Stiglitz is in the house | Between the Lines
This edition: fossil fuel subsidies undermining Australia’s diplomacy, the Kamala femininomenon, and New Zealand’s recession lesson
The Wrap with Ebony Bennett
Nobel Prize-winning economist Professor Joseph E. Stiglitz kicked off his Australian tour this week and has well-and-truly hit the ground running.
There were full houses in Sydney and Hobart to see the former World Bank chief economist and best-selling author, who’s visiting Australia as a guest of the Australia Institute, as part of our 30th anniversary celebrations.
Here are three key takeaways from the first week of his tour:
1. Australia’s democratic institutions are the envy of the world
Mandatory, preferential voting and an independent electoral commission have helped Australia avoid some of the “perverse” outcomes seen in the United States, according to Professor Stiglitz.
“If the US had had rank order voting, Trump would not have been on the ballot in the first election in 2016.”
Professor @JosephEStiglitz unpacks three democratic institutions that Australia does better than the US.#auspol pic.twitter.com/5zY6zJ3HbS
— Australia Institute (@TheAusInstitute) July 30, 2024
“If we had that, Trump would never have been on the ballot.”
2. Government support for industry works
Radio National host Patricia Karvelas asked Professor Stiglitz about the global trends in industrial policy and the $23 billion Future Made in Australia policy.
He said it’s not about protectionism for protectionism’s sake, but that “technology has to be promoted”.
“Why is it that the US has a leadership…in high tech and in pharmaceuticals? It’s all because of government support.
“If [Australia] don’t engage in these new industrial policies, they’re going to be left behind.”
– Professor @JosephEStiglitz speaking to @PatsKarvelas #auspol pic.twitter.com/pGbl0aYy5U
— Australia Institute (@TheAusInstitute) July 30, 2024
“Why is it that the US has leadership in so many areas—in high tech and in pharmaceuticals? It’s all because of government support.”
“If Australia doesn’t engage in these new industrial policies, it’s going to be left behind.”
3. We’ll never see those AUKUS subs
Former Prime Minister Malcolm Turnbull joined Dr Emma Shortis and Professor Stiglitz on stage in Sydney to discuss the political chaos of recent years in the United States.
He said, in no uncertain terms, that domestic shortages mean the United States Government will not part with its Virginia class nuclear submarines, which form part of the AUKUS deal.
“As Paul Keating once said, in the great race of life always back self-interest because you know it’s trying.”
“I do not believe we will ever get any nuclear submarines from the Americans.
“The American legislation says before any submarine can be sold to Aus, the US President has to certify that their Navy doesn’t need it.”
– Hon. Malcolm Turnbull on AUKUS #auspol @TurnbullMalcolm pic.twitter.com/2fU9Ws12Ob
— Australia Institute (@TheAusInstitute) July 30, 2024
Limited tickets still available
Thank you to everybody who’s turned out for the tour so far. If you’re in Melbourne, Canberra and Perth there are still a few spots available—get your tickets now before they run out.
— Ebony Bennett, Deputy Director of the Australia Institute
The Big Stories
Fossil fuel subsidies undermining Australia’s Pacific diplomacy
Last week Polly Hemming, the Australia Institute’s Climate & Energy Director, travelled to the Republic of Marshall Islands (RMI) for the 15th Triennial Conference of Pacific Women and 8th Meeting of Pacific Ministers for Women.
Bringing together government, civil society and development partners, the conference assesses issues affecting gender equality in the Pacific region, including climate change, the nuclear legacy and development assistance. The conference and two days of ministerial dialogue precede the Pacific Islands Forum in Tonga in August.
The Australian Government’s International Gender Equality Strategy recognises gender equality as central to Australia’s foreign policy, claiming to have spent $660 million in 2022-23 on gender equality initiatives in the Pacific region.
This is a big claim, but analysis of the federal budget papers actually points to very little that is specifically for women and girls in Australia’s international spending. In fact, Australia’s international spending is notoriously opaque and difficult to analyse. In 2024, Australia ranked 48 out of 50 for development assistance transparency 2024 Aid Transparency Index.
An honour to meet President Dr Hilda Heine today: first female president of the Marshall Islands, first Marshallese to be awarded a doctorate degree, leader, teacher, humanitarian, climate activist, personal hero, deadset legend. #auspol #climate pic.twitter.com/SNbE6lEace
— Polly Hemming (@pollyjhemming) July 23, 2024
Conference delegates were alarmed to hear that the amounts being talked about by the Australian Government are trivial in the context of the $14 billion Australian governments give in fossil fuel subsidies and tax breaks every year.
Not only is Australia not contributing adequately to its “Pacific family”, it is effectively subsiding the climate change that is adding to and exacerbating existing development issues.
Would you like a recession with that?
With Australia’s annual inflation sitting above the Reserve Bank’s target band of 2-3%, there have been calls for further interest rate hikes.
But New Zealand’s rapid rate increases expose the dangers of higher rates.
Senior Economist Matt Grudnoff shows that Reserve Bank of New Zealand increased rates faster than its Australian counterpart, but New Zealanders got “all of the pain and none of the gain”.
Over the last 18 months, inflation across the ditch has been coming down at a similar rate to Australia’s and the country fell into recession—twice.
Three glaring holes in the Energy Minister’s Press Club speech
Minister for Climate Change and Energy, Chris Bowen, spoke for an hour at the National Press Club recently in a speech titled “Australia’s Energy Choice in the Critical Decade”.
Despite the title, and questions from Australia’s top journalists, most of Australia’s energy choices didn’t even rate a mention.
Take a look at what went unsaid at the Press Club, from fossil fuel exports to subsidies.
Australia’s ute loophole
Even though the transport sector is the third largest source of Australian emissions, the Australian Government continues to incentivise the sale of big utility vehicles.
Over the last 20 years, the number of utes on our roads has grown much faster than the number of passenger vehicles—partly due to their exemption from the Luxury Car Tax.
Large vehicles impose considerable costs on society, from their higher carbon emissions and rates of road damage to serious safety concerns. So why did the government give up $250 million last year to subsidise them?
Why is it legal to lie?
Electoral recommendations from a Victorian parliamentary committee should spur action on truth in political advertising laws, said Bill Browne, Australia Institute Democracy & Accountability Director.
“In Victoria, it is perfectly legal to lie in a political ad, and it shouldn’t be,” he said.
“With bipartisan support in principle for truth in political advertising laws, it is time to get these laws in place for the next election.”
The Victorian recommendation came just a week after an AI-generated video of Labor Premier Steven Miles, created by the state opposition, was posted to social media.
“While this deepfake was marked as AI-generated, it shows how easy it has become to create fake content—and there is no guarantee that other fake content in the Queensland election will be clearly identified.”
Podcasts
A femininomenon? Kamala and reproductive rights in a transformed campaign | After America
After a wild couple of weeks in the American election, historian Dr Prudence Flowers joins Dr Emma Shortis to discuss the politics of reproductive rights, Project 2025 and the wave of support for Kamala Harris since Joe Biden’s withdrawal from the race.
Listen now:
How superannuation tax concessions help the rich get richer | Follow the Money
Superannuation tax concessions are meant to encourage saving for retirement, but the system is being gamed to help the wealthiest avoid paying tax.
On this episode of Follow the Money, Chief Economist Greg Jericho busts some super myths and explains what a fairer system would look like.
Listen now:
Another airline is grounded – should the government buy it? | Dollars & Sense
Flights in regional Australia are an essential public service, so the government could consider stepping in to support the stricken regional carrier, Rex, Greg Jericho says.
On this episode of Dollars & Sense, Greg and Elinor discuss Australia’s uncompetitive airline industry, the cost of privatising essential public services, and the latest inflation figures.
Listen now:
The Quote
“I do not believe we will ever get any nuclear submarines from the Americans.”
— Former Prime Minister Malcolm Turnbull, speaking on stage with Professor Joseph E Stiglitz at an Australia Institute event in Sydney.
The Win
Jabiluka uranium lease not renewed
After decades of campaigning by Mirarr Traditional Owners, the mineral lease over the Jabiluka uranium deposits in the Northern Territory will come to an end in August.
Energy Resources Australia held the mineral lease for 42 years, but the NT Government knocked back the 10-year renewal request “based on advice from the Federal Government”, reported the National Indigenous Times.
Prime Minister Anthony Albanese said he’ll be working with Traditional Owners to incorporate the site into the surrounding Kakadu National Park “once and for all”.
The Bin
Government’s new gas exploration permits put climate at risk
The Federal Government’s granting of several new gas and sea dumping (described by the gas industry as carbon capture and storage or CCS) exploration permits in Australia is a disaster for the climate that will increase Australia’s emissions.
Sea dumping projects increase emissions by enabling new fossil fuel projects. Just three Australian coal fired power stations emit more carbon pollution than the entire world’s current CCS capacity.
“Expanding Australia’s gas production in the middle of a climate emergency is not just short-sighted: it treats our Pacific Island neighbours and future generations with contempt,” said Mark Ogge, Principal Advisor at the Australia Institute.
What’s On
Unparliamentary with Paul Bongiorno | 1pm AEST, Tuesday 6 August
Unparliamentary is the Australia Institute’s fortnightly show that gives you the scoop on what’s happening in federal politics.
Unpack the big political and policy issues with Paul Bongiorno, veteran political journalist and columnist for The Saturday Paper and The New Daily.
Gas. The facts. Darwin | 6pm ACST, Tuesday 6 August
Did you know that Territorian drivers pay 30 times more in vehicle registration than the gas industry pays in royalties? Or that Inpex and Santos don’t pay for the gas they export from the Northern Territory?
Cut through the gas industry spin and find out what gas development really means for the NT with Darwin pediatrician Dr Louise Woodward, local tourism operator Rob Woods and Australia Institute Senior Researcher Mark Ogge.
Australia’s Biggest Book Club: Joseph Stiglitz | 10am AEST, Tuesday 13 August
Professor Joseph E. Stiglitz will discuss The Road to Freedom: Economics and the Good Society in this special edition of Australia’s Biggest Book Club.
In his stunning new book, the Nobel Prize-winning economist offers a powerful re-evaluation of democracy, economics and what constitutes a good society—and provides a roadmap of how we might achieve it.
Politics in the Pub: The Future of the Media | 6.30pm AEST, Wednesday 21 August
Can quality journalism survive in Australia? With the social media giants under fresh scrutiny, what role will these platforms play in Australian democracy? How will AI tools like Chat-GPT change the media landscape? And does government need to do more to regulate these technologies?
Join the Hon Ed Husic MP, Minister for Industry and Science, Senator Sarah Hanson-Young, Greens Arts & Communications spokesperson, and Karen Percy, Media, Entertainment & Arts Alliance (MEAA) Federal President (Media), to discuss the future of the media at this Politics in the Pub.
2024 Laurie Carmichael Lecture: Professor Allan Fels AO | 6pm AEST, Thursday 5 September
Join Professor Allan Fels and Sally McManus in Melbourne for the 2024 Laurie Carmichael Lecture on power, profits, and price gouging.
In the lecture, Professor Fels will demonstrate that business pricing has contributed to inflation, keeping prices higher than they should be, and recommend Australia adopts more effective competition policy, including the power to break up big business when it acts anticompetitively.
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