem, what, after all, is the solution? The post ’89 left doesn’t appear to have any real clue what the word ‘socialism’ is now actually meant to mean (as opposed to not mean, in ten thousand different ways). And, until the left does have a persuasive, unifying programmatic answer to that, the left is pretty much limited to keeping capitalism on life support (such as avowed socialist Yanis Varoufakis found himself doing in 2015 as a minister in Greece, to no avail, and as BK is essentially promoting in Crikey every day).

      You say BK needs to ‘finally abandon the shibboleths of neoliberal economics’, and yes, I’d certainly agree, but abandon them for what? Neither unfettered or planned economies work, we now know that. And what ‘delicate mix’ of the two isn’t a policy elitist’s wet dream, no matter how certain to be despised viscerally by the grand plan’s inevitable losers? What is the socialist alternative, really? Is it a thing, or is it just a think? (Sorry to throw these questions at your step, but you did make an interesting comment.)

      1. Owen

        A Socialist alternative would stop the accumulation of obscene amounts of wealth to a tiny fraction of people, who distort any sensible Democracy.Capitalism recovers during and after War,the only problem in this era is, if its a big one, the planet becomes unliveable, we have never been in this situation before, it dosn’t look too good!

        1. Will

          I completely agree, Owen. Democracy must prevail against the distortions of extreme wealth (not least because the scientific consensus is we are now on the cusp of a planetary climate crisis). But who is explaining why democracy must prevail? What is the relationship between democracy and socialism?

          1. JMNO

            Why not the social democratic forms of government that prevail in the Scandinavian countries? They work a whole lot better than just about any other form of government and in the interests of their citizens

      2. Steve Gardner

        Will, privatisation has failed because the provision of stable and efficient market for electricity is a public good, and private markets cannot deliver public goods. So there’s an argument for public ownership specifically of the electricity network, and more generally of other public goods like public transport and education. But that’s not an argument for ‘planned economies’ in the Soviet style.

  8. klewso

    You invest all that capital to hire the hearts and minds of a troop of party animals (paying way over market value) – you gotta use it?

    I’d like to know the ins and outs of why the AEMO did a Nelson, at that particular point in the electoral cycle (Frydenberg-Turnbull waging war on renewables) when the SA government asked for more power during that heat-wave, 5 weeks ago.

  9. Dog's Breakfast

    Seriously, the mining and resources industry generally need to be barred from political contributions, like tobacco and gaming companies, and if possible or constitutional, barred from any political advertising or the funding thereof.

    This has been part incompetence, but a very large part of it is bloody-minded oppositionalism from Abbott in particular, carried on by the ineffectual Turnbull, and desperately stupid rational economic theory once again exposed to reality.

    Many vital industries have to be protected from the market, not thrown into it. Electricity, gas, power generation, resources. You’ll never come up with satisfactory regulatory regimes while the vampire squids of the Big Four accounting firms are around.

    Face facts, these things should have remained in government hands, or so tightly controlled that only benign corporates would get involved, if there is such a thing.

  10. Tony Foot

    It really got me worked up when the Mining Co.s did that advertising campaign against the mining tax and the same with the carbon tax.
    What kind of democracy is it when the voters can be swayed or controled by vested interests with dodgy advertising campaigns?
    The then Opposition thought it was great and actively supported it. Now they see that it can affect any side of politics they are less keen. Though in WA the Libs are not too sorry it happened to the Nats.
    Our problems as citizens is how do we control or counter the vested interests interfering in the democratic process. We have a similar problem with vested interests owing the news outlets and supporting their rich mates.
    Is there any answer to the problem?

    1. Owen

      A change from Capitalism to Socialism but this will not be “allowed” to happen,even if the majority of people would want it to happen,which is not the case currently!

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