Last week Anthony Albanese finally announced the government’s major plan for the transition to a renewable energy economy. The Future Made in Australia plan was quickly derided by critics as “picking winners”, in the misguided view that the market is better at deciding how to tackle climate change and that the market is in any way free or lacking distortions.

It’s an article of faith among many economists and commentators that governments should not try to “pick winners”, despite the fact that Australia has a long and glorious tradition of doing so.

How about $141.1m on carbon capture and storage projects? Not enough? Try $1.5bn on the Middle Arm petrochemical hub in Darwin? Pfft. What about the Inland Rail to nowhere costing $31bn over 10 years? Now that’s real money!

This year the government also spent $17.4bn on private schools, because many decades ago someone decided to pick that as a winning way to provide education (and win elections).

So spare me your conniptions about government interventions now that they want to provide tax breaks for renewable energy projects. Climate change is the result of the market failing to price in the cost of climate change. Arguing the market will now solve it is ignorant in the extreme.

And the playing field is not level. The US$1tn US government intervention of the absurdly named (but politically smart) Inflation Reduction Act has upended the renewable........

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