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Changing, adapting, innovating

By Ben McNeil - posted Monday, 17 August 2009

The political debate over the federal government’s carbon pollution reduction scheme (CPRS) has reached a critical point with the opposition and industry groups claiming it will cause significant job losses. But the idea of an industry that lasts forever is a complete fallacy - all industries have to adapt to a rapidly changing world. And as the world is moving to a low carbon economy, protecting current heavy polluters is the equivalent of protecting the typewriter industry at the dawn of the personal computer.

If we look back at Australia’s major socio-economic reforms, the same old arguments have played out over and over again. Whether it was lowering trade tariffs, the GST, occupational health and safety, bank liberalisation, or compulsory superannuation, certain industry groups try and sell the story that these reforms will bring down the entire Australian economy and as a society we’ll be returning to the dark ages.

Although greenhouse intensive industries will need to undergo structural changes, there is far more employment and wealth creation in moving to a clean, low carbon economy for Australia.


Do you remember the argument over trade import tariffs in the 1980s? The argument was that lowering trade tariffs on industries like textiles and cars would devastate the economy and push manufacturing jobs offshore. The industry opponents always loved to talk about the impact on the government-protected part of the economy, and completely ignored the new jobs in other parts of the economy. The same is happening today with respect to our carbon-protected part of the economy.

Lowering trade tariffs did restructure parts of the economy, but many more new jobs grew in new industries. By 2008 Australia’s unemployment rate had dropped to its lowest in more than 30 years despite a continual lowering of trade tariffs by successive governments. So what happened to all those people who were in effected industries? They found better, high-paying jobs of the future. Similarly, as we move out of recession, the new growth area for jobs won’t be in the old high carbon economy of the past.

Small innovative countries have an equal opportunity, along with large countries like China and the USA, to create new clean industries. Finland has a population slightly larger than Sydney, at about five million, yet Nokia exports 200 mobile phones for every person in Finland (about one billion annually). Nokia achieved this after making some tough, structural streamlining to its business in the 1990s having seen the potential for global telecommunications.

The inter-connected economy brings huge opportunities for small, knowledge rich nations to export technologies and prosper. Just like Nokia, innovative Australian companies like Cohlear, a company which helps people hear again through their innovative hearing implants, are rapidly expanding.

Cochlear is an Australian innovation success story with a positive future. A meaningful carbon price, and upscaling research and development in “clean” technologies, will spur hundreds of green Cochlear style companies all over Australia to service the technological needs of a low carbon economy. Those new Australian products and technologies will be craved in a world short on oil and high on carbon and would position Australia as a leading clean-tech hub for a growing Asia.

What type of green start-ups am I talking about? V-fuel, a new company that is seeking to commercialise a revolutionary new battery design which has potential for boosting electrification capacity of vehicles and storage capacity for intermittent wind or solar power plants. Or Microbiogen, a company based in Sydney seeking to develop non-food based biofuels for ethanol production. Pursuing a low carbon economy will grow hundreds of new businesses commercialising new fuels, materials, software, buildings, cars and energy technologies.


Cutting Australian greenhouse gas emissions isn’t just a feel good exercise - it is strategically necessary given the global transition towards low carbon, non-oil based economies. Australia must be ahead of the world if it wants the hundreds of green cochlears start-ups to come from our shores and that means passing carbon pollution reduction legislation.

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First published in the Canberra Times on August 7, 2009.

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About the Author

Dr Ben McNeil is a climate scientist and economist from the University of NSW and author of The Clean Industrial Revolution: Growing Australian Prosperity in a Greenhouse Age.

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