Crunch Time: Using and abusing Keynes to fight the twin crises of our era

Guest Post by Tony Kevin. Tony holds degrees in civil engineering, and in economics and political science. He retired from the Australian Foreign Service in 1998, after a 30-year career during which he served in the Foreign Affairs and Prime Minister’s departments, and was Australia’s ambassador to Poland and Cambodia. He is currently an honorary visiting fellow at the Australian National University’s Research School of Pacific and Asian Studies in Canberra. He has written extensively on Australian foreign, national security, and refugee policies in Australia’s national print media, and is the author of the award-winning books A Certain Maritime Incident: the sinking of SIEV X (Scribe 2004), and Walking the Camino: a modern pilgrimage to Santiago (Scribe 2007).

‘Crunch Time: Using and abusing Keynes to fight the twin crises of our era’, by Tony Kevin (Scribe Publications, Melbourne 2009, RRP $32.95).

I am pleased to introduce my new book on Australian climate change policy, ‘Crunch Time’ (Scribe Publications, Melbourne 2009) to readers of BraveNewClimate. I see BNC as a responsible public affairs website that is making a distinctive contribution to climate change discussion in Australia.

Crunch Time is the latest in a series of books written by Australian non-scientists (e.g., Clive Hamilton, Guy Pearse, David Spratt and Philip Sutton, Gareth Morgan and John McCrystal) who seek to communicate the scientific truth of Australia’s climate emergency to general Australian readers. The purpose of such books is to convince non-specialist readers – that is, those who have not yet surrendered their intelligence to the soothing seductions of denialist dogma – that the science of disruptive global warming is real; and that it is broadly accessible to all readers, even those with little or no scientific background.

This is an ambitiously wide-ranging book. It goes further than its predecessors into the current convoluted and deeply dishonest Australian political discussion of the issue, and into the possibility of real nationally funded fiscal and engineering solutions, which would apply a bold green Keynesian approach to achieve a comprehensive energy infrastructure transformation away from burning coal as Australia’s electricity source.

Running through the book is a documented case setting out the ways in which the Rudd government has failed dismally to live up to its own early rhetoric on the urgency of confronting the climate change challenge, thus betraying the high hopes that were placed in it by environmentalists. The book begins with a forensic account of how the government, under pressure from the coal lobby, abandoned its commitment to respecting the science set out in the Garnaut Review.

With great political skill, Rudd presented himself as the final arbiter above the ‘scientific argy-bargy’. He claimed the final responsibility as Prime Minister to strike a responsible balance between the climate science and the needs of the economy. In so doing, he betrayed the climate security of the coming generations of Australians.

His pathetically weak 5% minimum emissions reduction target both discredited Garnaut’s work, and undermined public understanding of the reality of the threat to Australia of disruptive climate change. Rudd was determined not to disturb Australia’s energy status quo. The 5% target would easily be met by dubious overseas carbon trading: the existing coal industry and its work force would be carefully protected by lavish subsidies and exemptions. Rudd gave Australia the appearance of climate change mitigation policy, but not the reality.

Rudd’s Machiavellian politics here played right into the hands of climate change deniers. By his own political arbitrage of the climate science, he gave deniers’ claims alleging the uncertainty of the science an undeserved degree of publicity and credibility: an advantage the deniers were quick to exploit, e.g. in pressing for ‘balanced’ access by their leaders to the ABC and to national major print media, and in the well-managed Fielding ‘fact-finding’ US tour and what followed from it.

Amazingly, even now, there has never been a clear, robust, Rudd government denunciation of denialism, because it suits the government politically that a strong denialist movement continues to flourish in Australia, in order that the government may position itself at the claimed ‘centre’ of the ‘national debate’. Indeed, there may be as many covert deniers in government parliamentary and trade union official ranks as in the coalition opposition.

Rudd made great political gains throughout 2008-09 by wedging both the coalition opposition parties on his right, and the environmental movement on his left, into political ineffectiveness. The coalition – already deeply infected with denialism from the Howard years – has irrevocably split apart on the issue. But also, the environmental movement was similarly wedged between its more ideologically rigorous elements – the Greens Party, Greenpeace, Climate Action, YCC etc, who were manouevred into an ineffective marginal political space where they could be shrugged off as ‘alarmists’ or ‘extremists’ – and the more mainstream environmental organisations like the Climate Institute, Australian Conservation Foundation and WWF Australia, which still hoped to be able to work usefully with the Rudd government from inside the tent, despite its betrayal of their best hopes.

With spin and false promises, the Rudd government in its two years in power has debased the coinage of the public debate on real climate change solutions, demoralising the environmental movement and manoeuvring it into political weakness. Responsibility for the steady decline in public concern about the truth of Australia’s climate crisis as measured by opinion polling, and the dangerous spread among otherwise intelligent people of denialist myths and factoids, can be laid directly at the door of the Rudd Government’s cynical policies, which put its present-day political advantage ahead of its ethical responsibility for the climate security of the next two generations of Australians – our own children and grandchildren.

Rudd’s false reassurance to Australians is – ‘don’t you worry about climate change, we have got it safely under control’. This is a deeply corrupted policy outcome that has no parallel in any other developed country, except perhaps in Canada and Russia where a similar cynical view prevails that short-term national economic interest as defined by government should prevail over global climate security.

Crunch Time sets out in documented detail how Obama is trying seriously to combat global climate change nationally and internationally, in ways that Rudd is not doing so. Yet ordinary Australians have been given the impression that our government is seriously tackling climate change and that it can even offer the US some helpful policy lessons!

Perhaps because my book carries this uncompromising critical evaluation of current Australian government climate policy, it has not yet caught the attention of the mainstream media: perhaps Crunch Time is seen as a subversive book, which it is safest to ignore. I hope however that in a Australia’s free society, knowledge of this book will spread, if necessary by word of mouth, and that it will eventually be widely read and discussed by many thoughtful Australians.

In the 1920s and 1930s, the radical British economist J M Keynes was similarly subversive of established economic thinking, which condemned millions of people to needless years of unemployment. In the end, his bold ideas prevailed over conservative vested interests. We need such intellectual boldness now.

My book advocates that the currently divided and demoralised environmental movement should unite around one single priority policy goal – ending coal burning for power in Australia by 2030. It advocates serious professional study of the possibilities for adapting the present two coal-based national power grids to two new geographically dispersed and technically diversified grids across eastern and western Australia, using a balanced mix of all available renewable energy generation and energy storage technologies now technically available, but not yet integrated at full scale in any country. I argue that the inherent variability of wind and solar energy can be fully compensated by a mix of geothermal energy which is potentially 24/7, and existing energy storage technologies like reverse hydroelectric pump/flow systems (the Snowy Mountains scheme could be easily converted to serve such a purpose), and heat exchange cycle energy storage technologies e.g. using ammonia or liquid salt solutions, and by using smart grids and off-peak pricing. In such ways, supply and demand could be balanced without burning coal and emitting GHG. Gas power generation could be a useful transitional technology.

Serious national study, funded by government, of such technical possibilities should be a top priority: instead, the matter is being left to public interest websites to try to assemble necessary public information. This is no way to run a national energy policy! At government level, ignorance and intellectual laziness reign supreme. Techno-myths like ‘clean coal’ and CCS discourage serious consideration of how to wean Australia off burning coal for power.

Personally, I do not support nuclear energy in Australia. I believe we could manage a transition to mixed renewable energy more quickly and safely. But Crunch Time records Hansen’s advocacy of nuclear energy. I believe this a matter for calmly argued democratic public choice on a basis of full public information on all the options – which we are not getting now. The most important thing is to stop mining and burning steaming coal as soon as possible – which means, really soon!

I’d like to see an early referendum on this. Instead, the Rudd government pretends to be pursuing all energy options except nuclear – ‘not picking winners’. This is a deeply dishonest and irresponsible policy, because everything the Rudd government is doing in practice is favouring the expansion of coal and impeding energy alternatives to coal.

Crunch Time gives the general reader a broad scientific understanding of how manmade GGE are heating the global climate, and thus threatening our children’s climate security; and how Australia’s range of hot dry climates means we are on the front line of climate disruption. The book explains the reasons for the wide ranges of uncertainty in climate prediction, and for delayed positive feedbacks from GHG emissions over periods of up to several years. It sets out a prudent bottom-up risk-management approach to such ranges of uncertainty. It shows how paleo-climatology is a reliable predictor of the long term CO2- global average temperature correlation. It sets out how Homo sapiens cannot long escape the GAT, sea level rise, and climate-zone shift consequences of CO2 atmospheric concentrations climbing above 350 (based on the seminal Hansen 2008 paper). The climate science described in the book was checked by three leading Australian climate scientists: it is appropriate to the general audience for whom Crunch Time was written.

Market rationalist economics comes in for criticism, for the way it discounts our children’s future (drawing on the debate in UK generated by Stern) , and for its total faith in market trading or tax mechanisms to generate change to non-GGE energy. I argue that market mechanisms even with high targets are too slow to act by themselves. In what is a national climate emergency, Keynesian solutions must be driven by direct state-led allocation of resources to replacing coal-based energy.

Crunch Time suggests how this energy transition could be funded, by the sale to investors of Australian Government Renewable Energy Savings Bonds. Instead of spending economic stimulus money on peripheral things like pink batts and un-needed school halls, or big bucks on coal railways and ports infrastructure, or on broadband, the Rudd government had ideal opportunity in the recent recession (which may recur) to direct deficit funding to building renewable energy grids – or nuclear grids, if that is the public choice. (Hence the book title) .

The book’s final chapter explores a frightening but plausible climate change scenario for southern Australia in 2060. All the data are coming in now at the top of or above IPCC2007 projections. Global climate change effects eg polar ice melting, ocean warming and acidification, are happening earlier than foreseen. My 2060 projections are already within a 20%-30% range of possibility. We need soberly to visualise such concrete scenarios, if we are to find the political will to do what needs to be done as a society now if we are to avoid them. Scientists are mostly reluctant to spell out such scenarios – they say all such scenarios are ‘unimaginably bad’. But Crunch Time ‘imagines the real’, showing how fragile and harsh human life would be on a greenhouse earth.

However, Crunch Time is not a pessimistic tome: it offers strategies for solutions, in arguing (page 223 onwards) that:

The keys to a successful green-Keynesian strategy will be boldness, policy focus, and community inclusiveness. It will take boldness not to be intimidated by the apparently impregnable forces of conservative opposition: in a democratic society, they can be overcome by the power of public opinion. It will take policy focus to concentrate effort on the priority target of replacing Australia’s coal-fired electricity generation by renewable energy generation by 2020, by using the present recession as the opportunity to direct major public investment towards wind, solar, and geothermal electricity-generating plant and associated transmission infrastructure. And it will take community inclusiveness if the renewable-energy movement is to expand beyond the traditional alternative cultures where it has derived most of its strength so far, and instead position itself firmly in the centre ground of Australian politics, where neither major party will be able to marginalise it.

Please read Crunch Time: it could become an influential source of ideas for our times, as Keynes’s General Theory of Employment, Interest and Money was an important book in those times. The book is indexed and copiously referenced.

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There are upcoming book discussion events in Perth on 10 November with Carmen Lawrence, at UWA IAS; and in Brisbane at the Avid Reader Bookshop on 18 November, with Paul Barclay, ABC presenter of ‘Australia Talks’ and Radio Fora.