Tomorrow is the United Nation’s “World Food Day” and the focus is on the pressing need for the world to adapt to climate change. But even before “climate change” became a political concern, the poor have been unable to deal effectively with drought, storms and flooding.
Now government programmes in the name of climate change have already had terrible results – more than US$ 11 billion worth of subsidies were used to turn food crops into biofuels last year. This contributed substantially to the rise in food prices that helped push 75 million more people below the hunger threshold.
There is a case for government to provide flood defences and other collective goods, but most adaptation will occur at a much more local scale and as such is best left to individuals.
In a new report, world-renowned agricultural economists Professors Douglas Southgate and Brent Songhen point out that farmers will likely adapt to global warming by switching crops, and adopting new technologies and farming methods – just as they have done for centuries.
The launch of the report, Weathering Global Warming in Agriculture and Forestry by Douglas Southgate and Brent Sohngen (November 2008, International Policy Network), coincides with World Food Day and can now be downloaded here.
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A calf drinking from a nearly full farm dam: Photograph taken just south of Oberon, Central Tablelands, New South Wales (Australia) by Jennifer Marohasy, October 14, 2008.
Jennifer Marohasy BSc PhD is a critical thinker with expertise in the scientific method.
Predictable US-centric viewpoint. Gee and haven’t our own farmers adapted so well. So we can look forward to the abandonment of future EC really soon ?
Given how easy adaptation is …
EC (Exceptional Circumstances) Assistance is a creation of government that has many perverse outcomes including the continual proping up of unviable farmers. Yet another reason to support policies of reduced government intervention.
And ofcourse in Australia, governments have significantly hampered the ability of farmers to adapt to natural climate change by introducing bans on new crop varieties.
Perhaps – but we’ve spent billions ongoing over 30 years or more – EC supports whole regions Jen – not just unviable farmers. No wheat crop means no purchases from the machinery dealer, means no spare parts sales means etc etc ….
and the theme here by our optimistic economists is how massively adaptable agriculture is – ROTFL !
and Aussie farmers are among the best in the world in many areas – e.g. cotton, rice.
So what grows in dust? GMO issue is marginal.
Adaption to natural climate change is sensibly to work out what the climate odds are – then either don’t farm there – or if you reckon can make enough money in the long term – when the rains fail – go to the beach, don’t plant and destock
The hard won experience is actually fighting the seasons! Fighting back usually means more good money sunk in after bad, more stress, etc. Stoicism and perseverance may actually be the seed of economic collapse.
Now if your odds of good and bad seasons are changing – well that’s the whole point isn’t it …
The Kyoto ethos of expensive but ineffective renewable energy will not provide a higher SOL for the 3rd world.
If these people are going to survive under this mantra they will need more assistance than ever, in ever more difficult to understand technology.
However, what they’ll mainly need is more of Luke’s “stoicism and perseverance”.
What a solar panel is more complex than a diesel generator?
Spanglers – Hanging on in quiet desperation is the English way.
when it comes to yaks – Sell’em or smell’em.
Take any diesel generator work out the KWH it will generate per hour. Multiply that by 24 to get a day. You can go out buy it install it and there you go complete. Lets go solar there are 5 generating hours in the day. Cells cost $1000 per 90watts then have to connect them point them at the sun make sure they are not shaded so cut down any close trees. To be self sufficient an average house costs about $80000 for cells connected to the grid. To equal the diesel generator you need batteries lots of them which my guess is puts your simple system well over $100000. Then you have the complex wiring plus the large amount of maintenance, cell cleaning, battery electrolyte levels etc. Your pride and joy then takes 40 years to pay for itself, a pity since expected life is 25 years. That is unless a hail storm or lightning doesn’t get it first. For simplicity in all aspects the generator wins hands you just do not understand the complexity of “alternative” energy. An oxymoron if there ever was one.
When did you ever have a solar panel that replaced a diesel generator?
Quiet desperation well describes the woman who walks for miles with a baby on her back to gather green firewood.
Governments of Australia do not have clean hands in the food crisis issue.
Tax incentives for forestr have led to loss of agricultural, food producing land being removed from the food production cyce and turned into forests, so that people seeking tax reduction can bebefit.
The carbon credit system will eventually mean that carbon credits will make it more cost effective to grow timber on food producing land than to grow food.
Governments are still buying food producing properties, removing them from the food production cycle and turning them into parks.
We have had a biofuels industry for a long time, and govenments are madating minimum biofuel content of petrol.
So let’s sort out our own mess first before we poke the finger at the USA.
Luke,
In the 3rd world they need mainly cooking energy. Wind and solar don’t supply this unless you get incredibly complex, expensive systems that the 1st world does not yet effectively have.
The 3rd world needs gas and coal technology.
To use Luke’s simplistic logic on drought assistance we should also halt funding to 2nd and 3rd generation welfare recipients.
And what about urban public transport? This sector has been continually dependent on massive subsidies for many decades so, on Luke’s logic, we should scrap that too?
Well, no. You see, these ecotrogs only ever want to apply the principles of economic darwinism to farmers who happen to own land that the greens would like to confiscate.
So out comes the same old sleazy double standard where the urban punters get to ride to work on their hopelessly subsidised train or bus to their hopelessly subsidised departmental job with their 3rd generation basket case mates while demanding ruthless “make it or break it” policies in the bush.
Same old, same old.
Note that Luke made the above comments only two days after Rudd/Swan handed out $10 billion to maximise their approval ratings. So we will still have people dying because it takes 3 months to see a cancer specialist . Apparently funding more ambulances, hospital beds, aged care and mental health services doesn’t provide the same fiscal stimulus as a sleazy old christmas piss-up.
Talk about losing the plot.
Hey am I denying them EC ? Hang on? Listen mate – if they’re super efficient and super adaptable they wouldn’t need the coin? So why are we handing out billions then.
It’s not an argument about equity and comparisons of which group’s shit stinks less. It’s about whether the sector seems to need ongoing support against climate issues.
– of course being a democracy maybe we should put EC assistance to a vote? But I reckon it’s in your interest not to.
Remember I’m on your side.
H Pete, 1.06 PM,
I am both a farmer and an investor in a forestry company.
Fact is; the tax act is the same for both.
There are no tax advantages for MIS, contrary to what is repeatedly claimed, that are not available for other farmers.
However compliance with the Tax Office requirements is much more stringent for Managed Investment Schemes.
I too, Ron, am a farmer and a forester. But I am a native forester. And your claim that the tax treatment for MIS is the same as for other farmers is pure bull$hit.
The tax advantages enjoyed by MIS schemes may well be “available” to other farmers but this mostly in theory rather than reality.
The advantages of MIS schemes are only available to people with an existing high income that is in the high marginal tax bracket. And it is only available to those who do not directly take part in the planting, tending or harvesting of trees.
When I plant or regenerate a hectare of forest the major inputs are my own labour for which I get no tax deduction and therefore no immediate refund or reduced tax liability. So my forest must carry forward the full cost of establishment at compound interest until the harvest date.
Your MIS scheme, on the other hand, involves cash outflows to third parties which are tax deductible and result in a substantial tax refund or substantially reduced tax liability. So those investors in the 48% tax bracket get an immediate benefit, courtesy of the tax base, of 48% of their initial investment. So only 52% of their investment needs to be carried forward at compound interest to harvest date.
The entire concept of deductibility for forest establishment was originally put in place under the assumption that the forestry operation was an on-going concern with a continuous annual outlay for the regeneration or replacement of areas that had been harvested that year. And in those circumstances it was clear that replanting and regeneration were “normal and necessary” attributes of the use which could be classified as expenses that were not of a “capital nature”.
The MIS schemes have abused this principle to gain deductibility for initial forest establishment that is clearly of a capital nature. The only way a normal farmer could enjoy those advantages would be by investing in cash rather than by personal exertion, and in someone else’s forest, on someone else’s farm. They cannot gain anywhere near the same tax treatment for their own actions on their own land.
And it follows that it is the tax pie that is heavily subsidising the MIS scheme in a way that provides a major competetive advantage to MIS forest products to the marketplace detriment of normal farming operations.
This is not mere opinion, it is fact. I trained as an accountant and have operated on both sides of this issue and know exactly where the money for jam is to be found. We have a tax act that actively discriminates against family farms in favour of mostly urban absentee tax avoiders.
Responce to Ian Mott.
The reason for my delayed responce is because I have been away for a few days.
It is apparent that your views are emotionally and passionately held. This is admirable, but unfortunately does not make them correct.
So lets look at your arguments in order as raised.
1. What is unique about “But I am a native forester?”
Fact: All agricultural production in Australia, operates under the same Tax Act.
All primary producers have access to the same deductions.
( Maybe it is time to brush up on those accountancy notes.)
2. Your claim that MIS Schemes are only available “to people with an existing high income and who do not take part in planting, tending or harvesting their trees.” Is false!
Anyone can invest.
Your paragraph regarding “concept of deductability;”is totally without fact or foundation.
The Fed. Gov. many years ago recognised the desireability of the establishment of softwood plantations to provide for the sawn timber requirements of a growing Australia.
In 2000 all states and terriotries, along with the Federal Government signed off on the Vision 2020 policy, which aimed at establishind a hardwood plantation industry which would provide for all of Australias export and home requirements for hardwood pulp by 2020. Thus reducing our need to use native forests.
This industry is expanding and slightly behind schedule to reach this target.
However it still operates under the same Tax Act as you or any other farmer.
3. Contrary to your socalled factual opinion,” the tax act does not “actively discriminate against family farms in favour of mostly urban absentee tax avoiders.”
As a farmer I resent your presumption that modern family farming businesses cannot profitably compete with all other entities in agricultural production.
However it could be that in the realm of forestry, scale of enterprise is significant.
Pikey.
Pike.
1 the unique aspect of native forestry is that we do not plant trees to expand our forests, we take measures that enable the seeds from our existing trees to germinate in adjacent land. These actions take more time but produce a much more varied, multispecies forest of significantly greater biodiversity value. The cost of this process is much lower than the outrageously priced MIS “battery forests” and consequently, even in the rare times when the assisted regeneration is done by contractors, the tax deduction is much lower.
In most cases native regrowth forests are established by use of the farmers own labour. In many cases it is more a case of withholding normal pasture maintenance so existing seedlings can get established. In others, it involves excluding stock in a wet year so seedlings will survive.
None of these methods involve a call on the tax pie like MIS forests do. In fact, when a farmer foregoes income by excluding stock he actually reduces his capacity to earn a tax deduction because his income is lower.
Now I have heard some extraordinarily self serving casuistry in my time but your suggestion that every farmer, regardless of his income level, has equal “access” to the tax act takes the cake.
2. Your suggestion that “anyone can invest”, is a continuation of your previous casuistry. The whole economics of MIS is dependent on the investor needing a large deduction to reduce the portion of his income that is in the high marginal tax bracket. There may be the odd bogan in lower tax brackets that can be stooged into the scam but they are the exception.
Your guff about the 2020 vision might fool the mug punters, matey, but I was the Chairman of a Regional Plantation Committee, took part in the formation of two others, and was on the national executive of Australian Forest Growers. I was there, Freddy, so spare us the crap.
Prior to the introduction of tax subsidies for the capital costs of forest establishment, the act of planting trees to establish forests was an activity that was normally only undertaken by the ignorant.
Even on bare sites, foresters with a scrap of nous knew to first plant widely spaced trees of the desired species and then allow their seedlings to spread over the entire site. Thereby producing a native forest on previously cleared land.
In the early 90’s the greens colluded with some of the stupider bureaucrats and the plant nursery industry to manipulate the market to benefit their own interests. And they came up with the 2020 vision that was based on the moronic belief that the only way to establish a forest was to plant one. The result of this is that instead of gaining 3 million hectares of new native regrowth (free range) forest with a mosaic of the original species, that wildlife actually want to live in, we are getting miles of booring clonal monocultures (battery forests) that provide only a fraction of the biodiversity value but at a huge cost to the revenue base.
I was there at the start. Garbage went in and garbage is now comming out.
See http://www.ipa.org.au/publications/239/plantations-2020%27s-myopic-vision
3. The family farmers who own native forest must compete in a marketplace against plantation wood. That plantation wood grower has already had almost half of his capital outlay returned to him/her in year 1 of a 25 to 30 year project. The native forest owner must carry all of the capital cost through to harvest.
And if you seriously think that doesn’t constitute a discriminatory effect then I can only conclude that your claim to be a real farmer is somewhat dubious.
Responce to Ian Mott,
Obviously Mr. Mott you are free to manage your land as you see fit. It could be that regeneration of native woodland is environmentally desirable in your area.
That is your decision and you live with the results.
What you do not have, is the right to make false claims about other farmers and entities who are establishing commercial forestry, COMPLETELY LEGALLY AND WITH THE APPROVAL OF THE ATO.
Their rights are as valid as yours.
If you cannot commercially compete, then only you can change that.
Stop whinging and get out and enjoy the birds and the trees.
Pikey.
What a cop-out Mr Pike. I made no statement that could be construed as suggesting that MIS schemes operated without the approval of the ATO or that they were operating illegally. Indeed, I made it quite clear that the discriminatory and anti-competetive impact was a product of the intellectual failures of both the 2020 vision and the tax act.
And as for the ecological integrity of both policy instruments, it remains a fact of history that when Australia decided to embark on a policy of forest expansion they did so with a framework that deliberately excluded the form of forest establishment [assisted native regrowth] that;
1. Produces the best biodiversity values,
2. Expands the area of existing fragmented forest habitat to make it more ecologically viable,
3. Does so at the lowest cost to the public purse,
4. Uses skills, equipment, knowledge and labour that are already present on most farms, and
5. Had the capacity to achieve the area and volume targets in a much shorter period.
Instead, they opted for the option that was;
1. Most favourable to urban absentee investors and the tax avoidance industry,
2. Most favourable to the green movement who don’t even own suitable land, let alone establish forest on it, and
3. Most likely to alienate the huge majority of farmers who already had native forest on their properties.
But don’t let the facts get in the way of your comfortable delusions, Mr Pike. Best go back to the promoters and get them to give you another bull$hit rev-up about what a great job you are doing to save the planet. Your kids might believe it but it doesn’t cut any mustard around here.