Speaker 1: Now on weekends the Sunday Sweet looking at the stories
Speaker 1: of the week. Look, no shortage of issues to rip
Speaker 1: into on planet Earth right now. Who better to do
Speaker 1: it with than the great Adam Crichton, formerly of Washington
Speaker 1: d C And the Australian newspaper and now Chief Economists
Speaker 1: at the Institute of Public Affairs. And he's on the line.
Speaker 1: Good I Adam, good morning. Lovely to talk to you, mate,
Speaker 1: Lovely to talk to you. You wrote brilliantly about net
Speaker 1: zero through the week. I just had a listener told
Speaker 1: me about his new power prices, and you know, we've
Speaker 1: all had to live through this. The government think they're
Speaker 1: heroes because they give us some of our money back
Speaker 1: to help pay for the very big bills that they've created.
Speaker 1: But the question of net zero has become key here
Speaker 1: because a proportion of the coalition, name with the Nationals,
Speaker 1: is saying we've got to get the hell out of this.
Speaker 1: And it's not just Nationals, as you pointed out through
Speaker 1: the week former Labor British Prime Minister Tony there that's
Speaker 1: called the net zero policy doomed to fail due to
Speaker 1: its irrationality. It's a really big issue. Why do we
Speaker 1: need to give net zero the flick.
Speaker 2: Yeah, well, look, certainly I think we may have turned
Speaker 2: the corner very slowly on all the net zero nonsense.
Speaker 2: As you pointed out, a former British Prime Minister Attorney
Speaker 2: players come out against the new South Wales Nationals, South
Speaker 2: Australian Liberals, UK Conservative Party have all dumped it. Now. Well,
Speaker 2: I think more and more people are realizing it's just
Speaker 2: a massive tax on the economy and it totally restructures
Speaker 2: the economy in a terrible way. You lose your manufacturing sector.
Speaker 2: Of course, as you pointed out earlier, power prices go
Speaker 2: through the roof, so you have huge job losses, huge
Speaker 2: increases not just in the direct power costs, but all
Speaker 2: the costs of food, the food and the supermarkets because
Speaker 2: obviously fuel goes up, transport costs are higher, and look,
Speaker 2: you know it's you know, we keep hearing that we're
Speaker 2: on the way to the transition, but really we're not.
Speaker 2: There isn't really much of a transition. We're still totally
Speaker 2: dependent on fossil fuels for our energy, but the rollout
Speaker 2: of wind and solar around the country is just massively
Speaker 2: increasing the costs overall because the extra we have to
Speaker 2: spend on transmission networks and they drive the old fossil
Speaker 2: fuel reliable power stations out of business. So look a
Speaker 2: total mess. And I really do hope the coalition formally
Speaker 2: dumps it and goes to the next election to promise
Speaker 2: to unwind it. Otherwise we're going to face more and
Speaker 2: more economic destruction in this country.
Speaker 1: We love to or certain parts of the commentariat love
Speaker 1: to talk Australia down. But here's the thing, Adam, surely
Speaker 1: we obviously produce eight percentage. I think it is one
Speaker 1: percent of global emissions. Countries like the United States, China,
Speaker 1: India and Russia they dwarf what we do. But it
Speaker 1: seems are right and saying it's Australia. I think you
Speaker 1: might have said this, Australia, Canada and the EU want
Speaker 1: to play by the rules, but the other countries large
Speaker 1: emitters that they're just paying lip service to them.
Speaker 2: Yes, look it's just a joke. I think it's fallen.
Speaker 2: I think Australia's share has actually fallen from one point
Speaker 2: five percent about fifteen years ago to one point one percent.
Speaker 2: So even if we have our missions, it barely makes
Speaker 2: any difference at all. So we're just engaged in this
Speaker 2: huge economic self harm, self sacrifice, if you like, for
Speaker 2: no reason. I mean China and India, just those two countries,
Speaker 2: their share of global emissions is now forty percent, and
Speaker 2: even the US is only thirteen percent. And China and
Speaker 2: India are not paying any attention at all to these
Speaker 2: so called Litzier goals. They're rolling out hundreds of newqualified
Speaker 2: power stations that also, by the way, building lots of
Speaker 2: nuclear power stations too in China, which is sensible, but
Speaker 2: their emissions are going up massively. I mean, you have
Speaker 2: countries like you know, large countries like Britain, they have
Speaker 2: reduced their annual emissions by about two hundred and forty
Speaker 2: million tons of carbon dioxide a year, that's over the
Speaker 2: past twenty years, but China has increased it's by one
Speaker 2: point nine billion. So I mean, so you know, the
Speaker 2: UK is going these huge efforts, massive massive sacrifice, but
Speaker 2: it's not making a scrap of difference to the global
Speaker 2: carbon emissions. And you know, net zero in the US
Speaker 2: is obviously not being not being pursued under the Trump administration.
Speaker 2: And as you said earlier, it's really just US and
Speaker 2: the EU and maybe Canada and if you wait all
Speaker 2: of that by GDP, it's about fifteen percent of the
Speaker 2: world is paying any attention to net zero. So I think,
Speaker 2: you know, we're just a laughing stock. And you know,
Speaker 2: the idea that we're going to inspire other countries to
Speaker 2: change their mind, I think is just ludicrous.
Speaker 1: Yeah, yeah, I'm sure that that is right, one hundred
Speaker 1: percent correct, Adam. Going back to your Washington d C days,
Speaker 1: all those probably months ago, Now, well, what's what you
Speaker 1: read on Trump and Iran is he and he's moved
Speaker 1: those B two bombers. So he's obviously making it clear
Speaker 1: for anyone who's paying attention. Hey, I'm not just dittle
Speaker 1: dabbling around here. You know we are serious. But do
Speaker 1: you imagine he'll he'll assist Israel or what do you think?
Speaker 2: Well, look, it's you know, it's hard to predict this.
Speaker 2: He's got huge, this huge domestic political problem where I
Speaker 2: would say probably more than half of his base, his magabase,
Speaker 2: his fervent supporters, they don't want to get involved. They
Speaker 2: don't want the US getting involved in other wars. They're
Speaker 2: often sympathetic to Israel, but they just don't want they
Speaker 2: don't want Americans to die and spend more money in
Speaker 2: the Middle East anymore, but says, you know, I'm sure
Speaker 2: your listeners know there's been a series of failed wars
Speaker 2: in the Middle East over many years that have cost
Speaker 2: the US a lot and really haven't achieved a great deal.
Speaker 2: But on the other hand, you know this, Trump has
Speaker 2: said many times that Iran can't have a nuclear weapon,
Speaker 2: and their administration there in Taran has said many times
Speaker 2: that they intend to do just that. So it puts
Speaker 2: the US present in a very difficult position. He has
Speaker 2: moved those bombers. It doesn't necessarily mean anything. I don't
Speaker 2: think we won't know until something happens that will happen suddenly. Probably.
Speaker 2: You know. My understanding is Israel wants the US to join, obviously,
Speaker 2: but look, it's a it's a very vexed problem, and
Speaker 2: I'm not you know, I'm glad, I'm not. I'm glad
Speaker 2: I'm not making the decision.
Speaker 1: Yeah, a tough one me both. Now, today we read
Speaker 1: in the Nine Papers that Treasurer Jim Charmers, who we
Speaker 1: call here JIMBO, has revealed the recently released book Abundance,
Speaker 1: which argues progressives need to rethink their overly rules based
Speaker 1: approach to making the change they want had been a
Speaker 1: wake up call for the left of politics. Now you
Speaker 1: know it's been it's been the catch cry of center
Speaker 1: right governments to have smaller government. This is not this
Speaker 1: is not a new thing. But it took the work
Speaker 1: of American journalists as a reclient and Derek Thompson to
Speaker 1: convince the treasurer here, do you actually think the unions
Speaker 1: to let him get rid of red tape if it
Speaker 1: reduces their power? I can't see it.
Speaker 2: Well, no, look, I can't see it. And actually it's
Speaker 2: this labor government that has massively increased regulation so much.
Speaker 2: I mean, the IPA has done a lot of research
Speaker 2: on on the growth and regulation over the years, and
Speaker 2: it's just extraordinary to see the figures. I mean, we've
Speaker 2: just had just over the last three years, we've had
Speaker 2: an increase in the number of regulatory roles, if you like,
Speaker 2: in the federal government. So he's bureaucract's employed full time
Speaker 2: to enforce regulation that's gone up nineteen percent to one
Speaker 2: hundred and seven thousand staff. That's the match. So this
Speaker 2: is your things like well obviously net zero and a
Speaker 2: huge raft of regulations that go with that. You know,
Speaker 2: we don't talk much about the industrial relation system anymore,
Speaker 2: but that is extremely regulated, and you know that entails
Speaker 2: hundreds and thousands of regulations too, so you know, and
Speaker 2: we haven't even got to the tax system yet. So look,
Speaker 2: I mean, he's right that we do need to reduce
Speaker 2: regulation obviously. I mean we're in a period of extremely
Speaker 2: lackluster growth, extremely low productivity growth. You know, we've had
Speaker 2: declining living standards now, you know, for most of the
Speaker 2: last three years. So something has to be done. But
Speaker 2: you know, I must say I'm a little bit skeptical
Speaker 2: that the this government will be able to do it.
Speaker 2: But you know, let's hope they can. They have a
Speaker 2: big majority. Should try to do some good things.
Speaker 1: Yeah, exactly. And the Productivity round Table which is upcoming,
Speaker 1: do you say anything come out of that. I mean,
Speaker 1: we had the Jobs and Skill Summit when they were
Speaker 1: elected last time. I'd argue nothing much came out of that.
Speaker 1: Will anything come out of this.
Speaker 2: Well, look, let's hope. So. But I'm a bit worried
Speaker 2: the Productivity Commission. I'm a little bit worried that it's
Speaker 2: been too captured by the left. I mean, it doesn't
Speaker 2: seem to advocate for lower taxation anymore. It's more partial
Speaker 2: to spending growth. And indeed, this whole debate, we have
Speaker 2: to remember spending is the problem. We need to reduce that. Sure,
Speaker 2: we do need to change how we raise revenue because
Speaker 2: we do it in a very inefficient way. But spending
Speaker 2: growth is out of control. It's growing far faster than
Speaker 2: population growth or inflation. You know, you've got the NDIS
Speaker 2: in particular. You know it's growing almost ten percent a year.
Speaker 2: It's completely out of control. So I do worry that
Speaker 2: this whole chat of tax reform will just lead the
Speaker 2: higher taxes. But we do need to simplify the system,
Speaker 2: reduce the overall rates. I mean, you know, one fact
Speaker 2: I always say is our top marginal tax rate is
Speaker 2: higher than China's and they're supposed to be a communist country,
Speaker 2: So what does that say about us? That's the case,
Speaker 2: So we need to get those rates down to encourage
Speaker 2: people to work and say and also, you know one
Speaker 2: thing that's not talked about in my sense is a
Speaker 2: lot of bright young Australians are leaving Australia to go
Speaker 2: work in the US or work in other jurisdictions where
Speaker 2: they pay far less tax because it's just so hard
Speaker 2: to get ahead here because of the tax burd Yeah, great.
Speaker 1: To chat, Adam. Have a terrific weekend. Thanks so much
Speaker 1: for your time, mate. Yeah thanks, lluy good on your
Speaker 1: Adam Crichton, chief economist at the Institute of Public Affairs,