(An excellent systems perspective of the crumbling Tasmanian forestry industry originally published in the Tasmanian Times, 18 May 2010, Ed.)
Mike Bolan
The current forestry ‘crisis’ in what was recently described as a ‘sustainable industry’, is revealing on-going dysfunction in our system of government coupled with persistent misunderstandings that are threatening to wedge the Green movement in Tasmania.
Looking around we can see that human foibles can cause us to favour one person over others, even to their detriment, and that favouritism may continue despite repeated examples of bad behaviour. Such is the lot of some families where one child is favoured over all others and, despite repeated transgressions, the parent(s) remain blind to the issue.
Spent all the pocket money? Never mind, here’s more. Failed your exams, never mind here’s a private tutor. You beat up little Johnny? Never mind, I’ll tell him to stay away from you in future.
Rewarding favoured parties for their failures usually produces nothing more than more demands and more failures, as families with a grossly spoiled child may realise. Favouritism can produce monsters.
The Soviet Union comprehensively showed that the analogy holds for wide public subsidies after they developed some of the world’s most polluting industries that produced some of the world’s most useless products.
The lesson is that subsidies effectively disconnect industries from the needs of their customers and focus them instead on arguing for more subsidies. As a result they morph into political persuasion systems to increase their political influence and guarantee more subsidies for the future.
In Tasmania’s forestry subsidies take several forms which include:-
• free or below market costs for scarce resources (e.g. water for plantations, native timbers);
• non-repayable cash payments (e.g. Community Forest Agreement grant);
• legal exemptions that cut costs (e.g. from Clean Air Act and Planning Acts among many others);
• legal favours that reduce risks (e.g. forestry judges grievances made against it by taxpayers);
• political favours that protect the industry from scrutiny (e.g. Pulp Mill Assessment Act); and
• other kinds of support (e.g. information blackouts on dangers such as water pollution).
Tasmania’s forestry industry enjoys ALL of these favours at our expense and has done so for several decades, with the subsidies increasing over time. The result is a ‘sustainable’ industry that is totally reliant upon subsidies for its survival. That’s not an industry, it’s a charity.
The weaknesses induced by disconnecting the industry from market forces include the current crisis which resulted when their markets dried up leaving them with hefty cash shortfalls.
The lack of competence produced is indicated by the fact that the highly paid industry executives either didn’t see the current ‘crisis’ coming, or if they did they just saw it as another opportunity to ask for yet another handout. Such a lack of executive competence deserves no less than outright dismissal in effective companies. (Whatever happened to the ‘hand up, not a hand out’ idea one might wonder?)
The current situation
Tasmanians would be wise to explore optional uses for their scarce resources while they have the chance.
Globally, food is scarce and increasing rapidly in price as is the water needed to produce it. Fibre (e.g. pulp) is in relative global abundance and paper is becoming progressively less necessary as technology supplies other solutions to distributing information.
It seems that the core of forestry’s problem is the idea that growing low value pulp wood trees on otherwise valuable land, and subsidizing that growth (e.g. free water, we pay road and bridge costs) is somehow a good idea. There appears no real evidence to support this save the claims of the industry itself including pulp mill suppliers and similar parties with conflicts of interest.
Lazy Australian governments have just accepted the forest industry’s word for the methods of land and resource use and have completed neither a comprehensive resource audit to assure that we can spare the resources, nor explored competitive uses for the resources (i.e. failed to explore opportunity costs) to establish whether we can get better value.
The lack of useful information has left Tasmania in a position where everything is arguable and the most powerful political groups easily get their way. In the case of forestry that group is a well funded coalition of political parties (partly funded by forestry interests), unions (e.g. CFMEU) and industry (e.g. Gunns and their various suppliers and contractors) that form a power block to advance forestry interests, with little regard to the impacts or costs to the rest of us.
The effects of leaving tax money deployment and land and water decisions to that power block include:-
• the stripping of native forests for low value woodchips (as fibre);
• massive depletion of water catchments (total plantation use exceeds 600 Gl per year in Tasmania alone) to the detriment and cost of food producers;
• poisoning of rural water sources through spraying of chemicals and potential toxins leaching from huge areas of plantation trees;
• growing community division between the advantaged groups and those who must pay the price;
• adverse health and other impacts from burn offs, log truck ‘accidents’ etc
Now, the Premier says “The forest industry is the heart and soul of much of regional Tasmania but it cannot survive on piecemeal fix-ups. It must be given surety to encourage investment and jobs growth. This roundtable is a step in achieving that.”
The majority of people at that ‘round table’ are from the forestry coalition mentioned above, in other words they will control the agenda by the vote. Other parties may be there but they cannot control what happens – in other words the community will be outvoted by the minority interests represented in the forestry coalition.
Some people are now asking “Can we really expect the same people that have spent our money and controlled our laws for the last couple of decades to come up with a plan to make a real change in land and water use and suddenly to deliver real value to the public and to markets? The same people who have showed progressively lower profits every year.
The same people who have trashed our forests and subverted our democratic decision making? The same people who trumpeted the ‘sustainability of the industry’ until late last year? The same people who are asking for more hundreds of millions of dollars to be given to them to do with as they see fit?”
Such highly valid questions cut to the heart of the issue.
How you answer those questions is likely to depend upon your situation.
Whether you stand to benefit from the forestry coalition, or in the community that must pay in a range of ways?
Whether you see the money required for further subsidies to forestry as money that could have been used to support our collapsing health system.
Whether you choose to believe the claims of the very people who have brought us to this current situation.
Dealing with root causes
In organizational work, it is best to have a real understanding of risks, options and limits prior to making a decision, in this case that might mean building a picture of Tasmania’s competence and resilience in the face of future risks, opportunities and threats.
Such an approach would mean:
• An audit of land, water and other resources available
• Scientific forecasts of weather pattern and other likely future changes (e.g. oil prices)
• Educated forecasts of likely global supplies and demand to forecast markets and opportunities
• Strategies to develop the most likely industries and avoid or deal with the worst risks.
Having such information would help build a sustainable approach to water and land use, as well as reveal relevant opportunities for forestry.
But that’s not the method in use by government – instead it’s a constant grab by the powerful for control of resources that could otherwise be used to benefit the public, and it’s that method that appears to underpin the current approach to forestry’s ‘crisis’.
From a wider perspective it makes no sense to continue to:-
• Treat forestry as a favoured industry
• Divert more taxpayer funds into forestry (note that ACL was only offered repayable loans)
• Make decisions without understanding land and water availability
• Ignore future risks and threats to other industries like food production and health
• Exclude communities and taxpayers from active participation
Simply put, leaving the root causes of the current situation in place maintains the massive favours to forestry and continues to impoverish and disadvantage the community at large.
It also risks adding credence and apparent environmental support to the case for a pulp mill, potentially funded by taxpayers.
For many people, that risk is a bridge too far.
More than money needed?
Some writers have already suggested that one background forestry goal is to convert Green voters into Labor voters by making environmental interests indistinguishable from Labor/forestry interests. Such an outcome would shatter Green support and strengthen arguments for a pulp mill.
Here’s how Tim Dobson of the Green Left sees the new coalition of Green and Labor interests…
“TheTasmanian Greens were able to build support due to the popular stand they took on the pulp mill and the corruption surrounding it, as well as being consistent advocates for action on climate change and social justice issues.
Its record-high stemmed from being independent of the major parties and their ties to big business and all sorts of vested interests.
This independence is now severely compromised and, despite assurances that Green cabinet ministers will retain their political platform and will excuse themselves from any cabinet meetings where there are obvious differences such as forestry, there is a still major compromising pressure that will affect the political decisions made by the Greens cabinet ministers.
The Greens are now in a situation where they have a political interest in the survival and popularity of a Labor-led government.
It was compromising pressures such as these that effectively destroyed the Democrats. That party was seen as a “third force”, but by being “pragmatic” it destroyed itself.
The Greens built themselves through their strong, principled stance against anti-social and anti-environment policies. The choice facing the Greens is either to continue along this path or to become an appendage of the major parties.
Choosing the latter option will alienate the Greens’ growing support base, those who believe in the party’s fundamental platform of peace and non-violence, grassroots democracy, social and economic justice and ecological sustainability”.
Who to believe?
Despite the complexity of the current environment, we can all understand that when people ask for our money we need to be extra careful before believing their claims.
There are many severe risks to leaving control of forestry to the recipients of our tax dollars, without including those who must earn and pay those dollars (taxpayers).
At the moment the cry is ‘we need help…give us more of your money’ which boils down to taxpayers paying taxes, while subsidized industries like forestry get the say, the money and all of the favours.
It’s a case of ‘You pay, we say’.
Obviously taxpayers are totally disenfranchised by this approach and it is that situation which so many find objectionable.
Unfortunately the current proposal by Tasmanian Labor retains all of the risks and disadvantages to the community, the only difference being that a few new publicly supported groups may participate (e.g. tax exempt environment groups) possibly to ‘green wash’ whatever decisions are made to support forestry.
Apart from that the community appears to be left out of the picture, although there may be a seat offered if the community attends at its own expense (after having paid for all of the others to attend of course).
As we might expect, there are solutions to this ‘crisis’ and some of them would satisfy the hopes of Green supporters as well as reinvigorate the forest industry, but such approaches are unlikely to emerge when the current powerbroker coalition of forestry industry, unions and political parties control the process, the decision making and our resources and money.
If we retain the current system sustainable change remains highly unlikely until and unless the community is returned as a key decision maker in the deployment of its resources and monies, and is represented proportional to their numbers and contribution.
The government’s conclusion that forestry ‘must be given surety to encourage investment and jobs growth’ is a recipe for ongoing dependence and favouritism.
Instead forestry should learn to deliver the greatest value possible and to work to market demand to create the greatest return to the public for access to their resources.
Remember, this entire debacle is driven by our paid representatives choosing who they represent and how, while demanding that we pay their salaries and benefits and accept the diversion of funds from essential services to support an industry that cannot support itself.
Watch this space…
Mike Bolan
Mike is a complex systems consultant, change facilitator and executive/management coach who welcomes new information and useful contributions that extend our understanding of a situation.
