The coming tsunami

It is an article of faith amongst the university educated commentariat that Labor is the party of progress, reform and enlightenment, and that the Liberals represent the forces of reaction and darkness. This weltanschauung permeates the writing coming out of the Canberra Press Gallery, and it infects not only the ALP but also the Liberals, who made Malcolm Turnbull Leader in 2008 partly in order to persuade the commentariat they, too, were for reform and, in particular, they wished to join the great moral enterprise of cleansing Australia from the polluting consequences of burning coal. 

If ever there were a clean, green Liberal it was Malcolm Turnbull who, as Minister, banned the importation of tungsten light globes in order to enforce the speedier installation of mercury based high-efficiency globes, which gave out a cruel, cold light and were disliked by consumers for that reason. These light globes were much more expensive than the tungsten globes which were deemed to be so wicked in their consumption of coal-based electricity that they had to be banned. 

Malcolm also let it be known during the 2007 election campaign that he had argued in cabinet, in vain, for ratification of the Kyoto Protocol. 

Now that Labor is approaching its götterdämmerung the commentariat is gearing up its campaign to bring Malcolm back as Liberal leader. As the polls continue to show that Labor is heading into the dust-bin of history, so the hysteria behind the bring-back Malcolm campaign will increase. 

What happens when a mainstream political party, which has played a key role in Australian history since the turn of the 20th century, decides to seriously challenge economic reality with fantasy, and demands that the Australian people follow it into a world of intermittent electricity (amongst many other third world characteristics). 

In our history there have been a number of crises which split the Labor Party and profoundly changed the course of events. Billy Hughes, our worst prime minister, deliberately and maliciously split the ALP over conscription. In doing so he fostered a sense of sectarian division and distrust throughout Australia which lasted for three generations. 

In the late 1920s, as the terms of trade turned against us in 1929, Jack Lang, having borrowed huge sums in order to build the Sydney Harbour Bridge, found himself facing state bankruptcy and decided to default on the loans he had secured in happier times. 

The NSW State budget was then larger than the Commonwealth budget, so such a default would have national implications that would persist for generations. 

The upshot was that Labor federal Treasurer Joe Lyons refused to countenance default; the Scullin government fell, and Joe Lyons emerged, to his great surprise, as Prime Minister, at a time of very great economic and social hardship. This successful resolution to a very serious political and economic problem, was the work of a handful of influential business leaders and politicians, of whom Staniforth Ricketson, the founder of J B Were and Sons, was the most important. Joe Lyons was an outstanding success as PM. 

After the War came the Split. After Evatt lost the 1954 election his dementia became clearly manifest and the formation of the DLP and the QLP is a story that has become part of our political heritage. 

The ALP is now hell-bent on bringing in a carbon tax which will seriously diminish our international competitiveness. The factors which lead to comparative advantage in international trade and which govern investment flows around the world are simple enough to grasp. Australia is blessed with huge reserves of cheap coal, black and brown, which enable us to generate electricity at very low cost. This is why we have six aluminium smelters and a very large alumina refining industry. This is why any new project which is electricity intensive will look at Australia as a possible location. (Or used to). 

The Greens want to change all that and Labor is on a promise to accommodate them. A scowling Greg Combet assured us on April 18 that the Government was determined to press on with this decarbonisation policy and we had better get used to it. This is not the sort of demeanour and language which a senior minister in a government polling in the low thirties ought to adopt. 

The investments which have been made in Australia since the oil shocks of the 1970s, all based on the comparative advantage of low cost electricity, have underwritten the prosperity which we have enjoyed since the 1980s. And now Greg Combet and his colleagues want to put an end to this situation. 

As more and more people become aware of what is being foisted upon them and what the consequences of these policies are likely to be, disappointment and regret will turn to anger and resentment. Labor will be left as a rump fighting with the Greens for the inner city public sector vote. Those Labor parliamentarians from outside the inner city electorates, and who are in touch with their constituents, are now beginning to grasp the size of the tsunami which is coming towards them. They will have to take action soon or see the Labor Party, to which many have given their working lives, swept out to sea, never to be seen again.


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