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Insights 20: 11 June 2021
NZ Herald: Oliver Hartwich on evaluating the final CCC proposals using sound environmental economics
Podcast: Matt Burgess dissects the Climate Commission’s final recommendations
Research Note: To Graduation and Beyond by Joel Hernandez

An emissions plan that does not cut emissions
Matt Burgess | Senior Economist |
Only one thing contributes to our emissions targets: lower emissions. On that standard, this week’s report from the Climate Change Commission fails.
Consider the following two facts from the Commission:
  • New Zealand can cut emissions to net zero by 2050 with a carbon price of $50, and
  • The Commission’s plan achieves the same target with a $250 carbon price.
Which means for every $5 spent on the Commission’s plan, $1 will go to reducing emissions while $4 will go to the Commission’s favoured technologies regardless of their emissions benefits.
In any other area, such hefty and unnecessary costs might be a problem. But the Commission did not let niceties like meeting our emissions targets get in the way of its preferred version of economic transformation.

Astonishingly, the Commission sent its final report without analysing the costs and benefits of its proposals. The Commission wants to ban new gas connections in 2025, stop imports of all petrol and diesel vehicles by 2035, and plant hundreds of thousands of hectares of trees.

The Commission has no idea what effects these policies will have on emissions, wellbeing or distribution. It has not done the work to know. That should disqualify the Commission from making any claims about intergenerational equity.

Emissions policies hurt future generations if they do not cut emissions. Nobody, except the well-paid officials at the Climate Change Commission, benefit from public policy by the seat of the pants.

But try telling that to large parts of the media and environmental activists who think there is no such thing as a bad emissions plan. Massive government intervention is enough. Who cares whether it cuts emissions?

The Commission’s report shows it still does not understand how the Emissions Trading Scheme (“ETS”) works. It is the government’s policy, and since June 2020 the law, that the ETS caps emissions. An ETS cap means other policies cannot reduce emissions any further if they work within the cap.

Twice the Commission has tried to explain why this neutralising effect of the ETS does not apply to its plan. It has botched both attempts. We still do not know how the Commission’s plan cuts emissions.

Later this year, the government will table its emissions reduction plan, backed by the false imprimatur of this week’s report from the Climate Commission.

The government can cut more emissions more quickly if it ignores the Commission’s advice and instead uses a strengthened ETS to lower emissions.

Further analysis of the Climate Change Commission’s final report:
Eric Crampton on the Commission’s ETS errors: Bindingness and the ETS
Matt Burgess on why the government should reject the Climate Change Commission’s plan, BusinessDesk ($)
Matt Burgess and Oliver Hartwich podcast on the report.

To Graduation and Beyond
Joel Hernandez | Policy Analyst |
Secondary schools should provide every student with the skills and knowledge they need to succeed after graduation.

However, in our latest report, To Graduation and Beyond, we show that this is not always the case. But fleeing to high decile schools is no solution.

In fact, our report finds low decile schools overrepresented among top performers – after taking into account differences in the families they serve.

Our work in Statistics New Zealand’s Integrated Data Infrastructure draws on data from more than 500,000 students enrolled at nearly 500 secondary schools, and their family backgrounds.  We compare tertiary qualification completion rates for students graduating from these schools and find high-performing schools (the top 10%) across all deciles.

Among these high-performers, low decile schools tend to outnumber their middle- and high-decile peers.  

When we instead look at progression into a tertiary institution, high-performing schools tend to skew to both low and high deciles.

To Graduation and Beyond is the sixth report using the Initiative’s school performance tool to fairly compare secondary schools.

Setting a level playing field matters when comparing school results.

While we cannot say what leads to greater or lesser success among comparable schools, we provide the starting point for that kind of work. The Education Review Office, for example, could assess on-the-ground factors at different schools that might lead to these different outcomes.

Much more work is needed to reverse our dismal educational decline.

Over the last three years, the Initiative has opened the black box of secondary school results. But it would be up to the Ministry of Education to provide these kinds of results to every school, so that every Principal, Board of Trustee Member, and parent can share these insights.

Identifying which schools are getting the best outcomes is crucial so that successful schools can be studied, underperforming schools can be given support, and parents empowered in school choice.

Of course, not every student needs to go into a university, polytechnic, private training establishment, or Wānanga. There are many worthwhile opportunities outside of formal education.

Regardless of whether students progress into and complete a tertiary qualification, every child deserves an education that opens as many doors as possible. Fortunately, many low-decile schools are strong performers. But until parents, Boards, and principals start receiving better information on their schools’ performance, it will be harder to lift performance at the schools that need it most.
The report, To Graduation and Beyond: Secondary school performance and tertiary education outcomes can be read on the New Zealand Initiative website here.

Listen to Joel Hernandez explain his three-year journey of crunching New Zealand's education data in our Initiative podcast.

An awake press asking questions
Dr Oliver Hartwich | Executive Director |
To land a top job, having a stand-out CV helps. But that does not justify hallucinating your life’s achievements. Especially not if the media are doing their job.

It is a lesson Annalena Baerbock is just learning the hard way. The 40-year-old politician is the German Greens’ candidate to replace long-serving Chancellor Angela Merkel in this year’s election.

Until a few days ago, Baerbock’s chances looked good. Her party led in opinion polls. Her personal popularity eclipsed those of her political rivals. Magazines celebrated her fresh new style of politics.

But with Baerbock’s rise to stardom, due media scrutiny set in. Journalists interested in her background looked through the CV she published on her party’s website – only to find exaggerations and falsehoods.

According to her vita, she first worked as a journalist for a regional newspaper for three years. However, a look through that newspaper’s archive returned less than a dozen articles by her.

Baerbock also studied political science at the University of Hamburg from 2000 to 2004. Despite that, and contrary to reports of her completing a bachelor’s degree, she never concluded these studies.

Instead, she moved to London, where between 2004 and 2005, she received an LL.M. in international law. In the Bundestag’s official handbook, her profession is stated as ‘international lawyer’. Never mind she does not have any state exams, let alone a bar exam to practise law anywhere.

Baerbock also claims to have been chief of staff to a member of the European Parliament in Brussels from 2005 to 2008. Except her posting was mainly in Berlin, and she started as an assistant, becoming chief of staff only after two years.

Similarly, her listed memberships were not correct, either. She is not a member of the prestigious German Marshall Fund nor the United Nations High Commissioner for Refugees (UNHCR). As international lawyers might know, private people cannot become members of the UNHCR anyway.

As interest in Baerbock’s non-transparency grew, she also suddenly realised she had failed to declare to Parliament a salary received from her party. The 37,000 Euros even included a bonus for a good result in the European elections and a Covid-19 bonus.

After two weeks of examination, Baerbock’s CV has collapsed like a soufflé. And now the media are analysing her political statements, too.

Why did she believe electricity could be stored in the grid (it can’t)? Did she really say people consume (rather than emit) carbon dioxide? And is it right Social Democrats invented Germany’s Social Market Economy in the 1960s (no, it was the Christian Democrats in the 1940s)?

As unpleasant as it must be for Baerbock, this is what happens in a democracy with an awake press. It is just as it should be.

Listen to Oliver Hartwich and Chelsy Killick discussing the Baerbock affair in the Initiative’s podcast

On The Record

Other Initiative activity:
All Things Considered
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