Cling to previous glories or attempt for affluent future

The risk we face isn’t fairly existential. We’ll nonetheless be alive, only a lot poorer – and kicking ourselves for not seeing it coming and doing one thing about it.

The answer’s in two elements. First, the federal authorities should clarify to the coal and fuel industries, the premiers, the mining unions and the affected areas that there’ll be no additional assist or encouragement for anybody pretending they haven’t seen the writing on the wall. Anybody making an attempt to cease the clock and hold residing prior to now.

There’ll be loads of assist and encouragement, however solely for these industries, employees and areas needing assist to maneuver from the previous world to the brand new. As a part of this, the federal government should do what now even the UN secretary-general says each nation should do: finish subsidies of fossil fuels and use the cash to help the transfer to renewables and inexperienced manufacturing.

Assist coal miners relocate or retrain – no matter. Promise that, wherever it made sense, the brand new renewable and inexperienced industries can be arrange close to the previous mines.

Ideally, the coverage of ending the previous and shifting to the brand new must be bipartisan. No opposition ought to take the low highway of courting the votes of these preferring to maintain their head within the sand.

But when that’s an excessive amount of to ask of a two-party duopoly, Anthony Albanese and the Labor premiers ought to take their lives of their fingers and overcome their life-long worry of what the opposite aspect will say if you put the nationwide curiosity first.

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Second, decide winners. Econocrats spend their lives telling governments not to do this – to not subsidise new industries you hope will turn out to be worthwhile.

Bother is, politicians being politicians, you could be positive they’ll be placing taxpayers’ cash on some horse within the race. And in the event that they’re not making an attempt to select winners, they’ll be doing what they’re doing now: backing losers. Which might you favor?

Extra importantly, it’s a neoliberal delusion that new industries simply spring up as profit-seeking entrepreneurs search new methods to make their fortunes. Doing one thing by no means carried out earlier than is excessive threat. The possibility of failure is excessive. Banks received’t lend to you.

We don’t stand an opportunity of changing into a inexperienced superpower with out plenty of authorities underwriting with, inevitably, some massive losses. However I can consider many worse methods of losing taxpayers’ cash.

Ross Gittins unpacks the economic system in an unique subscriber-only publication each Tuesday night. Signal as much as obtain it right here.