Daily Archives: November 17, 2009

Organic foods or bio-tech foods – for solving world hunger and helping the environment?

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  • Some anti-genetic engineering activists “talk of defending the ‘intrinsic integrity’ of crop-plant genomes,” writes Stewart Brand in his new book, Whole Earth Discipline. “What integrity? Crop plants have no integrity of their own…. Botanist Klaus Ammann points out that good old wheat, fashioned through good old breeding, has modifications that include ‘the addition of chromosome fragments, the integration of entire foreign genomes, and radiation-induced mutations.’” Next to this orgy of gene swapping, biotechnology offers a precision that makes genetically engineered food look downright tame.
  • On the mitigation front, they are creating grains that require less water and that utilize nitrogen more efficiently—a boon for the atmosphere, the oceans, and farmers’ bottom lines. And on the adaptation front, they are developing drought-resistant maize varieties for sub-Saharan Africa, rice that can tolerate flooding in Southeast Asia, and rice that can grow in China’s increasingly salty soils.
  • Next month, when experts from across the globe convene in Rome for the annual World Food Summit, … how to diminish the number of hungry people in the world, which according to the FAO, rose to an alarming 1.02 billion this year. A vital part of their conversation will be to what extent biotechnology can—or should—play a role in these efforts.
  • For the rest of us “foodies,” now is the time for some deep soul-searching, to decide whether we will allow ideology to win out over evidence, particularly when the goals of biotech are increasingly aligned with many of the values the organic community allegedly holds dear.

From SEED magazine

What will the Australian ETS achieve? or What can a centrally planned carbon economy achieve?

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The goal of any emissions trading scheme is to reduce carbon emissions. The idea is to provide a price on carbon which currently does not have a price so as to create a value for carbon. To achieve this; the government is creating a market out of thin air. It is restricting the use of carbon by limiting its supply. The users of carbon will then need to think and act innovatively to cut down their use of carbon or pay for the use of carbon. The cost of carbon will depend on the supply and demand of carbon on any particular day. There are far more intricacies that I do not understand but basically this is it.

However, the Rudd government is clearly incapable of managing to pass legislation that does not pander to special interest groups. Also, it has shown that politics is more important than economics.

The Australian ETS called the CPRS has put a cap on carbon price of $10 a ton till 2012. By doing this; the CPRS is not creating a market at all, it is creating a centrally planned market economy for carbon. On top of this the government decides which industries are part of the CPRS and which are not; which industries get free carbon credits and how much. In addition, it is allowing overseas carbon credits to be bought in Australia to the tune of 100%. What this means is that carbon reduced in other countries as part of their ETS can be bought by Australian companies and they do not have to innovate to reduce their carbon output.

By putting a cap on the price, by providing free credits as it seems fit, by excluding some industries and providing access to foreign carbon credits the government is acting as a central planner and distorting the idea of a carbon market. Centrally planned economies do not work. A distorted market will not provide the benefits of a free market and in this case it will not lead to reduction in carbon emissions. What else will happen is hard to fathom?

And this is the problem with public policy. It is not always clear what will happen when we distort the market.

With a low carbon price the energy companies may not have enough incentive to innovate? Or they can easily buy from overseas credits and continue business as usual. Foreign competitors who are selling their carbon credits to Australia can become more competitive in than Australian companies.

On the other hand, an Australian ETS implemented before the US or other major countries in the world leaves a small country like Australia in a position where it may be disadvantaged by the policies of the bigger and more powerful countries. This will have an adverse effect on the Australian economy.

So coming back to my original question, the Australian ETS does not seem to be in the direction of achieving its basic goal of reducing carbon emissions but it will surely be creating additional effects that are hard to understand right now and can be detrimental to the country.

As a Buddhist saying goes, “First, do no harm”. That should be the goal of public policy. However, the Australian ETS may be doing harm first. This is dangerous.

The imported book fiasco in Australia

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Time Labor was brought to book | – suhit’s posterous

Given this week’s decision to maintain regulatory protection for Australian publishers from imported books, these politicians may find themselves paying up to 30 per cent more than readers in other countries, but then that’s the price of an economic policy that panders to vocal special interest groups at the expense of the wider community.

The decision – and Cabinet was reportedly deeply divided on the issue – means Australian publishers will retain a 30 day exclusivity period within which, if they decide to publish a specific title, they will not be subject to competition from often cheaper overseas imports.

This is nothing short of a special tax on books, and would appear to fly in the face of the pro-education rhetoric in which the Government so likes to cloak itself. Furthermore, the decision totally rejected recommendations from the Productivity Commission and also knocked back a compromise proposal from Competition Minister Craig Emerson.
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In terms of books, if a title isn’t available here because an Australian publisher hasn’t picked it up or it’s far cheaper overseas, then in the digital age there’s always the likes of Amazon – which doesn’t pay Australian taxes or employ Australian workers. The imported books fiasco is a stark illustration of the fact that when it comes to continuing the process of reforming and modernising the Australian economy that began with the Hawke and Keating governments, and continued through the Howard years, the Rudd Government has to date been found sadly wanting.

via news.com.au

This is most ridiculous. In terms of losses, consumers in Australia will spend about $200 million per year because of this decision. These kinds of decisions by the Rudd government makes you wonder how they can manage the carbon reduction scheme. Their ability to pander to vocal interest groups is scary.

Update: An interesting history of the law in question which was enacted by the Britishers to help British publishers.