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Having the ear of governments

Economist Ross Garnaut has been advising prime ministers on policy since the 1970s. So when his advice on climate change was taken up and implemented, only to be abandoned by the following government, his response was phlegmatic.

“I’m beyond feeling things like disappointment and regret,” Professor Garnaut says from his office at the University of Melbourne.

“When you’re working on a big policy issue you know that things don’t always work out as you would wish.”

Garnaut was appointed by state, territory and federal governments in 2007 to review how climate change would affect Australia and what should be done about it. In 2010 he updated the review and formally advised a parliamentary committee on a policy response. The equivalent of Britain’s climate adviser Lord Nicholas Stern, Garnaut concluded human-caused climate change was real, the costs of action were less than the costs of inaction, and pricing carbon was the centrepiece of the best policy response.

That advice saw a carbon price enacted by the federal Labor government in 2011. The Abbott Coalition government removed the scheme in 2014.

“The regret I feel is for future generations of our species,” says Garnaut, reflecting on those events. “I think what humans have done, particularly over the last 250 years, is wonderfully good … for that to be all put at risk through humans not using their own capacity for analysis seems to me to be a terrible pity.”

Garnaut’s experience as a senior policy adviser has been unique. His advice on liberalising the economy (floating the dollar, removing trade barriers etc) in the 1980s was acted on – and critics still peg him as a cold-hearted economic rationalist for that.

Yet on climate change he is seen by some in business and politics as a radical (he’s publicly warned climate change could lead to “extended anarchy”). He objects to the term; “I see myself as an economic rationalist seeking to understand the issues.”

Garnaut says his climate advising experience was not fundamentally different from past experiences. Businesses which would have been disadvantaged by reform were noisy, while other businesses were quiet. But climate policy proved “a particularly bitter and difficult issue”, he says. The business community protested more loudly, and media company News Corp had more power and used it to oppose reform.

The policymaking process is now more focused on short-term political pressures and appeasing vested interests than in the 1980s and 90s, Garnaut says. There was a stronger independent centre of the polity back then, with more people engaged in questions of the national interest. Political leaders were more open to expert advice.

“The regret I feel is for future generations of our species,”

Economics has been described as the dismal science but Garnaut’s use of it is quite lively. He has written or edited 47 books and values economics for “its relevance to understanding the great policy questions of the day”. Marrying academic research with policy advice is “just what I’ve always done,” he says.

“I first of all want to properly understand the issue, and I do that whether I’m presenting at a seminar or presenting to a prime minister.”

He’s made headlines lately for his research on China and climate change (he was ambassador to China in the 1980s and a founding director of Asialink). Since 2012 Garnaut has argued China’s economic model is changing to a less energy-intensive one in which emissions will plateau soon.

His latest research project is Indonesian energy policy. The country is committed to acting on climate change but its emissions are growing quickly; Garnaut visited coal mines and oil fields in the Indonesian forests in late 2014 to see for himself.

As for Australia, Garnaut says he is not in a hurry to investigate and advise on climate policy for future governments. He thinks his advice still stands, and repeats that an emissions trading scheme would be a strong policy choice (he has ideas on how to address the oversupply of credits, and low prices, in schemes overseas).


 Watch Ross Garnaut debate politician Clive Palmer on climate change on ABC Lateline.


Professorial Fellow of Economics










Read Garnaut’s views on China’s role in addressing climate change