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Australia Needs a Green New Deal

Australia is a climate wrecker on a global scale. With a government long beholden to mining interests, calls for climate justice fall on deaf ears. But plans for a Green New Deal are not just necessary — they’re achievable.

Along the Great Ocean Road of Australia. (Flickr)

Last Monday, frontbenchers from the Australian Labor Party (ALP) tabled a motion in the lower house calling on Parliament to declare a climate emergency. Only five Labor MPs showed up to defend their motion. Astoundingly low-energy though this effort was, it was hardly surprising: the party’s climate policy consists mainly of vague rhetoric, while in practice it continues to approve coal projects across the country.

In Queensland, the Labor government under Annastacia Palaszczuk has opted to fast-track the Adani coal mine, opening up the Galilee Basin to mining development that promises to increase global carbon emissions by a stunning 10 percent. The ostensibly left-leaning, climate-friendly Victorian Labor government under Daniel Andrews is expanding drilling activities offshore in the Otway Basin. The existent ban on onshore fracking and drilling will expire altogether next year, and there is no word of extending it.

We can see similar patterns across each state. The house is on fire, yes — a fire that the ALP not only helped start, but continues to fuel.

Meanwhile, the Right — the Liberal National Party Coalition(LNP) — remains an unapologetic cheerleader for the coal industry and a bastion of climate skepticism. In order to meet the Intergovernmental Panel on Climate Change (IPCC) targets, Australia would have to shut down twelve coal-powered plants by 2030. Instead, Scott Morrison’s Coalition government wants to double coal exports. Globally, Australia is the third-largest exporter of carbon emissions. Investment in clean energy has fallen to 2016 levels as the government rewards the fossil fuel industry with billions in subsidies for all their good work.

This willful intransigence is partly explained by the enormous structural power of the extractive industries. The Australian economy is heavily reliant on primary exports and raw materials. Mining accounts for 20 percent of business investment, 60 percent of exports, and 18 percent of stock market capitalization.

The mining industry provides a crucial stimulus to construction, transport, and infrastructure, and is a supplier of inputs to key industries such as electricity generation, cement, and steel. It is likewise a highly profitable destination for banking investment. Australia’s mining giants thus find themselves at the commanding center of the narrow range of industrial activities that make up Australian capitalism. Consequently, they enjoy vast political influence.

In 2010, the industry effectively deposed ALP Prime Minister Kevin Rudd. When he proposed a modest tax on mining, they countered with a $100 million scare campaign. This pressure culminated in a leadership spill led by Julia Gillard who, once installed as prime minister, drastically watered down Rudd’s tax, handing miners at least $1.5 billion in savings. It isn’t for naught that the industry has cultivated deep ties with the Australian political class and commands an army of lobbyists who are deployed to shape policy at all levels of government. Take, for example, Australia’s lead negotiator on the Kyoto Protocol, Ralph Hillman, who later became the head of the Australian Coal Association. Former ALP leader Bill Shorten’s chief of staff was Cameron Milner, the owner of a lobbying firm employed by Adani. Even the former head of the Australian Council of Trade Unions, Martin Ferguson, now heads the union-busting Minerals Council of Australia.

Such is the nexus of power that contributes to dire ecological vandalism, not just nationally but globally. We need a new vision.

Beyond Mining

Such a vision is exactly what an Australian iteration of the Green New Deal (GND) could provide. The plan has been popularized by Alexandria Ocasio-Cortez and Bernie Sanders in the United States, and was most recently adopted by Jeremy Corbyn’s Labour Party at their conference this year. The program calls for large-scale state intervention to rapidly decarbonize the global economy.

The strength of the GND is its radicalism. Carbon taxes and emissions-trading schemes to “gradually” phase out fossil fuels are far too little, far too late, and often counterproductive. Charging fifteen cents for plastic bags at supermarkets won’t cut it; nor will imploring consumers to “vote with their dollar” and “buy green.” Nor can we rely on shareholder activists to pressure big polluters. Businesses are already experts in greenwashing their profits. So long as the corporate polluters who superintend our political system remain seated in power, emissions will rise. The market has failed us.

A Green New Deal instead demands heavy government investment into a green economy, regulation of industry, and (in more radical iterations) a forthright program of nationalization and wealth redistribution. This approach defies “climate nihilism,” instead identifying in the climate crisis an opportunity to create a more humane economic system. The GND represents a genuine synthesis between climate action and social justice.

This formula can work because it can offer tangible improvements to living standards. Australia is a country with stagnant wages, high prices, and soaring inequality. Imagine instead a country where government-subsidized solar panels and a renationalized grid have cut electricity prices to a fraction of their current expense; where free, frequent, and spacious public transport services every corner of the country; and where those cars which remain are electric, powered by a capacious infrastructure. Imagine the eradication of unemployment through investment into green industries, supplying the populace with training, followed by tens of thousands of well-paid and secure union jobs.

The only things that should go extinct in our time are the ills of privatization and labor-market insecurity. Such measures would necessarily represent a victory over a politics driven by mining companies, which have hitherto been riding roughshod over indigenous rights, sponsoring draconian laws that criminalize protests, and stealing the natural resources of poor neighboring nations, like East Timor.

This type of practical yet utopian thinking is at the heart of the Green New Deal. It has the potential to draw together solutions to the climate crisis with the fight to address the everyday injustices of Australian capitalism. Such a vast economic transformation would necessitate and facilitate political change: after all, the same nexus of corporations, think tanks, lobbyists, politicians, and civil servants who are responsible for environmental destruction can also be blamed for stagnating wages, soaring house prices and rents, absurd student debt, rampant wealth inequality, and the privatization of essential services.

The majority of Australians accept the scientific validity of climate change and believe that more drastic action should be taken to address it. They believe that the government should provide and pay for health care, aged care, childcare, social housing, education, and public services (such as public transport and roads). They oppose the privatization of public services. There is widespread distrust of politicians and little faith in the political system. A Green New Deal that overhauls all this could find ample popularity in Australia.

What Might a Green New Deal Look Like?

If we are to avoid climate collapse, we must drastically reduce global emissions within an incredibly short time frame — about ten to fifteen years. Social reorganization on this scale and speed will not occur without rapid, large-scale state intervention into the economy. The broad strokes of what must happen are clear and well within our current technological capabilities.

A moratorium must be placed on all new coal and gas exploration. The fossil fuel industry must be shut down as soon as is practicable. Rather than extending the life of coal stations or replacing them “like-for-like,” as advocated by the current LNP government, the closure of coal power generators and related industries can be used as an opportunity to invest in renewable energy and re-skill workers displaced by the coal phaseout to gain employment in the numerous occupations that will grow as a result of increased green investment (i.e. coal mine rehabilitation).

Australia is the world’s largest exporter of both coal and gas. Pundits have been predicting the end of the coal industry for some time, yet the global market continues to furnish it with demand. Even so, the fossil fuel industry enjoys vast subsidies, which should be promptly abolished.

But the market alone cannot be trusted to escort the fossil fuel industry to its grave: the fossil fuel industry should be nationalized, appropriating their revenue, capital, and labor power, and redirecting them toward GND social and economic programs, eventually phasing the industry out while simultaneously providing an engineering and infrastructural basis for new green industries.

Renationalizing the electricity grid could eliminate the considerable cost burden it imposes on working households and facilitate a rapid transition to a 100 percent renewable electricity grid. Under the nationally owned system, which lasted until the early 1990s, prices remained stable and affordable for decades. Private ownership now allows competing energy retailers to charge extortionate prices to consumers while the system is plagued by periodic summer blackouts.

Worse, the marketized energy grid disincentivizes coal-powered generators from exiting the energy market — if one coal generator goes out of business, the rest see their prices and profits soar. Removing the profit motive from the electricity industry can allow for a rationally organized, clean, and affordable energy system. Instead of producing emissions, Australia’s central deserts, blessed with abundant sunlight, could pioneer the large-scale use of concentrated solar thermal energy.

Transport accounts for 18 percent of national carbon emissions. Under private management, fares, overcrowding, and delays have all increased as public transport fails to expand in line with population growth and urban sprawl. Private operators are nonetheless showered with cash: Metro Trains receives $800 million a year from the Victorian state government. This must stop. Public transport must be brought under public control, made free, and expanded to minimize reliance on cars. A national high-speed rail system could be introduced to reduce the use of trucks, shipping, and airplanes for domestic transport.

Building accessible medium- to high-density public housing in inner-city areas can improve access to the public transport grid, increase energy efficiency, and free up space for urban agriculture. Rather than auctioning off inner-city public housing to private developers, inner-city public housing stock should be greatly expanded. This could eliminate burgeoning housing waiting lists and minimize urban sprawl as part of a government-mandated housing guarantee.

Investment in new forests has the potential to capture large amounts of carbon dioxide. Initiatives like the Great Forest National Park proposal in Victoria are an excellent start. Sustainable manufacturing practices must also be readily adopted. For example, cement production can be weaned off its reliance on limestone to eliminate its 8 percent contribution to global carbon emissions.

A GND also opens opportunities to redress other long-standing and less immediately economic injustices. The call for a “Black New Deal,” which would place traditional aboriginal land in aboriginal hands, has already been issued. Jobs dedicated to regenerating and protecting natural environments could be a valuable weapon against poverty and marginalization in indigenous communities, while genuine aboriginal sovereignty could provide a shield against environmentally destructive mining and agriculture.

The list could well go on, but the picture is clear — an effective solution to the climate crisis would require no less than a total reorganization of the economy and society.

How Would We Pay for It?

Robert Pollin put the price of a Green New Deal at as little as 2.5 percent of global GDP per year — which would translate to about $45 billion in Australia. Under Bernie Sanders’s more ambitious plan, annual expenditure is estimated at around 12 percent of GDP annually over the next ten years. This is the equivalent of about $200 billion in Australia.

It is beyond doubt that the economic and human costs of climate collapse will exceed the costs of climate action. It is beyond all moral and political doubt that these costs should be borne primarily by the perpetrators of this crisis, among them the 100 corporations responsible for 71 percent of global carbon emissions.

In addition to the overwhelming moral case, funding a GND is not as difficult as it seems. Where will the money come from? Contrary to its opponents’ claims the GND is too expensive to fund, there is plenty of money sloshing around Australia that could be repurposed for something as necessary as a plan to decarbonize.

Australia spends approximately $29 billion annually in subsidies for fossil fuel. According to one report, a mere 10–30 percent of this amount, if redirected to green energy, would be sufficient to trigger runaway investment. To put this in context, the federal government gifts $4.6 billion annually to wealthy private schools — over half of school funding — while public schools becoming increasingly overcrowded and underfunded. Meanwhile, $32 billion has been allocated to needless defense spending in this year’s budget. A third of corporations operating in Australia pay no tax at all (60 percent of which are from the resources sector). This cost the Australian government $13.4 billion in 2015–16.

Australia’s highly unique dividend imputation system taxes corporations at rates determined by their shareholders’ income and not the company’s rate of profit. It is designed to overwhelmingly benefit corporations and wealthy individuals who under this system pay no tax on dividends. This system is worth about $30 billion. It should be scrapped wholesale and replaced with a progressive tax on corporate profits.

The country’s big four banks’ loans to the fossil fuel industry are valued at around $29 billion. This doesn’t scratch the surface of their anti-social lending practices. If these banks were placed under popular control, their enormous funds could be put to far better use than expediting the apocalypse. Interest-free loans could help redress spiraling housing costs and encourage green investment, while punitive interest rates could further discipline damaging industries.

These savings — and many more could be suggested — already amount to $138 billion. And this says nothing of borrowing. Government debt in Australia is low by OECD standards — standing at 40 percent of GDP compared to 106 percent in the United States. This figure could surely rise without causing too much pain, except maybe of the psychological kind, inflicted upon the minds of market ideologues inhabiting debt-averse neoliberal think tanks and the upper echelons of Australia’s civil service.

The promoted dichotomy between economy and ecology is a false one. Money does not disappear after it is spent. Lower energy prices and greater investment in the manufacturing of ecological technology and infrastructure will boost the economy. Preserving the environment itself will defend jobs — for example, the sixty-four thousand jobs that will be saved if the Great Barrier Reef is not utterly destroyed by dredging activity. And this says nothing of the new jobs that could be created by a green economy, which may expand the government’s tax base and reduce the administrative costs associated with a punitive welfare state.

These proposals are just the beginning. Yet issues like these are not even being considered by our major institutions, let alone the broader public. This is because they are not being posed. Now is the time to turn this around.

How Do We Win a Green New Deal?

A Green New Deal, once put on the table, will be met with resistance from Australia’s capitalist class. The miners and the fossil fuel industry will declare an all-out war. The banking and real estate industries will cry foul at any measures that lower housing prices. The renationalization of public services will be resisted by the domestic and multinational corporations that currently dominate them. Encroaching upon class privileges by increasing corporate taxes (along with other revenue-raising measures) will elicit generalized outrage from Australia’s political and economic elite.

The networks of power underpinning Australian capitalism are hostile to even moderate measures to avoid ecological collapse. Given that they cannot be voted out of power and will not abdicate voluntarily, the only plausible option is a mass movement that can confront, challenge, and displace them.

Our movement must be explicit in its demands. We must be willing to wield tangible force while also championing a compelling vision.

Such a mass movement must have a base in the trade union movement, which has historically supplied the muscle to force through radical reform. Yet for this potential to be actualized, the unions must overcome their bureaucratic malaise and political timidity and reassume their historic role at the forefront of social movements. After all, those who produce society’s wealth have — potentially — the power to halt the production of wealth and to spearhead economic transformation from below. Militant unions should use their industrial power to lead the charge in driving industry to decarbonize.

This will require a new politics. The ALP left and the Australian Greens ought to reject neoliberal, market-based “solutions” to the climate crisis. It is unlikely, however, that they will, especially given their history and rightward trajectories. And we should be on guard against any attempt to hijack the language of a Green New Deal at the service of centrism. Ultimately, it will be necessary for leftists, activists, and unionists to form a new political movement that can fight for a socialist Green New Deal.

An effective climate movement must be unapologetic about the scale of action necessary to avert planetary crisis. Change on the scale required will have to dislodge a power structure that depends on the extraction and consumption of fossil fuels. This is no small task, but the only meaningful way forward.