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Archive for July 2011

Same-Sex Marriage

The ACT Labor Party conference today debated a motion (moved by Natasha Shahidullah and Andrew Barr) that advocated a change to include same-sex couples in the definition of marriage. I spoke in favour of the change.

Same-Sex Marriage
ALP ACT Conference, 30 July 2011

Few moments in life are so powerful, so emotionally charged, that they transcend the individual and connect us all.

  • The birth of a child;
  • Saying and being told I love you;
  • And for those of us who are married – our wedding day.

A day so special that we name anniversaries silver, gold and diamond.

Marriage should be recognised and registered by law, regardless of the sexual orientation, or gender of the couple wanting to be married.

Same sex marriage is not about gay versus straight, conservative versus progressive, left versus right.

Continue reading ‘Same-Sex Marriage’ »

Good Tory, Bad Tory

The debt ceiling crisis in the US really is quite extraordinary to behold. For decades, the US Congress has raised the debt ceiling as required. After all, the debt ceiling is just the natural consequence of a set of political tax and spend decisions, so in some sense it’s odd that it even requires separate legislation. As recently as late last year, most reasonable observers thought there was no chance that Congress would vote against raising the debt ceiling.

But the US Republican Party no longer does reasonable. Following the Tea Party takeover, House Republicans have now now decided that they would prefer to trash America’s credit rating (and thereby push up interest rates for millions of Americans) rather than accept any increase in taxes for high-income Americans.

The question is: how do mainstream commentators react when one party moves sharply to the extreme? As Paul Krugman’s column and blog have recently noted, the overwhelming tendency among most political observers has been to maintain a standard he-said, she-said approach. So it’s easy for the casual watcher to miss the big story: the US Republicans are fast abandoning any semblance of a market-driven party, and are now willing to do or say just about anything for political gain.

The contrast with parties like the UK Conservatives and New Zealand National Party is palpable. I don’t agree with some of what those parties are doing, but at least it’s possible to discern a clear ideological compass in their decisions, many of which continue to be pro-market (eg. both countries’ adoption of emissions trading schemes).

As for Australia, it’s now pretty clear where Tony Abbott takes his lead. Having abandoned his party’s belief in using markets to deal with climate change, walked away from a set of fuel tax reforms first put in place by Peter Costello in 2003, and used any chance he gets to attack the scientific consensus over climate change, Abbott is firmly placing himself in the US Republican mould. The question is: will the Coalition’s rejection of mainstream economics in favour of populist politics get written up for what it is? Or will commentators miss the critical shift (that one political party has taken a huge leap to the intransigent right) and focus instead on what Krugman describes as ‘the centrist cop-out’?

Gould’s Books

I spoke in parliament recently about the passing of bookseller and social activist Bob Gould. I wouldn’t normally use this website to promote a business, but his daughter Natalie Gould wrote to say that she is trying to ensure that Gould’s Books survives, and is running a 50% off sale until 14 Aug. So if you’re strolling along King St Newtown, do drop in.

What I’m Reading

Social Mobility

Tim Soutphommasane’s recent philosopher column in The Australian dealt with the underrated issue of social mobility – how far does the apple fall from the tree?

I penned a short letter in response, which the Oz kindly ran on Tuesday.

Dear Editor,

I enjoyed Tim Soutphommasane’s article on social mobility. As he correctly points out, it’s fundamental to how we think about inequality, since most of us are willing to put up with a bigger gap between rich and poor if the lottery is redrawn each generation than if social position is immutable from birth.

Tim quotes my research as finding that Australia is “among the most socially mobile societies in the world”. Not quite. My study found that we are more socially mobile than the US, but less socially mobile than the Scandinavians.

For those who like numbers, a 10 percent rise in a father’s income is associated with a 1-2 percent rise in his son’s income in Denmark and Sweden, 2-3 percent in the UK and Australia, and 4-6 percent in the US and China.

So it’s not as hard to jump from rags to riches in Australia as in some other societies. But we could still do more to ensure that every child – no matter their circumstances – has the opportunities that should be their birthright.

Andrew Leigh
Member for Fraser.

Tax Forum

The Australian Government’s Tax Forum will be held in Canberra on 4-5 October. Expressions of interest opened today for people in several categories: community, business, academics, superannuation, general public, and students.

More details here, with an expression of interest form here.

Drug Use

A friend emails to draw my attention to the new AIHW statistics on drug use.

Thought you might like to know that the updated population stats on drug use are out today. The media is mostly excited about the illicit side of things but… the following may interest you: smoking is down (to 15% of people aged 14+), preference for ‘alcopops’ among young people is down, and more than two-thirds of people support increased tax on tobacco products or bans on point of sale advertising.

Lots of positive changes there.

Crime and the Press

By coincidence, two of my favourite economics commentators today have written up papers that I wrote while an economics professor at the Australian National University.

  • Ross Gittins discusses my paper with Francesca Cornaglia, which finds that crime lowers the mental wellbeing of non-victims (and suggests that the fear effect of crime may even be larger than the direct impact).
  • Peter Martin discusses my study with Joshua Gans, which looked at Australian media slant in the period 1996-2004, and found that the press was mostly pretty centrist until 2004.

The academic publication process being what it is, both are still wending their way through refereeing and revisions.

Mine the Gap

My AFR article today is on the mining boom and inequality. A big thanks to Parliamentary Library researcher Alan Payne, who painstakingly compiled several of the statistics below (but of course bears no responsibility for any policy conclusions).

Boom Times for the Few, Australian Financial Review, 26 July 2011

In 1978, US economist Henry Aaron described the study of inequality as being like ‘watching the grass grow’. After becoming more equal in the immediate post-war era, inequality in most English-speaking countries had flatlined for decades.

Continue reading ‘Mine the Gap’ »

Sideshow @ YouTube

The ANU has recently posted on their website the video of Lindsay Tanner speaking about his new book, Sideshow (introduced by Gia Metherell and thanked by yours truly). It’s just on an hour long, but well worth watching.

ABC News 24 Capital Hill with Andrew Leigh and Andrew Southcott

Andrew Leigh and Andrew Southcott debate the price on pollution on ABC News 24 Capital Hill, hosted by Lyndal Curtis.

The Power of Prices

In his new book, Adapt, economic journalist Tim Harford tells the story of ‘Geoff’, a man who is determined to reduce his carbon emissions. As he goes through his day, Harford shows Geoff making a series of well-intentioned mistakes: going out of his way to wash his dishes by hand rather than use the dishwasher (Harford argues that the dishwasher has a smaller carbon footprint), but then choosing to tumble-dry rather than line-dry his clothes (which uses significantly more carbon). Geoff buys energy-efficient lightbulbs, but then decides not to install them until his existing ones pop (which will cost him more). He switches off his mobile phone charger, but leaves his desktop computer on standby (Harford tell us that the computer uses 100 times as much energy).

The point of Harford’s story is that solving climate change through personal action alone is hard. Even if we had a sophisticated computer program that could tell us the carbon intensity of a particular decision, how many of us would bother to check it?

Thankfully, there’s a simpler solution. The effect of putting a price on carbon is to change prices so that they reflect the carbon emissions embodied in them. Under a carbon price, an environmentalist doesn’t have to know precisely how a product was made – you just need to look at the price tag. By modestly changing prices (overall price impacts will be just 0.7 percent), carbon prices will change consumption patterns. As any marketer can tell you, customers already flock to cheaper brands. With a carbon price, there will be an incentive to choose the low-carbon option.

This incentive will exist for both firms and households. For firms, carbon pricing will encourage them to think hard about how they can reduce emissions. A recent Economist article gave the example of the potato chip firm Walkers, which discovered its carbon footprint was unexpectedly high.

‘It turned out that because Walkers was buying its potatoes by gross weight, farmers were keeping their potatoes in humidified sheds to increase the water content. Walkers then had to fry the sliced potatoes for longer to drive out the extra moisture. By switching to buying potatoes by dry weight, Walkers could reduce frying time by 10% and farmers could avoid the cost of humidification. Both measures saved money and energy and reduced the carbon footprint of the final product.’

With carbon pricing, we can expect to see simple changes like this taking place inside each of the 500 large polluters, as managers and workers look together for ways to reduce emissions. The better companies succeed, the more that business assistance can be used to grow the firm and increase employment.

Changing prices and providing assistance is the Labor way of achieving reform. As Paul Keating pointed out on Lateline, this is precisely why we floated the dollar. But it’s also a simple description of trade liberalisation (which reduced prices of imported vehicles and clothing, and provided industry assistance for textile and car workers), as well as the Accord itself (which kept real wages constant in exchange for improvements in the social safety net).

Unlike previous Liberal Party leaders – and conservative leaders in Britain and New Zealand – Tony Abbott refuses to accept that the market can be used to solve environmental problems. (Perhaps this suspicion of markets isn’t so surprising from a self-confessed admirer of the late BA Santamaria.) What Mr Abbott fails to realise is that a government that won’t use price signals has to fall back on heavy-handed alternatives like regulation, mandates and bans. That’s why the Coalition’s ‘Direct Action’ plan is so much more expensive – and less effective – than the Gillard Government’s Clean Energy Future approach. We’re now in the ‘Bizarro World’ in which Tony Abbott is the proponent of highly interventionist solutions, while Labor favours the market-based approach of pricing carbon.

Little wonder that a poll of members of the Economic Society of Australia, released at last week’s Australian Conference of Economists, found that 79 percent agreed with carbon pricing, while only 12 percent supported direct regulation. When it comes to reducing carbon pollution, a carbon price is the only sensible way to go.

(Cross-posted at the ALP blog)


ABC Canberra is looking for local storytellers for their ‘Now Hear This’ competition. This year’s theme is ‘Changes’.

More details here. One of last year’s stars, Eleri Harris, is now an ABC producer and presenter, so you never know where the competition might lead you…

Clean Energy Future – Mobile Office

Today I held a mobile office with Member for Canberra Gai Brodtmann at the Civic bus interchange to discuss the Gillard Government’s Clean Energy Future Plan.

Tackling climate change is an issue that many local families and businesses in the ACT have been eager to discuss with me, and there is a broad community consensus that the time to act is now.

The Labor Government’s Carbon Price will target the biggest polluters, while driving investment in clean energy technologies and infrastructure. The package is designed to assist those who need it most, with 9 out of 10 households due to receive tax cuts or increased payments.

Details on the Clean Energy Future Plan can be found at

I understand that many people will have questions about the Plan and how it will affect them. I am happy to answer these questions, so please feel free to email me or call my office on (02) 6247 3457 if you would like more information.

Sky AM Agenda 11 July 2011 with Andrew Leigh and Jamie Briggs

John Quiggin

John Quiggin is a rare beast. He produces 500 academic words a day, plus endless blog posts for his two blogs. He’s written on just about every policy topic imaginable, and always manages to find something fresh to say about them. In fact, I can’t recall a conversation of substance with John in which didn’t learn something new – whether we were talking about water, education, crime or politics.

So I was most chuffed last night when John was awarded the Distinguished Fellow award from the Economic Society of Australia, following in a long line of extraordinary economists, including Trevor Swan, Colin Clark and Bob Gregory (who gave a splendid intro about John’s shift from mathematics into economics).

Incidentally, I was also delighted to receive the Young Economist Award for the best Australian economist under 40, following on from my friends/coauthors Joshua Gans and Paul Frijters. (Thanks to Justin Wolfers and Joshua Gans for very kind words, and Danielle Cronin for writing it up in the local press.)

Why household assistance doesn’t undo carbon pricing

My AFR op-ed today explains why providing household assistance doesn’t undermine the effect of introducing a carbon price.

The price is right for consumer shift, Australian Financial Review, 12 July 2011

One of the most persistent myths in Australian politics has been that providing household assistance undermines the effect of imposing a carbon price. If the prices of carbon-intensive products rise by $10 and you give me $10 in assistance, aren’t we back where we started?

Continue reading ‘Why household assistance doesn’t undo carbon pricing’ »

Eastern University Games

I spoke in parliament last week about the Eastern University Games, hosted this year by the University of Canberra and ANU.

Eastern University Games, 7 July 2011

I rise to speak on the 2011 Eastern University Games, hosted this year by the University of Canberra and the Australian National University. The games were launched in style on Sunday night and finish up today. Canberra is playing host to 19 universities from across New South Wales, the ACT and, for the first time, New Zealand. The Eastern University Games complement the Northern, Western and Southern university games being held across Australia.

Continue reading ‘Eastern University Games’ »

Carbon Pricing

I spoke in parliament last Thursday about carbon pricing.

Continue reading ‘Carbon Pricing’ »

Democracy in Malaysia

I spoke in parliament today about democratisation movements in Malaysia.

Continue reading ‘Democracy in Malaysia’ »

Majura Parkway Funded

Terrific news today that the Majura Parkway is going to be funded, in a 50/50 split between the federal and ACT governments. This is something I’ve been pushing for since before I entered parliament, and I’m delighted to see it’s now going to become a reality.

Here’s the joint media release from federal Infrastructure and Transport Minister Anthony Albanese and ACT Chief Minister Katy Gallagher:


More than 40 years after the first line appeared on a map, construction of the long awaited Majura Parkway will finally start next year and be completed in 2016.

Continue reading ‘Majura Parkway Funded’ »

Australian Student Prizes

Congratulations to the 12 ACT students who won Australian Student Prizes today – James Cribb, Thomas Emerson, Swaranjali Vijaya Jain, Harrison Steel, Daniel Steemson, Jessica Carly Thomson, Aisha Marie Woodruff, Luke David Heinrich, Daniela Lisacek, Judy Mengzhou Wang, and Wenray Wang. Here’s a media release.

MEDIA RELEASE - Fraser student wins national education prize

Federal Member for Fraser Andrew Leigh today congratulated a local student whose academic achievement has earned them a 2010 Australian Student Prize.

Continue reading ‘Australian Student Prizes’ »

Launching Jemma Purdey’s biography of Herb Feith

I was proud tonight to launch Jemma Purdey’s fine biography of the late Herb Feith. We had around 120 people in the Main Committee Room at Parliament House, which was testament to the number of people Herb’s life touched.

Book Launch of Jemma Purdey, From Vienna to Yogyakarta: The Life of Herb Feith
Andrew Leigh MP
Parliament House
6 July 2011

I begin by acknowledging the traditional owners of the lands on which we meet today, and thanking those who have worked hard to organise today, particularly Louise Crossman and Nik Feith Tan.

Jemmy Purdey, family and friends of Herb, internationalists all – thank you for coming today to celebrate Herb’s life and Jemma’s fine book.

Let me begin with a story.

Continue reading ‘Launching Jemma Purdey’s biography of Herb Feith’ »

Global Fund

Andrew with Jacqueline & HectorI spoke in parliament last night about the Global Fund to Fight AIDS, Tuberculosis and Malaria.

Global Fund to Fight AIDS, Tuberculosis and Malaria, 5 July 2011

Last week I represented Australia at the 2011 Partnership Forum for the Global Fund to Fight AIDS, Tuberculosis and Malaria. This is a conference that takes place every two to three years and helps set the strategic direction of the Global Fund. The conference was held in Sao Paulo, Brazil, and included a group of around 25 parliamentarians. Established a decade ago, the Global Fund has spent US$22 billion and saved six million lives. In other words, for every $4,000 it spends, the Global Fund saves a life. Internationally, it accounts for two-thirds of spending on tuberculosis and malaria and a fifth of public spending on HIV. The Global Fund also works hard to bring down the price of drugs, with the prices of first-line antiretrovirals and malaria treatments for children falling by at least 50 percent over the past three years.

Continue reading ‘Global Fund’ »


I spoke in parliament yesterday about one of the pieces of legislation that will enable the building of the National Broadband Network.

Continue reading ‘Broadband’ »

Education Funding

I spoke in Parliament yesterday on education funding, opposing a motion put by the Coalition’s education spokesperson, Christopher Pyne (the member for Sturt).

Continue reading ‘Education Funding’ »

Indigenous Education

I spoke in parliament yesterday about Indigenous education.

Continue reading ‘Indigenous Education’ »

What I’m Reading

It’s been over a month since I last posted about the things I’ve been reading. But while I can’t promise that these articles appeared yesterday, I can attest to the freshness of their ideas:

On the topic of academia, I’ve been amused to discover how long the tail of academic publishing is. Although I resigned as an ANU economics professor a year ago, I’ve still got forthcoming papers in Economics Letters, Economic Papers and the Oxford Bulletin of Economics & Statistics, as well as revise-and-resubmits being considered by the Economic Record, The BE Journal of Macro, Review of Income and Wealth and the Economics of Education Review.

I’m Hiring

Due to recent events, I’ve now found myself looking for another staff member. The job ad is below. Please note that it’s only a 6 month stint. Applications close 15 July.

Continue reading ‘I’m Hiring’ »

National Capital Authority on Campbell & Memorials

On 22 June, the Joint Parliamentary National Capital & External Territories Committee heard evidence from the National Capital Authority’s Don Aitken and Gary Rake recently. I asked them about some concerns that have been raised with me about development in the suburb of Campbell and some proposed memorials for World Wars I and II. Here are some snippets from the transcript.

Continue reading ‘National Capital Authority on Campbell & Memorials’ »