NSW Treasurer Daniel Mookhey is betting big on renewables to keep his state out of recession – even as the Iran war, rate rises, and a restless electorate make that a very hard sell.
As the Iran war hits petrol prices and slugs the country’s economic growth, if there’s one timely battle that’s seldom ever tested out to see who’s right, it’s the one between the conservative voters who watch the likes of Sky News “After Dark” and those who are left-leaning and, undoubtedly, were a part of the hordes who voted into power the now unpopular PM Albanese. Well, it looks like NSW Labor Treasurer Daniel Mookhey is about to strike a positive blow for renewables supporters, claiming they’ll save his state from recession!
Of course, if over time he’s proved wrong, then conservatives who can’t understand why we don’t use our cheap coal to lower power prices and inflation, as well as boost economic growth, will be able to yell: “We told you so!”
For those who don’t know Mookhey, he’s not a hack Labor guy and seems to take his job as the money man of NSW very seriously. He’s currently fighting his committed trade union leaders and colleagues, over the viability of the state’s Workers Compensation system that’s going broke! Mookhey says without reforms, especially cracking down on excessive and exaggerated mental health claims, premiums will have to rise by 36%, which would be a bank-breaker for small businesses. It would be another inflation generator that this country doesn’t need right now.
This hasn’t made Mookhey popular with leftie Labor types, who can be uneconomic and happy to see employers feel the pain of economic pressures, even if it kills job creation. I’ll never forget as a second-year economics student being told by my lecturer that unions don’t care about the unemployed because they don’t pay union fees!
Enough of ‘life-shaping’ historical memories, what’s Mookhey arguing about renewables and how it will save his state from recession?
Ahead of next year’s election with Labor losing supporters nationally and stateside, and with the new Opposition leader Kellie Sloane looking formidable, the SMH’s Michael McGowan has looked at a speech the NSW Treasurer will give today at the McKell Institute. This is the guts of what the Treasurer will say:
- The NSW economy is now likely to grow at 1% rather than the 2.5% predicted six months ago.
- The Iran war and its petrol price impact has hurt economic growth.
- The RBA’s interest rate rises are having an economic slowdown effect on the state, where the average mortgage size is $873,000, compared to $677,000 in Victoria.
- He claims the state’s renewable energy projects linked to Labor’s commitment to net zero targets, because of the size of the investments, will save NSW from recession.
But whatever Mookhey’s more economically objective stances are on some subjects, on renewables he could be more a politician than an economist.
You see, McGowan points out that the rise of One Nation’s political popularity is worrying Labor. It comes when (as I’d argue) the ‘common sense’ argument that conservative voters and Pauline Hanson’s supporters think looks better than costly and inflationary green policies is still appealing to voters who were once less hostile to renewables.
Creating a greener economy is like those who want to be wealthy. Everyone wants to be rich, but most are never willing to fork out and pay the price of expert help or finding the time to learn how to become money wiser.
Ironically, going green might’ve been a sellable goal for city slickers until the Iran war and high inflation have hit petrol and power prices, and the renewables growth has been harder to cop regionally.
McGowan looked at this subject and reported the following: “The rollout of renewable energy in NSW has become an increasingly toxic issue in parts of regional NSW. Recently, Australian Energy Infrastructure Commissioner Tony Mahar wrote to Planning Minister Paul Scully to warn the “sheer scale” of the rollout was placing “unprecedented pressure” on regional communities.”
This is the short-term downside of the Minns Government’s big plan to make New South Wales a nationally and globally significant data centre hub, but that means energy and water will be required, hence the challenges for some regional areas.
So, Daniel Mookhey is trying to pull off the double play of being a business-oriented, entrepreneurial Treasurer, who might create the basis of growth and jobs long term, while remaining a true believer in the green ideals of Labor.
The question is whether voters cop this short-term pain on the cost of living, made worse by the Iran war and the RBA’s interest rate crusade against inflation. And it’s why this Labor Treasurer will labour the point in his speech today, that renewables are worth the pain now for what’s delivered down the track.
That said, the NSW Treasurer needs Donald Trump to get peace in the Middle East as soon as possible, and the RBA to see the recession threat being big enough to stop hitting borrowers/voters with rate rises.
