"It doesn't matter how beautiful your theory is, it doesn't matter how smart you are. If it doesn't agree with experiment, it's wrong." Richard P. Feynman

Tuesday, March 29, 2011

Garnaut - More Bureaucrats Will Keep Power Prices Down!

And this bloke purports to be an economist! Ross Garnaut , expert in everything from Global Warming to Power Generation thinks a new committee will reduce energy price increases - jet flight paths will have to change to avoid the proliferation  of aerial porkers we expect at the same time. I recommend Garnaut study the Deadweight Ratio before he adds to the burden of useless bureaucracy on the backs of Australian workers. This brilliant fellow proposes we tax the power generators out of existence and then we generously intervene with a loan to keep them going. The simple idea of not taxing them in the first place seems to have escaped him.

Professor Garnaut suggests the creation of a new energy security council which could act to prevent instability in the industry following the introduction of a carbon price.
The new body would be authorised to undertake a range of rapid interventions to stabilise the market, and could provide short-term loan guarantees.
"A government loan guarantee on the debt of generators will have the effect of reducing the short-medium term probability of generator insolvency," he says.
The loan guarantee would be made available to a small number of emissions-intensive generators.
A recent report by Morgan Stanley said Victorian brown coal generators could lose 20-60 per cent of their asset value if no compensation was payable when a carbon price was imposed.
Maybe "1000 year" Flannery might be looking for a job following his recent joust with Andrew Bolt .

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