Making Things Matters

From Bankers.asn.au - Source: Australian Bureau of Statistics 5206. National Income, Expenditure and Product. June Quarter 2003: Axiss Australia

Guest post by Viv Forbes

According to those pushing the (Australian) carbon tax, 500 bureaucrats googling away quietly in Canberra and generating little useful except carbon dioxide exhalations, are more valuable than 500 farmers, foresters, fishermen, workers and miners whose machines also generate more of the same harmless carbon dioxide in order to produce the food, fibres, hardware and energy needed for our daily existence.

It is a suicidal policy to levy a carbon tax on people who produce things but not on those who don’t.

Such an attitude shows how removed from reality the deep green mentality has become.

It is only since humans learned to harness carbon energy that we have been able to generate sufficient surpluses to support art, culture, academia, bureaucracy and big cities.

In the green energy society, before coal and oil replaced our hay burning horses and bullocks, most of the food produced was consumed by the large farming families, their labourers and their draught animals. Any surplus went to service people like butchers, bakers, blacksmiths and saddlers. Cities were small and there was little left for the tax man.

It is not the bureaucracy or the carbon tax that produces eggs for breakfast, electricity for the toaster, gas for the barbie or petrol for the car. It is hard working men and women with resources, skills and carbon powered machines.

Making things matters.

Viv Forbes,

Rosewood    Qld   Australia

forbes@carbon-sense.com

I am happy for my email address to be published.

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Viv, that pie chart is nearly 9 years out of date. I suggest you update it with more recent data or provide an explanation of why it is so out-of date. I’m on your side and I’m finding it hard to swallow. Credibility is going to suffer.
REPLY: I added it, not Viv, to illustrate industry in Australia. It was the only ready made pie chart I could find. I’ll happily substitute another if you have a suggestion for one. – Anthony

Unattorney

Classism Is behind climatism;efficiency is not relevant.Carbon is what poor people give off.

Andrew30

Is there a similar chart that compares people that create wealth and pay taxes versus those that only receive taxes? Note that anyone that is paid by taxes does not effectively pay any tax; they simply return some tax revenue back to the pool so that they can later receive it.
Once the number of voters in a country that derive their income from taxation exceeds about 40% the country is doomed to a downward socialist spiral.
The trick is to understand that ‘need’ and ‘want’ are two different things. A country may ‘need’ taxation paid firefighters, police, armed forces and judges but many not need taxation paid international prestige, pre-school daycare, or funding for economic refugees.

ShrNfr

But then again, what do you expect from a country that produced Julia and Barrie Harrop…

Ray Donahue
Mailman

Andrew30,
Funnily enough, 40% of the Greek economy is from the public sector…a sector that DOES NOT generate wealth!
Mailman

@Andrew30: The distribution of goodies is a secondary variable. It doesn’t really matter if the goodies are distributed mostly by government or mostly by markets. If there aren’t any goodies to begin with, the country will collapse. And the only way to get goodies is to GENERATE SURPLUS VALUE BY MAKING THINGS, as Viv said.
Successful countries range widely from high-welfare to low-welfare. Successful countries have only one thing in common: they MAKE THINGS.

fred houpt
Andrew30

polistra says: January 29, 2012 at 11:08 am
@Andrew30: The distribution of goodies is a secondary variable.
I disagree.
It does not matter how much a country makes, if the 40% of more of the population are non-makers than the wealth of 60% of the taxed entities are paying for 100% of the spending. If the non-makers have a lifestyle near equal to the makers then each taxed entities needs to be taxed for 50% of their wealth OR the country must borrow money from the bank deposits of the makers or the bank deposits of makers in other countries. Neither of which are possible to re-pay without increasing the taxation rate on the taxed entities to more than 100%.
Since the 40% voting block is sufficient to deter a government from cutting the largess, the country is doomed. People have not been known to knowingly vote in favor of a degradation of lifestyle of for their own unemployment.

pat

This is very typical. A special tax levy on government leeches is a wonderful idea.

Andrew30

polistra says: January 29, 2012 at 11:08 am
@Andrew30: If there aren’t any goodies to begin with, the country will collapse.
I disagree.
When the Europeans first arrived in Canada they had picks, shovels, axes, seeds and some draft animals. They did not bring any ‘goodies’.
The deal was that you needed to build a shelter and collect enough food and cut enough firewood to survive the coming winter or you would die. There was no welfare system but there was a big motivation to get off your but and get to work.
Canada did not collapse.

DirkH

Mailman says:
January 29, 2012 at 11:08 am
“Andrew30,
Funnily enough, 40% of the Greek economy is from the public sector…a sector that DOES NOT generate wealth! ”
Another problem of the Greek is that they have many state-owned companies. Their largest private sector enterprise is Hellenic Bottling, the local Coca Cola licencee. State-owned companies are theoretically capable of “making” things; the problem is that, usually, they are not in a hurry to do so.

Certainly, “[i]t is a suicidal policy to levy a carbon tax on people who produce things but not on those who don’t,” but those who push the carbon tax know full-well that 500 bureaucrats are far more powerful than any number of those who produce things that people need to eat or to use to sustain them, even more powerful than the elected representatives of the people who falsely believe that those elected representatives have much power to change things.
The real political power is with the non-elected bureaucracy. The bureaucracy is virtually impervious to any possible consequences posed by elections.

Peter Miller

This sums up many of our problems today – it has created an environment in which unscrupulous, dishonest, scare mongering, greedy ‘climate scientists’ can flourish:
“Spanish scientists announce the discovery of a perverse, perplexing atom
The new element is Governmentium (Gv). It has one neutron, 25 assistant neutrons, 88 deputy neutrons and 198 assistant deputy neutrons, giving it an atomic mass of 312.
These 312 particles are held together by forces called morons, which are surrounded by vast quantities of lefton-like particles called peons.
Since Governmentium has no electrons or protons, it is inert. However, it can be detected, because it impedes every reaction with which it comes into contact. A tiny amount of Governmentium can cause a reaction normally taking less than a second to take from four days to four years to complete.
Governmentium has a normal half-life of 3-6 years. It does not decay but instead undergoes a reorganization in which a portion of the assistant neutrons and deputy neutrons exchange places.
In fact, Governmentium’s mass will actually increase over time, since each reorganization will cause more morons to become neutrons, forming isodopes.
This characteristic of moron promotion leads some scientists to believe that Governmentium is formed whenever morons reach a critical concentration. This hypothetical quantity is referred to as critical morass.
When catalysed with money, Governmentium becomes Administratium, an element that radiates just as much energy as Governmentium since it has half as many peons but twice as many morons. All of the money is consumed in the exchange, and no other byproducts are produced.”

AlexS

So a post that support more taxes.= giving more power to the Government.

@Andrew 30
The trick is to understand that ‘need’ and ‘want’ are two different things. A country may ‘need’ taxation paid firefighters, police, armed forces and judges but many not need taxation paid international prestige, pre-school daycare, or funding for economic refugees.
Or Climate Change Officers!!
http://notalotofpeopleknowthat.wordpress.com/2012/01/11/climate-change-officers-at-sheffield-city-council/

Rosco

Ray forgot the “l” as in “.html” which works

don

Actually, the carbon tax levy on producers does end up getting paid by the non-producers–in the added costs of consumption and forgone growth, additional unemployment and lower investment. Essentially, it gives the non-producers more clout in rationing out the declining stock of goods made by the producers, all in the vain attempt to control climate. Looks like the madness of crowd behavior to me. The carbon mania has replaced the Dutch tulip craze, on a higher post industrial level.

Richard111

The two attempts tolink to this article above seem to have format errors.
there should be a double dash — between warming and cycle and html at the end.
My post is showing correctly. Lets see how it comes up.
Sorry to push this but it is from Met Office AND CRU !
http://www.mailonsunday.co.uk/sciencetech/article-2093264/Forget-global-warming–Cycle-25-need-worry-NASA-scientists-right-Thames-freezing-again.html

GeoLurking

Anthony Watts says:
January 29, 2012 at 11:02 am
“@Ray Donahue …When there are a lot of comments those with lower end systems often have trouble.”
Dunno, I’m running 4 GB on a quad core system and cable, Tips and Notes is always a slow loader for me. (Nvidia GTX 460)

u.k.(us)

Well said.
It will matter.

Ed Scott

Forget global warming – it’s Cycle 25 we need to worry about (and if NASA scientists are right the Thames will be freezing over again)
Met Office releases new figures which show no warming in 15 years
http://www.dailymail.co.uk/sciencetech/article-2093264/Forget-global-warming–Cycle-25-need-worry-NASA-scientists-right-Thames-freezing-again.html

DesertYote

grumpyoldmanuk
January 29, 2012 at 10:33 am
Viv, that pie chart is nearly 9 years out of date.
###
And it is probably still accurate. This type of data does not move much on a decade scale.

I think a more recent chart may be even more skewed away from producers. Does anyone else but me get the impression that our U.S. business is much more involved with googling, facebooking, and giving super-Mario more weapons or whatever in a new X-Box game in recent years? And our possible recovery last quarter is all based on Bulls#*t? Maybe I am just too old and a luddite, I don’t know…

Steve from Rockwood

The graphic shows mining at 5% of GDP. According to the Australian Government (so it could be wrong), mining and oil account for over 9% of GDP and almost 50% of all exports (including services).
So Australia is one of the largest exporters of CO2 and plans to adopt a carbon tax. This is an effective way for the Federal Government to further tax its own exports.

ShrNfr

Had Fisher observed the Greenspan/Bernanke Fed in action, he might have updated his theory with a revision. At some point, capital betrayed into unproductive works has to be either repaid or written off. If either is inhibited by reflation or regulatory forbearance, then a cost is imposed on productive works, whether through inflation, higher interest, diversion of consumption or taxation to socialize losses. Over time, that cost ultimately hollows out the real productive economy, leaving only bubble assets standing. Without a productive foundation, as reflation and forbearance reach their limits, those bubble assets must deflate.
— Foreword to Fisher; The Debt-Deflation Theory of Great Depressions (1933)

Gary

Producers will just pass on the tax costs to consumers. Of course, they will get blamed for the price rise — just as the bureaucrats plan and expect. It’s up to the producers to explain the reason. Unfair,yes; but it’s the way the game is played. Politicians count on the public and businesses being diffuse and individually weak.

Peter Plail

Peter Miller – Thank you for science I can understand.
Can I add another element? Europeanunium which, when it reaches critical mass, produces a black hole.

Mark

Go to the link below: Table 04 has current & past employment in Australia by sector:
http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/6291.0.55.003Nov%202011?OpenDocument
It only goes up to November 2011, and doesn’t seem to have a “government employee” option (although there is “public admin” & “healthcare & social assistance” etc), but you ought to be able to do a chart or two with it. Heck even without such an option it should still be obvious that in terms of CO2 vs economic utility there’ll be differences between, say, miners & public admin types.

johanna

I don’t have a pie chart, but the latest figures by segment (for 2009-10) from the Australian Bureau of Statistics are here, under “Industry”:
http://www.abs.gov.au/AusStats/abs@.nsf/Latestproducts/5204.0Main%20Features22010-11?opendocument&tabname=Summary&prodno=5204.0&issue=2010-11&num=&view=
Sorry, I can’t copy the graphic and it is not precise enough to convert to a pie chart. However, since the chart above, manufacturing has fallen from 12% to 8% of GDP, while mining has risen from 5% to 10%. Finance and insurance services has also grown, to 11%.
Mining, which underpins our prosperity and exports, is of course very energy intensive. So, the increasing energy prices nobble our most productive and fast growing sector – that would be the one where we have a comparative advantage in world markets. Brilliant.
BTW, the public sector is around 35% of the Australian economy, which is modest by European standards and comparable to the US.

sorry I see the first dailymail link was wrong but someone already corrected it

As a fellow Australian from Sydney I am of course particularly irate about the Carbon Tax starting this July. There may be some hope of it going when the Government (inevitably) changes next year, but that’s not for sure. Join me in writing regularly to politicians on both sides bringing to their attention material from this site.
The one single point I believe we need to get across to governments worldwide is that backradiation has absolutely no effect on a warmer surface – neither warming nor slowing the rate of cooling. It cannot even melt a bit of frost on the ground. This single physical fact (proven computationally by Prof Claes Johnson last year) is sufficient to completely demolish any concept of an atmospheric greenhouse effect.
What I believe we need is a substantial prize for anyone able to prove otherwise and actually show that spontaneous blackbody radiation can warm a warmer surface. It cannot and the reward would never have to be paid. But the fact that it never is paid out should be ample justification for the world (and even the Australian Government) to scrap their belief in anthropogenic global warming.
There have been faster rates of warming in sea surface temperatures before WWII than at any time since the war. There is no way that SST data over the last hundred or more years indicates anything more than about a 0.5 deg.C increase in the long-term trend by 2100. Evidence abounds that natural cycles are the sole reason for climate change, and such cycles suggest long-term cooling in the not-too-distant future. There is no evidence of AGW and there never will be.

I agree with just about everything said here with the qualification that services can produce wealth just as making things can. A company that performs accounting services for another business less expensively than they could in house lets the non-accounting company keep more of what wealth they generate. Keeping wealth from being destroyed by inefficiencies is, indirectly, wealth creation. It’s just that government services, much like soviet manufacturing, destroy most/all/more wealth that they create–when they create any at all.
The wealth of created things is made more valuable by the hoteliers, hairdressers and horse racers who don’t make things but make wealth more worth having while even while employing large numbers of people. It is unfair to target those who accumulate resources, make physical objects and generate material wealth, but it’s unfair to target anyone who is productive–whether they manufacture, mine, or produce services.

Ted

Vic
. How can a tough country like Australia become so soft, it’s a puzzle to me?

Patrick Davis

Off to QLD today using that nasty carbon polluting machine called a plane. But this article sums up the lunacy going on in the lucky country.

Andrew30

johanna says: January 29, 2012 at 2:38 pm
“So, the increasing energy prices nobble our most productive and fast growing sector – that would be the one where we have a comparative advantage in world markets. Brilliant.”
“BTW, the public sector is around 35% of the Australian economy, which is modest by European standards and comparable to the US.”

Now, add the not employed (unemployed, welfare, refugees, etc) to the 35% to get the numbers of people living on the taxes of makers and what percentage do you get?
So they increasing energy prices on your most productive and fast growing sector to keep giving the largess to the near 40% if the electorate. Why do you sound surprised? Where did you think the money was going to come from?
The Canadian Prime Minister has said:
“Kyoto is essentially a socialist scheme to suck money out of wealth-producing nations.”
“As economic policy, the Kyoto Accord is a disaster. As environmental policy it is a fraud”
The ‘leaders’ in the 40% plus tax receiver countries Need the taxes (suck money out of wealth) from the carbon dioxide tax ‘environmental policy’ to maintain the illusion of social success for 40% plus of the voters.
This has nothing to do with climate, science, temperature or polar bears; only power and illusion.
Europe is doomed, the US is close but I think Australia may be closer.

johanna

Snake Oil Baron says:
January 29, 2012 at 3:22 pm
I agree with just about everything said here with the qualification that services can produce wealth just as making things can. A company that performs accounting services for another business less expensively than they could in house lets the non-accounting company keep more of what wealth they generate. Keeping wealth from being destroyed by inefficiencies is, indirectly, wealth creation. It’s just that government services, much like soviet manufacturing, destroy most/all/more wealth that they create–when they create any at all.
The wealth of created things is made more valuable by the hoteliers, hairdressers and horse racers who don’t make things but make wealth more worth having while even while employing large numbers of people. It is unfair to target those who accumulate resources, make physical objects and generate material wealth, but it’s unfair to target anyone who is productive–whether they manufacture, mine, or produce services.
——————————————————————————-
Of course you are right, and the richest economies have a preponderance of ‘tertiary’ industries, while the poorest have mainly ‘primary’ industries.
But every economy is different, and has unique advantages and disadvantages. In Australia we have a vast landmass inhabited by 22 million reasonably well educated people and stable government. Mining, which needs relatively few (but highly skilled) workers to produce a lot of wealth, and exports, is a perfect fit for Australia, and without it we would be more like South Korea than the US. Agribusiness is another winner. Yet these are the kinds of industries that will disproportionately bear the burden of increased energy costs thanks to the carbon tax and lunatic subsidised green energy schemes.

thingadonta

“It is only since humans learned to harness carbon energy that we have been able to generate sufficient surpluses to support art, culture, academia, bureaucracy and big cities.”
I think you will find that agriculture (about 10,000 BC), and metallurgy (a little later) had a little to do with it as well.

old engineer

I agree with Snake Oil Baron, services count also. The mechanic who repairs your automobile, the doctor who treats your illness (in the U.S. at any rate, most doctors are yet government employees), even those who entertain you, don’t make tangible “things” , but do add to the economy.
The fact that the U.S. is becoming a service economy doesn’t mean that our individual income has to fall. There are lots of services that are highly paid. I worked as an R&D engineer in industry. My only “product” was a final report, yet I was well compensated.

Andrew30


Stephen Harper in Davos January 2012
This is somthing that almost all current western leaders just don’t seem to get.
The above youtube video is not as good as the content.
For a better quality video, with one lead in commercial
[Harper tells Davos that hard choices needed now
Rich countries take wealth for granted, PM tells World Economic Forum]
http://www.cbc.ca/video/#/ID=2190494228
For some reason this speech was not as widely reported as the Occupy Davos Igloos.

commieBob

‘The powers that be’ have, for a long time, thought that we wouldn’t be manufacturing any more and were willing to pass that off to China, et al. We were supposed to move to some kind of more advanced economy based on innovation. The trouble is that China will probably learn to innovate just as well as we do. It doesn’t matter to the 1%. They will still be rich but the rest of us have been feeling the resulting stagnation of our personal wealth over the last thirty years.
Ceding our industries (mostly to the orient) was a stupid idea. Setting up the rules to aid companies in exporting our jobs was a stupid idea. Making things does matter.
There is some hope. The tools, that used to be too expensive for all but large companies, have become cheap enough for individuals and small companies. CNC machines and 3D printers are becoming common. Maker culture is blossoming. We are beginning to see the same conditions that enabled important companies like HP and Apple develop in people’s garages.
Of course the government can still kill new wealth creation with taxes and repressive regulation. It’s our duty to prevent them from doing that.

Mardler

Mailman says:
January 29, 2012 at 11:08 am
Andrew30,
Funnily enough, 40% of the Greek economy is from the public sector…a sector that DOES NOT generate wealth!
——————————————————————————————————————————-
In the UK it’s 53% – we are a good socialist country and going down the europan with the rest of them.

R Barker

It seems like green is the wrong color to describe the opponents of atmospheric CO2. Grey or brown would be more appropriate. Feed the plants and they will feed you …all seven billion of us.

edbarbar

Brilliant!
On another thought, gas prices have really increased in the US. How much has that yielded a reduction in gas usage.

REPLY: I added it, not Viv, to illustrate industry in Australia. It was the only ready made pie chart I could find. I’ll happily substitute another if you have a suggestion for one. – Anthony

The color choices in that pie chart are a nightmare of unfriendly colors for the red green color blind. I suspect there are divisions between the pie sectors covering the entire lower right half of the chart, but I cannot see them. In fact I cannot even see the colors in that whole side of the chart. My color checker tells me they are a light turquoise 205,255,255 which is just about the worst possible color (other than light cyan) for those with red-green color blindness (ie 10% of your audience).
It would be greatly appreciated if you could create some color differentiation in that segment of the chart (preferably changing those colors substantially).
There are resources that list colorblind friendly color choices which should be strongly considered by anyone presenting data graphically on the web.
Larry
[REPLY: Larry, point well-taken, but as Anthony has pointed out, he borrowed the graph from another place and editing it would be extremely difficult if not close to impossible. If any commenter has the time and expertise, I’m sure Anthony would be happy to entertain a replacement. -REP]

u.k.(us)

thingadonta says:
January 29, 2012 at 4:14 pm
“It is only since humans learned to harness carbon energy that we have been able to generate sufficient surpluses to support art, culture, academia, bureaucracy and big cities.”
I think you will find that agriculture (about 10,000 BC), and metallurgy (a little later) had a little to do with it as well.
============
Just say the word, Viv.
The dogs will slip their leash.

jorgekafkazar

Mardler says: “In the UK it’s 53% – we are a good socialist country and going down the europan with the rest of them.”
“A nation of shopkeepers” selling each other shoes made in China. Not a whole lot of creation of wealth, anymore. The ultimate outcome of Socialist economic theory.
People like Gillard are parasites on the wealth-creating capability of Australia.

jack morrow

Peter Miller says:
Great Peter-I’m still laughing.

Dave Wendt

It seems to be the commonplace here, as well as almost everywhere else, that the
US doesn’t manufacture anything anymore. Like many things that “everybody knows” it is complete nonsense. The US is,and has been for a long time, the biggest manufacturer in the World.
http://mjperry.blogspot.com/2012/01/top-500-us-manufacturing-firms-had.html
Top 500 U.S. Manufacturing Firms Had 2011 Sales of $5 Trillion, Almost As Much as Japan’s GDP
“MP: The comparisons above help put the enormous size of the U.S. manufacturing sector into perspective and demonstrate that American manufacturing is not withering and disappearing, but thriving, expanding and prospering. In terms of profits, the American manufacturing sector will have its best year ever in 2011. Based on data currently available through the third quarter, the U.S. manufacturing corporations are on track to earn more than $600 billion in profits for 2011, which will be a new record high, and double the profits in both 2008 ($26.6 billion) and 2009 ($28.6 billion), and 36% above the pre-recession level of $44.2 billion in 2007. American manufacturing is alive and well”
The percentage of the US economy that manufacturing represents has indeed declined, but that decline has been matched almost exactly by the decline in manufacturing by the rest of the world. I commented some time ago on the cost breakdown of an iPhone. Since they are assembled in China, from parts sourced from all over, and therefore carry a Made in China label, China is credited for the full $400 retail price when they are brought to this country, while in fact the Chinese only collect about $6-7 of the total revenue from the product while the biggest majority of those revenues stay in the US.