The Australia Institute Feed Items

A new report has found that despite claiming not to invest in ‘controversial weapons’ 13 of the top 14 Australian super funds are still investing in nuclear weapons companies, in some cases even in an option described as ‘responsible’, new research from The Australia Institute and Quit Nukes has found.

Key results

• At least $3.4 billion of Australian retirement savings are invested by these 14 super funds in companies involved in making nuclear weapons.
• One of the 14, Hostplus, has excluded nuclear weapons companies across its portfolio since December 2021.
• The report analyses financial returns and finds that the exclusion of nuclear weapon companies from portfolios has an immaterial impact on returns.

“It’s frankly unconscionable to sell super fund members a responsible investment option and then use their money to invest in nuclear proliferation,” said Rosemary Kelly, Director at Quit Nukes.

“The thing that makes this baffling is that investing in nuclear weapon companies is just completely unnecessary in the broader scheme of things.

“Superannuation funds should divest immediately from weapons manufacturers who produce nuclear weapons. If you’re a member of 13 of these 14 leading funds you can request that your fund divest or threaten to take your savings elsewhere.

Restricting negative gearing and scrapping the capital gains tax discount would make housing more affordable and increase home ownership rates, the Australia Institute has said in a recent submission.

Key Findings:

A major cause of rising house prices has been increased demand from investors.

• Restricting negative gearing to newly built housing and scrapping the capital gains tax discount would reduce speculation in the housing market and allow more first home buyers to get into their own home.
• Reducing tax concessions would also raise billions of dollars of revenue that can be used to build more housing.
• Negative gearing and the CGT discount cost the budget around $20 billion per year, more than twice the $8.4 billion state and territory governments spent on public and community housing in 2022-23.
• Macroprudential policies such as restricting finance for investment properties would also slow housing price growth.
• Increasing housing supply is not the only solution. Over the last 10 years, the supply of housing has increased faster than the population, but house prices have still increased 75%.

“The Labor Government is right to look at options to reduce tax concessions for property investors,” said Matt Grudnoff, Senior Economist at the Australia Institute.

Shortly after the Minerals Council warned the government to undermine mining “at your peril”, Environment Minister Tanya Plibersek approved three new coal mine extensions. This nature-destroying decision has come just a few weeks before the government is set to host the Global Nature Positive Summit. The government is clearly pursuing a small target strategy but, in avoiding conflict, it risks offering voters a small and unexciting platform at the next election.

The government is all over the place with mixed messaging. To avoid angering the gambling industry, bigots and the mining industry, the government made a series of unforced errors that angered some of its key constituencies. It balked at implementing an outright ban on gambling ads, fumbling a policy with almost universal public support. And, in trying to avoid a “nasty” debate over census questions to capture data about Australia’s queer community, it succeeded only in alienating gay and gender diverse citizens.

But in appeasing the mining industry by approving new fossil fuel projects, the government is not just fuelling climate change that is damaging nature, it is contributing to the extreme heatwaves, floods, bushfires and extreme weather events that are driving up the cost of living – every new coal mine that’s approved means some other sector of the economy has to reduce its emissions even more.

Labor gearing up for a change?

28 September 2024

+++

The Wrap with Ebony Bennett

Environment Minister Tanya Plibersek approved three new coal mine extensions this week, completely undermining the government’s credibility on climate change.

At the same time Foreign Minister Penny Wong was at the United Nations General Assembly talking about sea level rise being a threat to the Pacific, Plibersek was granting approval for three massive coal mine extensions – one of the key sources of sea level rise – to operate until nearly 2070. Together, the three coal mines approved will produce more than 1 billion tonnes of greenhouse gas emissions over their lifetimes.

As world leaders are gathered in New York for Climate Week, let’s remember the United Nations, the International Energy Agency and the world’s scientists have been clear about what’s required to avoid dangerous climate change: no new gas and coal mines or extensions.

That’s why the Australia Institute united a group of Australia’s leading climate and environment organisations to publish an open letter in The Sydney Morning Herald, The Age and The Canberra Times this week. The letter calls on the federal government to tell Australians when it will stop approving new coal, oil and gas projects and end native forest logging.

Coles and Woolworths seem to take turns offering items on sale, showing that they are more concerned with protecting their market power than competing against each other, Australia Institute research has revealed.

The ACCC this week launched legal action against Coles and Woolworths for misleading consumers through discount pricing claims on hundreds of products at a time when inflation was at its highest. However, this is not the only way the two major supermarkets work to keep their profit margins high.

On this episode of Dollars & Sense, we discuss the allegations of dodgy conduct against the big supermarkets and the government’s apparent interest in negative gearing and capital gains tax reform.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Host: Hayden Starr, Digital Media Manager, the Australia Institute // @haydenthestarr

Show notes:

‘Inflation may be falling but business’ drive to maximise profits fuelled Australia’s cost-of-living nightmare’ by Greg Jericho, Guardian Australia (September 2024)

On this episode of Follow the Money, George Monbiot, Guardian columnist and co-author of The Invisible Doctrine: The Secret History of Neoliberalism, joins the Australia Institute’s Polly Hemming to discuss the impact of neoliberalism on our climate, the folly of carbon offsets, and why “bollocks” incrementalism won’t lead to systemic change.

Join President José Ramos-Horta at 6pm AEDT, Tuesday 8 October for an evening of conversation at the Sydney Opera House, presented by the Australia Institute as part of its 30 Years of Big Ideas.

This discussion was recorded live on Thursday 19 September 2024 and things may have changed since recording.

Guest: George Monbiot, author, columnist and environmental campaigner // @GeorgeMonbiot

Host: Polly Hemming, Climate & Energy Director, the Australia Institute // @pollyjhemming

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Show notes:

The Invisible Doctrine: The Secret History of Neoliberalism by Peter Hutchison and George Monbiot (June 2024)

A group of Australia’s leading climate and environment organisations have signed an open letter, coordinated by the Australia Institute and published today in the Sydney Morning Herald, The Age, and The Canberra Times, calling on the federal government to tell Australians when it will stop approving new coal, oil and gas projects.

The open letter comes as world leaders convene this week at the 79th session of the UN General Assembly in New York, to accelerate efforts to prevent the most dangerous impacts of climate change.

To ensure Australia is doing its fair share for a safe climate, the open letter signatories are calling on the government to:

• Tell Australians and the rest of the world when Australia will stop approving new coal, oil, and gas projects.
• Stop offsets being used to justify new fossil fuel projects.
• End native forest logging.

“Even though the world’s climate scientists and the UN Secretary-General have all declared that new fossil fuels are incompatible with a safe climate future, the Australian government is stubbornly continuing to approve new coal, oil and gas projects” said Rod Campbell, Research Director at the Australia Institute.

“Just yesterday, the federal government approved three new coal mines out to the 2060s, which will produce over 1.3 billion tonnes of emissions.

“To approve huge new coal mines while world leaders meet to discuss the most dangerous impacts of climate change is absurd, but also consistent with Australia’s disappointing track record on the issue.

The approval of three new coal mines in the Hunter Valley, during a rapidly escalating climate crisis, is shocking given the federal government’s stated commitment to climate action, the Australia Institute has said.

Key Points:

• The federal government has approved three coal mines in the Hunter Valley
  • Whitehaven Coal’s Narrabri Underground Mine Stage 3 Extension Project
  • MACH Energy Mount Pleasant project
  • Glencore and Yancoal’s Ashton-Ravensworth Underground extension
• The lifetime carbon equivalent emissions from these three projects are expected to be 1.357 billion tonnes.
• This decision will extend the operating life of these coal projects into the 2060s.
• The Australia Institute’s Coal Mine Tracker shows that these are the fifth, sixth and seventh coal mine projects to be approved in this term of government.

“These approvals are inconsistent with Australia’s climate goals and reinforces our country’s reputation as one of the world’s major fossil fuel exporters,” said Rod Campbell, Research Director at the Australia Institute.

Don Watson joins Dr Emma Shortis on this episode of After America to discuss the cult-like support Donald Trump has manufactured, the “mad” AUKUS agreement, and his latest Quarterly Essay, ‘High Noon: Trump, Harris and America on the Brink’.

This discussion was recorded on Friday 20 September 2024 and things may have changed since recording.

Guest: Don Watson, author of ‘High Noon: Trump, Harris and America on the Brink’

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

‘High Noon: Trump, Harris and America on the Brink’ by Don Watson, Quarterly Essay (September 2024)

American Journeys by Don Watson (January 2018)

‘Enemy Within: American Politics in the Time of Trump’ by Don Watson, Quarterly Essay (September 2016)

Theme music: Blue Dot Sessions

The ACCC launching legal action against Coles and Woolworths today for misleading consumers reinforces the findings of Australia Institute and Centre for Future Work research, that showed inflation is higher because of big businesses price gouging.

Key Points:

• The Australian Competition and Consumer Commission (ACCC) has launched legal action against Coles and Woolworths for misleading consumers through discount pricing claims at a time when inflation was at its highest.
• The ACCC alleges the misconduct involved 266 products for Woolworths at different times across 20 months, and 245 products for Coles at different times across 15 months.
• This covers the period when inflation rose to a peak of 7.8% at the end of December 2022 and led to the Reserve Bank raising interest rates 13 times in 19 months.

“Today’s announcement reinforces our research that has shown the inflation that led to the Reserve Bank raising interest rates was caused overwhelmingly by companies abusing market power to raise prices,” said Greg Jericho, Chief Economist at the Australia Institute.

“The ACCC does the best they can, but the drop in competition over recent decades has shown that the current system is failing us.

“The ACCC clearly needs stronger powers, including a competition and prices commission and divestiture powers to break up uncompetitive industries.

“Australia is dominated by uncompetitive markets. The threat of divestiture would lower prices, better service and more innovation and growth in productivity.”

Tomorrow the opposition leader, Peter Dutton, is discussing his plans to introduce nuclear power with anti-renewable energy commentator, Chris Uhlmann. No doubt we will hear the same claims about renewable energy causing electricity prices to be high and the need for nuclear power to keep prices down that both men have said in the past.

And just as was the case in the past, such claims will again be wrong.

The increased use of renewables in supplying electricity is not the cause of higher retail electricity prices – and it is clear that more renewables will lead to lower prices.

Research and data from the Australian Competition and Consumer Commission (ACCC), the Australian Energy Market Operator (AEMO), the Australian Energy Regulator (AER) and the CSIRO all make it abundantly clear that renewables are the cheapest form of electricity, and that the high cost of energy is driven by the cost of gas and coal produced electricity.

It is not surprising that people can be misled about the cause of electricity prices. Australia’s National Electricity Market (NEM) is a complex market stretching to 1,925 pages of rules and regulations such that any explanation of price determination will be greatly simplified.

So let us set out the two key issues to understanding retail electricity prices:

1.      The cost of generating electricity (the wholesale price) is a surprisingly small component of the many costs that contribute to household electricity prices.

On this episode of Dollars & Sense, Australia Institute Senior Economist Matt Grudnoff and Research Fellow Adam Gottschalk discuss the spin around productivity and why paying workers more – not less – might hold the key to a more productive economy.

Join President José Ramos-Horta at 6pm AEDT, Tuesday 8 October for an evening of conversation at the Sydney Opera House, presented by the Australia Institute as part of its 30 Years of Big Ideas.

Host: Matt Grudnoff, Senior Economist, the Australia Institute // @MattGrudnoff

Host: Adam Gottschalk, Anne Kantor Research Fellow, the Australia Institute // @adamchalksitup

Theme music: Blue Dot Sessions

We’d love to hear your feedback on this series, so send in your questions, comments or suggestions for future episodes to podcasts@australiainstitute.org.au.

The Western Australian Government’s changes to the state’s domestic gas policy give companies more opportunities to export gas and further reduce domestic gas supply, said The Australia Institute.

Key Findings:

• Exports of gas are threatening the stability of WA’s gas market.
• The policy changes announced today allow more of WA’s domestic onshore gas to be exported, not less.
• The cause of the problem is Woodside’s North West Shelf Extension proposal, which has not identified supply sufficient for its export capacity.
• “The barbarians are at the gates of the WA domestic gas market and the WA Government is throwing them the keys,” said Rod Campbell, Research Director at The Australia Institute.

“Today’s changes to the WA domestic gas policy allow more of WA’s domestic onshore gas to be exported. Onshore gas that had been set aside for the domestic market is now allowed to be exported.

“This benefits Woodside, which is desperate to take more gas for its North West Shelf Extension export facility. It also benefits gas companies that would rather sell WA’s domestic onshore gas to Woodside than Western Australians.

“This is a disaster for Western Australian gas users because it more closely links the domestic market and the export market.

“This is the east coast gas policy mess all over again.

“If anything, this is worse than the east coast because more WA gas (over 50%) is given away royalty-free and no gas exporters have ever paid Petroleum Resource Rent Tax.

Australia is one of the lowest-taxing countries in the developed world. While it is sometimes suggested that Australian governments spend too much, the reality is that Australia raises very little tax revenue compared to similar countries. Insofar as Australian governments have a problem balancing revenue and spending, that problem lies in the level of revenue collected, not the amount it spent.

Tax is good

This graph shows the 38 economies in the Organisation for Economic Cooperation and Development (OECD) in order of tax revenues as a percentage of their economy (GDP). Only eight have lower tax to GDP ratios than Australia, and these include relatively low-income countries like Türkiye and Mexico, as well as tax havens like Switzerland and Ireland.

If the graph does not display, click here.

If Australia were to increase the level of revenue it collects from taxation to the OECD average—a level similar to that collected by Canada or New Zealand—the Commonwealth would have had an extra $140bn in revenue in 2023–24.

Join Australia’s Biggest Book Club

Register for Black Witness by Amy McQuire

11:00am Friday 27 September 2024

This book was written with one overarching message: that the Black Witness should be believed.
There is a silence engulfing Australia in which the Black Witness must battle. We already have the weaponry. It is contained in the voices of our elders around campfires and kitchen tables, in community meetings and in the stories we tell our children. It is in poetry, in song, in art and in journalism. But we struggle to overcome the voice of the White Witness. The White Witness speaks above us and for us, and it is always the White Witness who is heard most clearly, because they speak the language that has been enforced on us through violence. It is violence that has enacted the silence, that has made the Black Witness an ‘unreliable’ one, a ‘threatening’ one, a ‘violent’ one in itself. It’s not just the violence of the original massacres, but the violence of the education, justice, health, child protection and political systems. The Black Witness is often told they must be legitimised by the White Witness. But this book is here to tell you that the Black Witness should be believed.

On this episode of Follow the Money, Australia Institute Executive Director Richard Denniss joins Ebony Bennett to discuss mining’s latest PR offensive and why politicians shouldn’t fear standing up to the industry.

Join President José Ramos-Horta at 6pm AEDT, Tuesday 8 October for an evening of conversation at the Sydney Opera House, presented by the Australia Institute as part of its 30 Years of Big Ideas.

This discussion was recorded on Tuesday 17 September 2024 and things may have changed since recording.

Guest: Richard Denniss, Executive Director, the Australia Institute // @RDNS_TAI

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

First, it’s not true.

Second, the gas expansion the industry wants would come at the cost of other things we need.

Australia already produces an abundance of gas — far more than we could use. The only reason there’s even a remote risk of a shortfall is that we allow gas companies to export as much as they want.

More than 80 per cent of the gas produced in Australia is exported or used to liquify gas (a hugely energy intensive process) so that it can be shipped overseas.

Australia exports about 35 times more gas than would be needed to cover any potential shortfall of supply on the east coast in coming years.

And the gas giants use more gas each year to liquify gas for export than the gas used by Australia’s entire manufacturing industry.

Government could ensure supply at home by requiring gas companies to set aside gas to meet domestic needs, using laws and policies already in place.

Instead, gas companies want to develop new, expensive gas for the domestic market so they can sell gas that’s cheaper to extract overseas.

Australia Institute research has shown that there is no shortage of gas in Australia, in either the short or medium term, and that it is gas exports that are putting pressure on domestic supply.

Continued attempts by the gas industry to claim a domestic shortage while expanding gas exports show that there is no shortage of either gas or corporate greed from the sector.

Key Findings:

• Australia is one of the biggest exporters of gas in the world, alongside Qatar and the USA.
• Around 80% of Australia’s gas is exported as liquefied natural gas (LNG).
• 90% of the gas processed in WA is either exported as LNG or used in LNG export processing.
• Over half (56%) of gas exported from Australia attracts zero royalty payments, effectively giving a public resource to multinational corporations for free.

“The gas industry is talking out both sides of its mouth — it is saying there will be domestic shortages if we don’t start opening up new gas fields, while at the same time advocating to expand export facilities like the North West Shelf proposal,” said Rod Campbell, Research Director at the Australia Institute.

“We produce, burn and export a staggering amount of gas in this country. The gas industry itself is the biggest user of gas in Australia due to the gas it burns to process LNG exports. To suggest there will be a gas shortage is absurd.

Professor Terri Givens joins Dr Emma Shortis on this episode of After America to discuss race in American politics and whether the country is ready to elect a Black female president.

This discussion was recorded on Friday 13 September 2024 and things may have changed since recording.

Guest: Terri Givens, Professor of Race, Ethnicity and Politics, University of British Columbia

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

‘Race, gender and politics: Is the United States ready for a Black woman president?’ by Terri Givens, The Conversation (July 2024)

‘Is America ready to elect a Black woman president?’ by Emma Shortis, The Conversation (September 2024)

The Roots of Racism: The politics of white supremacy in the US and Europe by Terri Givens (January 2022)

On this bonus After America, Nick Bryant, acclaimed author of The Forever War: America’s Unending Conflict with Itself and former BBC journalist, joins Dr Emma Shortis to reflect on the Harris-Trump debate.

This discussion was recorded live on Thursday 12 September 2024 and things may have changed since recording.

Guest: Nick Bryant, author and former BBC United States correspondent // @NickBryantNY

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

‘Are you ready for it? What a Taylor Swift endorsement means for Kamala Harris’ by Emma Shortis, The Conversation (September 2024)

The Forever War: America’s Unending Conflict with Itself by Nick Bryant (June 2024)

When America Stopped Being Great: A History of the Present by Nick Bryant (August 2020)

Theme music: Blue Dot Sessions

One of the biggest economic myths is that Australia is dependent upon mining for our prosperity. Yes, mining accounts for around 10% of Australia’s GDP, but almost all of that is its profits – and most of those either head overseas – especially so in the case of gas companies – or are delivered to the very wealthiest in Australia. The vast majority of Australians do not rely on mining at all.

This reality was made clear when BHP boasted last week that it paid “$5.6bn in wages, incentives and benefits paid to employees, $10.5bn in dividends to Australian shareholders”

But let’s be clear about who gets those dividends and profits – mostly it is the richest in Australia.

According to the latest taxation data from the ATO, just under 50% of the value of all dividends went to the richest 2.4% of Australians – those earning more than $250,000. Around 0.2% of Australians earned more than $1m a year, and yet that minuscule number received a quarter of all the dividends paid out by Australian companies. So while it might sound like that profit is helping “Australia” in reality, it’s mostly making the rich richer.

The mining industry is now surely the biggest whinger in the Australian economy.

This week it launched an all-out assault on the federal government at Minerals Week in Canberra, with chief executive of the mining industry’s chief lobby group the Minerals Council, Tania Constable, warning the government: “Undermine it at your peril.”

Relative to its size, the mining industry pays nowhere near enough tax in Australia and, perhaps unsurprisingly, they want to keep it that way. It’s obvious the mining industry is trying to cow the federal government into ruling out any policy changes before the election. It wants cuts to taxes and royalties, and IR laws that make it easier to cut wages and fire people. And it would prefer to remove any environmental restrictions preventing mining companies from polluting or opening new gas and coal mines wherever and whenever they want.

But more than that, the mining industry demands Australians all bow at its feet in gratitude. BHP wants praise for paying its taxes, insinuating the public hospital system would collapse without it, while mining billionaire Gina Rinehart asked: “Where is the red carpet for the BHPs and Rios?” As if mining companies aren’t some of the most powerful and profitable companies on the planet, let alone in this country.

Like a toxic boyfriend who wants thanks for doing the dishes (when you remind him), the mining industry demands Australians be grateful for the taxes and royalties they pay.

The Wrap with Ebony Bennett

Mining lobbyists descended on Canberra for the annual Minerals Week. On Thursday morning, the Minerals Council CEO Tania Constable described on Radio National what she sees to be the problem – policy interventions and the looming ‘threat’ of onerous environmental approvals:

We’re seeing major changes in royalties at a state level…That’s a huge impost on the industry.

Let’s be clear, royalties are the price mining companies pay to mine and sell the resources like iron ore, gas and coal that Australians collectively own. Complaining about paying royalties as an ‘impost’ on the mining industry is like a baker complaining he doesn’t get his flour for free.

It’s obvious the mining industry is trying to cow the federal government into ruling out any policy changes before the election. And they are smart enough to make the Minerals Council and BHP front their campaign. Much harder for the gas industry to argue to cut taxes and royalties when the Tax Office has labelled your entire industry “systemic non-payers” of tax and over the half of LNG exports attract zero royalties.

What is the Australia Institute’s Policy School?

The Australia Institute’s Policy School, is a new webinar series designed to equip policymakers, campaigners, NGOs, and public servants with the tools to advocate for change. Learn from experts about key public policy issues, persuasive messaging, and effective communication strategies to help create a fairer, more sustainable society.

It’s FREE, but registration is essential.
You can sign up once on Zoom and attend any session.
The first class will be “Australia is a low taxing nation and it costs us with Greg Jericho”, Thursday 19 September at 11am.

Each fortnight, you will hear from policy experts from the Australia Institute, who will take you through the key things you need to create change on critical public policy issues – like fair tax reform, electoral reform, the Australia/USA relationship, the housing crisis, or reducing greenhouse gas emissions.

You will learn about:

If you’ve ever flicked off an email before bed, texted your boss out of hours, or received an ‘urgent’ work call after clocking off, you’ll be glad to hear some respite is just around the corner.
A new right to disconnect from work, for employees in businesses with 15 or more staff, comes into force across Australia from Monday 26th August. This is a welcome response to the growing problem of ‘availability creep’, where work demands spill over into workers’ leisure time.
The new right means most employees can now refuse to monitor and respond to unreasonable contact from their employers about work matters outside of paid work hours.
Many of us are now online and digitally connected to our workplaces 24/7. This constant connectedness can make it hard to escape work calls, texts, and emails when not actually at work.
As we are now so easily contacted anywhere and anytime, our leisure and family time has become very susceptible to interruptions from work, leading to unpaid overtime, an inability to ‘switch off’, and blurred boundaries between work and non-work time. Gone are the days of 8 hours work, 8 hours rest, and 8 hours play.
The consequences are stark. Research has shown these work practices lead to increased stress, health problems and a poor work-life balance.

On this episode of Dollars & Sense, Greg and Elinor talk about the government’s new international university student caps and the latest house price data.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Show notes:

‘A terrace house is for sale in Sydney for $22m. The grotesquely unfair capital gains discount is partly to blame’ by Greg Jericho, Guardian Australia (September 2024)

Claims from the mining industry that they are significant funders of public services in Australia are overblown, ignore the fact that their profits are made off the back of public resources, and are heavily publicly subsidised, the Australia Institute has said.

Key Points:

• Taxes and royalties paid by the mining industry make up just 5 cents in every dollar of state and federal government revenue in Australia.
• 95% of Australia’s public services are paid for by other industries.
• Mining is also heavily subsidised in Australia, receiving the vast bulk of the $11 billion fuel tax credit scheme.

“Relative to its size, the mining industry pays nowhere near enough tax in Australia and, perhaps unsurprisingly, they are keen for that to remain the case,” said Rod Campbell, Research Director at The Australia Institute.

“Australia Institute research shows that Australians dramatically overestimate the economic value of fossil fuel mining to the country.

“If Australia really did rely on the low-employing, tax-avoiding, high-polluting, and largely foreign-owned mining industry for its economic security, we would be in serious trouble.

“Other countries charge far more for their natural resources, while in Australia we subsidise their extraction.

“The fact that the Government collects more money from HECS than it does from the Petroleum Resource Rent Tax is a wake-up call for those in charge.”

On this episode of Follow the Money, Greg Jericho and Matt Grudnoff join Ebony Bennett to discuss the latest GDP figures, the real drivers of inflation and how the Reserve Bank misread the state of the economy.

This discussion was recorded on Tuesday 10 September 2024 and things may have changed since recording.

Guest: Greg Jericho, Chief Economist, the Australia Institute // @GrogsGamut

Guest: Matt Grudnoff, Senior Economist, the Australia Institute // @MattGrudnoff

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

We’d love to hear your feedback on this series, so send in your questions, comments or suggestions for future episodes to podcasts@australiainstitute.org.au.

Last year the government announced it was considering removing its statutory power to overrule the Reserve Bank. Thankfully it has now reconsidered that move, and the actions of the RBA over the past year serve to remind everyone that it is far from infallible.

In its May Statement on Monetary Policy the RBA looked ahead one month and estimated that in June the annual growth of household consumption would be 1.1%. When the national accounts were released last week, the actual growth was revealed to be just 0.5%.

Now obviously economic forecasting is a bit of a mugs game, but household consumption makes up half of Australia’s economy and accounted for around 45% of all the growth in the economy over the past decade so it is pretty important. It is also the area of the economy most directly affected by interest rate rises. This error of forecasting suggests that the Reserve Bank has rather poorly misread just how greatly households had been impacted by the 13 rate rises that had taken the cash rate from 0.1% in April 2022 to 4.35% in November 2023.

This error is crucial because the main reason the RBA raises rates is to reduce the ability of households to spend. Because you can’t tell your bank that you don’t really feel like paying your mortgage this month, interest rate rises force households to divert money that would have been spent on goods and services to paying your mortgage.

In 2022, the government legislated Australia’s emissions reduction targets, “Australia’s greenhouse gas emissions reduction targets of a 43% reduction from 2005 levels by 2030 and net zero by 2050.”

The Australian Government claims that Australia’s domestic emissions have fallen by 29% since 2005.

This claim suggests that Australia is well on its way to meeting its domestic emissions reduction target under the Paris Agreement, even as the Australian Government subsidises and approves fossil fuel expansion.

But Australia is not actually decarbonising its economy and domestic fossil fuel emissions across the economy have changed very little under the Albanese Government (or previous governments).

Industry emissions (including stationary energy, fugitive emissions, and industrial processes) increased by 3% over the year 2023 while transport emissions also increased by 5%.

So how can Australia claim it is decarbonising when it is not?

On this episode of After America, Dr Emma Shortis and Alice Grundy reflect on the presidential campaign so far and on the dynamics of the Australia-United States relationship ahead of the third anniversary of the AUKUS deal.

This discussion was recorded on Friday 6 September 2024 and things may have changed since recording.

Join our webinar with Nick Bryant, former BBC United States correspondent and author of The Forever War, at 11am AEST on Thursday 12 September. Tickets are free, but registration is essential.

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Host: Alice Grundy, Research Manager, Anne Kantor Fellows, the Australia Institute // @alicekgt

Show notes:

‘Is America ready to elect a Black woman president?’  by Emma Shortis, The Conversation (September 2024)

Theme music: Blue Dot Sessions

The Fuel Tax Credits Scheme should be scrapped for the mining industry, not farmers, the Australia Institute has said in response to calls at today’s National Farmer Rally to keep the tax rebate for the agricultural industry.

On this episode of Dollars & Sense, Greg and Elinor discuss the latest GDP growth figures, how rate increases have damaged the economy and what might come next.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Show notes:

‘Now the Australian economy is on its knees, will the RBA finally start cutting interest rates?’ by Greg Jericho, Guardian Australia (September 2024)

Plans to import LNG to Australia reveal the extraordinary failure of consecutive Australian governments to stand up to multinational gas corporations, the Australia Institute has said.

Key Points:

• Australia is one of the biggest exporters of gas in the world, alongside Qatar.
• Around 80% of Australia’s gas is exported as liquefied natural gas (LNG).
• Over half (56%) of gas exported from Australia attracts zero royalty payments, effectively giving a public resource to multinational corporations for free.
• Across the country, gas and oil extraction employs just 21,200 workers — less than half of one percent (0.15%) of the 14 million people employed in Australia

“This is pure farce,” said Rod Campbell, Research Director at the Australia Institute.

“We produce, burn and export a staggering amount of gas in this country. The gas industry itself is the biggest user of gas in Australia due to the gas it burns to process LNG exports. To suggest there is a shortage is absurd.

“The fact of the matter is that we have allowed multinational gas companies to take us for a ride by giving away our resources tax free and locking us into unsustainable export contracts.

“When facing a genuine resource shortage, the usual first step is to reduce usage, but that is far from what’s happening here.

“Heavily subsidised multinational corporations have been driving up the cost of gas in Australia by forcing us to bid against the international market for our own resources.

A significant proportion of young Australians say attending live music is important to them, but rising costs are a major barrier to young peoples’ attendance at live music, a first-of-its-kind national survey conducted by The Australia Institute and commissioned by The Push has found.

As the live music industry in Australia continues to struggle financially, the survey found there is strong support among young Australians for policies that would both support the sector and encourage more young people to engage with live music events.

The Australia Institute, commissioned by The Push, surveyed 1,009 Australians between the age of 16 and 25 between 9 and 15 August 2024. The survey has a margin of error of plus or minus 3%.

GDP growth figures released today show the economy almost grinding to a halt. The economy grew by only 0.2% for the quarter and just 1% over the last year. The release of these GDP figures shows that the Reserve Bank is wrong when it says, “the economy is running a bit hot” and it is time to start cutting interest rates.

The only reason the economy has seen any growth is because of the contribution of government spending. Without this contribution the economy would have shrunk by 0.2% this quarter. Worst still, without the government’s contribution the economy wouldn’t have grown at all over the last year.

This highlights just how weak the private sector is right now. Household spending is down. Business investment is down. The private sector has been smashed by the rapid rise in interest rates, demand has dried up and production is grinding to a halt.

The current economic conditions highlight how close the Australian economy is to recession and how damaging high interest rates have been to the economy. With inflation falling in Australia and around the world it is time for the Reserve Bank to follow other central banks and cut interest rates.

The post Public spending keeps the economy going as the private sector is hit by rate rises appeared first on The Australia Institute.

Today’s national account figures show that GDP per capita fell by 0.4% during the June quarter. This is the 6th consecutive quarter of negative GDP per capita growth, showing that Australia is in a per capita recession amid an ongoing inequality crisis.

Key Points:

• GDP per capita growth of –0.4% represents the 6th consecutive quarter of negative per capita growth in Australia while total GDP growth of 0.2% is historically weak.
• Household consumption fell by 0.2%, the weakest growth rate since the COVID-19 lockdowns in the September quarter of 2021.
• Government expenditure contributed 0.3% to GDP growth.
• Interest rates are a blunt instrument that are causing normal Australians significant financial pain while the tax system is turbocharging wealth inequality.

“Today’s figures show that Australia’s economy has gone backwards for a record six consecutive quarters once you take into account population growth,” said Greg Jericho, Chief Economist at The Australia Institute.

“They confirm that households have been smashed by high interest rates despite our research showing that inflation has been mostly driven by company profits and supply-side factors. Fortunately, government spending has helped stop the economy from shrinking.

“Today’s figures highlight again how necessary the change to the Stage 3 tax cuts were, which will deliver some much-needed relief to low- and middle-income households rather than overwhelmingly benefit the rich.

On this episode of Follow the Money, Ebony Bennett discusses the latest in federal politics with Professor Mark Kenny, former Chief Political Correspondent for The Sydney Morning Herald, The Age and The Canberra Times.

This discussion was recorded on Tuesday 3 September 2024 and things may have changed since recording.

Guest: Mark Kenny, Director, ANU Australian Studies Institute // @markgkenny

Host: Ebony Bennett, the Australia Institute // @ebony_bennett

Show notes:

‘The PM can ill-afford bad weeks as narratives harden’ by Mark Kenny, The Canberra Times (September 2024)

Public spending keeps the economy going as the private sector is hit by rate rises by Matt Grudnoff, The Australia Institute (September 2024)

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

Repeat delays are testament to how fiendishly difficult it is to get changes to electoral law right. The most recent delay has been attributed to constitutional concerns: how to design laws that limit political finance without violating freedom of political expression, which is protected by the constitution.

The High Court has reined in legislative overreach, and may get another chance to do so: last month former state independent candidates wrote to Premier Jacinta Allan arguing the carveout in Victoria’s political donation laws for the major parties’ funding vehicles is unconstitutional. Victoria introduced strict donations caps ahead of the last election. There were three independent MPs in the state’s lower house. After the election, none remained.

Only in politics does the winning team get to change the rules of the game. The risk is that MPs may vote to skew the electoral system to their own benefit, at the expense of a level playing field.
The Albanese government has given some clues of its plans, including a cap on donations, and a cap on spending of somewhat less than $1 million per candidate. One million dollars sounds like an eyewatering sum, but putting up a viable challenge to a sitting MP does not come cheap. The Australia Institute calculates each MP enjoys almost $3 million in incumbency advantages, plus non-financial benefits.

Republicans have tried to pin the Vice-President as ‘Comrade Kamala’, but are her economic policies all that radical? On this special After America and Dollars & Sense crossover episode, Dr Emma Shortis and Dr Greg Jericho discuss Harris’ economic agenda.

This discussion was recorded on Friday 30 August 2024 and things may have changed since recording.

Register for our webinar with Nick Bryant on Thursday 12 September via the Australia Institute website.

Guest: Greg Jericho, Chief Economist, the Australia Institute // @GrogsGamut

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

Dollars & Sense, the Australia Institute

Theme music: Blue Dot Sessions

Peter Dutton and Donald Trump have a knack for political division. There’s no doubt that stoking fear and the politics of division can be brutally effective, but the last thing Australia needs is to import the damaging culture wars of the American far right, dominated by bonkers conspiracy theories adhered to by militant acolytes untroubled by reality.

Trump vowed to conduct ‘ideological screenings’ and to bar refugees from Gaza if he wins the Presidency and he’s also said he will bring back his controversial ‘Muslim ban’ on immigration. Similarly, Dutton has been echoing Trump’s call to ban refugees from Gaza, arguing that accepting people coming from Gaza is a national security risk. Zali Steggall described the policy as ‘inherently racist’ and this week Treasurer Jim Chalmers said: “[Dutton] divides deliberately, almost pathologically, and that sort of division in our leadership, in our society, right now is worse than disappointing — it’s dangerous.”

On this episode of Dollars & Sense, Greg and Elinor discuss the Greens’ ‘Robin Hood’ tax proposal, post-pandemic profits and the latest inflation data.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute and Centre for Future Work // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Show notes:

‘Unemployment is rising and Australia’s economy is weak – but don’t hit the recession alarm just yet’ by Greg Jericho, Guardian Australia (August 2024)

The media industry has changed radically over the last three decades, transformed by the 24-hour news cycle, social media and the tech giants, and now artificial intelligence. On this special episode of Follow the Money, recorded live at Politics in the Pub in Canberra, Minister Ed Husic, Senator Sarah Hanson-Young and Karen Percy from the Media, Entertainment & Arts Alliance (MEAA) discuss technology, trust and the future of journalism.

This discussion was recorded live on Wednesday 21 August 2024 and things may have changed since recording.

Guest: The Hon Ed Husic MP, Minister for Industry and Science

Guest: Senator Sarah Hanson-Young, Greens Arts & Communications spokesperson // @sarahinthesen8

Guest: Karen Percy, Federal President (Media), Media, Entertainment & Arts Alliance (MEAA) // @PercyKaren

Host: Richard Denniss, Executive Director, the Australia Institute // @RDNS_TAI

Host: Ebony Bennett, Deputy Director, the Australia Institute // @ebony_bennett

Theme music: Pulse and Thrum; additional music by Blue Dot Sessions

This week the Pacific Islands Forum meeting in Tonga will see leaders from the region address the dramatic impact of climate change and the urgent need to reduce emissions. It is an important moment for the Australian government to reject the lies of the gas industry and acknowledge that approving more gas will ruin the livelihood of the millions living in the Pacific Islands.

Gas is a massive contributor to greenhouse gas emissions (the clue is in the name!) that cause climate change. And given the world has just experienced 13 straight months of record setting temperatures, it is brutally clear that we need to reduce emissions quickly and with much greater urgency than has been the case over the past decade. But reducing emissions is not compatible with gas company profits, so gas companies and their boosters in the media routinely bring out a scare of gas shortages and with it calls for more gas.

Australians have gone through another winter without running out of gas despite being told earlier this year that a gas shortage was very much on the cards. And so of course now the gas industry is warning that a gas shortage could still occur because… well… because the gas industry knows that the only way it can justify demanding the government approve new gas mines is if people think we are about to run out.

ABC journalist and podcaster Matthew Bevan joins Dr Emma Shortis on this After America to discuss the Democratic National Convention and Trump’s to set the agenda.

This discussion was recorded on Monday 26 August 2024 and things may have changed since recording.

Guest: Matthew Bevan, host and writer of If You’re Listening, the ABC // @MatthewBevan

Host: Emma Shortis, Senior Research for International & Security Affairs, the Australia Institute // @EmmaShortis

Show notes:

‘Harris delivers warm and strong acceptance speech as Democrats take joy, hope and renewal to the electorate’ by Emma Shortis, The Conversation (August 2024)

Theme music: Blue Dot Sessions

One of the most regular and biggest scare campaigns Australians are subjected to is that Australia is about to run out of gas – that households will not be able to run heaters in winter or the light will go out in summer and the air conditioners will stop working because there will be no gas to power the electricity.

These warnings are increasingly shrill. In March for example The Australian newspaper warned that “Urgent action needed if Australia is to avoid catastrophic gas shortfall”. Despite getting through winter without a catastrophe this morning The Australian newspaper is now warning, that a “Perfect storm’ warning” has been issued to Australia’s east coast energy market.

It is all balderdash.

Australia digs up and exports a lot of gas. A really, really large amount. How much? Try 82,000,000 tonnes of the stuff each year. That is the 2nd largest amount of LNG production in the world, suggesting we are pretty good at it. But all that gas ends up as global greenhouse gas emissions and we’re meant to be reducing emissions.

For over two years now it has been clear that profits have been the main culprit of inflation, and that wages have not driven prices despite repeated warnings from the Reserve Bank and business groups that a wages breakout could be about to come and start a mythical “wage-price spiral”

The latest data on wage growth in Enterprise Agreements from the Fair Work Commission (FWC) is just the latest evidence that reveals how wrong those spreading a fear campaign about wages have been.

In the 3 months to 26 July this year, the 3 month weighted average of annual wage growth in enterprise agreements lodged with the FWC was 3.7% – down from a peak of 4.3% in October 2023. The last time the average was this low was in August last year. Importantly the 3.7% growth is lower than the most recent annual inflation figure of 3.8%.

While business groups and conservative media outlets continue to argue that wage growth is keeping inflation high, in reality – as has been the case for the past 2 years – wages are not driving inflation, indeed they are lowering it.

While the intention to reduce the influence of corporate political donations is welcome, the proposed legislation would disproportionately advantage incumbent parties, including enormous increases in public funding, much of which could be spent on election campaigning.

The Australia Institute’s submission to the government consultation into the Bill finds that:

On this episode of Dollars & Sense, Greg and Elinor get out the world’s tiniest violin for Australia’s big banks, who are finally having to compete to offer better mortgage rates, and discuss why three of the ‘big four’ are now offering less for term deposits.

Greg Jericho is Chief Economist at the Australia Institute and the Centre for Future Work and popular columnist of Grogonomics with Guardian Australia. Each week on Dollars & Sense, Greg dives into the latest economic figures to explain what they can tell us about what’s happening in the economy, how it will impact you and where things are headed.

Host: Greg Jericho, Chief Economist, the Australia Institute // @GrogsGamut

Host: Elinor Johnston-Leek, Senior Content Producer, the Australia Institute // @ElinorJ_L

Theme music: Blue Dot Sessions