As power prices crash, Idiot Taylor lies for gas cartel

In line with Idiot Dutton’s devolvong strategy to become utterly unelectable, Shadow Treasurer Idiot Taylor has chimed in with bald faced lies for the gas cartel. As usual, the lies are courtesy of the treasonous AFR:

Labor’s diabolical energy initiatives ignore Economics 101 with an appalling policy that will end in tears.

…It creates a permanent cap on rates of return – something that even the worst tin-pot autocrats haven’t imposed on their upstream resources sectors for fear of strangling investment and supply.

Except in WA and every other gas producer on earth where various forms of gas reservation works superbly.

More lies:

This model is “adapted” from the infrastructure sector, but that sector has regulated returns on investment, not caps on returns.

Worse, powerlines and railways are fundamentally different from the high-risk entrepreneurial activities of geologists, explorers and resource project developers focused on proving up and developing valuable scarce reserves. These upstream resource investments have a long successful history in Australia but are badly misunderstood by the government and are likely to collapse under this regime.

Cartel talking points. $12Gj locks in super profits. It they won’t invest into those then they can sell the assets to others that will:

More lies:

Distorted price relativities for gas versus other fuels will only exacerbate this by stimulating demand.

Err, there’s a coal price cap too and renewables are still much cheaper than both. There’ll be no surge in demand. Hopefully there’ll be some minor lift from manufacturing.

More lies:

Shortages would lead to gas rationing or sharp price increases in consumer markets exempt from the price caps under this legislation.

The cartel might ration supply but if it does then hit it “use it or lose it laws” or threaten super profits taxes that seize their ungodly war profits. They’ll fold like cheap suits soon enough.

More lies:

Of course, those who fail to learn from history are doomed to repeat it. When we faced sharp increases in inflation in the 1970s, price controls were a disaster.

…Gough Whitlam sought to go down the same path in Australia, failing in a referendum in 1973 and then failing as a government soon after.

Actually, the Whitlam and Fraser governments (under Treasurer John Howard) used export levies to crash the local price of coal and oil during the 1970s inflation shocks, both to drop local prices and take the windfall profits for the Australian Treasury.

The proposed local price caps are hugely more generous than this.

More lies:

The cure for both the short term and the longer term is to boost local supply, working within the laws of economics and not against them.

Economics 101 says that if you have a cartel dominating supply then you will be gouged. A cost+ model of regulation is one of many solutions that achieve the same thing: breaking the market power of the cartel.

Then again, if you are a part of said cartel, as the Idiot Coalition has been for many years, you’re not going the cheer that. Nor crashing power prices:

It appears Scott Morrison was the brightest of them.