Year: 2008

Isn’t All This Talk Of An Apocalypse Getting A Bit Boring?

This year is the 40th anniversary of Paul Ehrlich’s influential The Population Bomb, a book that predicted an apocalyptic overpopulation crisis in the 1970s and ’80s.

Ehrlich’s book provides a lesson we still haven’t learnt. His prophecy that the starvation of millions of people in the developed world was imminent was spectacularly wrong – humanity survived without any of the forced sterilisation that Ehrlich believed was necessary.

It’s easy to predict environmental collapse, but it never actually seems to happen.

The anniversary of The Population Bomb should put contemporary apocalyptic predictions in their proper context. If anything, our world – and the environment – just keeps getting better.

Ehrlich was at the forefront of a wave of pessimistic doomsayers in the late 1960s and early ’70s. And these doomsayers weren’t just cranks – or, if they were cranks, they were cranks with university tenure.

Despite what should be a humiliating failure for his theory of overpopulation, Ehrlich is still employed as a professor of population studies by Stanford University. Similarly, when George Wald predicted in a 1970 speech that civilisation was likely to end within 15 or 30 years, his audience was reminded that he was a Nobel Prize-winning biologist.

These predictions were picked up by people eager to push their own agendas. And a subgenre of films arose to deal with the “inevitable” environment and population crisis. Soylent Green(1973) depicted a world where all food was chemically produced, and other films imagined dystopias where amoral bureaucrats strictly controlled the population – just the sort of things advocated in The Population Bomb.

In retrospect, these fears seem a little bit silly. The green revolution that was brought about by advances in agricultural biotechnology came pretty close to eliminating the problem of food scarcity. Nor did the alarmists expect the large changes in demography and fertility rates that have occurred during the past few decades.

Nevertheless, for people in the 1970s, predictions of apocalypse through overpopulation and famine were just as real as the predictions of an apocalypse caused by climate change are today. And, just like today, environmental activists and their friends in politics were lining up to propose dramatic changes to avert the crisis.

For instance, the vice-president of the Australian Conservation Foundation wrote just last week in The Age that we needed to imagine global suffering before we can tackle climate change through “nation-building” – whatever that is.

But there are substantial grounds for optimism – on almost every measure, the state of the world is improving.

Pollution is no longer the threat it was seen to be in the 1970s, at least in the developed world. Changes in technology, combined with our greater demand for a clean environment, have virtually eliminated concerns about pungent waterways and dirty forests. Legislation played some role in this, but as Indur Goklany points out in his recent study, The Improving State of the World, the environment started getting better long before such laws were passed.

Goklany reveals that strong economies, not environment ministers, are the most effective enforcers of cleanliness in our air and water. Indeed, the world’s 10 most polluted places are in countries where strong economic growth has historically been absent – Russia, China, India and Kyrgyzstan have not really been known for their thriving consumer capitalism.

Other indices, too, show that humanity’s future is likely to be bright. Infant mortality has dramatically declined, as has malnutrition, illiteracy, and even global poverty.

And there are good grounds for hope that we can adapt to changing climates as well. History has shown just how capable we are of inventing and adapting our way out of any sticky situation – and how we can do it without crippling our economies or imposing brutal social controls.

Environmental alarmists have become more and more like those apocalyptic preachers common in the 19th century – always expecting the Rapture on this date and, when it doesn’t come, quickly revising their calculations.

Optimism is in too short supply in discussions about the environment. But four decades afterThe Population Bomb, if we remember just how wrong visions of the apocalypse have been in the past, perhaps we will look to the future more cheerfully.

Next Time You Sip A Latte, Look Beyond The Feel-Good Choice

Just how fair is fair trade? Mass market retailers from Safeway to Starbucks now sell us coffee that is supposed to quench our thirst and appease our conscience, but there is more to fair trade than feel-good marketing and social justice.

Coffee has long been highly politicised. In 17th-century England, coffee became allied with the cause of free speech when Charles II shut down the coffee houses that he thought were brewing criticism of his government.

And in the eyes of modern activists, coffee is symbolic of the unfairness of international trade. Their story of coffee is of the developing world exploited by globalisation and wicked multinational corporations. And their solution is fair trade – marketing coffee under a brand that guarantees growers more bang for their beans, sustainable agricultural practices and so on.

But there is more to fair trade than meets the eye. It comes at a high price. The program carries a great deal of ideological baggage and fair trade certification is full of requirements that can limit economic development rather than encourage it. For example, to achieve certification, coffee producers are required to structure their organisations not as the small businesses that have been so successful in capitalist economies but as democratic worker co-operatives.

For fair trade advocates, the only way the developing world can compete in a global coffee market is by adopting the quasi-socialist communal structures that have constantly failed to compete in other industries.

Individual farms are unable to achieve certification by themselves – the fair trade organisation will only approve co-operatives that can contain hundreds of farms. This practice reduces entrepreneurship and competition between producers, eliminating the benefits of innovative farming techniques. And in some regions, the fair trade system encourages farmers to grow in less climatically favourable areas, depressing the quality of the coffee beans.

Nevertheless, the fair trade marketing machine is extraordinarily powerful, and the brand has revealed an eager base of socially aware consumers.

The politicisation of the coffee industry has happened in conjunction with another major change: the awakening of the Australian palate. Coffee, like many other foods and drinks, has benefited from an expansion of taste that has added, for instance, sushi and specialty cheeses to our diet. It’s worth remembering just how recently it was that mass market stores like Gloria Jean’s were seen as gourmet retailers pushing the radical idea that the flavour of our flat whites actually mattered outside niche cafes.

In the middle of this gourmet revolution, whether we buy fair trade or just good old free trade coffee is merely another one of the thousands of choices we face in our overloaded supermarket. And Australians are wealthy enough to spend extra on products we feel are more ethical.

Indeed, symbolism has become an important part of the way we dine. Similar campaigns against genetic modification and for organic and sustainable agriculture are just as much about image as reality – too often they are based on flimsy evidence and have negative consequences for producers and the environment.

The fair trade system is more than our preferences in the supermarket. At best, fair trade has an ambiguous effect on the economic wellbeing of coffee growers in the developing world; at worst, it may actually be holding them back.

Tackling Obesity – Should The Public Pay?

The demand by AMA Victoria that the State Government fund bariatric surgery for the chronically obese is no doubt motivated by compassion, but illustrates some of the ways the debate about obesity has become severely distorted. Obesity is not a public health problem and should not be treated as one.

Until relatively recently, the phrase “public health” indicated health problems that were actually public problems – sanitation, the control of epidemics, water quality, airborne pollution and so forth. But increased obesity is not a public health crisis like an outbreak of bird flu would be. Obesity is not contagious – when one person overindulges on fast food, their colleagues and neighbours aren’t put at risk. And, in 2008, nobody orders pizza without being fully aware that cheesy crusts can lead to weight gain.

For these reasons, obesity is too often tragic, but it is first and foremost a private problem. Medical campaigners who seek to redefine the parameters of public health are eliminating the crucial policy distinction between public and private health concerns. When every health problem becomes a national crisis, no medical treatment is ineligible for government funding. Bariatric surgery may be an important, even necessary, tool to treat obesity, but it does not automatically follow that it should be paid for directly by the taxpayer.

Of course, the most common objection to this line of reasoning is the simple calculation that the cost of treating obesity now is far less than the cost of treating the consequences in the future – resolving heart disease and diabetes may be more expensive than bariatric surgery.

All public policy should be subject to economic assessment. But this is a slippery slope. Britain’s National Health Service shows what can happen when the government makes all health problems its business – those calculations rapidly lose their compassion and become cruel assessments of moral, rather than medical, questions. Last week British PM Gordon Brown hinted that individuals whose lifestyle choices had created their health problems – obesity is the classic example – may be refused treatment in order to cut costs.

The only way to avoid this trap is to drop the conceit that all medical problems are public problems, and to reintroduce the idea that individuals should be responsible for their own health.

What next? Liberalism after the Howard government

‘When you change the government’, argued John Howard in the last few days before the election, ‘you do change the direction of the country’.

Paul Keating’s clarion call proved to be just as ineffectual the second time round. That could perhaps be because it obviously isn’t true. Despite the high level of state economic and social intervention in Australia, the nation isn’t steered by Captain Government.

As Tim Wilson writes in this special section on liberalism after the Howard government, part of the problem that the Coalition faced in its final years was the unwillingness of the government to grapple with key demographic and social changes. Similarily, as Ken Phillip notes, in industrial relations the rise of independent contracting has been meteoric—to the extent that there are now far more self-employed people than there are members of a union — but the cause of this change was economic, not legislative.

Between 1996 and 2007 a lot of things happened, and very few of them were the consequence of Commonwealth legislation.

The ‘change the country’ line was doubly inappropriate because of the status quo strategy of the Rudd opposition. Federal Labor’s big ticket items may have been climate change and broadband, but fibre optic networks and carbon trading don’t win elections. Rather, it was Labor’s mantra of ‘economic conservatism’ that was specifically designed to repudiate Howard’s argument. To try to emphasise their credentials, Rudd and Gillard’s repeatedly affirmed the independence of the Reserve Bank — as if that was ever up for grabs.

The message was simple: vote for the ALP, and they won’t change the country. But if you vote for the Coalition, they will embark on another round of industrial relations reform, and the country certainly will change. The Howard government became alienated from its own record of conservative governance.

The 2007 election re-established the status quo brand in the minds of political strategists. It will likely go down as one of John Howard’s major legacies, and it is largely a positive legacy. With the government’s extraordinarily flattering economic record, it is no wonder that voters prefer more of the same.

Unfortunately, brand status quo has applied to areas which advocates of liberal philosophy — that is, the ideological combination of limited government and the open society — would prefer it did not. As Des Moore shows in his piece on the Howard government’s spending and taxing record, despite their professed sympathy with small government principles, the Coalition delivered no reduction in discretionary spending and its election promises foreshadowed no future reduction.

Along a wide range of public policy areas, the Howard government could have done more. Industrial relations reform was used as a federal power grab, rather than as a push towards common law contracts. Taxation reform drove yet another stake into the already terminal federal compact.

Other reforms were barely reforms at all—the 2006 changes to media law did little to free up a stifled commercial media sector. It is hard to avoid concluding that the government’s approach to reform was about quantity, not quality. Economic reform packages may have started out well-intentioned, but when they emerged from the meat-grinder of parliament, they too often represented steps backward.

This mixed record — the Howard government was extremely successful at managing the economy, but disappointing at reforming it—is reflected in this IPA Review issue by the conflicting, but not irreconcilable, accounts by Tom Switzer and Christian Kerr.

Liberalism’s dilemma

Nevertheless, elections are not won or lost on the size of government, weak media regulations, or eroding federalism. Elections are won on appeals to the status quo, issues such as immigration, or security fears. Federal seats are won on vacuous — and, as Richard Allsop points out, for federalists deeply concerning — issues such as graffiti, hoons and train lines. It isn’t just that voters are not interested in liberal policies. In many cases it has proven far easier to win votes with an illiberal platform.

Part of this gulf between the policy preferences of voters and liberal policy preferences has been explained well by Bryan Caplan in his 2007 book, The Myth of the Rational Voter: Why Democracies Choose Bad Policies. In it, Caplan nominates four biases held by the average voter that are not empirically justifiable. The ‘make-work bias’ is a tendency to equate economic growth with jobs, rather than productivity; the ‘anti-foreign’ bias ignores the importance of foreign trade; the ‘pessimistic bias’ overplays contemporary economic problems; and the ‘anti-market’ bias underestimates the benefits of market exchange.

Caplan’s four biases go most of the way to explaining the distance between liberal philosophy and Liberal Party policy. As a consequence, the Coalition’s loss of government illuminates sharply a debilitating problem that liberalism faces in 2007.

What role can liberal philosophy have if it can’t be successfully marketed to voters? Certainly, ideology cannot be the sole guide to policy. This is the classic dilemma for libertarians seeking public office. As one American libertarian noted, ‘There is no mass constituency for seven-year-old heroin dealers to be able to buy tanks with their profits from prostitution.’

Liberal political parties are unlikely to win future government on a platform of radical change, except in times of crisis. The four biases of the irrational voter mean that dramatic increases in immigration or a reduction in the minimum wage are hardly tickets to electoral success. In an era of status quo politics, it appears that ideology is, on net, an electoral negative rather than a positive.

But conversely, the final years of the Howard government demonstrated what can result when a political party has no philosophical base, lacks the fiscal restraint imposed by ideology, and simply purchases the votes it needs. Sooner or later, voters — or in the case of the 2007 election, the opposition — punish them for their directionless expedience.

Perhaps one reason why liberalism seems impossible to market to voters is because it hasn’t yet been tried. No major party has gone to an election — from opposition or from government — with a full programme of social liberalism and economic liberalism.

In her piece, Louise Staley starts to examine what an array of liberal social policies might look like. Importantly, she argues that ‘liberal’ in this context is not merely a synonym of ‘left’, but neither is it ‘conservative’. Instead, liberalism needs to develop its own approach if it is to break through the social policy impasse. But this is an area where modern liberal thought is conspicuously lacking, and filling that hole will need to be a part of any liberal revival.

There is the possibility, too, to develop an economically liberal message that may resonate with voters. The Howard government suffered from its abstract message — ‘economic growth’ is far less concrete than fibre-to-the-node and the Kyoto Protocol. Voters may instead respond to campaigns targeting over-bureaucracy and regulation, particularly as they affect business and community life. The record levels of regulatory and legislative activity during the Howard government provide ample scope to do so. It is fair to say that such a campaign would be a direct repudiation of the Howard record.

Ronald Reagan campaigned along these lines, although it should be noted that Australia lacks the anti-statist political culture of the United States. But if the Rudd Labor government turns out to be anything like the governments of Tony Blair and Gordon Brown, this regulation is likely to increase exponentially — presenting possible policy targets such as privacy and bureaucratisation.

Nevertheless, again we reach a strategic bottleneck — campaigns against the Nanny State may swing voters towards liberal parties at the margins, but probably not deliver two dozen seats. Arguing that a consistently liberal message could win an election would be convenient, but doesn’t seem to be true.

In this IPA Review, we have assembled a range of approaches to this challenge. What is not under question however is the need for liberalism in Australia, and the challenges which liberals face — limited government and the open society remain ‘simple and obvious’ goals regardless of their electoral popularity.

The Growth Of Australia’s Regulatory State: Ideology, Accountability And The Mega-Regulators

Institute of Public Affairs, 2008

Regulation is a political activity. It sets the framework for the market economy by defining the boundaries between private action and government action. Yet those boundaries are not fixed. Australian governments are growing the body of regulation — and the resources dedicated to regulating — at an ever increasing pace.

As Chris Berg argues, this growth in regulation has more than just economic consequences. It has significant political implications, as regulatory agencies are increasing their power and influence. Furthermore, those agencies are animated by a new regulatory ideology which favours interventionism and ‘arm-twisting’, adding to the powers of regulatory agencies.

Available in PDF here.

IPA Review Editorial, January 2008

It’s not too often that we can look enviously at the political state of a country buried deep in the European Union. Brussels is not just the capital of Belgium, but it is also the de facto capital of the EU, hosting the European Commission, the Council of the European Union, the European Council and one of the seats of the European Parliament.

So it is either fitting or ironic (I can’t figure out which) that Belgium has now been, for more than six months, without a government to call its own. As we quietly recover from the shrill hangover of the 2007 federal election, it’s worth considering how Australia could have been if no government had been successfully elected in November.

Since the 10th of June, Belgian politicians have been — at least as this edition of the IPA Review goes to press — unable to form a government coalition. This failure is the result of the adversarial relationship between French and Dutch speaking political classes, in particular, from the demand by Flemish nationalists for more autonomy over taxation and welfare policy in Flanders (a region that has traditionally favoured centre right parties; the francophone region of Wallonia appropriately prefers their politics to have a more socialistic flavour.) The former government remains in power, but only in a caretaker capacity, and the semi-former prime minister is set to step down once a replacement government is available.

Sure, not having a government has its disadvantages. The great economic reforms which have propelled Australia up the ranks of economic performance would not be possible from a government that couldn’t get out of caretaker mode. Similarly, the important reforms Australia needs — workplace changes which deliver deregulation rather than centralisation, the sale of remaining government enterprises, reform of communications and occupational safety regulation, corporate and financial services deregulation, and so on — all require a rather active government.

But on the positive side of the ledger, having no government also means having a government that can’t mess things up. Governments cannot extend their reach into the economy without a capacity to legislate. Indeed, as Belgium is a central member of the EU, no government also means no government able to increase its international obligations. As the Flemish free-marketeer Paul Belian has written, the inability of the Belgian Parliament to approve European Commission directives means that ‘in its hour of ungovernability Belgium is now more sovereign than it has been in the past 50 years.’

This special edition of the IPA Review arrives in newsagencies and letterboxes at a significant moment for the cause of limited government and open society in Australia. At the dramatic end of a nominally liberal/conservative government, we have assembled the nation’s best liberal and conservative commentators to try to describe the legacy of the Howard government and the causes of its demise. But more importantly, this IPA Review engages with the question—what next for liberalism? Has the cause of liberty advanced or retreated over the last decade? What are the next steps?

This edition also contains the full complement of non-election related commentary. Sam Gregg engages with Christian leaders who would ignore or reject free market economics for a socialist Christianity, Paul Monk holds anti-nuclear campaigners up to the harsh light of logic, and Chris Murn tries to host a Christmas street party. Pieces by Alan Moran, as well as Sinclair Davidson, Alex Robson and Chris Textor, dig further behind the claims of price-fixing by Visy and Amcor and reveal that not every criminal has committed a crime.

Even without a functioning government, Belgian government services continue to be delivered. Rubbish is still collected, social security payments are provided—even, as Paul Belian points out, taxes continue to be collected. While the government is in caretaker mode, government activity cannot be reduced, but neither can it be extended. As a result, the promises of more pork and populist extensions of middle class welfare which characterise Australian federal election campaigns may, indeed, obscure the fact that when the federal government is in caretaker mode for the election, that could be the best six weeks that government ever has. Cynics should hope for stalemate and inertia.