Janet Collins
Billy MHas Global Warming Finally Brought Our Leading Economists to their Senses?
July 6th 2008 07:36
The draft of the Garnaut Report on Climate Change was released this week almost like an explosion. The harsh warnings to government and industry to act immediately or face long term environmental consequences are not new. The UK’s Stern Review and Al Gore’s “An Inconvenient Truth” warned of the dangers of complacency long before Garnaut delivered his (draft) findings. The final report is due out in September but this is a pretty good taste of what is to come.
It is true that our previous government tiptoed so lightly over the warnings about global warming that even signing the Kyoto Protocol was off limits. In contrast Prime Minister Rudd made this an election commitment and followed it through as a priority of his new government. To follow the advice of Professor Garnaut relating to emissions trading though will be much more tricky. Will global warming be the catalyst for a new major economic reform in Australia?
Professor Garnaut is certainly no lightweight when it comes to economics. His CV lists a swathe of roles as Board Director and Chairman of large private enterprises and public institutions. To name just a few of the positions he holds currently are that of Chairman of Lihir Gold Limited and Director of Ok Tedi Mining Limited (Papua New Guinea). He can hardly be accused of baulking from biting the hand that feeds him.
What is also listed in Professor Garnaut’s CV is a position of Senior Economic Adviser to Prime Minister RJL Hawke from 1983-85. These were the years that led into some of the biggest economic reforms in Australia since Federation including the dismantling of the Australian System as we had known it in favour of the global trend toward economic rationalism and the market economy. It was a move away from protectionist policies to that of a free market.
Criticisms of the market economy and its failure to deliver all that it promised have escalated over recent years. An attempt to abolish one of the last protective mechanisms for workers came in the guise of the Work Choices legislation, introduced by the Howard Government and rushed through Parliament last year. It was to be the Government’s total undoing.
What Professor Garnaut is challenging the Government to do this time is not to follow world trends and popular politics but to lead the world in these reforms for the sake of the world environment. The (draft) report may be criticised for climbing on to the bandwagon of trends in environmental policies but it certainly didn’t gloss over the costs to all of us in petrol, electricity and the flow on cost hikes from industry.
Ironically economic rationalism and the market economy assumed that business would do the right thing by workers and the community without government intervention. Now that the future of the whole planet is at stake, Garnaut’s challenge to governments is to once again take control. Obviously, Garnaut no longer trusts corporations to do the right thing.
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