Home > Current Affairs, The EYE-BALL Herman O'HERMITAGE > POWER – in the Political sense – or Fuelling Industry?

POWER – in the Political sense – or Fuelling Industry?

April 9, 2011

Herman O'Hermitage

[The first in a series of Comments by guest Blogger – Herman O’Hermatige – Herman’s background is Finance, Economics and Political Science – he has been a friend for 30 years and like many others – he has a rage within -]

Economist’s talk about externalities and intrinsic costs –

In our time we are dealing with these two issues constantly, or put another way,  how fossil fuels have created a secondary problem in greenhouse gases,  and can we quantify the cost of dealing with or neutralising the issue.

The debate has its extremists, who either deny or claim a forthcoming Armageddon. This mania does not help, as both prevent exploring and debating the issue with any real insight or detached observation.

David Suzuki once said – ‘science is proving popular theory wrong’.  Searching for evidence where current thinking is a distorting or distorted mindset.  This is where Government, Lobbyists, and the Mass Media have reduced the debate.

The Montreal Protocol was adopted in 1987 – it was addressing Fluoro-Carbons.  During this period Ronald Reagan and Margaret Thatcher were practising what is now called supply side economics – Thatcherism – a form of increasing efficiency by adopting a new mindset in economic theory.

In Australia the Treasurer was Paul Keating and in his drive to make Australia significant on the international stage,  he too adopted many supply side economic initiatives that included privatisations like Qantas and CBA.

Extremists again wanted to privatise everything. All government, postal telephony services, electricity, water, and so on. Nothing was in the national interest, not gaols, freeways, defence – nothing.  Free markets were the answer.

Kyoto was in its genesis but not ratified until 1997.  Jeff Kennett – the Victorian Premier came to office in 1992, and his treasurer – Allan Stockdale found it politically convenient to claim a $2.2 billion deficit in Victoria, and public sector debt of $33 billion.  That $33 billion included unfunded superannuation liabilities by previous governments.  This debt number allowed them to close schools, sack public servants, and sell off power assets that included SECV and Gas and Fuel Corp.

The Victorian electricity assets are some of the worst polluters due to the fact that the La-Trobe Valley produces brown coal viz a vis the black coal of central Queensland or the Hunter Valley in NSW.

By the time Kyoto came into existence John Howard had taken government in Canberra, and his perspective is widely known – deny, why would we want to put a tax on one of our largest export revenues?

This left the other side of the debate to the Greens – Bob Brown continually claiming taxing carbon would create jobs.

So we have the background to the current issues, NSW and Qld need to exit power generation, both have large unfunded superannuation liabilities, but not on balance sheet,  and Tony Abbott proposes to compensate the Victoria electricity producers to renew towards less polluting power generation.

Without doubt this is all too brief.

I have not defined Greenhouse gases – I have not really explained how Qld have partly privatised their electricity assets – Victorian State Government saw a political shift last November – the same occurred in NSW 2 weeks ago after the previous premier did a midnight deal on selling electricity assets and refused to re-call parliament – and Qld State politics is in the flux. What fate awaits Anna Bligh?

Just as importantly the Victorian and NSW Labor governments were stale and bloated in many other ways.

In NSW Eric Roozendaal proposed selling NSW power assets for about $22 billion – he retired from Parliament in 2005.  Morris Iemma was prevented from selling power assets amounting to $14 billion and was replaced as Premier two years ago – and Kristina Keneally has sold distribution mechanisms for a bit over $5 billion dollars – and the new government has claimed they will conduct an inquiry into the sale.

A quick synopsis of the Federal perspective needs to be outlined. The constant debate ensues: –

  • the opposition claims the government does not have a mandate to tax carbon,
  • Bob Brown continues to say “a Carbon Tax will create Jobs” and
  • Julia Gillard states that Australia will have an interim tax, cost unknown, from 2013

– and the shenanigans continue.

On unfunded super – that is what Peter Costello set in place called the ‘Future Fund‘. Others including Kevin Rudd have tried to re-direct that investment pool towards non superannuation logics that includes carbon reduction. The ‘Future Fund’ has an independent board but is best described as a ‘QANGO’ – (Quasi Autonomous NON-Government Operation).

So what is Greenhouse Gases?  Kyoto lists six pollutants they target to be reduced – can be further read here –  Kyoto Protocol.

  • Carbon dioxide (CO2);
  • Methane (CH4);
  • Nitrous oxide (N2O);
  • Hydrofluorocarbons (HFCs);
  • Perfluorocarbons (PFCs); and
  • Sulphur hexafluoride (SF6)

On the extremes again we have varying debate. Alan Jones broadcast that carbon dioxide is not a deadly gas. Now we are trying to understand the carbon cycle.

Because of the sheer simplicity of that spin – others including Tony Abbott have jumped on the bandwagon. (Please Mr Abbott, We serious Australians want sensible debate, and such stupidity hardly improves your credibility. A security guard recently said to me he would be happy to create a room of only CO2 to experiment if Alan Jones would volunteer to be the guinea pig).

On the other end we have research through the hospitals and university system into high observations of asthma in children in the Hunter Valley, where coal is first open cut, and then fired to generate electricity for the greater Sydney metropolis.

Next we move onto the “Proven” v “Sceptics”.  I personally assert that 140 years of weather observations – is statistically very dangerous. Dr Jared Diamond in the book ‘Collapse’ – states that from ice core readings the earth entered a wet phase in about 1800 – and the current warming cycle will peak about 2200. Of course this too is out there.

If the last Ice Age was approx 17,000 years ago – do we go through 400 year mini cycles?  Then we have a volcano spitting more toxic gases in a week than Australia creates in 4 years.

What I assert is that Proven and Sceptic simply do not help. I said earlier – “both prevent exploring and debating the issue with any real insight or detached observation.”

Can we please just engage in sensible evaluation!

Photonics is a whole new science. It is capturing the turning of energy into sugar (carbon chains, stored energy, photosynthesis) at a much earlier stage than fossil fuels. It can be called renewables but does that include tidal or wind power? Photonics has been used by metaphysics to describe gravity between planets or other heavenly bodies. Get your own word. It stems from photosynthesis.

Now this science has a name, can the mass media please stop sensationalising the edges. The University of NSW has a school of Photonics.

There is power in our universe that humanity can’t fully comprehend. Think of the power of the water cascades in Toowoomba earlier this year – or the Tsunami that hit Japan. That is real power not the egotism of politics.

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