Archive for the ‘economics’ Category
Chapter 5 of the report focuses on the challenges to NEM system reliability caused by increasing VRE penetration, and on possible reforms to the system to accommodate these changes. Price signals, bidding, and market cap prices and floors, as well as many other terms dealt with in this chapter, are definitely outside my sphere of knowledge or interest, but I feel duty bound to try and make sense of them. For a useful beginner’s guide to the NEM, check out this ABC site, though it dates from 2010, and it’s fascinating to note how things have changed since then. The AEMO was only established in 2009.
The NEM is an ‘energy-only’ market, rather than a capacity market. An energy-only market is one in which the companies generating energy are paid for the electricity they sell. In a capacity market they would be paid for keeping generation capacity available to cover what might be a fluctuating demand. With an energy-only market, producers would presumably be focused on demand, not wishing to provide more of something they can’t sell when demand is down, as it has been in recent times. However, base load demand, which is intermittent and unpredictable, becomes a particular problem when investment in the kind of generators that provide base load power is low. The report has this to say on the matter:
The NEM relies on price signals (subject to market price caps and floors), performance standards and market information to incentivise the development and retirement of generation infrastructure. When there is sufficient baseload supply, average prices tend to be low, signalling that no new investment in base load generation is needed. When base load supply tightens, average prices increase, signalling that investment in base load generation is needed. Peaking generators respond to similar patterns but look to higher price periods associated with peak demand.
I don’t really understand this, especially the bit about peaking generators, which sounds as if there are separate generators for peak demand, but that can’t be right. In any case, what this chapter tells me is that the economics of electricity generation in a transforming and uncertain market are fiendishly difficult to comprehend and control. The review ends the chapter, and all other chapters, with consultation questions which help concentrate the mind on the issues at stake. These include questions about the NEM’s reliability settings, liquidity in the market for forward contracts to ensure supply for business and commercial enterprises (and the effect of increasing levels of VRE on forward contracts, and how this can be catered for), and other questions about creating or ensuring future investment.
Chapter 6 deals with the problem of the seemingly ever-increasing cost of electricity to the consumer. The chapter divides itself into sections on wholesale costs and retail pricing. It seems Australia no longer experiences low electricity costs by OECD standards. Network investments have recently driven prices up, and further rises are expected due to generator closures, the international price of gas, and constraints on gas supply. Again the report emphasises the role of gas, at least in the interim:
Gas has the potential to smooth the transition to a lower emissions electricity sector. Gas generation provides the synchronous operation that is key to maintaining technical operability with increased renewable generation until new technologies are available and cost-effective. Furthermore, gas is dispatchable when required.
It seems there’s an intergovernmental understanding that reform is desperately needed to develop and incentivise the local gas market. There are many roadblocks to successful reform, which are currently affecting wholesale costs which will lead to higher retail prices.
Some 43% of current residential electricity prices are made up of network charges, mostly for distribution. Many network renovations were necessary to meet revised standards. A 2013 Productivity Commission inquiry criticised ‘inefficiencies in the industry and flaws in the regulatory environment’ in respect of the planning of large transmission investments and management of demand. Consumer concern about rising prices is driving reform in this area, but we’re yet to see any clear results. Also, there is a difficult balance to be struck between system reliability and cost. A significant proportion of consumers have expressed a willingness to live with reduced reliability for reduced cost.
There has been a difficulty also in forecasting demand, and therefore the spread of cost. Reduced peak demand in the period 2008 to 2013 wasn’t foreseen. The reduction, likely driven increasing electricity costs, was a result of many factors, such as solar installations, energy efficiencies and reduced consumption. There’s a plan to introduce ‘cost reflective pricing’, which means ‘charging prices that accurately reflect the cost of providing network services to different consumer groups’. This is expected to reduce peak demand overall, as will increasing use of solar and, in the future, battery storage.
Retail pricing is another matter, and according to the report there is a lack of transparency in the retail market. Retailing electricity is obviously complex and involves covering wholesale costs as well as billing, connections, customer service, managing bad debts, marketing, return on investment, inter alia. We can only determine whether the retail market is operating fairly when these costs are open to scrutiny.
Chapter 7 deals with energy market governance from a national, whole-of-system perspective. The report stresses urgency on this, though given the complexity of the system and the divided views of policy-makers, it’s unlikely that decisions on integrating the system and making it more flexible will be forthcoming in the immediate future. The governance of the NEM is divided between policy-maker (the COAG Energy Council), rule-maker (AEMC), operator (AEMO) and regulator (AER, the Australian Energy Regulator). None of these bodies, the report notes, are integrated with bodies advising on emissions reduction. Again, the report doesn’t advance a plan for an improved governance system, but posts consultation questions for how improvements might be made. These include amendments to various rules and guidelines, methods for improving accountability and transparency, and expedited decision-making in a rapidly transforming market.
The report includes a number of appendices, the first and most important being a comparison of the NEM with other energy systems and markets worldwide, including those with a large market share of VRE, such as Denmark and Ireland. It is noted that the transformation of these markets, as well as larger markets in Spain and Germany, is being managed apparently without compromising energy security. However, the variety and complexity of many overseas markets and systems makes comparisons well-nigh impossible for someone as uninitiated as myself. Suffice to say that the role of interconnectors for system security is very important in many European regions, and support from governments for a more flexible system to accommodate VRE is more widespread.
Jacinta: So the problem is, or was, that the whole state of South Australia was left without power for a long period of time – more than 24 hours in some places, it varied between regions. This affected some 1.7 million people, endangering lives in some instances.
Canto: And how did it come to be a problem? First because of storm conditions, particularly north of Adelaide, described as unprecedented. This might be seen as the proximate cause, with many describing the ultimate cause as anthropogenic global warming, which will see conditions such as these arising more often.
Jacinta: Well another cause, whether proximate or ultimate, might be degraded transmission infrastructure – the big towers. The transmission network, which is operated and managed by ElectraNet, is the long-distance network, carrying power to the distribution network – the poles and wires – which connects homes and businesses. The distribution network is owned and managed by SA Power Networks, which is 51% owned by Cheung Kong Infrastructure/Power Assets (CKI), a Hong Kong Chinese company. But it’s ElecraNet that we need to focus on. It’s apparently owned by a consortium of companies, but the largest share is 46.5%, owned by China’s State Grid Corporation (SGCC), the largest electric utility company in the world. I’ve heard rumours that there were complaints by technicians regarding rusty and poorly-maintained towers, complaints dating back over five years, but I’ve found nothing as yet to confirm those rumours.
Canto: So overseas ownership may feature in answering the question of how this came to be a problem. Another factor might be the interconnectors.
Jacinta: Yes, to be clear, there are two interconnectors between SA and Victoria, with some speculation about a third being built connecting us to NSW, and allowing us to export our renewables-based energy to that state from time to time…
Canto: Can you describe what an interconnector actually is, and how it works? I’ve heard that they actually work as surge protectors, among other things, shutting down the system when it’s overloaded or in crisis.
Jacinta: It connects transmission systems between different states, or different countries, allowing states to import or export power according to differential capabilities at different times, which helps stabilise or standardise the power available to interconnected states or regions. I should point out that SA imports far more power than it exports, so we are reliant on the national electricity grid, as we always have been I think, for regular, stable supply. Apparently, in terms of area, this is the largest electricity grid in the world. In 2013-2014 SA’s import to export ratio was 6 to 1. If you look at the chart on the SA government website, you’ll notice that SA generates less power within its borders than any other state, including Tasmania, which gets most of its power from hydro. But this varies – not long ago, when Tasmanian dams were low, that state was the least productive. The two interconnectors to Victoria are the Heywood interconnector, with a 460MW capacity, and the smaller Murray Link, which was not operational at the time of the storm. An ABC article quotes the SA Premier as saying the interconnector ‘played no role in the blackout’, but the same article quotes Paul Roberts of SA Power Networks: “We believe — and this is only early information — that there may have been some issue with the interconnector but the state’s power system is shut down I think possibly as a protection”. This statement is vague – it tends to contradict the Premier, but it doesn’t say that the interconnector had a direct role in the statewide shut-down.
Canto: Sounds like people are being cagey and defensive right from the start.
Jacinta: Well, of course – avoiding blame here is a big thing, in terms of money as well as reputation. It’s probably being overly naive to assume that nobody really knows whether the shut-down was caused by the interconnector, or whether that shut-down, if caused by the interconnector, was absolutely necessary. But it looks like nobody’s going to admit knowledge.
Canto: So the problem may or may not have been related to the interconnector, but it was definitely caused by a major storm north of Adelaide, which may or may not have been due to anthropogenic global warming, and it caused damage to infrastructure which may or may not have been avoided if that infrastructure was being upgraded effectively by ElectraNet. Sounds like we’re getting nowhere fast.
Jacinta: What about this idea that the state’s relying too much on renewables. What evidence is there about that?
Canto: Well, unsurprisingly, the state’s opposition leaders and their fellow-travellers are lining up to score points out of this event. SA’s conservative party leader Steven Marshall says there should be an investigation into the state’s ‘lack of base-load power generation’, the Prime Minister, Malcolm Turnbull, who now heads a conservative government in spite of having been a long-time advocate of renewables, has ‘rebuked’ state labor governments for having ‘ideological’ renewable energy targets, and the populist MP Nick Xenophon has expressed a rather vague but passionate outrage.
Jacinta: Okay so let’s look first at SA’s lack of base-load power generation. Hasn’t this been a perennial problem for SA? As I’ve already said, we’ve been importing a lot of power from interstate, on a variable basis, really since the year dot. Or since we’ve been able to do so, via the interconnectors.
Canto: Well there’s something of a new mantra among the renewable advocates that the base-load concept is out-dated, but I’d rather not get into that now, I’m really a novice about electricity markets and grids and such. The fact is that SA is running neck-and-neck with Tasmania as the state that produces the least electricity in the nation, though of course SA is a much bigger state. It’s just that now we’re generating more from wind, so we’ve shut off our coal generators. So the argument will be that renewables had nothing to do with the outage, which damaged transmission lines and initiated a shut-down of our only operating interconnector. This would’ve happened regardless of the power source, though there may be questions about the interconnector, and about the maintenance of the transmission lines.
Jacinta: Okay, that’ll do, though I’d like us to discuss the whole topic of renewable energy, in SA and elsewhere, on an ongoing basis in the future. It’s a hot topic, with a lot of people implacably opposed to it, particularly readers of the rather reactionary Australian newspaper, apparently. All very amusing. And perhaps we can educate ourselves a bit more about the National Electricity Market (NEM), the Australian Energy Market Operator (AEMO) and the future of grids and off-grid electricity supply.
For more interesting articles on this issue:
Canto: So we’re tasked with solving the problem or problems in SA’s energy system.
Jacinta: We are? What problem? Or should I say crisis, what crisis?
Canto: That’s a good question Jass, because as you know the first step in finding a solution is to define the problem.
Jacinta: Yes I knew that. So we’re talking about how all the power died for a period of – what, 24 hours or so, statewide here in South Africa.
Canto: South Australia, don’t confuse our international readers. So I’ve heard the crisis framed in a number of different ways. First, in terms of the SA government’s irresponsible, unrealistic go-it-alone pursuit of risky renewable energy. Second, in the more or less opposite terms of other states’ and especially the federal govt’s foot-dragging and negative approach to said energy, leaving SA unsupported. Third, in terms of privatisation – a number of electrical pylons fell down like ninepins in the outback, because, it’s claimed, the private owners are pursuing profits over infrastructure maintenance. And a fourth and most comprehensive framing invokes climate change itself – SA was subjected to an unprecedented weather event likely caused by the emissions our gallant state government is trying to reduce..
Jacinta: And our little Torrens River has been torrenting like the mighty Amazon.
Canto: Yeah right. So with all these and more framings of the problem, it looks like we’ll have to spend a few posts on this issue.
Jacinta: Or a lifetime. But yes let’s try to be thorough. And positive. I thought we might start with the 9-point plan for solutions to complex problems which we found in the enlightening book The origin of feces by Stuart Waltner-Toews, and which was presented in simplified form on the Solutions OK blog.
1. What is the problem situation or issue? How did it come to be a problem?
2. Who are the stakeholders? What do they care about? Where are they coming from (motives, investments)? What are the agreements, discords among them?
3. What are the stories being told by these different stakeholders re their roles and concerns in the problem?
4. What’s our best systematic, scientific understanding of the situation/problem?
5. What’s our best understanding of the social & cultural issues to be addressed?
6. How are 4 & 5 related? How do they constrain or support each other?
7. What are the scenarios and narratives here that people most connect with? On what things can we agree on? What are the power relations between people who agree or disagree? Given these constraints and acknowledgements what do we realistically expect that we can do?
8. What course of action, governance structure and monitoring system will best enable us to implement our plans and move towards our goals?
9. Implement. Monitor. Adjust. Learn. Re-Start.
Canto: Yeah, that’s pretty comprehensive all right, maybe too comprehensive.
Jacinta: No I think it’s a good basis. Take point 1. What’s the problem? That’s easy. The problem is that SA had all its power cut for the best part of a day, and although many are saying this was a one-off, freak event, many others are saying it could happen again and that SA’s the most vulnerable state, it wouldn’t have happened to any other state.
Canto: Though I think our Premier said the exact opposite, it could’ve happened anywhere. Lots of conflicting narratives and opinions. So let’s get started.
Jacinta: Well let me first say that, whatever the cause, we are experiencing extreme weather here for October – rainy and stormy conditions which have certainly never been experienced here in a good long lifetime. And right now we’re got rain and strong wind conditions. There’s been little let-up for some time.
Canto: Interesting – we’re only a few days into October, but the average rainfall for September in Adelaide, since records have been kept, is about 58 millimetres. This year it was over 130 millimetres. October, though, might be the most interesting month for records. Certainly I can’t recall anything like this, and we have flooding in many parts of the state.
Jacinta: So we have extreme weather conditions, and the direct cause of the outage, according to our Premier, was freak weather conditions north of Adelaide, including two tornados which knocked over transmission towers near Melrose. More than 20 transmission lines were damaged. The question being asked, of course, is how could these storms knock out the power for a whole vast state for a long period? What were the back-up arrangements?
Canto: Well the back-up apparently relies on two interconnectors to the east coast. Presumably there must be some arrangement so that when local power isn’t forthcoming, the interconnectors receive a signal to transmit. However, only one was operational at the time of the outage. Now I don’t really understand this interconnector thing and how they work. I’m not clear on why one interconnector was shut down and why the other one didn’t just do the job. Is it just a matter of ‘firing up’ an interconnector and a whole state’s lights come back on? How simple or complex is it?
Jacinta: And what, if anything, has this got to do with renewable energy and the shutting down of the coal power station in Port Augusta?
Canto: We might get to that later. I haven’t been able to find exactly how interconnectors work, and nothing much at all on interconnectors in Australia, but currently in the UK there are four interconnectors, linked to France, the Netherlands, Northern Ireland and the Republic of Ireland, of which the France one is largest, with 2GW capacity. It would be interesting to know the capacity of the two interconnectors linking us to the east, and whether that has any relevance. Anyway, these interconnectors are spruiked as providers of energy security and flexibility, so the more interconnectors the better. Maybe there’s a case for having a third interconnector, so that we’re never, or rarely reduced to having just one to rely on.
Jacinta: So why did we have no power? Why didn’t the interconnector provide it for so long? Or was it the interconnector that provided it, or was it the local system?
Canto: Well there was certainly local work going on from the start, as soon as conditions allowed, to fix local faults, but I can’t find too much info on the role of the interconnector. However, word has just come out that there’ll be a state inquiry into South Australia’s unique situation, so maybe there’s no point in us continuing this conversation.
Jacinta: Wait up, I think it might be fun speculating on and researching the matter, and then comparing our findings with the inquiry.
Canto: Which’ll come out in, what, five years?
Jacinta: An unnecessarily jaded remark. So let’s get stuck into some research, and look for solutions, always keeping in mind that 9-point plan.
Canto: So Michelle Obama thinks America is the greatest country on Earth…
Jacinta: Not just thinks, but tearfully feels, in every cell of her body, but you know, even she must realise it’s all rhetorical baloney.
Canto: I prefer to call it balderdash – less American.
Jacinta: But you can’t blame pollies for getting all jingoistic come election time, can you?
Canto: I do. I can’t stand it at any time. But I want us to reflect for a while on the meaning of ‘the greatest country on Earth’. Is greatness measurable? Is there currently a fifteenth greatest country on Earth? What are the measuring criteria?
Jacinta: I think you’re taking it all too seriously, but it’s interesting – we’ve observed this before – that every nation in history that has had economic and military superiority over others has assumed this entailed moral superiority. Whereas in the world of realpolitik it just means they’re an apex predator.
Canto: I’m sure Donald Frump would agree, though I think he’s wrong to claim that the USA is no longer an apex predator. There can be room for more than one at the top, though it wouldn’t do to let that space get too crowded.
Jacinta: Yes, so ‘greatest’ can only mean ‘most powerful’, it’s not the kind of term you use to measure a nation’s quality for its own citizens.
Canto: But why are Americans so keen to trumpet their nation’s superiority? I mean methinks they do protest too much.
Jacinta: Well a couple of centuries ago, when the Brits had the strongest economy, weren’t they the same?
Canto: Well, not really… I mean, that wouldn’t be British, would it? I mean they thought they were morally superior of course, but they weren’t so utterly boorish as to proclaim it while banging their tits.
Jacinta: Well you’re making a good point. When imperialist nations or superpowers or whatever start believing they’re better than others in some moral way, they may act accordingly, pushing their weight around, hectoring, lecturing, even taking it upon themselves to punish other nations for not being like them.
Canto: Or invading other nations to show them how ‘being great’ is done. So that’s why we need correctives. We need more objective measures, not for measuring national greatness, which is just a term of power, or just rhetoric, but for measuring success in terms of the well-being, happiness, freedom or whatever of the members of that nation.
Jacinta: I think that people like Obama, and so many Americans, really believe in this rhetoric though. They take a term like ‘great’, and they really think it refers to all those other things – opportunity, well-being, smarts, etc.
Canto: Which is why reality checks are in order. Take the ‘land of opportunity’ rhetoric. What this refers to is social mobility. Anyone has the chance to be anything. But there are surely ways to measure social mobility, which are more or less objective.
Jacinta: Certainly more objective than just making the claim. And it’s interesting, we’ve looked at a few national surveys, based on various criteria, and I can’t recall the USA ever coming in the top ten in any of them. Usually it’s well down the list.
Canto: So it’s time to revisit those surveys. First the OECD survey that was posted on in the past, its better life index. The Organisation of Economic Co-operation and Development (OECD)…
Jacinta: Such a positive, feel-good internationalist title.
Canto: Isn’t it? It was founded in 1948, another of those positives to come out of the negativity of warfare. It’s headquartered in Paris, it has 35 member countries and its purpose is pretty well self-explanatory.
Jacinta: Yes, but while its focus is obviously on economics, primarily, the better life index is a kind of side project, which is almost saying ‘money ain’t everything’, there are all these other factors as well as the economic, to consider when striving for a better life, and a better country.
Canto: Yes they consider 11 factors in all: housing, income, jobs, community, education, environment, civic engagement, health, life satisfaction, safety, and work-life balance. People can give different weightings to these factors, and on their website they allow you to change the weightings so that you’ll come up with a different top ten or twenty of the 35 participating countries.
Jacinta: But according to the weightings they favour, the USA comes a fairly creditable ninth behind Norway, Australia, Denmark, Switzerland, Canada, Sweden, New Zealand and Finland, in that order. But since we’re in Australia we can surely permit ourselves some eye-rolling at your standard Yank jingoism.
Canto: Surely but of course many will say that these ‘objective’ assessment criteria are highly suspect, and possibly anti-American.
Jacinta: Naturally, and we haven’t the resources or the time to evaluate them, so instead we’ll look at a number of these surveys with the assumption that they’re not all anti-American, to see how our chauvinistic allies fare. But it’s interesting that the OECD survey doesn’t highly rate any of the non-Scandinavian European counties. A Scandinavian bias perhaps?
Canto: Well here’s another rather different international survey, which looks instead at cities.
Jacinta: Very relevant considering the world’s rapid urbanisation shift.
Canto: The Mercer Quality of Living rankings looks at living conditions in hundreds of cities ‘according to 39 factors, grouped in 10 categories’: Political and social environment, Economic environment, Medical and health considerations, Schools and education, Public services and transportation, Recreation, Consumer goods, Housing, and Natural environment. And again, you may want to believe its findings are biased and you may be right, but its highest ranking American city is Honolulu at number 31.
Jacinta: Honolulu? Hardly the heart of America.
Canto: Compare neighbouring Canada, which has 5 cities in front of Honolulu. Vancouver (4), Ottawa (14), Toronto (16), Montreal (21) and Calgary (28). Australia and New Zealand also rate far better than the USA with Aukland ranked at 4 (tied with Vancouver), Sydney ranked 10, Wellington 12, Melbourne 18, Perth 21 and Canberra 26. Some 16 European cities are in the top 25, with Vienna being ranked the number one city for the past 6 years in a row. There are no Asian, African or South American cities in the top rankings.
Jacinta: Mercer, by the way, is a human resources consulting firm headquartered in New York, and it’s really hard to get full data from it because it restricts full access to ‘professionals’, presumably behind a paywall. Nosy impoverished amateurs like us are unwelcome. So most of the data we’re using is from back in 2010 (and that’s only from press releases, with little detail) but I doubt that the USA has become any ‘greater’ since then. So it’s clear that the USA is no great shakes, city-wise – in fact it would be classed as probably the lowest-ranked western country in the world, according to this survey…
Canto: Conducted by a New York based firm…
Jacinta: Insofar as the liveability of it’s cities are concerned. And that’s where most people live, after all.
Canto: So it’s not looking good for the bad old USA. Any more surveys?
Jacinta: And in case people quibble about the term ‘western’, let’s be a little more precise. The USA, in terms of the quality of its cities for their own residents, lags behind Western Europe, Australia, New Zealand and Canada.
Canto: That way greatness tells lies.
Jacinta: There’s a website called numbeo which claims to provide ‘the world’s largest database of user contributed data about cities and countries worldwide. Numbeo provides current and timely information on world living conditions including cost of living, housing indicators, health care, traffic, crime and pollution.‘ Its ‘quality of life index’, based on countries, looks somewhat similar to that of the OECD, with the USA ranked tenth, well below Australia and New Zealand, ranked third and fourth respectively. However it differs from the OECD in that it ranks a number of non-Scandinavian European countries above the USA, namely Germany, Austria, Switzerland and Spain. And it ranks Canada below the USA, which is unusual. And again the top rankings are dominated by western countries, with Japan being the top Asian country at 16.
Canto: I’ve never heard of numbeo, what are their bonafides and how do they gather data?
Jacinta: It’s a crowd-sourcing site, founded in 2009 by one Mladan Adamovic, a former Google software engineer. It’s evolving, and its findings suggest it’s not particularly an outlier, though at this stage not perhaps as reliable as the OECD.
Canto: Well, with crowd-sourcing, there would be some nation-participants where information would be scarce, or virtually non-existent.
Jacinta: That’s right, but all of these survey organisations and websites face the same problems, and it’s pretty likely that the places from which info is scarce wouldn’t be in the top rankings in any case. If you know your country’s doing well, you’d want to share it.
Canto: Okay, so we’ve looked at three sources. One more?
Jacinta: Yeah well a few more, which I’ll summarise. Monocle magazine, a British lifestyle magazine, has been doing an annual quality of life index based on cities since 2006. Its criteria are ‘safety/crime, international connectivity, climate/sunshine, quality of architecture, public transport, tolerance, environmental issues and access to nature, urban design, business conditions, pro-active policy developments and medical care’, and it ranks Tokyo at number one, whereas Mercer ranked it 44th! It did rank Vienna at number two, however. And it ranked Melbourne at 4 and Sydney at 5, so it must be very objective.
Canto: And the US?
Jacinta: Its highest ranking city was Portland Oregon at 25. So there’s definitely a pattern emerging.
Canto: Where’s Adelaide?
Jacinta: They’ve never heard of it. Another survey based on cities comes from the Economist Intelligence Unit (EIU), from the London-based group that publishes The Economist. They go into a lot of detail about their criteria on their website, so I won’t go into it here. I only had access to their current top 10. It shows Hong Kong at number one, and Sydney at 5. No US cities make the ten, and Vienna isn’t there either. Tokyo comes in at 10. It should be added that they seem to have drastically amended their criteria recently – before that, Vienna regularly came in at number 3, with Melbourne and Vancouver also in the top 5 regularly. Melbourne ranked number 1 in 2011.
Canto: That’s interesting about Hong Kong, because I read elsewhere that life expectancy of its residents is about the highest in the world. So the city must be doing something right.
Jacinta: Well I’m sure the Chinese government will put a stop to that.
Canto: Okay I think we’ve done enough survey of surveys – let’s summarise. We started with Michele Obama, in typical US pollie style, proclaiming the greatness of her country.
Jacinta: I.e. not just great but ‘the greatest on Earth’. So we had a look at a handful of the most well-known global surveys of nations and cities, based essentially on liveability criteria. Though it’s impossible to be entirely objective in these surveys, they collectively present a pattern. In none of them did the USA distinguish itself, and in terms of its cities it really did quite badly, as a western nation. As to why that might be the case, we leave that for the reader’s speculations, for now. The gap between US perceptions and reality, I would contend, is largely caused by the assumption that if you’re globally dominant in economic terms, you’re in a ‘great’ country in any or every other way.
Canto: Roman economic hegemony, in the old days, was largely based on a substantial slave population, wasn’t it?
Jacinta: Well, that and being able to dictate terms of trade with others, as every dominant nation or empire has been able to do. But you’re right, a lot of economic success in the past has involved the exploitation of a populous underclass. The USA is by far the most populous of the traditional western countries, and it effectively has no minimum wage. That’s very handy for the McDonald Frumps of that great nation.
Jacinta: Okay so here’s a topical topic. I was listening with baited breath – I can do that, I’m a multi-tasker – to Malcolm Turnbull’s post-election speech the other day, and along with the whole nation I heard him extoll three ‘roolly good things’, in his estimation. The holy trinity – freedom, the individual and the market. Did y’all hear that? And I thought, Jeez, the libertarians among us will be doing cartwheels right now. And I further thought ‘hang on a minute Malcolm, turn that bull around’.
Canto: I see, so you prefer slavery, group-think and state control?
Jacinta: Ah very good, but let’s prise ourselves out of the straightjacket of ideology and slip into something more comfortable, like reality. Of course freedom’s a good thing, but of course it has its limits. And of course individuals are great, but as any mathematician will tell you, all individuals are members of a set, that’s actually what makes them individuals, and the market..
Canto: That’s not a very good analogy, I don’t think – that one about individuals.
Jacinta: That wasn’t an analogy.
Canto: Well… maybe, but bringing maths into it isn’t very helpful.
Jacinta: Okay. Okay, let me focus on the individual thing, because that’s probably my biggest gripe – it all flows from a misconception of the individual, IMHO.
Canto: What flows?
Jacinta: The horrors of libertarianism. I’ve been bottling this up for years, now I’m going to let it all seethe out. And it just so happens that ‘All hail freedom, the individual and the mighty market’ is essentially the libertarian mantra. Of course I don’t take Malcolm’s mellifluencies too seriously, but libertarianism really shits me.
Canto: But really – politics? Can’t we talk about water on Mars? Or Homo naledi?
Jacinta: Well, there is world enough, and time…
Jacinta: Ok I’ll try to be the soul of wit. Libertarians – and I know they come in all shapes, sizes and political colours – tend to believe in small government, minimal regulation and the invisible, wonderfully shaping and fixing hand of the market. I got my first dose of libertarianism years ago when I read – or tried to read – Anarchy, State and Utopia, by the American philosopher Robert Nozick. I could barely comprehend it, but I could see it was underpinned by a sacrosanct notion of rights, particularly the rights of the individual. It was also, I thought, an overly rational analysis of how individuals might aggregate. Or rather, that’s how I’ve come to think of it since. I had no idea what to think of it at the time.
Canto: So how do you think individuals aggregate?
Jacinta: No no what I think doesn’t matter, it’s more about what history and psychology and sociology tells us. And they tell us about families and extended families and kinship groups and trade affiliations, becoming ever more extended and convoluted as societies grow. And all this without any concept of rights.
Canto: Okay I think I see where you’re coming from. You think the individual shouldn’t be seen as the central human unit, or political unit, you’re wanting to emphasise social connections.
Jacinta: Of course! We didn’t get where we are now, the top predators of the biosphere for better or worse…
Canto: The fat controllers of the planet…
Jacinta: We didn’t get to this situation as individuals, we got here because we’re the most socially-oriented mammals around. Our language, our technology, our superior brainpower, these are all socially constructed. And our systems of government are just ways of organising and trying to get the best out of this dynamic, interactive, co-operative and competitive society.
Canto: So there are legitimately diverse views about the role of government. So what’s wrong with that? Libertarians just happen to lean towards the individualist, unregulated, small-government side.
Jacinta: Well, as I’ve said, I’m not so much interested in opinions as in what actually works to create the most effective society…
Canto: You’re trying to be scientific, but the question of what makes for an effective society will have different answers, not based on science. Some will say an effective society is one that looks after its minorities and its disadvantaged, others will say that diversity and dynamism is key, and this means inevitably that there will be winners and losers. How can there be an objective, scientific definition of an effective society?
Jacinta: Okay, I concede your point that there are a range of legitimate views on this, but I would be guided by what works, and that would reduce the range of legitimacy. Extreme libertarianism – of the ‘there is no society, only individuals’ kind – seems to me to be paradoxically an outcome of the success of certain societies in educating and empowering their members, so that they start to fantasise about themselves as ‘self-made’ and owing nothing to anyone. It’s delusional and would result in scrapping all history has taught us about the communities of language and shared knowledge and values which have shaped us. It’s an ahistorical ideology which has never been instantiated anywhere. Not to mention its arrogant (and ultimately self-defeating) selfishness. Of course the other extreme is also unworkable, that of communism with an equal share of communal goods, which would stifle innovation and diversity and would have to be imposed from above.
Canto: Which would be self-contradictory because in communism, there is no ‘above’, presumably absolute equality is just meant to happen naturally…
Jacinta: There’s no perfect or perfectly fair society, just some are fairer than others, and it’s an endless balancing act, it seems to me, between encouraging the freedom to develop ideas and ‘get ahead’, and protecting others from being exploited and done down. So to me it’s a matter of pragmatism and endless adjustment rather than gung-ho ideology. Individuals are pretty well infinitely complex so you would expect society to multiply that complexity to to a new level of infinity.
Canto: But I notice that many libertarians tend to avoid going on about ‘society’, they prefer to focus their ire on ‘the state’, as if it’s the enemy of society.
Jacinta: Oh yes, good point, the rhetoric goes that the state is this abstract, inhuman monster that steals our money, stifles our initiative and makes a mess of everything it touches. Insofar as it consists of people, it consists of really dumb or power-mad types who haven’t seen the light and just don’t realise that society functions better either without the state or with a minimalist one. They’ve never been able to point to any evidence to support their claims though. Essentially, the libertarian ‘state’ has been trialled in the real world even less than the communist state, its polar opposite, has been.
Canto: So how is it supposed to work?
Jacinta: Well, clearly there are libertarians of many different types and degrees who would argue endlessly about that. But many of them seem to think it would grow ‘organically’ through adherence to certain basic principles, one of which has to do with the primacy of private property, though I’m not sure how to articulate it. Another is that no law or imposition should be applied that interferes with an individual’s liberty, the idea being I think, that you’re free to do what you like as long as it doesn’t interfere with everybody else’s right to do what he or she likes, which when you think about it is a recipe for disaster, because who decides between competing claims – for example my right to enjoy the peace and quiet of my own residence versus my neighbour’s right to play shite music all night with the volume up to eleven?
Canto: Aww, is that neighbour still bothering you Jass?
Jacinta: Fuck off. Actually what really bothers me is the obsession with private property and ownership. Coming from a pretty impoverished background, I was always more fond of the ‘property is theft’ mantra. And that reminds me of a story from my youth. I was living in a share-house very close to the spacious grounds of Saint Peter’s College, the biggest and most exclusive private school in South Australia. It must’ve been school holiday time, and we decided to take our racquets and balls and have a hit around on one of their tennis courts. There was no fence or anything, we just walked in and started playing. There was no net either, so it wasn’t a particularly serious hit-out, but we were absorbed enough not to notice a fellow scurrying across the greensward to tick us off. The look of outrage on the face of this fellow was unforgettable, it was as if he’d caught us pissing on the altar…
Canto: Which is exactly what you were doing mate.
Jacinta: His get-up was unforgettable too, he had this bright orange cravat, and sort of pantaloons with braces as I remember…
Canto: You’ve forgotten the candy-striped jacket and the Old Boys’ cap…
Jacinta: No, it was too hot for that. Anyway, I remember his words, more or less. ‘What are you doing here? Don’t you know this is private property!!’
Canto: Ah yes, a defining moment in the Great Australian Class War. So you made mince-meat out of him with your graphite, carbon-fibre and kevlar weaponry?
Jacinta: Well, we were just teenagers. I remember we stood our ground for a while, more out of shock than anything. So he went on haranguing us about our outrageous behaviour and threatening to call the police, so we wandered off. But I was so infuriated when I realised what was happening. I wish I’d confronted the guy, and I ran though imaginary narratives in my head many times afterwards. It was a defining moment for me, actually, it crystallised for me my attitude to private property…
Canto: Which is?
Jacinta: Well, it’s never been very important to me – I mean, as part of his harangue, this guy said something like ‘how would you like it if someone came into your garden and started..’, and my honest answer would’ve been that it wouldn’t have bothered me, certainly nothing like the way it bothered him. And the comparison was odorous anyway, I didn’t own any spacious grounds, I wasn’t born into that world. The way this guy mentioned private property, as if it was his Lord and Master, to be protected and fought for with life and limb, it just sickened me.
Canto: You were outraged?
Jacinta: Yeah, I suppose our intellectual positions are just post-hoc rationalisations of some basic feelings.
Canto: Reason is but the slave of the passions and all that. Anyway, I’m keen to get on to some of those more interesting topics. So let’s get back to the original question – is Malcolm Turnbull a libertarian?
Jacinta: Well the correct answer is that he didn’t say enough, in that first Prime Ministerial speech, for us to make that inference. He believes strongly in freedom. So do I, of course. He believes in the individual. So do I, and I believe individual expression and effort should be nurtured. He believes in the market or markets. I most certainly do too, as sources of exchange, cross-fertilisation, community and growth. The devil or delight is in the detail. I mean, I’ve called his statement a libertarian mantra, which it is, but it’s also classical liberalism. In the end, though, we need to judge governments on their actions, not their words. We’ll have to wait and see.
OUR NUCLEAR FUTURE?
Our state government has, surprisingly, ordered a Royal Commission into nuclear power, which will bring on the usual controversy, but everything I’ve read on the science and energy front suggests that our energy future will rely on a mix of sources, including renewables, clean coal (if that’s not an oxymoron), nuclear energy and perhaps even fusion. Fukushima scared everyone, but it was an old reactor, built in the wrong place, and nuclear technology has advanced considerably since then. I hope to write more on this, probably on my much-neglected solutions ok? blog.
PNG WITCH-HUNTING GOES ON AND ON
I was shocked to hear the other day about people (mostly women, but also children) being accused of witchcraft/sorcery in PNG, right on our doorstep, over the past couple of years, and hunted down and brutally slaughtered, often in bizarrely sexualised ways. Somehow this story has passed me by until now. The country, or part of it, seems to have been gripped by a witch craze, like those that broke out in Europe from time to time, especially in the seventeenth century, not really so long ago. And they fizzled out as mysteriously as they burst into being. In fact the USA’s Committee for Skeptical Inquiry was reporting on these horrors from back in 2008, with some 50 victims claimed for that year. The article ended on an optimistic note:
Papua New Guinea is in dire need of skepticism, education, and legal reform. It appears that the latter is finally happening. These latest horrific killings, and no doubt the ensuing media outrage, have prompted the country’s Constitutional Review and Law Reform Commission to create new laws to prevent (or at least reduce) witchcraft-related deaths.
However, this 2013 article, from the sadly no longer extant Global Mail, indicates that the problem is far more deeply-rooted and long-standing than first thought, and it’s mutating and shifting to different regions of the country. Brutality is on the increase, fuelled by drugs and alcohol, but above all by massive social dysfunction, with children being regularly indoctrinated in methods of public torture. Sanguma, or sorcerers, are usually blamed for any deaths, and gangs of unemployed men (and almost all the men of the region are unemployed) go hunting for them amongst the most marginalised and unprotected women in the community. The article makes for harrowing reading, going into some detail on the suffering of these women, and highlighting the intractability of the problem. There are heroes too, including Catholic priests and nuns working at the coal-face. Unfortunately, tossing around terms like skepticism, education and legal reform won’t cut it here. This is a problem of deep social malaise, suspicion, superstition, poverty and despair that will take generations to resolve, it seems.
I’ve read at least enough about WW1 to be aware that its causes, and the steps made towards war, were very complex and contestable. There are plenty of historians, professional and amateur, who’ve suggested that, if not for x, or y, war may have been avoided. However, I don’t think there’s any doubt that a ‘force’, one which barely exists today, a force felt by all sides in the potential conflict of the time, made war very difficult to avoid. I’ll call this force the appetite for war, but it needs to be understood more deeply, to divest it of its vagueness. We know that, in 1914, lads as young as 14 sneaked their way into the militaries of their respective countries to experience the irresistible thrill of warfare. A great many of them paid the ultimate price. Few of these lambs to the slaughter were discouraged from their actions – on the contrary. Yet 100 years on, this attitude seems bizarre, disgusting and obscene. And we don’t even seem to realise how extraordinarily fulsome this transformation has been.
Let’s attempt to go back to those days. They were the days when the size of your empire was the measure of your manliness. The Brits had a nice big fat one, and the Germans were sorely annoyed, having come late to nationhood and united military might, but with few foreign territories left to conquer and dominate. They continued to build up their arsenal while fuming with frustration. Expansionism was the goal of all the powerful nations, as it always had been, and in earlier centuries, as I’ve already outlined, it was at the heart of scores of bloody European conflicts. In fact, it’s probably fair to say that the years of uneasy peace before 1914 contributed to the inevitability of the conflict. Peace was considered an almost ‘unnatural’ state, leading to lily-livered namby-pambiness in the youth of Europe. Another character-building, manly war was long overdue.
Of course, all these expansionist wars of the past led mostly to stalemates and backwards and forwards exchanges of territory, not to mention mountains of dead bodies and lakes of blood, but they made numerous heroic reputations – Holy Roman Emperor Charles V and his son Philip II of Spain, Gustavus Adolphus of Sweden, Frederick the Great of Prussia, Peter the Great of Russia, Louis XIV of France and of course Napoleon Bonaparte. These ‘greats’ of the past have always evoked mixed reactions in me, and the feelings are well summed up by Pinker in The Better Angels of our Nature:
The historic figures who earned the honorific ‘So-and-So the Great’ were not great artists, scholars, doctors or inventors, people who enhanced human happiness or wisdom. They were dictators who conquered large swaths of territory and the people in them. If Hitler’s luck had held out a bit longer, he probably would have gone down in history as Adolf the Great.
While I’m not entirely sure about that last sentence, these reflections are themselves an indication of how far we’ve come, and how far we’ve been affected by the wholesale slaughter of two world wars and the madness of the ‘mutually assured destruction’ era that followed them. The fact that we’ve now achieved a military might far beyond the average person’s ability to comprehend, rendering obsolete the old world of battlefields and physical heroics, has definitely removed much of the thrill of combat, now more safely satisfied in computer games. But let’s return again to that other country, the past.
In the same month that the war began, August 1914, the Order of the White Feather was founded, with the support of a number of prominent women of the time, including the author and anti-suffragette Mrs Humphrey Ward (whom we might now call Mary) and the suffragette leaders Emmeline and Cristobel Pankhurst. It was extremely popular, so much so that it interfered with government objectives – white feathers were sent even to those convalescing from the horrors of the front lines, and to those dedicated to arms manufacturing in their home countries. Any male of a certain age who wasn’t in uniform or ‘over there’ was fair game. Not that the white feather idea was new with WWI – it had been made popular by the novel The Four Feathers (1902), set in the First War of Sudan in 1882, and the idea had been used in the British Empire since the eighteenth century – but it reached a crescendo of popularity, a last explosive gasp – or not quite, for it was revived briefly during WWII, but since then, and partly as a result of the greater awareness of the carnage of WWI, the white feather has been used more as a symbol of peace and pacifism. The Quakers in particular took it to heart as a badge of honour, and it became a symbol for the British Peace Pledge Union (PPU) in the thirties, a pacifist organisation with a number of distinguished writers and intellectuals, such as Aldous Huxley, Bertrand Russell and Storm Jameson.
There was no PPU or anything like it, however, in the years before WWI. Yet the enthusiasm for war of 1914 soon met with harsh reality in the form of Ypres and the Somme. By the end of 1915 the British Army was ‘depleted’ to the tune of over half a million men, and conscription was introduced, for the first time ever in Britain, in 1916. It had been mooted for some time, for of course the war had been catastrophic for ordinary soldiers from the start, and it quickly became clear that more bodies were needed. Not surprisingly, though, resistance to the carnage had begun to grow. An organisation called the No-Conscription Fellowship (NCF), consisting mainly of socialists and Quakers, was established, and it campaigned successfully to have a ‘conscience clause’ inserted in the 1916 Military Service (conscription) Act. The clause allowed people to refuse military service if it conflicted with their beliefs, but they had to argue their case before a tribunal. Of course ‘conshies’ were treated with some disdain, and were less tolerated by the British government as the war proceeded, during which time the Military Service Act was expanded, first to include married men up to 41 years of age (the original Act had become known as the Batchelor’s Bill) and later to include men up to 51 years of age. But the British government’s attitude didn’t necessarily represent that of the British people, and the NCF and related organisations grew in numbers as the war progressed, in spite of government and jingoist media campaigns to suppress them.
In Australia, two conscription bills, in 1916 and 1917, failed by a slim majority. In New Zealand, the government simply imposed the Military Service Act on its people without bothering to ask them. Those who resisted were often treated brutally, but their numbers increased as the war progressed. However, at no time, in any of the warring nations, did the anti-warriors have the numbers to be a threat to their governments’ ‘sunken assets’ policies.
So why was there such an appetite then and why is the return of such an appetite unthinkable today? Can we just put it down to progress? Many skeptics are rightly suspicious of ‘progress’ as a term that breeds complacency and even an undeserved sense of superiority over the primitives of the past, but Pinker and others have argued cogently for a civilising process that has operated, albeit partially and at varying rates in various states, since well before WWI, indeed since the emergence of governments of all stripes. The cost, in human suffering, of WWI and WWII, and the increasingly sophisticated killing technology that has recently made warfare as unimaginable and remote as quantum mechanics, have led to a ‘long peace’ in the heart of Europe at least – a region which, as my previous posts have shown, experienced almost perpetual warfare for centuries. We shouldn’t, of course, assume that the present stability will be the future norm, but there are reasons for optimism (as far as warfare and violence is concerned – the dangers for humanity lie elsewhere).
Firstly, the human rights movement, in the form of an international movement dedicated to peace and stability between nations for the sake of their citizens, was born out of WWI in the form of the League of Nations, which, while not strong enough to resist the Nazi impetus toward war in the thirties, formed the structural foundation for the later United Nations. The UN is, IMHO, a deeply flawed organisation, based as it is on the false premise of national sovereignty and the inward thinking thus entailed, but as an interim institution for settling disputes and at least trying to keep the peace, it’s far better than nothing. For example, towards the end of the 20th century, the concepts of crimes against humanity and genocide were given more legal bite, and heads of state began, for the first time in history, to be held accountable for their actions in international criminal courts run by the UN. Obviously, considering the invasion of Iraq and other atrocities, we have a long way to go, but hopefully one day even the the most powerful and, ipso facto, most bullying nations will be forced to submit to international law.
Secondly, a more universal and comprehensive education system in the west, which over the past century and particularly in recent decades, has emphasised critical thinking and individual autonomy, has been a major factor in the questioning of warfare and conscription, and in recognising the value of children and youth, and loosening the grip of authority figures. People are far less easily conned into going into war than ever before, and are generally more sceptical of their governments.
Thirdly, globalism and the internationalism of our economy, our science. our communications systems, and the problems we face, such as energy, food production and climate change, have meant that international co-operation is far more important to us than empire-building. Science, for those literate enough to understand it, has all but destroyed the notion of race and all the baggage attend upon it. There are fewer barriers to empathy – to attack other nations is tantamount to attacking ourselves. The United Nations, ironic though that title often appears to be, has spawned or inspired many other organisations of international co-operation, from the ICC to the Intergovernmental Panel on Climate Change.
There are many other related developments which have moved us towards co-operation and away from belligerence, among them being the greater democratisation of nations – the enlargement of the franchise in existing democracies or pro to-democracies, and the democratisation of former Warsaw Pact and ‘Soviet Socialist’ nations – and the growing similarity of national interests, leading to more information and trade exchanges.
So there’s no sense that the ‘long peace’ in Europe, so often discussed and analysed, is going to be broken in the foreseeable future. To be sure, it hasn’t been perfect, with the invasions of Hungary in 1956 and Czechoslovakia in 1968, and the not-so-minor Balkans War of the 90s, and I’m not sure if the Ukraine is a European country (and neither are many Ukrainians it seems), but the broad movements are definitely towards co-operation in Europe, movements that we can only hope will continue to spread worldwide.