When Mark Twain reminded his readers that there were three kinds of lies — lies, damned lies, and statistics — he was actually describing the joy of arranging his figures, an occupation that "beguiled" Twain.
And why wouldn’t it? Twain was smart enough to know that the arrangement of numbers carried enormous power. In a world that daily sees global financial markets go up and down based on nothing more than "sentiment", though whose sentiment is never quite clear, the power of numbers is a brutal fact of life.
That’s why it’s imperative to know who is arranging the numbers and why. Last week we saw plenty of number arranging going on in both the mining industry and state politics, and I am still scratching my head and asking, why?
At the end of last week we saw the big boys of mining declare with an air of belligerence they wouldn’t be investing $80 billion in new projects because Australia was too expensive in terms of wages, a tight labour market and our tax regime — and consumption in China was slowing.
Does that mean the never-ending mining boom was coming to an end or is it meant to engender a sense of fragility around the boom, a sense that if we don’t treat it kindly it may just go elsewhere?
Certainly BHP Billiton chairman Jac Nasser was keen to put the boot into industrial relations, wages and environmental safeguards, by suggesting these were the culprits making his life so tough. But is the boom really so fragile that it could be imperiled by looking after community and the environment?
Meanwhile in Queensland another set of numbers were being wheeled out for inspection with the announcement that Queensland’s new Premier, Campbell Newman, had axed the multi-cargo facility planned for Abbot Point on the Great Barrier Reef.
A project that had a capacity to take Abbot Point from 50 million tonnes per year to 385 million tonnes had suddenly shrunk. Sure it would still be the biggest coal port in the world, located in the middle of the Great Barrier Reef, but now there would only be four terminals.
So what do these new numbers mean? Is this what the beginning of the end of the boom looks like?
Not necessarily. As the dust settled on the announcement it was clear there were some big winners despite the smaller scale. Clive Palmer, mining magnate and the largest funder of Campbell Newman’s election campaign, certainly came out in front because with the MCF out of the way, his standalone proposal was far more likely to get up.
Which is probably why he greeted the news saying the Premier’s decision would allow the port infrastructure to develop "in a more practical and efficient manner". Not that the decision had anything to do with his political donations, Newman told reporters on Tuesday.
So a smaller port — though still a record breaker when it comes to building the biggest coal port in the world in the World Heritage Reef — but apparently it’s still all systems go right?
Well maybe, but maybe not. The other set of numbers getting re-arranged this week were the number of coal ships that will be cutting through the Reef by 2020 care of the coal boom.
The Queensland Resources Council’s CEO, Michael Roche, disputed Greenpeace’s figure of 10,000 ships by 2020. Unfortunately for Roche, our numbers came from the proposals being written by the companies themselves.
As my colleague John Hepburn told reporters during the week, "the mining industry can’t have it both ways. They can’t push optimistic growth plans in order to exaggerate royalty payments and then talk down the boom when it comes to environmental impacts."
In November last year Roche issued a media statement claiming $8 billion in State royalties by the end of the decade, based on a projected tripling of coal exports from Queensland by 2020.
The figure was based on the QRC commissioned report "2011 Growth Outlook", in which the full growth scenario projected coal production to increase from just over 200 million tonnes per annum in 2011 to almost 700 million tonnes per annum in 2020. This would be more than a tripling by the end of the decade.
"When you look at the mine and port proposals in the planning process, Queensland are indeed expected to triple coal exports by the end of the decade — that is what we have based our shipping estimates on," Hepburn said.
"If the Queensland Resources Council wants to try to halve projected shipping numbers, they need to publicly state which of the proposed coal ports will be cancelled or downscaled, they will need to publicly halve their claims of projected future royalty payments, and they will need to publicly release the justification for their figures."
That’s why it’s so important to challenge the veracity of numbers. In a country dominated by an endless conversation about the economy, numbers are the way we signal what matters. And with so much at stake, we need the numbers to reflect reality, not politics and not commercial self-interest.
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