Theory

Students on Libertarianism

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On climate change

Ahmed Suliman

 

Climate change. Just two words that have a literal meaning of no more than a variance in our weather patterns. However these two words have caused so much tension, debate, conspiracy theories involving anyone who likes to have an opinion, as well as a multitude of new government policies and UN ramblings. The reason for that is the inconspicuous addition of the word anthropogenic, denoting human responsibility. Responsibility for our actions is, as we were taught from a young age, a fine and necessary virtue to have. However, collectively as a species, we seemed to have developed an unwavering phobia against admitting the consequences of our actions.

The science of climate change is reaching a higher consensus with every passing year. I’m sorry to tell you, my skeptic friends, that there is no, in all likelihood, global climate change conspiracy peddled by the Illuminati or green socialists, and facilitated by UN Agenda 21. I live in hope that we all realise that depoliticising the survival of our specie isn’t too much to ask. The issue is real, but that is not say that the solutions we are presented with today are anything near adequate.

More coercive economically illiterate government taxes are not the answer. The state, in this country and elsewhere, has become adept at creating and maintaining a culture amongst the masses of running off to the Nice Government Bureaucrat every time something needed action. This has legitimised the expansion of the state beyond belief, particularly in areas such as bureaucracy, tax collection and surveillance of its citizens. From a minarchist perspective, I believe that there are no real legitimate duties of a government other than providing safety and justice to its constituents through a strong police system and judiciary branch, and to maintain a defence force that can repel a foreign invasion. That’s it. Any other “important” service or product can be produced in high quality and lower prices through a truly free market. Any necessary collective action can make use of the free-willed motivated individuals taking part, not coercively made to come along for the ride by an increasing Orwellian government.

That last part will prove to be, in my opinion, highly influential in finding an amicable solution to decelerating anthropogenic climate change to a manageable level, while not compromising the great living standards that free enterprise has brought us since the industrial revolution. In an economic sense, the factors contributing to global warming are considered a negative externality, or actions that affect third parties without punishing the source through market pricing. To account for a negative externality would be to either tax it (which has negative impacts from a national economy health perspective, especially when other countries aren’t doing the same) or for those affected to demand compensation. At the moment there are many laws internationally concerning class or individual tort claims that provide polluters with immunity from tort claims. Governments would need to respect property rights (a fundamental tenant of a healthy free market system) enough to repeal such laws and allow those who can show demonstrable damage from the actions of a polluter for example to claim compensation, which can be in the form of class action lawsuits or individual cases. This would force companies and firms to account for such risks in their business cases and logically look towards more environmentally conscious alternatives.

On the topic of environmentally conscious alternatives, the clean energy sector is clearly the way of the future, but constant hampering by the state through high taxation and crippling regulations means that the cost of entry is still too high for most individuals and enterprises. It’s a basic principle of human behaviour that if you should effectively incentivise a behaviour if you want to see more of it. The importance of the clean energy sector needs to be recognised through decreased taxation and repealing restrictive legislation.

Finally, the personal civil responsibility of the individual is what we need in the face of a challenge like global warming. Throwing away the responsibility onto an inefficient and power-hungry state is reckless. Make sustainable choices in your own daily life, and encourage others to do the same. The work being done by private organisations such as Nature.org, who use donations to purchase forests to preserve wildlife and prevent them from being deforested, is a perfect example of how a non-coercive free market solution to environmental challenges works without damaging our economies or living standards.

 

 

On manufacturing

Rhys Tucker

 

On February 11, Toyota announced that they would cease production of cars in Australia by 2017, signalling the end of the Australian car industry. Among the reasons for the decision, Toyota cited a high Australian dollar, high manufacturing costs and low economies of scale. Meanwhile, the future of SPC Ardmona hangs in the balance. It seems that everywhere we look, manufacturing in Australia is dying. This issue is a contentious one, not only in the parliament but also among the parties themselves. But why can’t the government step in and save these companies? I hear you cry with bleeding-heart anguish. And indeed, that view is quite a popular one among people both on the right and on the left. People argue for heavy subsidies to save jobs in a dying manufacturing industry. In fact, Labor Party Leader, Bill Shorten was convinced that a little more taxpayer money could have prevented the automotive industry from leaving entirely. These intentions for job protection are noble, however, the reality of the situation is a little more complicated.

A Libertarian would approach this problem bearing in mind the conditions that manufacturing faces in Australia, and would come to the conclusion that a bailout of the manufacturing sector would not be worth its cost to taxpayers. On an ideological level, the idea of giving someone else’s money to someone else is unattractive, especially when the perceived societal gain from that transaction is small. Indeed, a lot of taxpayers won’t end up buying an Australian-made car or a can of processed fruit, and so will personally feel little of the benefit of keeping the industry alive. It also makes economic sense not to subsidise a failing business. Every dollar that is taken from the people in taxes and given as a bailout prevents successful businesses from expanding and hiring more employees. It also stifles consumer demand, as people have less money to spend on things that they actually want.

By removing subsidies from an inefficient and unsustainable manufacturing sector, we pave the way for private sector investment in many new industries. Sure, there may be some initial job loss as the economy makes this transition, but in the end we will be left with a more robust and expansive economy. From a Libertarian’s point of view, subsidies and bailouts are counterproductive, and send false signals to consumers and producers. We believe that if you want to expand the economy, encourage private sector investment in new industries and grow the job sector, we need to stop corporate welfare and minimise government intervention.

 

 

On marriage

Rebecca Lawrence

 

The debate surrounding marriage legislation in Australia is often over-simplified into the question “Are you pro-gay marriage?” In reality, the question should not be over which marriages should be legal, but whether marriage needs to be regulated by the state at all.

The answer, of course, is no. The Marriage Act (1961) should be abolished. The idea that the government has a role in elevating one kind of relationship over another is an unacceptable and unnecessary form of state intervention in the private lives of human beings (and a huge drain on taxpayers’ money).

An easy way to judge (from a libertarian perspective) whether an action should be illegal is to refer back to JS Mill’s harm principle. If, for instance, five people decide they all love each other very much and want to write themselves a “marriage certificate”, this does not harm anyone else in Australia. Similarly, if a woman finds someone to “marry” her to another woman, this too causes no harm to anyone else. If the same woman had chosen to “marry” her goldfish, it still wouldn’t cause any harm to any other citizens. Therefore, it is inappropriate for the government to intervene to say that these relationships are any less legitimate than a heterosexual, monogamous one. So long as a relationship doesn’t harm or infringe upon any other human beings’ rights, it should be just as legal as any other relationship.

A removal of state intervention in the institution of marriage is also necessary in order to preserve the strength of private organisations. A government that has enough power to determine who can get married is powerful enough to compel private marriage celebrants to perform ceremonies they would not otherwise have performed. For instance, there is nothing to say a progressive government could not legislate to allow gay marriage and also compel all registered marriage celebrants to perform gay marriage ceremonies. This would grossly undermine the power of private organisations (such as the Catholic Church) and the rights of any individual who would either be forced to perform a ceremony he believed to be morally wrong and illegitimate, or give up his career.

The current Marriage Act is used to identify couples who are eligible for exclusive government benefits- welfare benefits, tax benefits, subsidised marriage counselling and more. These, of course, should be abolished along with the marriage act, as they simply involve taxpayers subsidising a certain kind of lifestyle choice. The legal reasons for the Marriage Act’s existence – for example, next of kin arrangements – can and should be determined by private contracts, not a one-size-fits-all set of government regulation that kicks in when two people sign a registrar.

Any government legislation in the area of marriage is a grossly illegitimate and unnecessary form of government intervention in the private lives of individuals. It suggests that government knows what’s best for the individual better than individuals know for themselves. Therefore, Australia should focus less on potential amendments to the Marriage Act (1961) and turn its’ efforts to abolishing the Act entirely.

 

On welfare

Aiden Depiazzi

 

Libertarians across the nation beamed with approval when the Commonwealth Government announced that it would not be providing the $25 million assistance package to SPC Ardmona that the fruit processing company had requested. It indicated at the time that the Coalition was keeping to its election promises to spend wisely and spend thriftily, given the budget situation, and was in keeping with the rhetoric that surrounded the decision to provide no further support to Holden as well.

Corporate welfare is, in any circumstance, a sickly and unpleasant policy pursuit. Providing taxpayers’ funds to a private enterprise in this gift-giving manner sends the message that businesses needn’t plan carefully to stand on their own two feet; rather, if they fail, they can simply call on the public dollar to keep them afloat.

In the century of Asian free trade arrangements, Australian firms need to dynamic in responding to changes in cost structures. SPC Ardmona was not. Cheaper, comparable-quality products imported from Asia crowd out their product, but as their revenues continue to shrink, their costs grow ever higher. Mid-range workers were being paid 38% above their award wage, and that’s before we take into account the very generous leave arrangements, allowances, and up to 104 weeks’ full pay upon severance. The source of the bizarrely high wage arrangements is no mystery either (particularly because the EBA is a public document): SPC Ardmona is practically a union office. They have 8 full-time union organisers onsite, each entitled to 5 days’ paid leave to attend union training, regardless of disruption to the business. The organisers are also permitted to conduct union business on company property and on company time, whenever they like. And the sour icing on the rotten cake is that SPC workers are forced to buy income protection insurance from an insurance company that is partially owned by the Australian Manufacturing Workers’ Union, and the company pays part of the premium.

SPC sealed its own fate when it signed on to an EBA that hamstrung its ability to be cost-effective and to find necessary efficiencies in times of falling revenue. It has precisely nothing to do with the government or with the average Australian taxpayer. The Commonwealth Government’s decision was the right one.

Let’s also bear in mind that SPC is a subsidiary of a multibillion-dollar company that reported a $558 million profit in 2012-13. SPC was not standing alone when it asked the government for a handout; the $25 million in public money would have been a free gift, there purely to boost the return that CCA made on its own investment in SPC’s future.

Libertarians should therefore be understandably upset at Denis Napthine’s announcement that the Victorian Government will donate $22 million to SPC. I use the word “donate” very carefully, to combat the ridiculous and erroneous use of “co-investment” used by the company, the union, and the Federal Opposition. It is a vicious attempt to mislead taxpayers by implying that they will make a return out of the payment. Well, they won’t. It’s cash in hand for Coca-Cola Amatil, and nothing else.

My criticism of the Victorian Liberal Party’s decision leads nicely to my criticism of the Federal Liberal Party’s support for Cadbury. Unlike most Liberals, I’m not going to attempt to summon a defence for giving $16 million in taxpayers’ money to Cadbury in Tasmania. It was a poor decision.

The reasons for it being a poor decision are reasonably simple. The first is that, as described above, all forms of corporate welfare are wrong, and rewarding rent-seeking behaviour is the worst possible response a government can have to lazy corporate management. The second is that the circumstances surrounding the two cases are just too similar to attempt to differentiate. CCA doesn’t deserve taxpayers’ money to support SPC because it is a $5 billion entity that reported a $558 million profit in 2012-13. Well (according to the latest available figures) Cadbury is a $10 billion entity reporting a $674 million profit. If CCA can afford to sustain SPC, then Cadbury can afford to sustain its functions in Tasmania.

Decisions like these represent a mindset in which businesses operate sloppily and statically, in which we frown on competition and free trade, and in which the power to determine whether or not a company is viably competitive rests with trade unions instead of with market forces. Such decisions should be condemned by all liberals and libertarians, especially those with voices inside government.

If a business cannot sustain itself in a world of competition and free trade, then it should die. No ifs, no buts, no maybes.

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