End the cotton wool culture for kids

A lot of nonsense has been written lately about young people, alcohol and violence.  But there's one particular bit of nonsense that stands out.  It's this statement from Michael Daube in The Sydney Morning Herald last week:  ''Today's youth have vastly more freedom than before, and are much more affluent''.  Daube is a professor of health policy at Curtin University and one of the country's leading public health experts.  Daube was arguing for more restrictions on the sale of alcohol and tighter regulation of licensed premises in NSW.  He didn't point out in his article that in NSW the rate of violent incidents on licensed premises and alcohol-related assaults have both been falling.  Nor did he point out that per capita alcohol consumption in Australia has been going down.  Yet this didn't stop him calling for even more government controls on how people spend their money and their leisure time.

It's true that today's youth are more affluent than in the past, but if Daube thinks youths have more freedom then he hasn't been to a school, or a children's sports event, or a playground lately.

Belgian Gardens State School in Townsville banned children doing cartwheels and handstands in the playground — even if they did them on the grass.  According to the principal, ''gymnastic activities'' were classed as a ''medium risk level 2'' in the Queensland Activity Risk Management Guidelines.

Mount Martha Primary School in Victoria banned children from touching each other after some students suffered playground injuries.  The school said a ban on students playing tiggy and doing high fives was ''not an overreaction''.  A student at the school who put his arm around a friend who was winded was punished by being forced to walk around the school grounds with the teacher on yard duty.

BANNING TRADING CARDS

It's not just physical danger that children are being protected from.

Last year Southmoor Primary School in Melbourne banned students from trading football cards.  The principal said that ban would ''protect our little ones'' and would ''spare younger students the distress of bad trades''.  Apparently younger students were getting upset because sometimes older students made ''unfair'' trades with them.

Somehow, someone somewhere once decided that younger children playing sport should not be allowed to know the score.  It's now a widespread practice.  Last year I was coaching my son's cricket team in a neighbourhood tournament conducted by the local cricket association.  In response to a request from one of the children to be told what the score was, I made the mistake of telling him how many runs had been scored and how many wickets had fallen.  Unfortunately this exchange was overheard by one of the event organisers who said the child should have been told the score was unimportant and the only thing that counted was having fun.

To no avail did I try to explain that the child's idea of fun was in fact to know whether his team was winning or losing.  A further attempt to explain that every single boy and girl playing the game was keeping score in their head anyway was similarly unsuccessful.

These are not isolated examples.  Some are extreme, but they're all representative of how society and the government now treat children, regardless of whether they're in primary school or are teenagers.  Supposedly for their own good, children are wrapped up in metaphorical cotton wool and are protected from the risk of physical harm or psychological distress.  The inevitable result is that children lose the capacity to experience a sense of adventure or responsibility or self-control.  Social media and binge drinking are some of the few opportunities for self-expression young people have left.

Today's youth are less free than previous generations.  It's ironic that ''resilience'' is the new buzzword in education given that schools and society are determined to take away from young people the very freedoms that will allow them to learn resilience.  If the behaviour of young people is as big a problem as Michael Daube claims, then the way to improve their behaviour is to give young people more freedom, not less.

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Ignore the hysteria: it's time we privatised the tone-deaf, left-leaning ABC

No media organisation is above criticism — even from a prime minister.  That's especially the case when the media organisation in question is funded by taxpayers.

The reaction to Prime Minister Tony Abbott's criticism of the ABC has bordered on the hysterical.

Former ABC managing director David Hill told Fairfax Media Abbott's criticism was ''dangerous''.  The Age's political editor Michael Gordon labelled it ''astonishing''.  The Guardian's Katharine Murphy warned darkly that things might ''escalate''.

The ABC is not such a faultless organisation that it should be above criticism.  As a media outlet totally funded by taxpayers, it deserves much greater scrutiny, and has special obligations to be rigorously fair, balanced and impartial.  As an organisation, it has shown itself to be tone deaf when it comes to the legitimate concerns of many Australians, that it leans to the left and is not a welcome home for conservatives or classical liberals — particularly among its salaried employees.

In many ways the ABC has made a rod for its own back.  Its defenders are right to argue that it should not be an uncritical cheerleader for Australia, and that it should place the pursuit of truth above nationalism.  The ABC was perfectly entitled to report on revelations from Edward Snowden on the growing apparatus of state surveillance in much of the Western world.  It was a legitimate news story unquestionably in the public interest, and ignoring it would have done Australians a disservice.

But at the same time as it claims to be a news organisation dedicated to the pursuit of truth at home, it also assures Australians that it is best placed to sell our wares abroad.  In bidding — aggressively — for the Australia Network tender, the ABC opted to become a tool of diplomacy on behalf of the federal government.  The ABC is set to receive $223 million over 10 years to promote Australia's interests in our region.

That's not an appropriate role for any media organisation — public or private.  It hopelessly conflicts its news gathering operation and opens the ABC up to criticism that it undermines Australia's interests through its reporting.  That's why it is in the ABC's best interests that the federal government is now considering axing the Australia Network service altogether.  The Abbott government should go a step further, and privatise the ABC — but not because it is unhappy with their journalism.

Ultimately the case for reforming the ABC does not rest on one week of reporting.  If there was ever a case for a taxpayer-funded state broadcaster, it doesn't exist today.  Australians have at their fingertips access to more news from more varied sources than ever before.  Online, every niche interest and point of view is well covered.  And as private media companies continue to struggle with profitability, the continued lavish funding of the ABC only serves to undermine their business model further.

The Olympics: a tool for autocrats since 1936

Another Olympics, another repressive state using the Olympics to boost its international reputation and gain legitimacy at home.

This time it's Russia and the Sochi Winter Olympic Games.

When will it sink in that repression is not a regrettable anomaly in some host nations, but a central feature of the Olympic package?  That the Olympic movement feeds, legitimises, and even encourages political authoritarianism?

Here's the rap sheet for Sochi.  The 2012 presidential election, which put Vladimir Putin back in the Russian presidency, was surrounded by allegations of fraud.  His government met the resulting mass protest movements with a suite of legislation designed to suppress dissent, free speech, and free assembly.

The prosecution of members of the band Pussy Riot was just the most highly publicised attack on political and religious dissent in the last few years.

Amnesty International estimates that 4,000 people across Russia were detained for protesting in 2012 alone.  International non-government organisations engaging, however vaguely, in ''political activity'' are required to register as ''foreign agents'' and are subject to routine harassment.  Foreign journalists are intimidated and sometimes banned.

Then, of course, there's Russia's ''gay propaganda'' law, which makes it illegal to suggest that gay relationships and heterosexual relationships are in any way equal.

All this is on top of the usual forced evictions, construction and development corruption, and extra-legal environmental damage that is par for the course for any Olympics held outside the very richest countries.  Putin promised a ''zero waste'' Olympics as part of its bid back in 2007;  apparently the Olympics committee is unable to detect outrageous nonsense when they hear it.

Indeed, it was clear during 2007 that Putin's Russia was an illiberal Russia.  This chronology by FreedomHouse shows how political repression has increased since Putin's first election to the presidency in 2000.

But by now there is a well-established Olympic media cycle.  Negative stories are aired before the games commence.  The opening ceremony is 10 days away.  The next week and a half will, no doubt, be full of exposures of Putin's political perfidy, about the environmental and economic cost of the Sochi Olympics, warnings that Sochi's infrastructure isn't up to speed, fears about terrorism, and revelations of waste and mismanagement.

But those tales subside the moment the opening ceremony wraps up.  Unless there is a major political, logistical, or security crisis, the international coverage of the Sochi games will immediately focus on the sport.

Athletic performances will wash away the political stench.  Putin and his government will be the beneficiaries.  They will be photographed with sports stars and visiting celebrities.  They will feed off the praise of organisers and fans and athletes, for whom there is no world outside the Olympic villages and stadiums.

All the pre-Games bad press will be chalked up to anti-Russian sentiment.

That's the Olympic calculus — repressive regimes have to tolerate a few months of quiet and steady negativity, which is more than adequately compensated by a fortnight of blisteringly positive press.

Western complaints about Russia's anti-gay law will not take the shine off Putin's Olympics.

Defenders of the Olympics make much of the one historical instance where the games bought genuine, welcome political change:  Seoul, in 1988.  South Korea's democratisation dates roughly from that time.

But this is not much of a defence.  The country was at the time of its bid in 1980 controlled by a repressive military dictatorship, who wanted the Olympics to legitimise its rule.

As this 2004 paper makes clear, at best, the Olympics can be seen as a catalyst, rather than a cause, of South Korea's democratisation.  There were many factors pressuring the country towards change.

And anyway, the International Olympic Committee had no problem being used for authoritarian propaganda.  From the Olympic movement's perspective, it was just a happy accident that South Korean democracy emerged from South Korean dictatorship.

There's simply no reason to believe the Olympic movement cares about political freedom, and many reasons to believe it is happy to be a tool of the world's worst regimes.

The 2007 assessment of the Sochi bid (here, page 9) is a masterpiece of amoral detachment.  In its assessment of Russian politics, the only factor it feels worth relating is the overwhelming political support for holding the games, as if democratic debate about the virtues of the Olympics would be would be a negative.

It's true that the repression in Russia is now less than the last time Russia hosted the games in Moscow in 1980.  Or than that of Berlin in 1936, or even Beijing in 2008.

But it's no coincidence that the three most brutal totalitarian dictatorships of the twentieth century have each been granted an opportunity to host the Olympics.

Or that many other undemocratic nations have used the games to build legitimacy at home and aboard.

The Olympics movement simply doesn't care that it — and all the athletes who compete in their events — is being used as pawns in an authoritarian political game.

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How Entrepreneurs Fuel Creative Destruction

Knowledge and Power:  The Information Theory of Capitalism and How it is Rovolutionizing our World
by George Gilder
Regnery Publishing, 2013, 400 pages

In 1983, Peter Drucker wrote "it is [Joseph] Schumpeter who will shape the thinking and inform the questions on economic policy for the rest of this century, if not the next thirty or fifty years".  George Gilder would agree.  Gilder is one of the world's most influential supply-side economists.  His previous works, particularly his 1993 book The Spirit of Enterprise, have drawn heavily on Schumpeter's theory of creative destruction.  Much of his latest offering, Knowledge and Power:  The Information Theory of Capitalism and how it is Revolutionizing Our World, does the same.

Knowledge and Power is a challenging and powerful critique of standard blackboard economics and its focus on order and equilibrium.  Gilder's project is to map information theory ― with its emphasis on dynamism and disorder ― onto traditional economic interest like competition and markets.  The key, for Gilder, is to create an economics of information with human creativity and new technology the central element of progression and human development.

According to Schumpeter, creative destruction is the process of industrial mutation "that incessantly revolutionises the economic structure from within, incessantly destroying the old one, incessantly creating a new one", a process that is "the essential fact about capitalism".  In the same way that Schumpeter's entrepreneurs are creators of opportunities, Gilder's entrepreneurs are creators of knowledge ― the central actors in a capitalist system he sees as an information system.  In unveiling his information theory of capitalism, Gilder argues that in an economy "everything useful or interesting depends on [these] agents of change".

Information theory was created by Claude Samuels and Alan Turning in the 1930s and is a branch of applied mathematics relating to the qualification and transmission of information.  Pertaining to economics, Gilder sees the key insight of information theory to be the grading of information by the degree it is unexpected ― i.e. its entropy.  He sees the entrepreneur as an agent of change constantly involved in the process of trial and error in an attempt to create surprising, high-entropy information that will disrupt the status quo and generate growth beyond what was previously available.

A symbolic example of this process is Qualcomm, a corporation encountered by Gilder in 1993 through his work as a journalist for Forbes ASAP.  At the time, Qualcomm was working on a method of information transfer to overcome the restrictions imposed by the physical carrying capacity of an analogue connection.  Seemingly restricted by the laws of physics, Qualcomm was able to overcome these issues by moving into a system of code-based wireless transfer.  In his book The Qualcomm Equation, Dave Mock notes that Gilder's early support of the company's investigations gave it credence and helped it win investment ― to the ire of those "who contended that code-based wireless was a complete fraud with the subversive intention of mulcting billions of dollars from unsuspecting investors".

Qualcomm's transformation of the "physical scarcity of 'bandwidth' into an abundance of wireless communications" is a clear example of the creative destructive power of entrepreneurs.  By "transcending the laws of physics by the laws of information" the company was able to act as a key force for economic growth.

Through their discovery of new knowledge, Gilder places the creative entrepreneur at the very centre of economic growth and progress.  He contends a key failure of economics thus far has been its inability to grasp this idea, a failure that has seen economists "council governments to attend to everything except what matters most:  the environment for innovation".

Through his application of information theory, Gilder also stresses the important role a small but effective government can play.  As a low-entropy actor, government ― through the protection of trade routes, reasonable regulations, stable currencies, modest taxation and reliable protection of property rights ― provides the predictable base from which high-entropy activities can occur.  By providing a clear and stable channel for the movement of information, limited and steady government provides the environment for innovation by private citizens and operators.  Unfortunately, Gilder finds this is seldom the case.  In most countries, government is the most common source of destructive noise that interrupts the channel from which entrepreneurs discern information.  As a centripetal power, government's attempts to impose order distract entrepreneurs from their purpose, while obtaining by fiat the entrepreneur's rightful profits.

Which brings us to the central thesis of Gilder's book:  that power must not be taken away from those with the knowledge to use it effectively.  That is, successful entrepreneurs who have created businesses and driven the growth of jobs, markets and wealth ― and all the positive societal benefits that stem from them ― have thus proven themselves the most capable to reinvest the profits.  Capitalism succeeds, therefore, not with a system of sticks and carrots, but by linking knowledge and power.

To illustrate this point, Gilder tells the story of Warren Buffet and his concern that his personal tax rate of seventeen per cent was unfairly lower than that of his secretary.  Leaving aside the validity of this statement, and his failure to take into consideration corporate income tax and other levies, Gilder argues that this is exactly the way it should be as wealth can only grow when those who created it remain in control of it.  As such capitalism prevails because it assigns the exacting task of re-investment "to people like Warren Buffet rather than to people like his secretary".

With this key point, Gilder also articulates the clear misunderstanding that underpins socialism.  By attempting to seize capital and redistribute it to the population, socialism disconnects knowledge and power.  This, according to Gilder is the great secret of capitalism, "detached from a capitalist, there is no capital".

At the heart of Gilder's thesis is the refreshingly optimistic idea that growth and development are truly unlimited.  As the real source of wealth is knowledge, new players and technologies will always emerge that will disrupt old paradigms and continue to drive prosperity.  Gilder's writing can sometimes take a conversational tone as he moves from topic to topic whilst picking-up and dropping threads of thought in a somewhat arbitrary fashion.  But the text represents a new and interesting take on the school of economics and an impassioned defence of the morality and power of the free market.

The Post-Ideology Premier

Nick Greiner:  A Political Biography
by Ian Hancock
Connor Court Publishing, 2013, 480 pages

There is no doubt that Nick Greiner was one of the best premiers of any Australian state in the second half of the twentieth century.

The New South Wales Government he led from 1988 to 1992 introduced a range of worthwhile reforms in areas including financial management, industrial relations and education, as well as beginning to privatise some state-owned assets.

Greiner was clearly more principled than the average politician.  His new biographer Ian Hancock describes how, at times, Greiner was so blasé about the political consequences of his reforms that he even alarmed some Treasury officials.  Yet, while Greiner was principled, he made it clear that he "wasn't an ideologue in the Thatcher sense" and rebuffed attempts by journalists to categorise him as a supporter of "small government".  Greiner was what some might call a principled pragmatist.  In the jargon of the 1980s, he could be considered an "economic rationalist", but with different motivations to many others to whom that description was applied.  Soon after he became Opposition Leader in 1983, Greiner appointed Gary Sturgess to his staff.  In Quadrant that year, Sturgess explained the difference between himself as a libertarian, bringing a rights-based philosophy to the consideration of policy and those, like Greiner, who were "consequentialists".  The latter group may have come to many of the same policy conclusions, but did so because they could see practical benefits.

In many ways, Greiner's outlook is summed up by the title of his 1990 Deakin Lecture "Australian Liberalism in a Post-Ideological Age", a title with a touch of the Fukuyama's "End of History" about it.  In that lecture, Greiner referred to laissez-faire as a "silly dogma" and argued that liberalism needed to remain "largely non-ideological".  On the other hand, he also made it clear that he was opposed to populism, as exhibited by his predecessors from both side of the political divide, Bob Askin and Neville Wran.

Greiner saw government as akin to a corporation and described himself as the Managing Director of NSW Inc.  Hancock describes how the experience of doing an MBA at Harvard made Greiner receptive to "managerialism".  Introducing this practice delivered benefits such as making government departments focus on outputs, rather than process, but it also had some misguided aspects.  Greiner followed the example of the Cain Labor government in Victoria by creating a Senior Executive Service within the public service.  There are undoubtedly examples where SES level public servants have increased the quality of the public service, but the biggest legacy of the change is that public services around the country have become top-heavy with highly paid bureaucrats, whose contribution to the public good is probably no greater than their more humbly paid predecessors.

There were definitely practical benefits to many other Greiner reforms with reduced debt and significant efficiencies in government trading enterprises.  The very fact that Greiner initiated a commission of audit and then after three years had a review to assess how the government had performed against the audit was itself a level of accountability that had been sorely missing until then.  While pursuing industrial relations reform, Greiner also recognised that vested interests lurked in plenty of places outside the trade union movement and hence attempted measures like the deregulation of conveyancing to break the lawyer-monopoly.

In the period when Greiner was premier, one of the best chances for significant reform of the Australian Federation came along as Labor prime minister Bob Hawke pushed for a New Federalism.  Being neither a strident supporter of states' rights nor a centralist, Greiner was able to bring an open mind to this debate and worked well with Hawke.  Hancock rightfully devotes a whole chapter to New Federalism and regards it as the best hope for a more rational model of Commonwealth-state relations.  Unfortunately, New Federalism became a victim of the leadership contest between Hawke and Paul Keating, as the latter used the process as a stick with which to beat the former.

On social policy, Greiner was an instinctive liberal, for instance he supported Neville Wran's 1984 private member's bill to decriminalise homosexuality, not, as Wran argued, to bring the law in line with contemporary standards, but because "he saw the existing law as wrong in principle, irrespective of time and context".  Greiner opposed there being "some common morality enforced by the State", instead arguing that there should be "mutual tolerance of different moralities".

Another important aspect of the Greiner legacy was the new approach he adopted to campaigning, bypassing the Liberal Party organisation and using his own hand-picked team.  One can have some sympathy for his view that there were some underperformers in the organisation, while still seeing that there were grave risks in having your campaign run by a group of fifteen, only two of whom were party members.  A classic of the genre of the non-party type was Ian Kortlang, who may have brought military precision to aspects of Greiner's campaign, but showed that he lacked some political smarts with his role in the dumping of John Howard as federal leader in 1989.

In the end, Greiner's own downfall came from an aggregation of poor political decisions.  He allowed his wife to be put forward as a director of Elcom, the government-owned electricity retailer;  he appointed another MP, whose seat was abolished in a redistribution, as agent-general to London and, above all, he called an early election.  There are many analogies with Jeff Kennett and the 1999 Victorian election.  In both cases, the poor result was not a result of policy rejection, but poor politics, with a premier making too many decisions that looked arrogant.  Presented with a hung parliament, Greiner was able to successfully negotiate with independents and continue in government ― unlike Kennett.

However, worse was to come post-election through the person of Terry Metherell.  Metherell had been forced to quit Cabinet in 1990 when charged by the Tax Office with failing to declare interest on a lump of assessable income.  He had expected to be reinstated after the 1991 election, but Greiner did not do so.  A few months later, Metherell spat the dummy and announced he would become an independent.  Given the hung nature of the parliament this was highly inconvenient, so a couple of former colleagues and continuing friends of Metherell came up with the idea that he might resign his safe seat in exchange for a senior role in the public service.

Amazingly, this hare-brained scheme was sanctioned by Greiner, and once announced, unsurprisingly died a pretty quick death in the court of public opinion.  The problem for Greiner was that this was not the only pseudo-court he had to consider.

As part of his plan to differentiate himself from the previous Labor government, Greiner had set up the Independent Commission Against Corruption (ICAC).  Its head, Ian Temby QC, decided to investigate Greiner.  He found Greiner guilty of corruption, a finding which was later overturned, but by then Greiner had been forced to resign.

The best question about the ICAC decision was asked by the Independent who was most supportive of Greiner, Tamworth MP Tony Windsor.  Windsor wondered if "given the Temby decision, had he, Windsor, been guilty of corrupt conduct in using his position to secure concessions from the Greiner government?"  It is clear that if the ICAC ruling was consistently applied then no MP would be able to claim a political win by bringing services or infrastructure to their electorate at the expense of another.  Maybe Temby was onto something!

Hancock is a generally sympathetic biographer, although he certainly recognises faults in his subject, as indeed does the subject himself who participated in many interviews with the author.  The book is called "a political biography", but it has a significant amount of personal material.  There is much about the influence of his family and how certain Hungarian influences remained in an overall assimilationist environment.

When this book is added to his earlier work on John Gorton, Hancock must now be considered in the first rank of Australian political biographers.  There is so much dross written about politics that it is a delight to read a book by an author who combines detailed research with an understanding of politics and tells his story in a logical chronological narrative.  Not only does Hancock deserve praise, but so do the Public Policy Institute of Australian Catholic University and Connor Court Publishing for their Government, Policy and Politics series of which this forms a part.  Nick Greiner:  A Political Biography will be hard to beat as the best Australian political book of 2013.

Taking Freedom Seriously

The System of Liberty:  Themes in the History of Classical Liberalism
by George H. Smith
Cambridge University Press, 2013, 231 pages

One of the great legacies of Western Civilisation has been the emergence of the philosophical doctrine of liberalism (sometimes referred to today as libertarianism).

The evolution of the key philosophical themes of liberalism, warts and all, is the subject of an important book written by libertarian scholar George H. Smith, The System of Liberty:  Themes in the History of Classical Liberalism.

With its emphasis on the primacy of the freedom of individual actions in the economic and social realms, liberal philosophy stands in stark opposition to the historical and contemporary manifestations of authority, including slavery, religious servitude, monopoly, legal privilege, war, and statism.

The material comforts and the widespread social freedoms enjoyed by the common man and woman today ― although constantly threatened by socialists, progressives, and paternalists ― owes its existence to tireless intellectual efforts by those outlining the possibilities for human progress inherent within the liberal idea over at least hundreds of years.

Furthermore, it is no coincidence that industry, science, arts and culture have flourished in those parts of the world whereby liberal ideals attained their greatest acceptability.

Despite the great practical benefits of liberalism, important tensions and disagreements nonetheless emerged amongst self avowed liberals concerning the applicability ― if not the very meaning ― of key concepts and issues.  These are still being played out today.

Internecine philosophical debates among liberals led to the splintering of liberal thought into "old" and "new" varieties, contributing to philosophical confusions and later wavering public acceptance of liberal ideas during much of the twentieth century.

To illustrate the thematic structure of The System of Liberty, this review will highlight three topics from the book explaining how liberals addressed conceptual difficulties, the first being the amorphous notion of the "public good" in the presence of persistent political power.

Many philosophers have long argued that the presumption of liberty can be annulled, invalidated or overridden on exceptional occasions by political authorities when those actions are consistent with promoting the public good.

George Smith identifies several liberals who associated themselves with such an idea, including David Hume and Adam Smith, and even those more commonly associated with natural rights liberalism, such as John Locke.

The intent of the natural rights appeal to the public good is not to extend the sphere of coercive state intervention, but to restrict its scope.  As Smith describes it:

The principal function of the public good in natural rights liberalism was to restrict the activities of government to the enforcement of rights.  For these liberals, to say that a government ought to further the public good means that a government ought to protect the natural rights of its citizens in normal circumstances.  Natural rights were conceived as the primary constituents of the public good.

However, a difficulty with accepting a natural rights public good concept based upon Locke's writings is that Locke himself identified the public good in various contexts, the most controversial of which was justifying a "prerogative power" overriding the principles of justice, in exceptional cases, when this conforms with the public good.

As Smith rightly observes, this idea immediately begs several important questions that remain as points for discussion:  which criteria can be used to justify the "exceptional" case to stifle individual liberties?  Further, who decides which rights can be extinguished in favour of the public good?

The System of Liberty refers in detail as to how these initial debates, which can be traced as far back to the fourteenth century writings of William of Ockham (of Ockham's razor fame), subsequently informed the intense debates between liberals of natural rights and utilitarian persuasions over the accepted scope of government.

Smith illustrates how concerns that public good notions could override fundamental liberties have also informed political debates, for example the dispute over including a "general welfare" clause in the American constitution between James Madison and the anti federalists.

In an important chapter called "The Anarchy Game", Smith appraises the commonly used technique of critics who contend that liberalism is delegitimised as an acceptable philosophy, since it ultimately implies an endorsement of Hobbesian anarchy.

John Locke's intellectual nemesis, the absolutist Sir Robert Filmer, engaged in the anarchy game by challenging the core tenet of "social contract" theory that government is constituted by the consent of the governed.

Filmer not only stated that no government in history was established by the unanimous consent of the governed, but if people could break away from existing states to form their own then each individual could become his or her own king, the very essence of anarchy itself.

Smith explains that Locke ingeniously responded to Filmer's challenge by presenting an intellectual counterattack.

According to Locke, since it is impossible to identify the legitimate heirs of biblical Adam's patriarchal authority, absolutist governments of his day necessarily stood upon the quicksands of anarchy, since they lacked God-given legitimacy as Filmer described it.

In any case, Locke claimed it an absurdity that people would willingly join in a civil society only to be made worse off, as the absolute sovereign has their way with expunging economic and personal liberties at will.

While Locke may have used the anarchy game to full effect in his critique of absolutism, Smith argues that subsequent usage of the anarchy game, particularly by Edmund Burke in his critique of the French revolutionaries of 1789, engendered a decline in the prominence of Lockean theories within the broader liberal paradigm.

One of the more thought provoking themes covered in The System of Liberty concerns what George Smith refers to as "The Radical Edge of Liberalism", or the use of resistance or revolution to rectify the situation of a government which does not respect individual liberties.

Support for the use of resistance against illiberal legislation, or revolution of a tyrannical government altogether, cannot only be found in the works of Locke, but of Adam Smith, David Hume and Edmund Burke, although the criteria and circumstances in which these acts could legitimately apply vary among these writers.

For example, Adam Smith suggested that people can take up armed resistance when the abuse of governmental power becomes "gross, flagrant, and palpable", say when a government exceeds the feudal benchmark of a tax confiscating at least a third of people's wealth.

The author of the American Declaration of Independence, Thomas Jefferson, contended that persistent abuses of inalienable individual rights ― that of conscience, property and life itself ― would give legitimate ground to the overthrow of a government, thus representing liberalism's radical edge.

Illuminating the rich tapestry of liberal thought, The System of Liberty also brings to light the contributions of some lesser known, yet influential, participants in the unfolding philosophical debates over the meanings of freedom and liberty.

A highlight of the book is the nuanced interpretation of the work of prominent nineteenth century English liberal Herbert Spencer, who is falsely derided by most people today as a heartless "social Darwinist" with scant regard for the unfortunate.

As Smith helpfully reminds us, Spencer was steadfastly dedicated "to improving the economic and social conditions of the lower and middle classes", who were deleteriously affected by government interventions.

With regard to the "survival of the fittest" concept attributed to Spencer, it was not intended as a value judgment but as a description of those behavioural traits and characteristics more conducive to survival within a given society.

For example, the habits of work and thrift are commonly associated with the development of a dynamic, market based economy, with the benefit of previously untold levels of wealth accessible to the masses.

Even so, it is not possible for everyone to escape the stifling grasp of absolute poverty, and so voluntary charity is commended by Spencer, as a system simultaneously drawing upon our humanitarian instinct of concern for others while also providing incentive for donors and beneficiaries alike to access new economic opportunities.

On the other hand, bureaucratic state enforced charity, now referred to euphemistically as the "welfare state", not only drains productive potential because of the staggering fiscal burdens it imposes, but serves to encourage inappropriate behaviours and values, such as indolence and "cheating" the welfare system.

George Smith also reminds us of the British "voluntaryist" movement, including Edward Baines, Richard Hamilton and Auberon Herbert, who adopted Lockean self ownership doctrines when arguing for such reforms as the separation of education and state, and even the introduction of "voluntary" taxation systems.

Filled with insight befitting a scholar with a reputation as one of the leading libertarian thinkers in the world today, George Smith's The System of Liberty has been opportunely written at a time when liberal ideas, once again, seem to be on the rise.

Surveys around the Western world reveal a great distrust of government;  international student liberty groups have emerged;  pro-liberty think tanks are proliferating;  and even nominally liberal conservative political parties are facing an internal insurgency by principled members with strong beliefs in free markets and social freedoms.

As perhaps the most important book in liberalism written in 2013, The System of Liberty serves as the perfect intellectual accompaniment for the liberal resurgence taking root.

Capitalism In Ancient Rome

The Roman Market Economy
by Peter Temin
Princeton University Press, 2012, 320 pages

Enthusiasts of Ancient Roman history have long been struck by a peculiar absence.  As David Hume wrote, "I do not remember a passage in any ancient author, where the growth of a city is ascribed to the establishment of a manufacture."

Yes, there was much trade in the ancient world.  There were markets.  But the power of the Roman state and the paucity of evidence for industry, manufacture, and integrated markets has led many historians to conclude, as the great Moses Finley did, that "ancient society did not have an economic system which was an ancient conglomeration of markets."

Peter Temin's The Roman Market Economy is a clever, extended attempt to demonstrate otherwise.

Temin, an emeritus professor at MIT, is one of the world's most prominent economic historians.  He's written studies on the Great Depression, the economics of slavery, and industrialisation in the United States.  One book also published this year by Temin and a co-author, Hans-Joachim Voth, concerns early goldsmith banking in eighteenth century Britain.

In The Roman Market Economy, Temin's goal is to apply the standard techniques and theories of modern economics to the ancient world.

Of course such standard techniques and theories are broadly Keynesian.  Their application is usually rewarding, but, as we shall see, occasionally problematic.

Temin offers some tests to determine how much of a market economy Ancient Rome really was.  Were the level of prices determined by supply and demand, suggesting that trade dominates the economy?  Was there an integrated market ― in other words, did a price change in one region effect a price change in another region?  And was anonymous exchange common?  It's easy to make trades with people we know personally.  But were contracts and law ― formal and informal ― developed enough to facilitate trade among people outside a group of trusted friends?

The questions are hard to answer.  Certainly there are no data sets of the sort that economists are used to handling.

The first question is whether Rome was an integrated market, rather than a collection of local markets connected only by politics.  We have a small sample of wheat prices from around the Mediterranean region.  Some of those prices survived in the writings of Cicero and Polybius, others from scattered inscriptions.  It's a very small sample, in fact ― there are just six of them.  But they appear to be random.  We can compare those regional prices with prices in the city of Rome.

Temin uses a regression analysis to demonstrate that the prices in Rome and the rest of the empire track each other nicely, once transport costs are accounted for.  This suggests a unified Roman market.  There's no reason to believe prices would follow each other if markets were small and isolated.

From this Temin fills out our understanding of the market for grain, drawing on a large secondary literature.  Roman contract law was highly evolved, which was essential in ensuring the reliability of suppliers and agents.  Commercial partners sued each other when relations went sour.  Merchants developed mechanisms to prevent cheating.  Reputation mattered.

One confounding factor in determining how much of a true market the grain trade was in Rome is the substantial state intervention.  The state provided wheat to a certain proportion of the inhabitants of the city of Rome ― the annona.  This is the bread in bread and circuses.  It's not clear how many citizens received grain;  Temin suggests between fifteen and fifty per cent, leaning towards the lower figure.

Whatever the relative size, this was a significant distortion of the agricultural market.  However, in keeping with general Roman political economy, the annona was contracted out ― private merchants brought the wheat into the city on government contracts.  Another intervention was periodic grain handouts in times of hardship, as well as occasional price controls.  As Temin points out, the fact the emperors sometimes chose to impose price controls suggests the market was fairly dynamic and responsive to supply and demand.  Otherwise why bother?

Merchants needed finance.  Ancient Rome had a relatively sophisticated banking system.  One of our best sources is the Sulpicii, a collection of financial tablets discovered in Pompeii in the late 1950s.  These suggest that the Sulpicii took deposits, lent to third parties, acted as brokers for their clients, transferred funds between accounts, and changed money;  remarkably similar to modern banking.  We know there were a wide range of services and institutions providing financial services in the ancient world.  Temin compares the degree of financial sophistication to that of eighteenth century London ― in other words, extraordinary.

Agriculture was one big market in the ancient world.  Labour was another.  But Rome was a slave society ― intuitively, there can be no meaningful "labour" market where forced labour dominates.  Temin here is provocative and interesting.  Not all slave societies are the same.  We tend to think of slavery monolithically, projecting our cultural understanding of slavery in the American south onto all societies with slaves.  Slaves in Ancient Rome were more connected to the broader labour market than they were in South Carolina in 1860.

Of course Roman slavery was cruel and brutal, particularly for those who worked in certain industries.  Slaves were captured in war, or born into the condition.  But for some, slavery was closer to what we would describe as indentured servitude.

People need incentives to work, and slaves were subject to positive and negative incentives.  The evidence suggests that positive incentives were more common in Ancient Rome than elsewhere.  Slaves could earn wages.  They could be highly skilled, educated, and take managerial roles.  They could act as agents for the masters.

Most importantly, they could buy their freedom.  Manumission ― the act of freeing a slave ― was more prevalent than in any other slave society.  One scholar estimates that ten per cent of slaves were freed every five years.  In the American South that figure was 0.2 per cent.  Ex-slaves, at least in the cities, tended to have been educated in bondage.  Once free, they filled the ranks of merchants and administrators.  Slaves and ex-slaves operated in the same labour market as free individuals.

Temin is understandably on less sure footing when he moves from microeconomics to the macroeconomy.  The standard account of long term growth ― most recently and compellingly detailed by the University of California's Gregory Clark in Farewell to Alms ― classifies growth into the pre- and post-Industrial Revolution.  Before industrialisation, the world was stuck in a Malthusian Trap.  Innovation and discovery only led to population growth, not a growth in income and living standards.  After the industrialisation, income and living standards shoot up.

Temin is constrained by theoretical orthodoxy to apply this model to the Roman economy.  It doesn't fit very well.  There was technological development in the Roman empire, and there was income growth as well.  He concludes that the Malthusian dynamic operates over a period of centuries, rather than in the short term.

But if a society can enjoy economic growth for hundreds of years ― a growth only interrupted by military invasion and political collapse ― how can it be described as Malthusian?  If the Malthusian model can turn itself off for centuries and entire civilisations at a time, it's not clear how useful the model is.  Temin's final trick is to calculate Roman GDP.  Such a figure is only meaningful if markets are broad and sophisticated, which he has demonstrated.  He concludes that per capita GDP was around $1000 ― roughly the same as enjoyed by Europeans in 1700.  This is obviously tentative and speculative and relies on too many assumptions to list, but paints a fascinating picture if even half true.

Macroeconomics aside, Temin is very convincing.  Rome had market economy.  What lessons should we take from that?

First of all, Roman living standards were high.  Extraordinarily high, compared to living standards centuries after.  One strand of ancient historiography in the last half century has been to downplay the significance of the fall of Rome;  suggesting that the Empire melted away, rather than experienced the catastrophic collapse of our cultural memory.  In a 2005 book The Fall of Rome and the End of Civilization, the archaeologist Bryan Ward-Perkins establishes a sudden drop in material well-being that occurred alongside the barbarian invasions and the fall of the West.  Temin's evidence illustrates just what was lost.

Temin's argument has implications for political economy more generally.

Karl Polanyi made an influential argument in the 1940s that there was nothing "natural" about the market economy.  In his view, the market economy was imposed by the state during the eighteenth and nineteenth century.  Capitalism was a political project:  "laissez-faire was planned".

For Polanyi, the pre-market world was one where goods and services were primarily distributed by the principles of reciprocity (the gift economy) or redistribution (state control).  Trade was a minor element of these economies.  When it occurred it was dependent on personal relationships.  Anonymous exchange was rare.

This argument underpins the often heard claims by far left academics and activists that capitalism is inflicted on societies by those with power, rather than the spontaneous result of any innate human desire to trade.

Polanyi's thesis has not held up well.  Temin's book offers one illustration why.  Markets and trade were certainly not "imposed" on Ancient Rome.  There's no evidence that the Roman state wanted to upset an earlier gift economy and create markets;  no reason to believe Roman politicians sought to break the chains of communal reciprocity and replace them with self-interest.

Yet Rome was a market economy nonetheless.  In the absence of better evidence, we can only conclude that it was such an economy because participants in that economy desired it to be so.  Those who produced, bought, sold, transported, invested, lent, and innovated in Rome's integrated economy were not different to us.  Ancient Romans wanted to improve their living standards and pursue their own goals.  The market economy allowed them to do so.

Eye on the prize

Prizes are a common feature on the cultural economy landscape.  In Australia there is the famous Archibald Prize for portraiture, there are numerous prizes for literature and poetry, the AFI Awards in film and television, the Walkley Awards for journalism, and so on.

Prizes can be entertaining spectacle;  they can guide consumers to what is new and best;  they make a fine vehicle for a generous benefactor;  and they surely nudge cultural producers, whether they will admit it or not, closer to excellence.  Yet a case can be made that, due to the interaction of three emergent effects, we'd actually be better off without them.

First, prizes function for consumers as what sociologists call ''judgement devices''.  An overarching feature of the cultural economy is the continuous production of novel products that are of uncertain quality:  they are pure experience goods.  In most markets, such as for furnishings, shoes or cars, the price of a product is a reliable guide to quality.  But an awful movie has much the same ticket price as something brilliant.  A few years ago some colleagues and I looked at the role of the choices of other consumers as a judgement device in what we called social network markets.  Prizes also fulfil this role, but through the mechanism of an expert panel rather than wisdom-of-crowd effects.

Second, prizes introduce a discontinuity between winners and other nominees (also-rans) that distorts perceptions of underlying differences in quality:  consecrating a select few, and throwing the near winners back into the vast pools of mediocrity.

Third, because prizes are awarded by juries of experts — usually with different tastes and preferences than mass audiences (preferring stories about righteous courage in overcoming historical injustice, say, than street-racing robot fighting aliens) — prizes are costly to go after in terms of market risk.  If you try and fail, you end up with not only no prize, but also with something without much market appeal.

When we think about the effect of prizes, we usually have in mind a single-valued reward structure — that is, simply rewarding excellence that has already happened.  But as Gabriel Rossman and Oliver Schilke in a paper just published in the American Sociology Review (an ungated version of the paper is available here) explain the problem is that prizes are actually bimodal in their reward structure because of what economists (following the work of Gordon Tullock) call an all-pay auction.

In an earlier piece I was bullish on prizes, but the issue is complex.  The thing about prizes is that we need to consider not only the benefits to those who win, but also the costs to the losers.  Everyone pays to enter, in sacrificing market appeal, but only a few take the prize, and receive the consumer pay-off;  for the rest, they're now in a worse position than if they had never sought the prize.

Fittingly for this time of year Rossman and Schilke's research focuses on Oscar nominated Hollywood films.  Their method is to identify films that are seeking prizes by constructing and estimating an index they call ''Oscar appeal'' (which correlates well with actual Oscar nominations).  They then study the correlation between that index and a film's financial returns (box office revenues divided by production cost).

They find that Oscar appeal splits into two categories:  those that do receive nominations (and that tend to make money) and those that don't receive nominations (and that tend to lose money).  But the interesting thing is that ''taken together these two types of movies are no more or less profitable than movies with low Oscar appeal''.  In econ-speak, this means that ''the Oscars follow the structure of a Tullock lottery and seem to exhibit rent dissipation.''

Economists tend to be sceptical of the value of artificially created rents by government, such as exclusive licensing, or preferential purchasing provisions, because of rent-dissipation in all-pay bidding to obtain these benefits.  But what is significant about this research is that it extends this economic critique to the domain of prizes, which are a prominent mechanism in the cultural economy (and also in the academic research economy:  a research grant is also a prize!).

Should we abandon prizes?  The counter-factual world without prizes would mean fewer prize worthy films, which means less breadth in the field, but this only occurs if prize-seeking is actually costly in terms of market risk.  The take-away is simply that nothing is for free, including prizes;  or more specifically at the industry level that prize seeking strategies do not produce above-market returns.

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Why protecting the pension is a political con job

You'll only make it in politics if you are willing to be completely shameless.

On Tuesday Social Services Minister Kevin Andrews flagged a major review into Australia's welfare system.  One in five Australians now receives income support payments — 5 million people.  That's a lot, and the Coalition believes it is too many.  The budget has to be balanced.  We don't want to become like Europe.

So far, so good.  Yet 2.3 million of those people — nearly half, and the largest cohort — are on the age pension.  And Kevin Andrews has specifically quarantined the age pension from his review.  So, it isn't quite the major budget-repairing review it sounds like.

Bill Shorten confidently insists that ''the Abbott government is proposing to reduce the rate of increase of the age pension''.  (Never say Shorten isn't trying his little heart out.)

This comically absurd little spat over the pension reveals a lot about Australia's welfare system and the political system in which it operates.

The list of beneficiaries and the conditions placed on those benefits are not organised by any noble principle of need or fairness or morality, but calculations — often highly crude ones — about voting blocs.  Of course it is all dressed up in the language of social justice.

Despite being the largest beneficiaries of the welfare system, pensioners are a protected species.  Remember there's no guarantee a review would recommend a cut to any particular welfare entitlement, nor any guarantee the government would follow through if it did.  No, the pension is too sacred to even be studied.

Australians like to say they're concerned about middle-class welfare.  Defenders of the status quo argue our rate of middle-class welfare is relatively low by international standards.

But this week's little pension quarrel reveals something more fundamental — the modern welfare state is, itself, a project designed to benefit the middle class above all others.

Middle-class welfare isn't a bug or aberration.  It's the defining characteristic of any democratic welfare state.

This observation is known as Directors' Law — named after economist Aaron Director, who argued that redistribution policies in a democracy will benefit the largest voting blocs.  Invariably this is the middle class.  The primary function of a welfare state isn't to keep people out of poverty.  It's to transfer money to the powerful middle class.

Sometimes the system taxes the middle class to provide benefits to that very same middle class.  Such ''churn'' is a political confidence trick that relies on citizens' ignorance of their true tax burden.

You'd be hard pressed to find a philosopher, economist, sociologist or political theorist who could support such a distorting, wasteful, politically motivated transfer system on principle.  But that's what we have.  All the big political flashpoints of Australia's welfare policy — baby bonuses, family tax payments, parental leave — are disproportionately generous to the middle class.

Nor is the age pension solely to protect the poor.  Eighty per cent of people above pension age receive a part or full pension.  By excluding the family home from its income test, the pension protects elderly home owners from having to use the savings they've accumulated in their house to fund their retirement.  And, a bonus:  it protects the inheritance of their children.  No wonder it's popular.

Welfare is a political compact.  Sociologist Gosta Esping-Andersen famously distinguished three models of welfare state capitalism:  liberal, corporatist-statist, and social democratic.

Liberal welfare regimes view income support as a safety net.  Think the United States, where welfare is an emergency, often short-term measure.  The corporatist-statist regimes (found in Germany, France and Italy) uphold traditional class divisions.  Scandinavian countries have a social democratic regime where welfare is less about poverty and more about citizenship.  All classes get something.

Usually Australia is grouped in the liberal camp.  This reflects our English political origins, with a focus on individual rights rather than collective belonging.  And welfare for the rich seems to offend the antipodean sense of the fair go.

That's the theory anyway.

The Abbott government seems intent on destroying the last vestiges of what makes our system liberal.

There's something deeply alien — well, Scandinavian — about the Coalition's paid parental leave scheme.  The government will pay as much as $75,000 to new mothers for 26 weeks, according to their previous income, not their need.

The Coalition insists the parental leave scheme isn't welfare, it's a workplace entitlement.  Nonsense.  But the philosophy behind this talking point is deeply illiberal.  It suggests the state is as responsible for providing your income as your employer is.

Even more symbolic:  just two days after Kevin Andrews announced the welfare review, he also announced the government would give young couples $200 for marriage counselling.  The average Australian wedding costs upwards of $35,000.  Yet the party of free markets and individual responsibility feels the need to chip in another few hundred dollars.

Of course, a review into Newstart and the Disability Support Pension is a good thing.  The latter has grown rapidly in recent decades.  The chief executive of Mission Australia has said hundreds of thousands of disability support recipients should be helped into work.  The social and psychological benefits of employment are unarguable.  This is more than enough justification for an inquiry.

Nevertheless, any serious review of Australia's welfare system must be a review of the entire system.  Even the popular bits.

Joe Hockey has been unable to commit to returning the budget back to surplus until 2023.  But if the government can't slay — or at least scrutinise — some sacred cows, this deadline looks far too optimistic.

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It's not just the rich who benefit from free markets

Proposals in a recent Oxfam report, if implemented, would be a recipe for continuing impoverishment of the many.

The Oxfam report states that inequality is on the march, with about 50 per cent of total wealth owned by 1 per cent of the world's population, with the other half of total wealth owned for the remaining 99 per cent of the population.

In one particularly attention-grabbing headline, the ''Working For The Few'' report states that the world's 85 richest individuals own as much as the poorest half of the global population.

According to the NGO, ''The large and rising concentrations of income and wealth in many countries represent a global threat to stable, inclusive societies for one simple reason:  the unbalanced distribution of wealth skews institutions and erodes the social contract between citizens and the state.''

In an unhampered, free-market economy, the distribution of income is wholly determined by the interplay of mutually beneficial market transactions between sellers and buyers.

Incomes are attained by selling goods and services to customers willing to pay for them, and suppliers who most closely meet the needs and desires of consumers are rewarded with revenues that more than cover production costs.

The resultant inequality, therefore, derives from the personal choices of the millions, or even billions, of participants in the market process.

But unless profitable suppliers can keep pleasing their customers by providing valuable goods and services, their ability to keep accumulating wealth is threatened.

Factoring in other issues, such as the attraction of additional suppliers towards profitable areas of economic activity, technological developments, and changing consumer preferences, it becomes clear that wealth holdings are precarious.

Needless to say, we don't interact in unhampered markets, with an alliance of big governments and crony capitalists littering the scene.

There are great risks that these players prevent others from breaking into the wealthy ranks, but in the real world the ranks of the wealthy can still significantly change within the space of a generation.

Only 25 of the 85 wealthiest people in the world in 2013 were among the 85 back in 1996, with 60 people (including Rupert Murdoch) dropping out of the list during that period.

Entering the list came the likes of Mark Zuckerberg of Facebook fame, the owners of Ferrero Rocher chocolates and Nutella spread, Australian miner Gina Rinehart, and others.

Now, Oxfam does acknowledge that ''some economic inequality is essential to drive growth and progress, rewarding those with talent, hard earned skills and the ambition to innovate and take entrepreneurial risks''.

This is a reasonable point, but the report's subsequent focus on snapshots of the top 1 per cent overlooks the far more pressing issue about ensuring that more people, including the poor, can tap into opportunities for their own enrichment.

The Oxfam report oddly asserts that attitudes to the effect that it is better to focus on impoverishment, or absolute inequality, than relative inequality ''is no longer in fashion''.

This ignores the huge benefits arising from what has been described by some as the ''greatest and most remarkable achievement in human history'', and that is the precipitous decline in global poverty over the last few decades.

As recently discussed by American economist Mark Perry, about 5 per cent of the population lived on $US1 a day or less in 2006 compared with about 27 per cent in 1970, a massive decline in global poverty of 80 per cent.

Far from being a ''winner-takes-all'' system, the growing, but incomplete, embrace of market reforms, such as greater respect for private property rights, free trade and deregulation, has meant new opportunities for people to feed, clothe and house themselves and their families.

And that translates into real wealth gains for many people, in economic terms, which can only be a good thing.

So, what kinds of policy settings are needed to end impoverishment for many more people throughout the world?

Not high-taxing, big-spending and stringent regulatory policies, such as those advocated by Oxfam, that entrenches the cronies and excludes more people from economic participation.

Higher, and more progressive, income and wealth tax rate structures tend to discourage people from engaging in economic activities, including supplying labour where needed, that would otherwise propel them into higher income brackets.

And cracking down on tax havens poses a range of problems all of its own, including for low-income countries seeking to diversify their economic activities.

At the other end of the spectrum, mandated and rising ''living wages'' risks creating additional unemployment, as companies struggle to afford relatively more expensive labour services.

Education and health care are important, but high-cost, substandard services under monopoly government control are usually at odds with what poor people really need to meaningfully climb ladders of opportunity.

If we are genuinely concerned with ensuring that people escape the mire of poverty, then we would advocate policies ensuring that people cooperating in markets are less hampered in buying and selling between each other.

In short, what the world needs is a greatly reduced dose of government intervention, so that wealth becomes the rule rather than the exception.

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Narrow focus confuses intent

Instead of cementing human rights as a foundation stone of Australia's liberal democracy, the national curriculum confuses their history and intent.

The national curriculum primarily introduces human rights under the banner of ''Rights and freedoms'' in Year 10 history.  While the title is broad, the approach is very narrow.

According to the curriculum, human rights are approached as a post-1945 concept focusing on ''the origins and significance of the Universal Declaration of Human Rights, including Australia's involvement''.

It also focuses on the recent struggle for the rights and freedoms of indigenous Australians and the ''US civil rights movement and its influence on Australia''.

As Murdoch University legal academic Augusto Zimmermann wrote in critique of the curriculum, ''there is not a single reference to the struggles for rights and freedoms such as that which occurred during the 1688 Glorious Revolution, and afterwards by American revolutionaries (whose) whole purpose of acknowledging human rights was to protect the citizen against excessive government power''.

Without this background, human rights lack their history and also their framework.

Apart from cursory references to the Magna Carta in Year 6 history, there's no substantive discussion about the evolution of human rights and the influence of key political movements, particularly classical liberalism and enlightenment thinking.

Without it, two essential themes are not covered.

First, human rights as universal individual birthrights;  second, human rights are designed to stop the abuse of government power over the individual.

It's out of this tradition that Australia's common law rights evolved.

Similarly, it's only with this history that Australians can understand the social contract that gives government legitimacy is coupled with human rights to put a brake on its excesses.

Without this background, the national curriculum risks debasing human rights, whitewashes their classical liberal origins in favour of treaties, strips them of their sanctity and consistency and presents them as a modern legal gift of government.

There are numerous cascading problems in approaching human rights this way.  First, whatever human rights government gives, they can also take away.

Second, diluted human rights can then be superseded when they come into conflict with the policy objectives of government.

In the past 12 months there have been clear examples of how they can be compromised.

Last year, the Queensland parliament passed laws that have criminalised free association for bikies.

The last federal parliament considered introducing a state-sanctioned media regulator that would limit free speech because politicians didn't like what newspapers were saying about them.

The last federal parliament also considered laws that could restrict expressing political views in the workplace.

Third, when they're debased from protecting individuals from government abuse then any new aspiration can simply be added to the list of human rights consequently weakening their integrity.

The Victorian Charter of Rights and Responsibilities outlines this problem in practice.

Former British philosopher Isiah Berlin coined the division between human rights that protect individuals from government as ''negative liberties'' and rights that reflect aspirations for society as ''positive liberties''.

Traditional ''negative'' human rights include protecting free speech, movement, association, worship and property.  They're also principles that can be reasonably consistently exercised by individuals.

Yet the Victorian Charter elevates the worthy ''positive'' aspiration of non-discrimination to the status of human rights, despite the tension between the two different concepts.

Apart from limiting discrimination by government, non-discrimination is primarily about protecting individuals from unjust societal prejudice.

There is consistency between both ''negative'' human rights and ''negative'' non-discrimination in stopping government prejudicially discriminating access to government services and employment.

Similarly, Section 51 (xxvi) of the Constitution that allows state-imposed discrimination by giving the parliament the ''power to make laws with respect to the people of any race'' is inconsistent with negative liberties, and hence should be repealed.

But there is tension between ''positive'' non-discrimination and ''negative'' human rights.

It's impossible to protect the integrity of ''negative'' human rights when, as the Victorian Charter argues, ''every person has the right to enjoy his or her human rights without discrimination'' while also protecting the right of women to join gyms that exclude men, gays to have nightclubs that exclude heterosexuals and indigenous groups that require members have indigenous heritage.

Arguably, the whole point of free association is the right to discriminate in associating with some, but not others.

Worse, the Victorian Charter doubles down by explicitly prioritising non-discrimination ahead of human rights by stating that ''measures taken for the purpose of assisting or advancing persons of groups of persons disadvantaged because of discrimination do not constitute discrimination''.

Despite the inconsistency, achieving a society free of unjust discrimination remains a worthy goal, but we cannot ignore that when we prioritise ''positive'' non-discrimination, we are deprioritising human rights, and vice-versa.

The recent introduction of the national curriculum ensures it is not responsible for the cracks that now appear in the human rights foundations of our liberal democracy, but fixing the national curriculum will help future Australians understand human rights and also start the restoration process.

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Renewable energy sources are just a power failure

Much has been written about the contribution that wind and solar have made to Australian energy supply, especially in the recent hot spell.  About 10 per cent of electricity supply comes from renewable sources, two-thirds of this being unsubsidised hydro-electricity, with one-third from wind/solar which needs subsidies to cover more than half of its costs.

During heatwave conditions in the five days to January 18 this year, wind actually contributed 3 per cent of electricity supply across the Australian National Electricity Market.  Nobody knows the contribution of rooftop solar but it could not conceivably have been more than 1 per cent.

Overall, wind facilities amount to 3300 megawatts of capacity, somewhat less than the Loy Yang brown coal power stations in Victoria or Macquarie Generation's black coal facilities in the Hunter Valley.  Windmills produced at an average of 23 per cent of their capacity during the January heatwave.  This was below their year-long average of about 30 per cent because the hot spell, as is often the case, was characterised by still air.  Fossil fuel plants are available 95 per cent of the time.  Gas plants (and hydro-electricity) can be switched on and off at very short notice to fill the peaks in demand.  As a result they generally earn more than the average plant on the electricity spot market.

The below-par performance of windmills in high-demand periods means they not only require a subsidy but are also less valuable than other plants because their availability is reduced when they are most needed and when the price is highest.  Accordingly, windmills actually earn less on average than other plants in the electricity spot market.  Indeed, during the recent heat wave, wind power earned an average of $123 per megawatt hour in Victoria and $182 in South Australia while the average price was respectively $209 and $285 in the two states.

SUBSIDIES ARE EXPENSIVE

Investments in wind and other subsidised electricity generation, according to the renewable energy lobby group the Clean Energy Council, has been $18.5 billion.  By contrast, the market value of comparable generating capacity in Macquarie Generation coal plants is said to be only $2 billion and a brand-new brown coal plant of 3300 megawatt capacity would cost less than $10 billion.

Wind aficionados claim that such costings do not take into account that wind is free whereas fossil fuel plants have to pay for their energy.  But that is also untrue.  Wind plant maintenance is about $12 per megawatt hour which is more than the fuel plus maintenance costs of a Victorian brown coal power station.

Subsidies to renewable energy were once touted not only as a key to reducing emissions of carbon dioxide but also as paving the way to a future source of electricity that would become competitive in price and reliability with fossil fuels.  After two decades of increasing subsidies, this optimism has proven to be unfounded.  Instead we have seen subsidised renewable energy sucking capital into worthless investments.

On present plans, a nominal 20 per cent of electricity is to be sourced from renewables by 2020.  By that year the excessive cost burden on the economy will be $5 billion a year and rising.  This entails crippling subsidies paid by consumers and businesses.  The imposition has been a factor in the foreshadowed plant closures of Holden, Electrolux and the aluminium smelters at Kurri Kurri and Point Henry.

Because of our readily available coal and gas Australian electricity costs are intrinsically among the lowest in the world.  This was formerly crucial to attracting highly competitive energy-intensive industries like smelting.  Australia could once again benefit from low-cost electricity if deregulation freed energy supply from its renewable obligations.  The benefits would be especially welcomed across all agricultural and manufacturing industries that are subject to international competition.

Subsidies on existing Australian renewable plants are planned to run for 15 years.  But Spain, previously the poster child of renewable subsidy excesses, has shown the way forward by eliminating all previously promised subsidies.  Australia needs to abandon its own renewable schemes and allow the energy market to operate on commercial terms.

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Neo-prohibition isn't the answer to violent crime

It wouldn't be a moral panic without demands that the government do something.

And so it is with the alcohol-fuelled violence panic that swept New South Wales over the Christmas break.

Richard Denniss of the Australia Institute made a few proposals in the Sydney Morning Herald here.  Governments could increase alcohol prices by increase taxes or imposing a minimum price.  They could restrict pub opening hours.  They could even set a maximum blood alcohol level for people in public places.

Such proposals are more or less the sort of neo-prohibition public health activists have wanted for years.

Today Barry O'Farrell announced a crackdown on alcohol venues, with mandatory bottleshop closures at 10:00pm, a 1:30am pub lock-out, and no pub service after 3:00am.

Let's lay aside whether it is fair to restrict the liberties of all because of the idiocy of a few.  It is utterly and despicably perverse that our immediate reaction to a highly publicised violent assault is to blame public policy, or market forces, or ''culture'' in general.

It's classic guilt displacement, shifting the responsibility from the perpetrators of violence and onto society.  That is, it's not totally their fault they were violent.  Alcohol vendors were plying them with liquor!  Lazy politicians were neglecting their regulatory duties!  Music videos have been glorifying drinking!

What does this imply for the moral responsibility of the perpetrators?  After all, to punish somebody for an act they had little control over would be a travesty of justice.

Perhaps the number of bottleshops in a suburb should be a mitigating factor in sentencing.  Of course, none of our latter-day prohibitionists have taken their logic this far.  But such perverse reasoning is implicit when we seek social explanations for individual criminal acts.

The perversity increases when you realise that there is no alcohol-fuelled violence crisis.  The rate of violence related to alcohol is stable, even declining.  (This piece in the Guardian sums up the evidence for New South Wales nicely.)

Our alcohol consumption is steady, too.  Australia's per capita alcohol consumption has been hovering around 10 litres a year for the last few decades.  (In the 1970s it was more like 12 litres.)

But regardless of whether it is trending up or trending down, it remains the case that the Australian public consumes a large quantity of alcohol, and gets into very few fights.

There are, as there have always been, brutal thugs who take pleasure from violence.  The correct — and most direct — response is to target the thugs, not to fiddle with tax policy.

The relationship between alcohol and violence is not as clear cut as you might expect.  Yes, much violent crime is caused by intoxicated people.  The doctors and police are right.  But figuring out whether alcohol actually causes the violence is quite hard.

Correlation, as we all know, is not causation.

The most common theory is that alcohol lowers inhibitions.  It directly anesthetises the parts of the brain that we use to regulate our everyday behaviour.  Alcohol changes us physically, and in a way that makes some people more aggressive.

From experiments in laboratory settings we know that people who consume alcohol exhibit more aggressive behaviour.

But the inhibition theory is not the only theory which could explain this.

Some experiments have shown that people tend to get more aggressive even when given a placebo.  That is, when they are told they are going to have an alcoholic drink, but are secretly given a non-alcoholic tonic, they get aggressive anyway.  Thus the ''expectations'' theory suggests people get more aggressive when intoxicated simply because they expect to get more aggressive when intoxicated.  They think aggression is more socially acceptable in a drunk.

There are other theories.  The connection between alcohol and violence could be indirect.  Intoxication reduces intellectual function, causing us to exaggerate provocation and to needlessly provoke others.

But these theories only take us so far.  It's one thing to show in a lab that people who believe they are intoxicated people are marginally more aggressive than those who are sober.  It's quite another to draw policy conclusions from that finding.

The overwhelming majority of people drink without getting violent.  (Some people just get more helpful.)  In the real world, humans are able to regulate their behaviour even while intoxicated.  Even if alcohol ''causes'' violence, it only causes it rarely, and in a tiny fraction of people.

Even drunk people make choices.  Even drunk people can be moral.  We are not machines.  Public policy ought not to treat us like machines.

The more policy-focused researchers try to side-step this issue with macro-level studies that look at correlations between alcohol consumption in an area and incidents of violence.

That's where we get the claims that bottleshop density facilitates violence, for instance.

But these studies often struggle to distinguish between other factors.  The essential feature of bars and pubs and nightclubs and bottleshops isn't that they sell alcohol.  It's that they bring large groups of young men together in close proximity.

Ultimately, the neurological, psychological, and sociological evidence about the relationship between alcohol and violence isn't strong enough to get us away from a simple intuition:  violent acts are caused by violent people, regardless of their level of intoxication.

As one paper from 2008 concludes, ''alcohol may facilitate violent behavior among those who are already inclined to behave that way.  It is also possible that violent adolescents sometimes use alcohol as an excuse for their behavior.''

So the idea that we would be trying to blur the responsibility of violent offenders with alcohol regulation is utterly, utterly repugnant.

It's exactly what the thugs, and their lawyers, want us to do.

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When multinationals go on welfare

Coca-Cola Amatil's net profit in 2012 was $558 million.  In 2011 its net profit was $532 million.  In a few weeks we'll know its net profit for 2013.

CCA owns SPC Ardmona.  SPC Ardmona wants to be paid $50 million by Australian taxpayers — $25 million from the federal government and $25 million from the Victorian state government.

This $50 million payment from taxpayers will, according to SPC Ardmona, be a ''one-off government investment on innovation plans and efficiency improvements''.

There's an obvious question to ask about the company's request — and it's a question few people want to talk about.  Why can't SPC Ardmona get the $50 million from CCA?  It's not as though CCA doesn't have the money.

CCA has said that if SPC Ardmona gets the $50 million from taxpayers then it will give $150 million of its own money to SPC Ardmona.

CCA's commitment raises a further question.  To a normal person (and remember, it's normal people from whose pay packets SPC Ardmona wants to get its $50 million), it's strange that a very profitable company like CCA, which last year had revenues of $5.1 billion, would be willing to spend $150 million on SPC Ardmona but not $200 million.

If SPC Ardmona's prospects are in fact as bright as the company makes out, surely CCA should be willing to invest the entire amount that SPC Ardmona says it needs.

The fact that ­­it is not willing to do so is revealing.

SPC Ardmona and CCA need to explain (in normal people's language) why the federal and Victorian governments should give SPC Ardmona $50 million if CCA itself refuses to do so.

It's understandable that SPC Ardmona and CCA are lobbying the government for a handout.  That's how business in Australia — and how politics — has always been done.

COMFORT IN THE ALP

A revealing article by Stephen Loosley, the former ALP national president and senator, appeared in these pages last week.  It was about the Labor Party and its relationship with business.  Loosley wrote ''elements of business, particularly the emerging generation of leaders, remain comfortable talking to the ALP''.  He's right.  And that's the whole problem.

The next generation of this country's business leaders have grown up in the 1980s and 1990s thinking that if they have a problem the government will fix it.  It's no wonder they're comfortable talking to the ALP.  Anyone running, for instance, a wind farm or an unprofitable manufacturing business would be especially comfortable talking to the ALP.

Four days before the last federal election Kevin Rudd promised SPC Ardmona the $25 million it wanted.  Thankfully, it was a commitment that wasn't matched by the Coalition — and it's a commitment that shouldn't be matched by the Coalition.

For one thing, the federal budget can no longer afford these sort of handouts.  But beyond the issue of cost there's something more important at stake — and that's the principle.  Put simply, government handouts to failing companies are unfair.  And they're unfair for two main reasons.

First, inevitably the handouts go to the largest and noisiest companies such as Ford, Holden, SPC Ardmona and even, potentially, Qantas.  Government handouts don't go to the family-run firm that services machine tools and employs a dozen people.  A worker at Holden (at least until a few months ago) was treated by the government differently from a worker at that machine tool company even though they might both be doing the same job.

Second, the handouts given to companies to support the above-average wages of their employees are paid for by the taxes imposed on everyone, including those who earn much less than those working in the companies receiving the government handout.

(It's ironic that the Left opposes taxes imposed on the less ­well-off to pay for the privileges of the wealthy — except when those taxes pay for ''free'' tertiary education or government bailouts to companies with heavily-unionised workforces.)

Federal cabinet is expected to make a decision on SPC Ardmona by the end of month.  Giving $25 million of taxpayers' money to SPC Ardmona wouldn't just be wrong, it would be unfair.

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Curriculum should be decided by schools and parents, not governments

Labor's national curriculum isn't neutral.  Neither will be any curriculum redrafted by Christopher Pyne.  That's exactly why parents — not politicians — should be able to choose what their children are taught.

So far the debate about the national curriculum revision has been focused on which version of the curriculum will be the most ''balanced'' and ''objective''.

But the debate should not be over which curriculum all students should be forced to learn.  It should be over whether we should have a national curriculum at all.

On Thursday, historian Tony Taylor, on these pages, ridiculed the idea that there was any need to fix the Labor curriculum.  In particular, he mocked the notion that Christianity and Western civilisation deserved greater prominence.

Although Taylor and other defenders of Labor's curriculum like to pretend it is ideologically neutral, the truth is that any curriculum devised by politicians or their appointees will be political.  Labor's curriculum places far too much emphasis on ''sustainability'' and other ideological concepts, and far too little emphasis on how Australia's institutions evolved.

Christopher Pyne is right to recognise that the Labor curriculum does not give sufficient emphasis to the role of Christianity and Western civilisation in Australian history.

But Taylor argues that because Australia is now a multi-faith society, it's now less important to teach students about Christianity in schools.

This misses the point.  The history of Christianity should be taught in schools not because we want to preach Christianity to all Australian students, but because the institutions and the society that we have now are the result of our past.

Over the past 2000 years, Christianity has played a far more profound role in shaping our society than any other major religion.  Even if the proportion of Christians has declined over the past 40 years, we have inherited a society shaped by Christian values.  We cannot understand our nation — and indeed, our world — unless we understand the elements that shaped it.

But the Labor curriculum neglects the role that Christianity and other aspects of Western civilisation — including the Westminster system, democracy and liberalism — have played in shaping our society, for worse and for the better.

Instead, it teaches students to be ashamed of our past by highlighting the wrongdoings of the European settlers.  If there must be a compulsory curriculum, it should present a more balanced view.

Nor does the fact the curriculum was drafted by ''independent'' panels and academics automatically make it immune to ideology.  The fact remains that those panels and academics were appointed by the Labor government and many had left-leaning tendencies.  For example, Stuart Macintyre, who was placed in charge of drafting the history curriculum, may be an eminent historian from the University of Melbourne, but he is also a former Communist Party member and a self-described socialist.

The curricula these appointees drafted were certainly not objective.

But despite all of this, Taylor is right to be concerned about Pyne's assurance that the new curriculum will be ''balanced'' and ''objective''.

A revised Pyne curriculum that gives due attention to Christianity, the British Empire, and the rest of Western civilisation is preferable to the existing Labor version.  But that does not mean all schools should be forced to teach it.

There is no single ''honest'' version of history, just as there is no such thing as an entirely ''neutral'' account of modern-day politics.  There is always more than one historical narrative.  There always has been — ever since the ''father of history'' Herodotus wrote his great work in the fifth century BC.

History is always influenced by politics to varying degrees.  Sometimes it happens without us realising.  As such, any account that claims to be ''honest'' and — worse — ''official'' should instantly set off alarm bells.  The version of history in the Rudd-Gillard curriculum is no exception.  And nor, for that matter, is any version touted by Pyne.

And what happens when governments endorse particular versions of history?  In a democracy — which is what Australia is, thanks to the British Empire — you get the ''history wars''.  In Australia, the beginnings of these ''wars'' in education were rooted back in the Whitlam era, when the Commonwealth indirectly began to influence humanities in schools through the Curriculum Development Centre.

This is exactly why we shouldn't have a single curriculum.  No government should impose its version of history on the rest of the country.  What's more, the national curriculum will likely remain controversial for as long as it remains in place.  Since the two sides of politics are unlikely to ever agree on an ''official'' version, it is probable there will be a sweeping revision of the curriculum every time a new government comes into power — just as is happening now, and has been happening for the past 30 years in Britain.

That's why there should be no national curriculum.  Instead, there should be different private curricula available.  Schools should be able to choose the curriculum they believe best suits their students, and parents should be able to select the school that reflects their own values.  That way there would be no need for Pyne — or any other politician for that matter — to decide what all students should learn.