Coal mining will outlast green hysterics

“Not all jobs are good”, says former Liberal Party leader John Hewson.

That assertion, odd for an economist, fell from Hewson’s recent Australian Financial Review column lashing the Government and Labor for appeasing the coal industry over climate change. Neither, he says, will confront the “necessary transition” to an economy without coal mining. “Some of those jobs, indeed some of those industries”, writes Hewson, “may not be able to be protected, nor should they be”.

More than anything, Hewson’s column encapsulates an important truth about our climate change debates - there is no absolute response; rather, it depends on your socio-economic standpoint.

Over recent decades university graduates engaged in professional or quasi-professional “knowledge work” have grown from a small fraction to over 30 per cent of the workforce. Since this echelon controls the channels of ideas and information, it is hardly surprising that we are bombarded with policy prescriptions that promote, or protect, their interests at the expense of other socio-economic strata.

The gentrification of social policy is a prominent feature of contemporary politics. John Howard, “the battler’s friend” is not immune to it. The trend is apparent on issues like “work-life balance”, “diversity”, urban development, higher education and, last but not least, the environment, especially climate change.

When Hewson says some jobs aren’t good, he’s not thinking of his own. And nor does the whole herd of alarmists bellowing for an end to coal mining.

It’s fashionable to assert that “transition” to a decarbonised economy will be relatively painless. Those peddling this myth tend to draw on a series of undigested, and often misunderstood, research papers and reports, starting with last year’s Allen Consulting effort (PDF 2.09MB)for the Business Council’s Roundtable on Climate Change.

According to the report, greenhouse gas emissions cuts of 60 per cent from year 2000 levels by 2050 would only reduce GDP by 6 per cent less than otherwise. Then came the famous - or infamous, depending on your perspective - Stern Review estimate that “the expected annual cost of emissions reductions consistent with a trajectory leading to stabilisation … is likely to be around 1 per cent of GDP by 2050”.

The figure of 1 per cent was widely described as a cinch. Now, the third instalment of the IPCC’s Fourth Assessment Report, released at the recent Bangkok conference, follows in a similar vein, stating that reducing emissions to acceptable levels will cost no more than 3 per cent of global GDP by 2030.

(The IPCC report brought on the inevitable Sydney Morning Herald headline: “It won’t cost the earth to save the planet”.)

Such pronouncements are commonly used to dismiss the understandable fears of energy sector investors and unions. One egregious case is the AFR’s Brian Toohey, who claims “Australian households and businesses will barely notice the cost of achieving deep cuts to greenhouse gas emissions by 2050”, and adds “we could adopt the 80 per cent target set by California’s Republican Governor, Arnold Schwarzenegger, and still find it a breeze to achieve”.

A breeze to achieve? Toohey writes from his own secure perspective. What for him is a breeze, may well be a tornado for thousands of blue-collar families. While progressives call for drastic measures to save our common inheritance, there won’t be common consequences - some will win, others will lose.