The crimes of free-market capitalism

We are paying a heavy price for selling off public assets decades ago.

Milton Friedman, the Nobel Prize-winning economist who was the leading light in modern free-market economics. PHOTO CNN

Milton Friedman, the Nobel Prize-winning economist who was the leading light in modern free-market economics. PHOTO CNN


As we sleep, democracy, the rule of law and all the institutions that make up civil society are being eaten alive by the world’s most voracious beast – capitalism in its free-market form.

In a civil society, “the perennial gale of creative destruction”, as Joseph Schumpeter called capitalism, must be regulated. Another economist, Milton Friedman, thought it shouldn’t, and duped leaders into believing that if money-makers are left alone everyone will be richer.

That didn’t happen. Instead, the central tenet of free-market capitalism – that government must be so small that you don’t notice it – has weakened democratic institutions. The idea of small government goes down well with some voters, but over time they pay a heavy price.

Relaxing government scrutiny of private corporations’ behaviour has brought a resurgence of unethical practices in pursuit of profit – in some cases amounting to criminal behaviour, as the banking royal commission has uncovered.

Fossil-fuel interests are driving our assault on natural systems to new levels, with emissions uncontained. Scientists’ warnings are getting sharper. Their reticence about stating personal positions, which has bothered former leading NASA scientist James Hansen, is starting to fall away.

As old deadlines pass without political action, leading scientists are now saying that it will take stern global measures over the next decade to stop us from slipping into a permanent “hothouse Earth” state at least 4C warmer than today. More about that next week.

We know that our high-carbon lives are fuelling dangerous climate change, and that conspicuous consumption and poor leadership aren’t helping. But one reason for our failure to act stands clear of all the rest – uncontrolled, unfettered, self-centred capitalism.

In the privatising of Australia’s public assets, electricity was a key sector. Victorian premier Jeff Kennett led the push in the 1990s by breaking up his state’s electricity commission and selling its assets, an example that the rest of the country largely followed.

Unfortunately, the privatisers didn’t read independent analysis like John Kwoka’s detailed 1995 Harvard study of US power utility ownership. Kwoka found that the cost of regulating private utilities made them more expensive than keeping the utilities in public hands.

Privatised electricity has been a complete and very costly failure. Phony competition between companies selling an identical product and unregulated spending on poles and wires has made an expensive dog’s breakfast of the National Electricity Market. Actually my dog is much neater.

In framing the National Energy Guarantee as providing cheap, reliable power, Malcolm Turnbull and Joel Frydenberg failed to mention that what made power costly and unreliable was privatisation. Unfortunately, this mess is now the basis for a national climate policy.

Unlike past Labor schemes, the NEG enjoys Opposition support. In these days of small mercies we have to hope and pray that today’s Coalition party room decision will allow future reviews of our shamefully weak emissions targets and that it won’t stop renewable investment in its tracks.

This whole fiasco has happened because in the 30 years since learning about global warming governments have failed to confront the “merchants of doubt”, the coal, oil and gas interests whose reserves will lose value in the event of decisive climate action.

Throughout those years Australia paid a heavy price. A change of government saw the demise of our most effective emission-cutting measure, the 2012-14 carbon tax, as the Coalition under Tony Abbott succumbed to a well-resourced barrage of industry propaganda.

This failure is not just about climate policy. Politicians of all flavours avoid confronting business interests because so much is shared between them. It can be expressed in many ways, through meetings and shared social events, for instance. And money plays its tawdry part.

This public-private mutual admiration society has the effect of limiting involvement of ordinary people in big national and state decisions. Sure, we get invited to make submissions about this or that policy or project, but opportunities for public discussion are few and far between.

The blurring of lines between public authority and private capitalism has greatly lengthened the gravy train of corporate boards and executives, lobbyists, politicians, minders and senior and former public servants. It’s getting hard to tell the difference between them.

We used to think that retiring politicians and senior bureaucrats who slipped seamlessly into well-paid private consultancies were bordering on corrupt. We thought that an excellent pension after leaving office was adequate compensation for years of service, but apparently not.

All good politicians and public servants – and there are many of them still – recognise that public service is a privilege, a high calling that has its own, non-monetary, rewards. But it has been dragged into the mud by poor examples set at the top.

Lack of daylight between government and private interests is all the justification we need for strong anti-corruption commissions in Canberra and each of the states. That can’t happen soon enough.

Posted in atmospheric science, Australian politics, business interests, business, investment, employment, carbon emissions and targets, carbon tax, changes to climate, climate politics, climate sensitivity, consumption, electricity networks, fossil fuels, future climate, inequality, public opinion, renewable energy, temperature | Tagged , , , , | Leave a comment

Struggling for words in the face of a crisis

We seem paralysed and struck dumb by the monstrous crisis threatening life on Earth.

Scientists observe a stream of meltwater on Greenland’s ice sheet entering a moulin carrying the water to bedrock 700 meters below, where it lubricates the bed and hastens ice sheet movement toward the sea. PHOTO Matt Hoffman, Los Alamos National Laboratory

Scientists observe a stream of meltwater on Greenland’s ice sheet entering a moulin carrying the water to bedrock 700 meters below, where it lubricates the bed and hastens ice sheet movement toward the sea. PHOTO Matt Hoffman, Los Alamos National Laboratory


A couple of bystanders at Manly Beach in the ABC’s revived War on Waste series said all we need to know about our all-too-human response to environmental impact.

Confronted by a tonne of discarded bits of plastic arranged on the sand in the shape of a giant human footprint, a crowd gathered to hear the show’s host, Craig Reucassel, declare that this was the total amount thrown out by Australians “every minute of every day”.

Hearing the news, a woman shuddered, paused for a moment and said she found it “terrifying”, with concern, perhaps fear, in her expression. A tatooed bloke in a singlet said, “you just don’t think about it till you see it put there in front of you”. Indeed, we don’t.

I recently listened to an online talk by British writer-academic Robert Macfarlane about how we cope with knowing that our species has so profoundly impacted the planet that it has passed out of the Holocene and into a new geological epoch, the Anthropocene.

He spoke of his feelings at witnessing meltwater pouring down through cracks in the Greenland ice sheet: a dullness of mind, a sense of being stunned, unable to find words to respond, a thickening or stickiness in thought and speech.

The idea of the Anthropocene, says Macfarlane, is so massive, so stupendous in its implications, so far removed from ordinary human life, that it is beyond our capacity to grieve about it or to find the incentive to spring into action. We’re stunned into silence.

Western Australian philosopher Glenn Albrecht has coined a word, “solastalgia”, for the sense of desolation and powerlessness felt by people at losing a beloved home environment. He calls it “the homesickness you have when you are at home”.

In researching this he interviewed Hunter Valley people who felt powerless in the face of fallout from power stations and large-scale coal mining in their neighbourhood. “Dora” said she lost weight and would wake in the night with her stomach like a clenched fist.

People experiencing the impact of weather extremes also struggle to express their feelings. That much was evident last week in reporting of Australia’s current drought, centred on NSW but felt in parts of all mainland states, as prolonged warm, dry conditions start to bite.

Brian Egan of the farm charity Aussie Helpers says the drought is the worst he’s ever seen. In a wavering voice he told ABC Radio National Breakfast last week that the desolate land and the dead and starving animals seemed “just like a war zone… actually quite frightening.”

He said the impact on farmers was traumatic. His charity’s counselling service was receiving multiple calls daily from farmers suffering anxiety and depression, with “suicidal thoughts”.

From the other side of the Pacific, western United States and Canada, come apocalyptic images of wildfire bearing down on houses, and of stunned residents returning to discover every home in every street, their whole cherished neighbourhood, levelled.

Whatever has triggered our distress – the Anthropocene, a coalmine, wildfire, drought, flood, famine, contagion or war – the common thread is a sense of helplessness and hopelessness that clouds our thinking and makes words hard to find.

Some of these happenings are not direct outcomes of our impact on nature. But no-one in the world is untouched by what is happening to air, oceans and lands – our life support system.

Technology has done much to improve our lives, but it has also put up a barrier between us and our natural world. The world’s richer people now have homes and cars with their own micro-climates, and we can criss-cross the planet with little disruption or discomfort.

Our use of technology has raised the stakes. While dulling our sense of place it has massively multiplied our impact on the biosphere, allowing us to avoid responsibility for that impact.

Our conspicuous consumption follows primitive urges, like chronically obese people who can’t stop eating, but now we’re ravaging the whole planet. It’s way past time we rediscovered the nurturing part of our nature, the part that recognises the value of caring for our home.

We need Reucassel and Macfarlane and others to continue shining lights into dark corners of our war on nature. But if we really want a safer future we must look to ourselves, all of us, together.

Australia seems paralysed by this crisis. Our national government cannot or will not articulate the dangers we face. Perhaps it is afraid to. Perhaps it too is afflicted with Macfarlane’s sticky speech.

Glenn Albrecht got it right. He invented another word, “soliphilia”, which involves cherishing our connection to place, and in solidarity with others, being willing to accept political responsibility for the health of Earth, the planet that is our home.

Solidarity arises from another natural trait, community. Humans are social animals who work best together. When enough of us stand up and say “enough”, but only then, things will start falling into place.

Posted in Adaptation, Arctic, Australian politics, changes to climate, climate system, community action, consumption, disruption, extreme events, future climate, human behaviour, ice, leadership, planetary limits, waste | Leave a comment

Tough times for professional journalism

No amount of spin about Nine’s takeover of Fairfax Media can disguise the fact that Australian journalism is in trouble.

IMAGE: ABC

IMAGE: ABC


So Kerry Packer’s burning ambition to bring the Sydney Morning Herald into his Nine Network stable has finally come to pass. Except that the man himself is no longer around to enjoy it.

Nine’s takeover of the ailing Fairfax empire was a swift, slick deal, done and dusted before any reporters – including Fairfax staff – got wind of it. Not so slick is the outcome for professional journalism and the media landscape in Australia.

Fairfax Media, which also publishes the Melbourne Age, the Australian Financial Review and the Canberra Times, has been one of two key players in Australian print media since the 1980s, the other being News Corp Australia, which publishes this newspaper.

Digital technology brought Fairfax down, but it wasn’t from lack of understanding. In fact, Nine coveted Fairfax because of its successful real estate site Domain and its Stan streaming service.

But these could not replace Fairfax’s once-lucrative print classifieds, the “rivers of gold” that made it so enticing to Packer. Digital competitors Google, Facebook, Carsales, REA and Seek sucked up all the gold, leaving Fairfax with a dry river bed.

We’re assured that the major newspapers will live on, but Nine wants to focus on “strategic objectives and its digital future”, which throws into question the fate of a host of regional Fairfax papers in Australia and New Zealand – including Tasmania’s Examiner and Advocate.

So after two decades of disruption driven by the Internet and its digital technologies, newspapers and the journalists employed by them now face a whole lot more uncertainty. As if they needed it.

These are big issues for companies facing commercial extinction due to outmoded technologies, and for their staff facing the axe. No-one should doubt that the demise of Fairfax is a blow to Australian media diversity – the lynchpin of an informed public.

While informing their public, newspapers have also been community hubs. This is true of the big city mastheads, but it is even more true of smaller papers, from dailies like the Mercury down to small-town weeklies or monthlies.

For many communities, the loss of their local paper is like being struck dumb. A good printed newspaper encapsulates the happenings of the day (or week/month), both for today’s purposes and for posterity, in a manner than no digital source can hope to emulate. No community should lightly give them up.

In the likely event of a Fairfax regional newspaper sell-off, it is to be hoped that towns affected will rise to the challenge to help their local rag survive. But the chances of that happening are diminished by an uninformed population.

The annual Australian Digital News survey has repeatedly found that Australians, feeling powerless to affect things that are happening around them, are making a deliberate decision to avoid news altogether, either in printed or, more likely, digital form.

This is especially true of younger consumers, who are turning more and more to “news” about entertainment, celebrities, arts, weird happenings, or new commercial products to make them rich/powerful/beautiful. They’re wanting to escape from reality, and who can blame them?

Exacerbating that trend are powerful figures who choose to manipulate or misrepresent news media for their own purposes. We are in dangerous territory when a US president and acolytes in this country name reputable journalists as purveyors of “fake news” and “enemies of the people”.

Making that accusation sound plausible wasn’t so easy when text on paper predominated, but anything’s possible in today’s online world. The Internet empowers everyone, including unscrupulous political and commercial interests.

Democracy depends fundamentally on diverse, vigorous, professional news services with high standards of ethical behaviour and editorial independence. Good news media will often irritate politicians and business interests, but this is democracy at work.

A functioning democracy depends especially on an ability to study matters too complex for one person working in a daily news cycle. Such collaborative efforts over extended periods depend on stable, secure media organisations run by people who know the business.

So how do we protect quality professional journalism from the vicissitudes of business? The Turnbull government’s $20 million a year package for regional newspapers is a start, as are various investigative and regional collaborations by the ABC. But they fall far short of what’s needed.

Melbourne journalist-academic Bill Birnbauer suggests non-profit journalism centres, funded by tax-deductable donations, feeding investigative and public-interest stories to news media. It would be a relief if such a model can be made to work here as it has in parts of the United States.

Ultimately, professional journalism from multiple sources will survive in this country only so long as people like you tune in regularly to broadcast news and, importantly, take out digital subscriptions or buy newspapers. For the record, I do all three.

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