The Wrap with Richard Denniss

When former Treasurer Josh Frydenberg learned of Scott Morrison’s secret plan to spend a quarter of trillion dollars on nuclear submarines that (just two years earlier) the navy said they didn’t need, he said:

“Everything is affordable if it’s a priority. This is a priority.”

To be clear, the former Treasurer is spot on. Australia is an incredibly rich country, our GDP per capita ranks 8th largest in the world. Likewise, we are a low-taxing country, even before we blow another quarter of a trillion dollars on the Stage 3 tax cuts. But, like kids who inherit billions from their parents, just because Australia is rich doesn’t mean we can’t squander it.

According to the world’s atmospheric scientists we are on track to heat the globe by just under 3 degrees by 2100. While the Albanese Government and the Coalition support the Paris Agreement target of limiting global heating to ‘just’ 1.5 degrees we continue, with bi-partisan support, to open new gas and coal mines and spend more than $11 billion per year on fossil fuel subsidies.

Like buying submarines, tackling climate change isn’t about money. It’s about power. Sadly, it’s also about foreign interests. Just as the big winners from our nuclear submarine purchases will be the United Kingdom and United States, so too will the enormous profits earned from our expanding coal and gas exports flow overseas as well. Of course, it doesn’t matter where in the world our coal and gas burns, it will still cause the climate change that will wreck our reefs, fuel our fires, and feed our floods.

Buying nuclear powered submarines is a dumb idea, but former Treasurer Frydenberg was right: a country as rich as Australia can always afford to pursue its priorities.

Australia is rich enough to do anything it wants, but it seems our democracy is not yet strong enough to do what our voters want.

Read more.

— Richard Denniss, Executive Director of the Australia Institute

The Big Stories

Excess Corporate Profits Driving Inflation

Australia has been experiencing high levels of inflation, and it’s been blamed on everything from overseas conflict to wage growth. However, this isn’t the entire story.

Our report ‘Profit -Price Spiral: The Truth Behind Australia’s Inflation’ reveals the high rates of inflation in Australia are largely due to excess corporate profits, not wages. What’s more, it shows high inflation wasn’t inevitable, and would have stayed within the RBA target band if corporates had not squeezed consumers through the pandemic via excess price hikes.

Policy Director Greg Jericho spells it out clearly here.

AUKUS: Submarines on the Never Never, or Castles in the Sky?

AUKUS has landed…sort of.

What the US President and the Prime Ministers of Australia and Great Britain have announced is a game changer. But it is not defence policy, and it is not a defence plan. What has happened is great political theatre with deep domestic political significance, explains Allan Behm.

Our open letter calls on the Government to listen to the science and prevent new coal and gas developments.

Thank you to all our supporters who put our open letter from 118 scientists and experts in the papers, calling on the Government to prevent any further new fossil fuel projects in Australia.

It is time to put climate science back into Australia’s climate policy. Add your name to the open letter. 

Government Makes Start on Cutting Super Tax Concessions

Small change, big debate. There’s no doubt the government’s change to tax concessions on super earnings has got people talking, but there’s still confusion about what it is and who it will affect.

Our report from February showed the massive scale of super tax concessions. The annual cost of super tax concessions ($52.6b) is on par with the value of the entire age pension program ($55.3b).

This reveals that idea of “self-funded” retirees is a misnomer. There are two classes of state-funded retirees in Australia, both costing the taxpayer roughly the same amount: those living on the aged pension, and a smaller group of wealthy account holders with lavish tax loopholes.

Senior Economist Matt Grudnoff breaks down Labor changes to the super system (that affect only the top 0.5% of super balances) and answers the burning questions in the video below.

Gender Pay Gap

On International Women’s Day, our report showed that for the average woman in Australia, the gender pay gap will be more than $1.01m over her working life.

The report is a detailed breakdown of the different ways the gender pay gap can be measured, and looks at the dimension of the issue through levels of income, ranges of occupation and ages and an industry breakdown. It shows that men have higher average salaries than women in 95% of all occupations, including those where women dominate the workforce.

To rectify the issue, the report recommends policies to promote greater access to childcare and parental leave for both parents, family-friendly work practices, and the lifting of wages for industries dominated by women – most urgently in the care sector.

Delay vs Decarbonisation

Climate policy can incentivise genuine emissions reduction, or it can delay decarbonisation by expanding the use of offsets. Currently, it’s the latter: renewable energy generation commencements recently hit a six-year low, while carbon credits issued have been growing by a million tonnes per year.

Report author Eliza Littleton explains below, or read the report ‘Delay or Decarbonise?‘

The Quote

To actually approve new coal and gas, fossil fuel industries now, is actually like writing a death certificate for the planet.

– Professor Fiona Stanley AC, Australian of the Year (2003), a signatory to our Scientist’s open letter.

The Win

Leave the 0.5% alone! 

Lara Vella takes to the streets of Double Bay to see how the wealthy are coping with the latest superannuation changes.

ACCC to Crackdown on Greenwashing

The competition watchdog will step up its probe of companies’ environmental claims after an initial sweep found more than half made misleading statements ranging from overstating climate action to developing their own certification schemes. This follows the Australia Institute referring the Federal Government’s carbon neutral certification scheme, Climate Active, to the ACCC.

Read more about how a gas company can be ‘carbon neutral’.

The Bin

A gas company tried to emphasise the need for gas for domestic electricity generation — a gas company that exports all their gas. Senator David Pocock called them out.

An export gas company @inpexaustralia using the argument that we need more gas for local electricity generation 🤯

We don't have a gas supply shortage – we export 75% of our gas. And pay export prices for our own gas.#cookingwithgas #safeguardmechanism pic.twitter.com/N8iCaqNPOQ

— David Pocock (@DavidPocock) February 28, 2023

Get Involved

South Australia is set to become the first jurisdiction with Indigenous Voice to Parliament

To commemorate the occasion, the South Australian Parliament is holding a special Sunday parliamentary sitting so the public can watch the historic passing of legislation enacting the first Indigenous Voice to Parliament in any jurisdiction across Australia.

You are invited to join in witnessing this historic moment.

11am ACDT, Sunday 26th March
SA Parliament House steps, North Terrace, Adelaide

Add your name to our no new fossil fuels open letter.

Signed by over 118 scientists and experts, it calls on the Australian Government to follow the advice of the world’s scientists and prevent any further new coal and gas developments in Australia.

What’s On

Politics in the Pub with Adam Bandt

Join Greens Leader Adam Bandt MP for a discussion on the Albanese Government’s proposed Safeguard Mechanism climate legislation. As the Federal Parliament debates the safeguard mechanism legislation, we’ll explore whether the proposed reforms are intended to safeguard the climate or fossil fuels?

6:30pm AEDT, Wednesday 22 March. Free, registration essential.

Thank you for supporting the Australia Institute. There are massive issues to tackle this year and we couldn’t do it without supporters like you.

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