Government spending and energy regulations: economic burdens that must be lifted

The six years of global economic sluggishness following 2007′s world financial meltdown contain many lessons though few advanced nations’ economic managers will recognise them.

One is that increasing debt and monetary charged fiscal stimulus has not worked. Markets are in a lather about the US forecast to have achieved 4 per cent annualised growth this quarter. The US has a far more flexible economy than other advanced countries and its federal structure allows dispersed decision making to its great advantage in allowing some states to lead the way with new forms of gas and oil. Even so, the US cannot sustain such a growth rate until the federal government has mended its excessive spending and monetary creation, thus paving the way for a recovery in savings and investment.

Since 2007 advanced countries have seen real growth at under one per cent per annum (the EU’s has been negative). That means real living standards have dropped. Australia has performed better than most with growth averaging about 2.5 per cent, but this is less impressive when set against the increasing reality that Australia is an economic appendage of the developing countries to our north growing at 6 to 8 per cent in that period.

The growth in Government spending,though basically taking from the earners of wealth, thereby having adverse incentive outcomes, has not got the destructive force of redistributions in previous eras when the venue was military uses. It is however very difficult to reverse.

On top of the deficits and cannibalisation of investable funds by government spending that has damaged the economies of the advanced nations. Regulatory intrusion has played a major part. Nowhere is this more evident and costly than in energy.

Ever-cheapening energy was the wellspring of the industrial revolution. As well as powering factories, other commercial premises and homes it provided the basis for the synthetic materials we now take for granted. However, governments throughout the developed world have implemented policies deliberately designed to increase its price in order to reduce carbon dioxide emissions. Usually they have done so reassured with cock-eyed technological optimism that new “”clean” energy will eventually be lower cost than the fossil based sources.

The resultant impost places a ball and chain around traditional productive activities across the western world. Colin Robinson reminds us, that the UK has a policy for an 80 per cent reduction in carbon emissions, incorporating a minimum carbon tax, subsidised windmills and solar power, minimum efficiency level regulations on appliance and housing, and government sponsored nuclear power. All of these, with the exception of still demonised nuclear, remain features of policy in Australia – indeed our own situation is worsened by the banning of unconventional gas in Victoria and its discouragement in New South Wales.

Developing nations totally reject any but token measures to inhibit their use of low cost energy and have stood firm against the western world at the various climate change conferences. They have benefitted from the developed world’s purpose-driven impediments to their own industries’ access to low cost energy and have now attained sufficient economic muscle to out-stare threats to impose penalties, for example on airlines that avoid paying a carbon tax.

Even Among developed economies those that have been less forceful in implementing tax-induced energy price hikes have seen businesses migrate to them. Thus, Ontario, formerly Canada’s manufacturing heartland has seen ‘renewable energy’ raising electricity prices from being among the lowest in N America to being one of the highest. Factories are moving to take advantage of cheaper energy in the United States. Heinz, Caterpillar and Kelloggs left for Arkansas this year. Maurice Newman warns that this is happening in an article in today’s The Australian.

Fortunately, none of this is irreversible. We are observing a deflation of the scary climate change (nee global warming) stories from the mundane climate model assassinating empirics of no warming for 17 years do the ludicrous attempts to demonstrate warming’s effects by an Antarctic research expedition now stuck fast in ice that should have disappeared.

Facts are undermining the fashionable science based on human induced warming often and will eventually mute governments’ energy distorting policies – though sadly the accretion of interest groups and people in powerful positions is unlikely to allow this to proceed as fast as it should.

According to Fox News
“Chris Turney, a professor of climate change at Australia’s University of New South Wales, said it was “silly” to suggest he and 73 others aboard the MV Akademic Shokalskiy were trapped in ice they’d sought to prove had melted.”

image

The exhibition, complete with Guardian journalist, was expecting to be wallowing in water. They were apparently unaware that the ice is accumulating. Warmistas have no scholarship. And is there a Lawrence (Titus Oates) on board prepared to sacrifice for the good of the rest of the party?

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21 Responses to Government spending and energy regulations: economic burdens that must be lifted

  1. Robert O.

    There is a good pictorial record of the “Aurora”, Mawson’s ship steaming around Commonwealth Bay in 1912 without a piece of floating ice to be seen. And today we have the Scientific mission re-tracing this voyage stuck fast in ice, about 60 km. from its destination and in need of assistance. I think that this will make some people wake-up to the reality of the global warming hypothesis and its models failing to predict anything of use for humanity.

  2. H B Bear

    Increasingly government spending on health and education has little impact on future income or well being. Significant increases in real spending on school education has seen no improvement in quality or student outcomes, which have in fact declined on international comparisons. Similar observations can be made for health expenditure on a rapidly aging population.

    Not only is the level of government spending rising as a percentage of GDP, the proportion going on the “soft” areas of health, education and welfare is rising as a percentage of that government spend. If you want to see the impact of it look to the basket case that is Tasmania where the largest employers are the public hospitals and university while the economy bumps along at near zero growth.

  3. Andrew

    Not sure why the link stuffed itself up – there’s not a “close link” button so I don’t think that was me.

  4. gabrianga

    No mention of the “Guardian” and BBC journalists stuck in the ice.

    Once the little stunt went arse up their silence has been deafening. Somebody obviously forgot to mention their part in the Antarctic expedition to our local TV and radio stations as their silence is deafening.

    Have a “guid” New Year and keep your lum reeking for a long time.

  5. Dan

    The UK is changing over a coal powered electricity generator to burn wood

    Says it all really

  6. gabrianga

    And, Dan, importing the wood from the Good Old U.S.A by sea. Carbon footprint……forget it!

    Another Cameroon/Obammy “solution”

  7. Blogstrop

    sadly the accretion of interest groups and people in powerful positions is unlikely to allow this to proceed as fast as it should.

    the Fisk Doctrine takes care of this.

  8. cohenite

    People advocating renewable energy to solve the non-existent scam of AGW should be pelted with cow manure.

    And may the loons, alarmists, sundry fuckwits and other human detritus on the Akademik Shokalskiy expedition get frostbite on their stupid, lying tongues.

  9. Bruce

    South Australia has the highest electricity prices in Oz courtesy of the enlightened green-progressive elite.

    Holden is in South Australia….(yes, Cats, those were dots)

    Who, in their right mind, would invest anything in such a place? You do not grow potatoes in a desert, it needs to be a fertile and pleasant land. The whole of Oz is rapidly turning into a desert of the urban left.

  10. .

    Andrew I’d totally believe what you are saying. The labour market is pretty rough right now.

  11. sdfc

    Get used to low growth Andrew. We’re a high debt economy approaching the end of a terms of trade / mining investment boom.

  12. David Brewer

    Since 2007 advanced countries have seen real growth at under one per cent per annum …Australia has performed better than most with growth averaging about 2.5 per cent, but this is less impressive when set against the increasing reality that Australia is an economic appendage of the developing countries to our north growing at 6 to 8 per cent in that period.

    Population growth should also be taken into account. Australia’s population is growing at 1.6% a year, so its growth is also less than 1% on a per capita basis, an awful result given our record-high terms of trade in recent years.

  13. sdfc

    Not a surprise with such low credit growth.

  14. stackja

    accretion of interest groups and people in powerful positions

    Academia and the media joined the AGW crusade and for sometime drowned out the opposition.

  15. “They were apparently unaware that the ice is accumulating.”

    I’m pretty sure they were aware the *sea* ice was accumulating. A nice overview of Antarctic ice trends is presented here: http://www.skepticalscience.com/An-overview-of-Antarctic-ice-trends.html

    - Antarctic *land* ice is decreasing
    - Antarctic *sea* ice is increasing

    “Antarctic sea ice has shown long term growth since satellites began measurements in 1979. This is an observation that has been often cited by skeptics as proof against global warming. However, rarely is the question raised: why is Antarctic sea ice increasing? The implicit assumption is that if Antarctic sea ice is growing, it must be cooling around Antarctica. This is decidely not the case. In fact, the Southern Ocean has been warming faster than the rest of the world’s oceans.”

  16. .

    It’s warming faster so its accumulating ice in summer.

    “Because of warming.”

    No – it has been cooling since 1997 and Antarctic and Artic sea ice is accumulating.

    Please do not lie to us.

  17. Andrew

    I think the theory is multi-year (glacial) ice is denser – having been on a glacier in Alaska, it’s actually markedly blue rather than snow-coloured as it had the air squeezed out by the mass on top. Or something. So perhaps they can tell if a glacier dropped a gazillion tonnes of old ice into the water.

    As for Stanley:

    I’m pretty sure they were aware the *sea* ice was accumulating.

    I’m pretty sure they WEREN’T because 2 days ago the statement from the Ship of Fools said “Sea ice is disappearing due to climate change” in Prof Turkey’s bizarre excuse for the Ship of Fools debacle.

    In fact, the Southern Ocean has been warming faster than the rest of the world’s oceans.

    What, faster than 0.00-0.01C (the calculated range since we put Argo buoys to measure it, at which point the previous estimated warming by proxy promptly stopped)? Really? That fast?

    You won’t get an education from SkS, warmieboy.

  18. JakartaJaap

    Staggering that there is still a prat left who reads and/or believes SkS. Keep that link, readers, it may be the last of the ho-hoicans.

  19. Andrew

    @JJ, apparently at SkS he learned that:

    - gerbil worming has occurred over the last 150 years, and that
    - this has been contributed to by CO2

    LOL!

    He cites belief in this not

    because it’s a basic fact

    but because he has faith in the peer-review system! Apparently at SkS he has been led to believe that there is a debate between elite SkS types (who believe in CO2, and are better and smarter than everyone else) and “deniers” who do not. Even though no actual denier, or even a direct quote attributed to a denier of CO2, has ever been found.

    How do you deal with people who don’t even know what the question is, let alone have any clue about the answers? Remembering that this is an article that was fairly clear about the issues – the cost of “green-approved” power, and the inaccuracy of models as well as the absurd ignorance of warmies of even the current state of the planet.

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