The improvement in the Coalition’s Newspoll on 29 January (still down at 47/53 TPP) has almost been forgotten and questions continue as to whether Morrison is able to address the “two big things” (quit Paris accord and slash immigration) needed to give the Coalition a chance. The need for quitting the Paris accord has been enhanced by what has happened under heat waves in Victoria, South Australia and now NSW.

Since my 29/1 Commentary the possibility of the Coalition establishinga policy which would, as promised, allow lower electricity prices to happen and be sustained continues to be highly unlikely– except of course if government controls are able to be imposed legally and producers/retailers are compensated for a proportion of  the existing higher costs which would otherwise be met by consumers of electricity, but with taxpayers then having to pay the costs. As indicated in the this article (Forward Electricity Prices Increase), at present futures markets are operating on the basis that the increasing reliance on renewables under announced policies will mean that there will be periods when major shortages of supply occur given that states have policies which will rely on up to 50 per cent of power coming from renewable and prices will have to increase to choke off a proportion of demand (the discussion in the article is confused because the author and the AFR itself supports existing policy).

This is basically what happened during last week’s heat wave and little wind power and which led to a sudden major increase in costs. It is reported that Victorian and South Australian consumers of electricity had to pay additional costs of about $1bn for just two days last week, which indicates the frailty of existing policies operated by those two states (see Power Costs Increase by $1bn in Two Days) and which other states also operate. Indeed, NSW has today experienced blackouts which appear less than in  Melbourne but which include outages (and additional costs) in hospitals (see Blackouts in NSW Too).

Note that Federal Resources Minister Canavan  said that this occurrence “justifies investment in reliable sources of power, such as coal-fired power”. But he fails to recognise that the private sector will not make any such investments under the existing climate change policy which aims to reduce usage of coal. Note also that the climate “expert” employed by The Australian, Graham Lloyd, comments that  “Renewable energy might be the cheapest option to build but it makes sense only if there is power available when it is needed”(see Graham Lloyd on Renewable). But he doesn’t canvass a reduction in usage of renewable or a basic problem with policies.

The “solution” of course is to withdraw from the Paris accord which Turnbull signed on our behalf (sic) and, instead, adopt a climate change policy which preferably eliminates any target for using renewable or reducing carbon emissions but at least reduces such targets to a major extent. Properly handled, that would provide a major weapon with which to fight the election given that Labor has adopted an even larger bunch of targets to use renewable and to reduce carbon emissions.  But Morrison has first to indicate that his government is now not in agreement with CC policies adopted under Turnbull.

My previous Commentary have argued that, as a Coalition leader facing an election, Scott Morrison needs to get cracking on enunciating policies asap in the New Year. But although active since early January, he seems to have focussed on matters which are mostly “organisational” and would have limited appeal to the electorate in general. Indeed, his poor handling of some of these matters might even have attracted negative comment or a sort of “well what was that all about”.

Now we have a situation in which three of his ministers have said they will not stand again but, in what seems bad strategy for the Coalition, will remain as ministers right up to the election and yet whatever they pronounce will have no application as future policy in itself. Morrison’s response is that such “refreshing” is normal but it gives the appearance of rats leaving a sinking ship (see Morrison Loses Three Ministers). Moreover, while the “pick” by Morrison of former President of the Labor party, Warren Mundine, for the seat of Gilmore should help retain that closely fought seat, Morrison seems to have mishandled the arrangements for the de-selection of a popular local candidate and he felt forced to publicly attack that candidate. This has apparently upset not only the candidate but other local Liberal members, some of whom resigned. It will not have helped the next Newspoll by the Coalition.

Today’s article in the Herald Sun by Peta Credlin points out that, while Mundine “delivered a devasting indictment of the party that had been his DNA for decades”, the “immediate attention of the media focussed on the cack-handed way the former Liberal candidate was replaced and the unhappiness of local branch members. Instead of Mundine’s move signifying just how much the coming election matters, its been treated as further evidence of Liberal chaos” (see Re: Credlin on Mundine Highlighting Added). With what is almost despair Credlin adds “As you know, I’ve been a critic of the current government for not being sufficiently different from Labor, whether that’s been rolling PMs or pandering to the green lobby by destroying Australia’s energy advantage. But for all the government’s mistakes, Mundine’s move highlights the gulf that still remains between the two big parties. Labor’s instinct is always for more spending, more regulating and more taxing, especially on anyone who works hard to get ahead”.

Importantly, neither Morrison nor his Energy Minister (Taylor) seem to have been able to indicate why they have not made any substantive change in energy policy and/or how they are going to effect the promised reduction in electricity prices. Alinta, one of the our large retailers, has indicated that no reductions are likely in the next 18 months. If correct that would follow the about doubling of wholesale prices in Victoria over the last six years  (which covered the closing of Haxelwood) and similar increases in other states.

Note that Alinta  was bought by a Chinese group in 2017 “from private equity for $4bn as part of a wave of foreign investments targeting growth opportunities in Australia’s power and utility sectors following a jump in gas and electricity prices over the past few years” ie it would seem that the Chinese saw that the increased prices offered high returns and no effective action was subsequently taken by the ACCC to try to ensure competition, rather the so-called regulatory solution. (see Power Prices To Rise further). The implication is that Atlinta feels that any policy changes by either the Victorian or Federal governments will be accompanied by price increases.

Indications remain (but without detail) that, to ensure (sic) reliability and to control prices, the Morrison government will likely announce a highly regulated energy policy, possibly in the budget.  Such a de facto nationalisation would naturally suit Labor, which has been attributing part of current problems to privatisations undertaken by former Premier Jeff Kennett. But instead of pointing out the gross inefficiency of the SECV when he came to office, the latter’s main contribution to existing political difficulties facing the Coalition seems to be to push some of the oldies in the Liberal Party to resign, including existing “conservatives” such as Kevin Anderson and Tony Abbott.  Yet Morrison shows no sign of even bringing them back as ministers, even though that should at least improve the image from the existing left of centre!

The concern which the extreme left feels about a return of Abbott to the Coalition ministry is indicated by the front page article published by today’s Age. It is headed   “An Olympian’s Task: to kick out Abbott” and written by two journos, Peter FitzSimons & Bevan Shields, whose writings would raise a question about The Age’s claim of being “always independent”.  According to these two, “World champion athlete-turned-barrister Zali Steggall has called time on Tony Abbott’s “destructive and divisive” 25-year career in federal politics, launching a major bid to seize the former prime minister’s blue-ribbon Sydney seat of Warringah…  the four-time Winter Olympian said Mr Abbott was an “aggressive” national figure who had lost touch with the affluent electorate and deserved to be thrown out of Parliament for his role in the demise of Malcolm Turnbull, and views on the environment… Tony Abbott, who has been a handbrake on Australian progress on many fronts but particularly effective action on climate change”. (Note that my first message conveying this article was rejected because “the content was rejected due to suspected spam”. When I sent the same message again the suspected spam had disappeared!).

The Coalition’s (Federal & Victorian) failure to enunciate a coherent energy policy was important in the abysmal handling of the policy during the heat wave and may well constitute another challenge or two in the period ahead if (as is forecast) further high temperatures occur. In considering the various policy “explanations” it is pertinent to assess what the main policy makers said that during the heat wave yesterday (see The Incredible Story of Vic Energy Policy under “Extreme” Eventsextracted from reports/comments in yesterday’s Australian):

• Federal energy minister Angus Taylor said the government was closely monitoring the energy situation in Victoria and thanks AEMO for the job it has done managing a difficult situation in collaboration with the wider energy industry. “The conditions experienced over the last two weeks across the national electricity market reinforce the need for investment in reliable 24/7 generation and the retailer reliability obligation.“That is why the government is backing in new reliable generation investment through its Underwriting New Generation Investments program which has had strong responses to its registration of interest process that closed on 23 January.“The government will carefully consider all proposals and will have more to say once we have considered all the submissions and feedback received during this process.”
•  Labor leader Bill Shorten said he was very concerned about the load shedding, suggesting the Morrison government was partly to blame.“Ever since the federal government said they could lower power prices and took responsibility for the power debate, it’s now partly on the federal government’s head this challenge of blackouts,” Mr Shorten said.“They’re the ones who said that renewables were a waste of time – well they’ve been in charge now for the best part of six years.
  “I do expect the federal government, having said they could lower prices, to do more for the reliability of the system rather than just blame the states but it is most serious and let’s just keep our fingers crossed.” Mr Shorten said the last six years of energy policy had been a disgrace.“While this government has been debating the scientists and the community about renewable energy there has been a virtual freeze on investment in power generation and now sadly when we need our power the chickens have come home to roost,” he said.  “While you have a government that can’t deliver a coherent national power policy, there will not be investment in new generation and where you don’t have investment in new generation, sooner or later the old generation will fall over and then we face these sorts of crises.“To me it highlights everything that’s wrong with the LNP and the Liberal government in Canberra in 2019 – they spend so much time arguing about the politics, and now we’ve wasted 2000 days and we’re no better off, indeed we’re worse off, than we were six years ago.”
• Victorian Energy Minister, Ms D’Ambrosio said voters had spoken loudly and clearly on the Coalition’s credibility on energy policy at the November election.“They had no energy policy. The only energy policy they took to the last state election was to build a new coal-fired power station which – even if you started building it today – would take eight years to come”.  “No-one is prepared to finance it, and we can see that the problems we’ve got now is that we’ve got a 20th Century system for a 21st Century climate, and the fact is our thermal generators are ageing, they are becoming less and less reliable.“That has been palpably evident in the last couple days.” “More energy supply is available to us in Victoria this summer than it was this time last year. That’s because of our strong emphasis on renewable energy: the quickest form of energy to be built, the cheapest and, of course, if we have a look at today, the most reliable.“Wind power came through today. Wind power produced sufficient power generation – as was anticipated.“Our batteries – our large batteries – were available last night when we needed them the most.”  AEMO data showed the batteries generating just 25 megawatts of a Victorian total of 8,622 megawatts at 7pm last night.
  Wind is currently generating 8.1 per cent of Victoria’s energy.
• Victorian opposition leader Michael O’Brien said the load shedding today in Victoria has shown the failure of the Andrews government’s energy policies.“Something is seriously wrong when the power goes out in Victoria because we don’t have enough supply,” the Liberal leader said.“On a day of extreme temperatures, there are serious health and safety concerns with deliberately cutting off supply.“When Labor policy led to the closure of Hazelwood Power Station, the Liberals and Nationals warned that Victoria was left exposed.“We are not a Third World country. We deserve a safe and reliable power grid.
  “Daniel Andrews loves to boast he’s good at ‘getting things done’. Keeping the power on would be a good start.”
• Victorian opposition acting energy spokesman David Southwick said it defied belief that in a first-world country like Australia, Victoria has a state government that can’t guarantee enough electricity for people to go about their daily lives.“Melbourne is currently hosting thousands of international tourists for the Australian Open who must be wondering why the state government is asking its citizens to refrain from using common household appliances to prevent large scale blackouts,” Mr Southwick said. “Most Victorians agree that renewable energy is the future but we need to make it a sensible transition that doesn’t threaten power supplies and cost Victorians a fortune.“Daniel Andrews owes all Victorians an explanation as to why he can’t keep the lights on.”

Conclusions

Readers of this Commentary will recognise the ineptness of these statements of policy makers, both Liberal and Labor. Of course, Australia can increase the usage of renewable but the limited wind yesterday showed that they produced only 8 per cent of power in Victoria. This low contribution occurs quite frequently (similar low contributions occur in other states). If the reliance on renewable is increased so too will there be a need for considerable additional investments in back-up power sources, such as gas and diesel. This futher addition to the cost of producing power requires either additional subsidies by taxpayers (already large) or further increases in prices (already doubled in the last six years). A reduction in the unnecessary government restrictions on investment in gas would also help as it has enormously in the US.

The cost of producing more power, and reducing electricity prices, would also be reduced if the existing policy of reducing emissions from coal usage was either dropped or substantially reduced and the non-binding agreement in Paris was dropped or reduced.

A belated Happy Australia day

The extent of the Coalition’s loss in the Victorian elections far exceeds predictions in pre-election polling: it looks like a 5% swing against the Coalition which could mean they hold only 25 seats in a Lower House of 88 total seats and could lose 5 of their 16 seats in the Upper House, which has 40 seats. As such their capacity to constitute an effective opposition will be difficult, to say the least. The unanswered question is why such a loss has occurred particularly in the so-called sand-belt area on the east coast of Port Phillip bay which would include middle income groups.

There are numerous explanation for the large loss but there seems little doubt that the Victorian Liberal party under the leadership of Guy (who has been re-elected) failed to explain to the electorate what the Liberal Party stands for and how it distinguishes itself from Labor. For example, he apparently refused to have a debate on Sky News (which now broadcasts through Victoria) and this is reputed to have typified his attitude to media. By contrast Labor leader Andrews’ claim that Victoria under him became the “most progressive state” received attention on the ABC and the Fairfax press.

Guy failed to promote a view which, while agreeing that the state had an important role,  also emphasised the importance of the private sectors in providing education, health and transport in particular as well, of course, as expanding the private sector economy, which is much bigger than the government sector. Guy could have made more of the strong economic and population growth in Victoria as reflecting the private sector’s initiatives. He could also have put in perspective Andrews claims of providing state education, health, etc services by pointing out that this is just what state governments are expected to do.

The Liberal Party’s “problems” at the federal level, particularly in regard to the dismissal of Turnbull as leader, would also have contributed to the loss of votes in Victoria. Turnbull’s deliberate undermining of the role of the Liberal Party, both during his leadership and after, undoubtedly caused a loss of “Liberal” voters, as shown in the continued poor polling while he was PM and the almost certain loss of the federal election if he had stayed. The take-over by Scott Morrison has however done little to help, partly because he has given the impression of agreeing with some of what Turnbull did and partly because he has not adequately explained his view on most major policy issues. These developments made it more difficult for Guy to promulgate policies at the state level. Morrison also made only one official visit to Victoria and spent considerable time during the election campaign taking a bus around north Queensland where no election is imminent.

Some Liberals (and the ABC) have argued that, with Michael Kroger as the elected head of the party, it has gone too far to the “right”. But as the failed Turnbull move to the left shows, this claim can scarcely be sustained. Rather, Guy should have moved to the right instead of trying to play down the middle or simply repeating what Andrews said. Shadow Attorney General Pesutto rightly complained that “something’s gone horribly wrong” as he watched the vote count narrow in his own seat of Hawthorn, which he has lost. He added “we’re going to clearly have to do a root-and- branch review, to bottom, of all of this… My own preference would be that the party needs to take urgent action to re-orient and get back on the right foot”. Whether he was using “right” to indicate a shift in the orientation of policies is not clear, but that is what is obviously needed.

As I pointed out in my previous Commentary of 22 November, this was particularly the case in regard to the mishandling of the terrorist threat and the Sudanese gangs by the Andrews government and, in particular, by Attorney General Pakula. An opportunity to use this “gift” to the Coalition was missed.

The one encouraging development from the election is that it appears that the Greens have lost seats in both the lower and upper houses. But this may be more a result of Labor’s attack on them and some self-inflicted wounds than criticism by Guy. Yet he had an opportunity to criticise the rise of electricity prices and the influence of the Greens but instead offered a subsidy.

Overall, whether at the federal or state levels this result is a reflection of the failure of the Liberals to distinguish themselves from Labor. Guy was a major offender and should not be re-elected as leader of the  Victorian Liberals. The Newspoll due tomorrow is unlikely to show any improvement at the federal level and could raise questions about the federal leadership, which is already trying to say that the Victorian election was all about state issues (see Vic Election Result Has Federal Implications).

In my Commentary published on 18 November I suggested the handling of the Bourke St incident indicated serious deficiencies. This has been confirmed by developments since then.

Most important has been the statement by Victorian Attorney General Pakula that Victorian police had not received information from federal sources which would warrant them acting to at least monitor the now dead Muslim terrorist, Shire Ali. But Victorian police chief Ashton subsequently announced that they had in fact received the necessary federal information. This prompted me to send a letter to the press arguing that Pakula should resign but, as he has stuck to his guns and has been supported by Victorian Premier Andrews, that won’t happen a couple of days before the election (see OZ on Bourke St Terrorist Revelationsand Pakula Claims Not Informed of Terrorists Passport Withdrawal).

My letter was published in today’s Australian (see below)  and the Herald Sun published a slightly different version

Fix terror tracking

The Australian, Letters, November 21

Following the killing of Sisto Malaspina by terrorist Hassan Khalif Shire Ali and the many questions about the performance of security, police services and Victorian ministers, three men have now been arrested over another alleged terrorist plot (“Melbourne terror raids: three men charged over plot designed for ‘maximum casualties’”, 20/11).

While the capacity of protective services to prevent terrorism is limited, it must be given top priority in monitoring suspects. But despite removal of his passport, and frequent attendance at Muslim prayer bodies, Shire Ali was not.

Information about potential activists must be fully exchanged between state and federal agencies and ministers. Despite the initial denial by Victorian Attorney-General Pakula (“ASIO, Home Affairs contradict Martin Pakula on Shire Ali’s passport”, 19/11), this now appears to have been the case. This avoidance of facts, and failure to stop Shire Ali, calls for the resignation of Pakula.

Most importantly, federal and state governments need to review what appear to be serious deficiencies in arrangements for preventing terrorist activity.

Des Moore, South Yarra, Vic

Debate on this incident will doubtless continue but public attention moved yesterday to the announcement by Victorian police that three Muslims had been arrested as terrorists. It appears that these three had been planning a shooting expedition into a large crowd and their planning had been followed by police for some months despite their use of encryptions (see Objectives of Three Terrorists). Note that they were influenced by“Anwar al-­Awlaki, a Yemeni-American ­cleric who was killed in a drone ­attack and whose hate sermons inspired two of America’s worst terror attacks: the Pulse Nightclub massacre in Orlando, Florida, and the San Bernardino shooting”.

The report also reveals that “­Armagan Eriklioglu, the father of two brothers in the alleged terror cell, posted a link to a Turkish-language Islamic State Facebook –account”. He was not arrested yesterday and the report says he “is not suspected of being part of his sons’ alleged plans”, which seems surprising.

It is possible that this decision by Victorian police to arrest three was timed in order to demonstrate their efficiency (sic) after their poor performance in handling Shire Ali!

As to encryptions, Home Affairs Minister Dutton took the opportunity to call for “the Intelligence Committee today within the parliament to return their advice back to parliament very quickly because this is legislation the government needs to deal with very quickly,” he told reporters. “We have a bill before the parliament that provides the appropriate safety mechanisms, the privacy protections in place, but it allows police and ASIO to do their jobs in relation to these terrorist investigations”. “Mr Shorten has been opposed to this legislation but he needs to review his position as well. We are in a position of vulnerability” (see Dutton Seeks Shorten’s Support on Encryption).

Fairfax-Ipsos Poll Shows Increased Coalition Rating

The Fairfax/Ipsos poll for Nov 14-17 shows an increase in the Coalition’s rating to 48/52 TPP from 45/55 in Oct 10-13. At this level the Morrison government is at a higher rating than the Turnbull one was when he was deposed. But there is still a long way to  go for the Coalition and Morrison’s personal performance rating fell to 48 per cent from 50 per cent and his preferred PM rating also fell by a percentage point to 47.

The poll also asked pollers about their views on Energy Policy and Immigrants from Muslim countries, viz

• Main energy priority for Government is 47% for Reduce Household Bills cf with 39% for Reduce Emissions.This suggests that, once the cost of reducing emissions hits bank accounts, there is a tendency to reduce support for measures which add to living costs. If the Morrison government were to reduce the cost of emissions (and hence Household Bills) that would likely further reduce support for the mythical dangerous warming thesis.
• For views on Immigrants from Muslim countries, 47% say they should be reduced (cf 45% in previous poll) compared with 35% who voted for them to stay the same (cf 29% in previous poll). Those favouring an increase fell from 23% to 14%.  As this poll was taken before the Bourke St killing, it probably understates those who think Muslim immigrants should be reduced, as does the latest arrest of three Muslims. A more appropriate assessment would likely occur if the government were to publish an information paper on Muslim beliefs (see Fairfax-Ipso Poll Opposes Increased Muslims)

Immigration Statement by Morrison

In his so-called population speech on Monday, Morrison “floated the idea of reducing the permanent migration cap by about 30,000 people a year. This would bring the maximum permanent intake to the level to which it has fallen in the past year, despite the current cap being 190,000. The population plan will be discussed at the next meeting ­between state and federal govern­ments on December 12” (see Possible Immigration Targets).

While Labor has indicated it may support a reduction, this is a disappointing response to the many commentators who have argued for a higher reduction figure and to the decision not being made by the Federal government, which should be the policy determinant.

However, Morrison is reported as saying that “Australia will refuse to sign up to the UN’s migration pact, which has already been rejected by the US and several European countries, on the grounds it would weaken border security and undermine the annual immigration program”. He took the position that the compact is

“contrary to the ­national interest and would be used against Australia by critics of its border policies”. “I’m not going to sign up to an agreement that I believe will only be used by those who have always tried to tear our stronger border policies down”… “I experienced this first-hand back when I was responsible for stopping the boats. We must ­always decide on these issues and not have our laws undermined by outside influences” … and has a “fundamental flaw” in failing “to distinguish ­between illegal and “proper” ­migration when it came to the provision of welfare benefits” (see Australia Not Signing UN Global Migrant Pact).

Hopefully, this decision may also lead to rejecting other global agreements, such as the Paris one on climate change which is clearly not in Australia’s interests. But his statements justifying our immigration policy also need to emphasize that, while reflecting the cultural basis of our society, it is non-discriminatory. As indicated in the recent report by the Centre of Independent Studies, the social cohesion objective is an important component of immigration policy (see CIS Report on Immigration).

Last Sunday’s Commentary on the killing by a Somalian (Shire Ali) in Bourke St gave the gist of  PM Morrison’s reaction that   “I am the first to protect religious freedom in this country, but it also means I must be the first to call out religious extremism,” he said. “Religious extremism takes many forms around the world, and no religion is immune from it … But here in Australia, we would be kidding ourselves if we did not call out the fact that the greatest threat of religious extremism … is the radical and dangerous ideology of extremist Islam.”

Responding yesterday to queries, Morrison said that the terrorist’s past substance abuse and alleged mental health issues are an “excuse” and that he would continue to call out extremist Islam and that this is “the elephant in the room”. He pointed out that Shire Ali’s reported marital struggles and substance abuse did not deter from the fact he was radicalised.  “I think that’s an excuse. This bloke, radicalised in Australia with extreme Islam, took a knife and cut down a fellow Australian on Bourke Street,” he told the Ten Network’s Studio 10 this morning. “I’m not going to make excuses … he was a terrorist. He was a radicalised extremist terrorist.”

He added that he had consulted with a Muslim community leader before he made the initial comments, and that commentators accusing him of “dog whistling” are making excuses for terror. “That is the same lame, old, tired excuse for not dealing with this problem as has always been served up,” he said. “I don’t believe that’s where the majority of decent, hard-working, respectable Australian Muslims are at. They want their communities to be safer” (see Terrorist Had Communicated With IS).

Today’s Australian reports that Mr Morrison has urged imams to identify “infiltrators’’ in their mosques and to be more alert for and proactive towards any signs of radicalisation. It describes the Prime Minister’s “forceful rhetoric” as aimed squarely at imams he believed were “looking the other way’’ when confronted with extremism in their mosques. Home Affairs Minister Peter Dutton has also called for Muslim community members to help bring potentially dangerous radicals to the attention of police. Morrison is reported as claiming that  the “active co-­operation” of Islamic leaders was required to prevent terrorism. “When you’ve got 400 people on an investigation program and 230 people with cancelled passports, there’s no way you can have active eyes on everyone,” Mr ­Morrison said. “No government can achieve that. This is about protecting their own communities, and their own religious communities’ integrity, because at some point a young person is always going to be ­vulnerable. “That’s when these infiltrators go to work. They can sniff it out and in they go. We’ve seen it time and again.”

By contrast, today’s Australian also reports Sheik Omran, the spiritual leader of the Islamic youth centre where Shire Ali ­attended prayer sessions, as ­accusing Morrison of “making the Muslim community a scapegoat to distract from the failure of police and intelligence services to prevent Friday’s attack”. Mohammed Omran, the emir of the Hume Islamic Youth Centre close to Shire Ali’s Meadow Heights home, dismissed the “bloody Prime Minister’s’’ call for imams to do more to stop Islamic extremists, saying the greatest power he had was to dial triple-0 when confronted with a threat. According to The Australian, “the HIYC, a sprawling mosque, cafe, gym and bookstore in the Melbourne suburb of ­Coolaroo, has seen a procession of jihadists and would-be terrorists through its doors, including ­domestic terror plotters and suicide bombers who killed themselves in Iraq” (see Muslim Leader’s Attack on Morrison).

Another report today confirms that Shire Ali had had contacts with Yacqub Khayre ( the man responsible for the Brighton siege last year and the murder of a receptionist) and his friends, as well as being an online friend of infamous Australian terrorist Khaled Sharrouf in 2014 (the man who posted a photo of his young son holding a severed head online in 2014) (see Ali Had Friends with Other Radicalists).

Judging by the foregoing activity of Shire Ali and his Islamic “friends” (of which more will doubtless be revealed), the anti-terrorist policies and the accommodative attitude adopted toward the Islamic community by former PM Turnbull and Victorian Premier Andrews have, even with the large increase in police and intelligent analysts, clearly been deficient. According to comments by Victorian Opposition Leader Guy,  while Premier Andrews ­ had four years to back the federal government on deportation “the government hasn’t recommended a single person for deportation in four years. Now he says this is on the agenda.” Yesterday Andrews declared the Victorian government “stands ready” to co-operate with the federal govern­ment on deportations and visas, in a break from past responses to ­federal intervention on state law and order (see Andrews Now Supports Deportation and Visas).

But policies need to extend much further into restricting statements by Muslim preachers et al endorsing all of the Koran. Freedom of religion is generally accepted but, in this day and age, it should not allow the preaching of death to believers  in other religions.An experienced analyst of the Koran, Bill Muehelenberg, argues that “the problem is not with ‘extremists’ but with the religion itself. The religion commands its followers to kill the infidel. Its founder led the way here, leaving all Muslims a perfect example of what they should do”… “The simple truth is this: if a Christian kills in the name of Christ, he does so in total opposition to the life and teachings of Christ, and the entire New Testament. However, if a Muslim kills in the name of Allah, he has full justification to do so from the life and teachings of Muhammad, from the Koran, and from the hadith and sira” (see billmuehlenberg.com/2008/11/21/jesus-muhammad-and-violence/).

As I argued in a recent Commentary, the government should publish a paper outlining the beliefs of Muhammad in the Koran, which was put together after the death of Muhammed in 632 but for which he left no records. And other new policies are also needed.

Further Downturn in Newspoll

Last Monday’s Newspoll showed a further drop in the Coalition’s polling to 54/55 on a TPP basis and a drop also in Morrison’s personal satisfaction ratio. As argued in previous Commentary, I believe this reflects Morrison’s failure to indicate policies on major issues. This view is also reflected in an editorial today’s Australian, viz

“Mr Morrison does not need to don baseball caps and give us the thumbs up to convince us he is a suburban dad. We get it. He needs to use the authority of the top job to deliver the reforms and arguments this nation needs. As a Coalition Prime Minister there must be more he wants to achieve on tax reform or energy affordability. He must be concerned about cultural issues such as our university sector rejecting a centre for Western civilisation or a Labor opponent refusing to call out Islamist terrorism. In short, Mr Morrison will win government in his own right only if he provides the central missing ingredient of this dismal past decade of politics: leadership”  (see OZ Says Morrison Needs to Deliver Basic Reforms),viz

“Mr Morrison does not need to don baseball caps and give us the thumbs up to convince us he is a suburban dad. We get it. He needs to use the authority of the top job to deliver the reforms and arguments this nation needs. As a Coalition Prime Minister there must be more he wants to achieve on tax reform or energy affordability.

He must be concerned about cultural issues such as our university sector rejecting a centre for Western civilisation or a Labor opponent refusing to call out Islamist terrorism. In short, Mr Morrison will win government in his own right only if he provides the central missing ingredient of this dismal past decade of politics: leadership”.

Many will be aware of Banjo Patterson’s ballad on The Man from Snowy River,  which began with “There was movement at the station, for the word had passed around That the colt from old Regret had got away, And had joined the wild bush horses”. Clancy of the Overflow then caught the escaped horse and turned around the other horses which had formed a collective with the colt. But Clancy had first to overcome numerous obstacles.

There is increasing recognition that Morrison needs also to make more ”movements at the station”. This is widely reflected in the weekend media.

He has succeeded in overcoming some challenges and displays enthusiasm to do more. But, as Chris Kenny points out, every time Morrison “tries to solve one problem it seems to create another. Hence a rushed announcement on our ­Israeli embassy aimed at winning votes in the Wentworth by-­election doesn’t work and exposes the government’s cynicism; an overreaction to the partially leaked and dishonestly characterised recommendations of the ­Ruddock ­review on religious freedom prompts rushed new laws that come unstuck; and a quick fix with Indonesia to send Turnbull to a Bali conference opens ­internal schisms in the ­Coalition and sends mixed signals to the public” (see Kenny on Morrison).

Kenny argues that “If climate is set to be a major issue at yet another election — as seems clear — then Morrison must have a comprehensive policy that sits in stark contrast to Labor’s reckless plan for a 50 per cent ­renewable energy target and 45 per cent emissions reduction goal. Getting into a climate compassion competition with Labor is the road to ruin, economically and politically”. Further, “if the Coalition can unite behind a clear agenda while attacking Labor, the government will stand a good chance. However, recent history suggests such cohesion and tactics might be beyond them”.

It is time, Kenny rightly says, for “Morrison to admit the government had drifted off course under Turnbull and for him to be unashamed about applying a corrective, especially on climate and energy. He doesn’t need to overdo it because, as outlined, the fundamentals are strong. A steady continuum from here will spell certain defeat. It will not be enough for the Morrison government to campaign on the best achievements of the Abbott and Turnbull governments. It can only succeed if it rapidly develops a character and agenda of its own, and engages in robust battles with Labor on areas of Coali­tion strength”.

In a word,  bring the horses home and get them together as a group, just as Clancy did.

Importantly, The Australian’s political editor has pointed out that “with the Coalition trailing Labor in Newspoll 53-47 per cent on the two-party-preferred vote, Mr Abbott has now said he would do “everything I can” to help Mr Morrison win the election, which is due to be held by May next year… Mr Abbott, referring to his removal as Liberal leader in 2015 and Mr Turnbull’s removal three months ago, said: “People who regard themselves as Liberal voters who are dismayed and disappointed with the events of the last three years must grit our teeth and vote for the better choice of the Scott Morrison-led Coalition over the Bill Shorten-led Labor Party”.“In the end, an election is less about striking a pose than choosing a government. “No government is going to appeal to every single voter but when it comes to a choice between Morrison and Shorten it is a no-brainer” (see attached OZ on Abbott}.

Moving Abbott to a more important “station” than he now has would be one of the measures Morrison could take – and needs to do so asap – in the near future.

Indeed, changes such as this could help the Coalition in Victoria in the 24 November election, where it appears to be behind in the polls (about 49/51 TPP) but has just secured considerable financial assistance from the Cormack Foundation. A win in Victoria would be of considerable assistance to Morrison, who faces a Newspoll on tomorrow which is unlikely to show any improvement (see Labor Ahead for Vic Election).

Part of the basis for another change could also be found from the release of a new data series from the Australian Bureau of Statistics on Friday showing that coal mined in Australia in 2017-18 was valued at $65.6 billion, up from $41.4bn in 2013. “This is the first time that statistics for output (by commodity) and intermediate use of inputs have been published for the mining industry,” the ABS said. Gas production also increased dramatically over the past five years, rising from $22bn in 2013 to $46.5bn in 2018. In 1994-95, gas production was worth $2.6bn (see Energy Ministers Meet).

As domestic usage of coal would probably have fallen since 2013, or at least not increased as much as the ABS data indicates, the increase in exports could be used to argue not only the important role it is playing in increasing national income but the absurdity of further reducing emissions here while the overseas users of our coal  are increasing their emissions, with some such as China doing so quite rapidly.

This development could provide the basis for the Morrison government informing the Paris agreement authority that it has already made its fair share of emissions reductions for the time being and will stop subsidies for renewable except for projects already started. Such a policy change would provide a major difference between the Coalition’s climate change policy and Labor’s.

There is plenty of ammunition available to support a  more moderate climate change policy and provide budget savings. Judith Sloan’s survey of the increase in electricity prices and the cost effects of policies provides a basis for having more moderate polices  (see Sloan on Energy). For example, the subsidies for renewable are costing $2-3bn per annum and are being paid by taxpayers/consumers. Her conclusion is that  “the NEM (National Electricity Market) is in disarray, but let’s not kid ourselves that this is because of policy paralysis. This is because of incredibly poor policy where the consequences in terms of price and reliability were completely foreseeable. The challenge for the federal government is how to pull us back from this abyss”.

Of course, a more moderate federal climate change policy would not prevent some of our states from continuing policies which are costly and have no effect in reducing temperatures. But it would establish a scenario in which state political parties could follow the moderate federal approach and in which Australia would be leading the way towards changes to policies which are approaching those adopted by the US.

The  Greens leader’s attempt  to “explain” his party’s loss of votes in recent elections has led him down a track which could result in his displacement as leader. His response has been to bring back into public debate the extremist view of Greens that climate change causes many of the problems which society faces. On this occasion the problem is bushfires and the alleged failure of the Turnbull government to take sufficient action to reduce CO2 emissions.

This thesis has led to its ridiculing in a spate of letters (see Letters on Greens), including one by me which is below and an editorial in The Australian saying that “Senator Di Natale and his party have shown they lack the policies and expertise to make a constructive contribution to the nation” (see Editorial on Greens). Andrew Bolt goes further in describing the Greens as “vultures” andpointing out that “nothing Australia could do would make any measurable difference to temperatures. We’re just too small, making up only 1.3 per cent of the world’s emissions.  What’s more, satellite data shows the world’s temperature last month was just 0.2 degrees above the average for the past 30 years. What tiny part of that tiny warming (some of it natural) could we have changed by cutting our emissions even more? And what difference would that have made to the fires? So Di Natale is either a liar or a fool, in my opinion” (see Bolt on Greens).

However, the best Turnbull could manage was to say “Look, I’m disappointed that the Greens would try to politicise an event like this. I mean this has been shocking destruction of property … Thank heaven there have been no lives lost, but that’s a great tribute to the community, to the firefighters, to all of that preparation and resilience. But this is not the time to politicise a disaster like this”. Environment Minister Frydenberg has issued no press release on the attitude of the Greens.

In fact, it is an opportunity to use exactly what The Australian and Bolt have done. But Turnbull and his ministers have so locked themselves into emissions reduction policies that they find it difficult to criticise even the green extremists – because they are adopting policies which are not all that different!

Di Natale Misses the Point on Reasons for Bushfires

(Letter Published in The Australian, 22 March, 2018. Square bracketed bits deleted by Ed)

Having lost the Batman by-election, and lost votes in the South Australian one, the Greens are desperately searching for ways to bring back voters. Hence, you report that their leader Di Natale has seized on the bushfires recently experienced to blame the federal government’s failure to address climate change and allowing conditions conducive to [hurricanes and] bushfires (“Greens fire up climate row”, 19/3).

[Instead,] he suggests, we need more usage of renewable energy, the high use of which was the main reason why Labor lost the South Australian election! That aside, [even] the last IPCC report  in 2014 said its modeling concluded that “it’s likely the number of tropical cyclones will either decrease or remain essentially unchanged”.

It is highly unlikely that increased usage of renewable would lead to reduced hurricanes and bushfires. The most likely cause of the latter is the increased restrictions on clearing which Greens support and which was a [major] cause of the dreadful Tathra fires.

How Labor won the 2014 Victorian Election

It is not often that I agree with the editorials in The Age. But with the heading “ Andrews’ ALP guilty of taxpayer fraud”, today’s editorial is different in including a statement that “Premier Daniel Andrews and his government … have transgressed too often”. It is making this statement following the report by the Victorian Ombudsman on the strategy used by Labor in the 2014 election.

This involved the hiring of  5500 “volunteers”, known as the red shirts, who organised door-knocking and phone bank operations and were paid about $390,000 from 21 Labor MPs’ public accounts for staff allowances. Andrews says that this money has now been paid back from Labor funds and that this makes it all OK. But the Andrews government also spent about $1.0 mn trying, through a legal action in the High Court, to stop the Ombudsman from making her report (see further in How Andrews Won 2014 Election).

Bolt argues that this “Disgrace is too hard to swallow” (see Bolt on Labor’s win in 2014) and it is difficult to see that the government can get away with doing nothing further, even in its own interests with an election in November. One media report suggests that Attorney General Martin Pakula should fall on his own sword.

While elections have different backgrounds, this event must increase the chances of a win to the Victorian Liberals. It could also help lift the chances of the federal Coalition even under Turnbull.

Richard Morgan has again managed publication of an advertisement by his Climate Study group, this time to even a half-pager in today’s Australian and titled REALLY DANGEROUS, GLOBAL CLIMATE CHANGE, THE NEXT ICE AGE. Readers of this Commentary are familiar with the argument by the group that “ the dangerous global warming threat is …not supported either by failed climate models or evidence from past global climate experience”. But note that it also says that “past levels of CO2 were at least four times the present level without dangerous global warming” and that “the next ice age should be the most serious climate event for humanity to fear.“ Having regard to  all this, it said “there is an urgent need to bring power costs down” (see full ad with title of Ice Age Possible).

The Australian also published today the  average wholesale energy prices in each state and it shows that Victorian and South Australian “have more than doubled since this time last year, as experts warn that blackouts and supply issues are likely to increase as state governments chase ­aggressive ­renewable energy ­targets”(see Vic/SA Energy Prices Double). The basic reason for this doubling is the reduced usage of cheaper coal-fired power (including the premature closure of a number of generators) and the substitution of usage of the more expensive and less reliable wind and solar power. What is emerging is that the larger that wind and solar are used as power “fuels” the more that some form of additional back up is required (adding to expenditure) and/or the more that higher prices will be required when electricity is in short supply because there is no wind or sun.  In this regard, note the view expressed by a former US Energy Secretary under Obama (and Nobel Prize Winner) that batteries are too expensive to be a major source (see Batteries as Source of Electricity).

The recent heat wave on 18/19 January illustrates what can happen when a “short supply” problem develops in circumstances where a significant “fuel” supply is normally provided by wind/solar. An analysis of electricity prices for those two days by Dr Tom Quirk and Paul Miskelly (see Analysis of Electricity Prices for 18/19 Jan Heat Wave) shows that the price of electricity in each of Victoria and S Australia jumped in the afternoon of each day and they calculate the total extra cost as being some $400 million.  There were no reports of blackouts. In short, when a significant supply normally comes from wind/solar, the “back-up” will have to include an increase in prices charged to consumers.

When a similar situation arose on 28/29 January reports of blackouts also emerged in each of the two  States but have been denied in Victoria as being due to “shortages of supply”. The explanation (sic) in Victoria by Premier Andrews is that  “there were distribution and localised network problems in individual neighbourhoods”, whatever that means (see Andrews on Electricity Prices Jan 29). Andrews also suggested that the distributors may have to pay compensation as they are responsible for supply.That is what is normally called “passing the buck”.

The bottom line is that the states of Victoria and SA are now so reliant on wind/solar as “fuel” that, when heat wave conditions occur, they are exposed to additional costs on top of the additional costs that renewables incur anyway. Energy Minister Frydenberg goes along with Andrews in accepting  that “the weekend power outages were the result of distribution rather than supply issues”, but without explaining what “distribution” exactly means in this context. He is right, though,  in “calling upon the Andrews government to drop its reckless state-based renewable energy targets and mindless bans on gas”. One might have hoped  here that Frydenberg would also take the lead by, at a minimum, reducing the Federal government’s “reckless” renewable and emissions targets.

Warming Up for Resumption of Parliament

Parliament resumes on 5 February but there already signs of leaks which seem to be directed at alleviating any further decrease in polling for Turnbull that might occur at next Monday’s Newspoll and thus increase support for Abbott (see Warming Up for Next Parliament). Somebody leaked to the ABC an item for consideration by the expenditure review committee established by the Abbott government in 2014. One of the options for consideration by the committee (but rejected for consideration by Cabinet) was the possibility of preventing anyone under 30 from accessing income support. The ABC dutifully gave this a run in last night’s 7.30 report but it didn’t seem to do more than draw attention to the fact that Abbott remains a candidate for PM.

Strangely, Turnbull judged it necessary to comment today on another leak to the ABC, this time about the performance of  Scott Morrison when he was immigration minister in the Abbott government and when as PM Abbott played a leading role in establishing the border protection policy. Turnbull said the Coalition made no apologies for sending the clearest message to people smugglers, which he in fact he did shortly after he became PM.

But the problem is that both the Federal and South Australian governments have the same basic policies seeking to reduce emissions of CO2 and increase the usage of renewable, both of which policies add to power costs. True, South Australian Premier Wetherill says his government aims to have zero CO2 emissions by 2050 whereas the Turnbull government’s target is so far only a 26-28 percent reduction by 2030.  But US Energy Information (see graph below and the article Energy Prices) shows the adoption of policies designed to reach these targets is already resulting in much higher electricity prices in South Australia than in Europe (average) and Britain. In fact, South Australian prices are 35% higher than in Victoria but only a fraction higher than in Germany and Denmark, each of which would fall in Turnbull’s “idiot” grouping.

It is little wonder that my Commentary  drew attention to Weekend Australian articles by Judith Sloan, who described “energy policy as a farce”, and by Chris Kenny who spelled out the adverse effects in Ontario, particularly in manufacturing,  from the adoption of policies similar to South Australian.

Meantime, my letter published in the AFR yesterday argued that the main problem is that  “it is government failure (as economists describe it) that is occurring across the entire energy pricing sector” (see below). Such failure relates to both the emissions and renewable policies as well as to the extraordinary regulatory arrangements.

Government Failure Not Energy Markets (Letter published in AFR, 14/8/17)

You report that Treasurer Scott Morrison told the energy companies the government would act if they do not meet commitments to help consumers cut their costs (“Libs, energy chiefs agree certainty key to price fix”, August 11).

But it is government failure (as economists describe it) that is occurring across the entire energy pricing sector. If lower priorities were given to emission reduction imperatives, that would help reduce electricity prices. The case for lower priorities has been enhanced by analysis published by climate experts showing that temperature estimates by the Bureau Of Meteorology do not warrant emission reductions as they have been targeted by governments.

We also now learn that electricity retailer AGL has benefitted by using the government controlled pricing sector to achieve a 14 per cent increase in profit. How did the Australian Competition & Consumer Commission or the electricity regulators allow this to occur? How come that as a customer of AGL I was advised a day before it announced its profit surge that I had been “mistakenly” receiving additional discounts on my bill and that these would be “corrected” on 17 August?

The reality is that the government regulated market has allowed customers to be subjected to quasi-monopolistic pricing while, with the other hand, governments have been forcing prices up by imposing policies which are now shown as faulty. My bill should increase my discounts, not reduce them.

Des Moore
South Yarra Vic

The argument as to the causes of the large increase in electricity prices continued yesterday following the publication of a supposedly bipartisan Review Into Victoria’s Gas and Electricity Markets (see article from The Age on Victorian Power Prices). I failed to have published in The Australian a letter rebutting the Review’sclaims. The main claims are that, since privatisation in 2002, electricity prices have risen faster than in other states through profit gouging and opaque pricing and more regulation is needed (“Regulation needed to keep lid on energy bills: review”, 14/8). But the Australian Energy Council (AEC) says that power prices has shot up only in the past 12 months and that the real issues were government interference in energy markets.

The AEC has undoubtedly identified the major influence. As I said in the letter above published in the AFR, and again in my unpublished letter in The Australian,  it is government failure that is occurring across the entire energy pricing sector. The giving of higher priorities to emission reduction imperatives has been the most important influence and this forced the closure of Hazlewood power station and, hence, the switch to power sources which result in higher costs passed on to the consumer.

The Australian has to a degree caught up today by publishing another excellent article by Judith Sloan entitled “Energy a Joke, But No One Laughing”  which elaborates further on criticisms of the existing energy policy situation (see Sloan on Climate Policy). Unfortunately, the editor of The Australian could only find room to publish it on page 29. Meantime, the South Australian situation has deteriorated further, with Weatherill announcing that, in addition to expanding wind turbines, it will construct what is described as “the world’s largest solar thermal plant costing $650 million”. Given Turnbull’s classification on Sunday of the “idiocy” of South Australia’s policy, he ought now to be thinking of taking action to deter SA from proceeding. But his political problems suggest there will be no such action, let alone any modification of Federal policy.

Today’s Herald Sun reports that, on a Galaxy poll of 815 people, the Victorian Coalition headed by Matthew Guy has suddenly jumped ahead of Labor with a “primary” vote of 41/33 compared with 36.5/38 in November 2014. On this basis, they would be 53/47 on a TPP basis compared with 49/51 in February. Daniel Andrews is still the preferred Premier but more say they are dissatisfied (47) than are satisfied (38).

The fact that the Victorian Coalition is 53/47 on a TPP basis while the Federal Coalition is 47/53 will doubtless be noticed. Mathew Guy has benefited from Andrews poor handling of threats from terrorists and of the administration of  the judicial system, particularly on parole and bail matters. But Turnbull has failed to handle Shorten on a range of matters. In short, this another reason why the Federal Liberal Party should replace Turnbull asap.

Energy Policy

I concluded yesterday’s Commentary by saying that Turnbull’s press conference late in the day indicated that “the Turnbull government doesn’t have a clue about what to do about energy (climate) policy – but ‘everything is on the table’”. Today’s media reporting confirms that.

We now have numerous reports of various possible parts of what might be imagined as a policy and the numerous queries that they raise. Following are some examples of possible parts and queries.

• To help reduce the upwards pressure on energy prices, Turnbull has announced the government will legislate to have the power to reduce exports and make more gas available locally. But even if this legislation is passed (Shorten will like the government intervention), the new arrangements will not start until January 2018. Turnbull has given no indication of how much of the (?expected) gas exports will be stopped  or how that will be decided. Gas is only one source of energy in the market and it would also be difficult to determine how to calculate the desired reduction in domestic gas prices. One report suggests “Asian” gas prices will be looked at. But will gas companies be forced to sell domestically the amount they would have sold overseas or would they be allowed to hang on to that gas? Leaving aside the adverse effects on international contracts (will the would-have-been buyers sue on default of contract?), the policy may require the government to regulate the gas industry in detail, almost to the point of nationalising it;
• Turnbull says he is “open” to allowing the use of coal which is “clean”, but does that mean the HELE coal which uses new burning technology and is used in some overseas countries or does it mean the emissions of coal which are buried underground (the so-called Carbon Capture and Storage or CCS system)? HELE coal still emits about half of normal coal and is more expensive as is CCS (much more). Why would clean coal only be used when existing generators cease to operate? Why not use normal coal? One report quotes Turnbull as saying that as a large exporter of coal “it would be good if we had a state-of-the-art, clean-coal power station in Australia”? But why? It would also be “good” having a state of the art normal coal fired generator.
• The Clean Energy Target (CET) proposed by Finkel has not been endorsed by the Party Room and (reportedly) is yet to be approved by Cabinet. There is no indication of what might happen to the renewable target (now set at 23.5% for 2023 but until that is confirmed or otherwise, the upward influences on electricity prices will continue. Writing in today’s Australian, Graham Lloyd says correctly that “rewriting the rules on renewable energy subsidies is the first step” and that “existing measures … are unsustainable” because they have the capacity to “wreck system reliability and raise prices” (see Market Forces for Energy?).

The reality is that, whatever comes out of the existing discussions within the Coalition, Turnbull is supporting a greatly expanded intervention by government in the energy market and, through that, more detailed control over the factors influencing climate. One report mentions that Turnbull stated “we believe in this market , there needs to be stronger involvement from government, stronger leadership”. But he omitted to mention “this market” is the one he has created. As I have pointed out, this involvement is not required by threats to temperature levels and, is amongst other related government interventions as well, totally unnecessary. But Turnbull’s leftish inclinations mean that he will continue to try to establish a wrecking scheme that will suit his inclinations.