Three tax alternatives to restore sovereignty to Australia’s states

Gregory Melleuish, University of Wollongong

If it happens it will overturn nearly a century of the Commonwealth accumulating power at the expense of the states, commencing with the Engineers Case in 1920.

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The Uniform Taxation Act in 1942 helped to accelerate the process by giving the Commonwealth exclusive control over income tax.

The long-term consequences have been that while the states continue to deliver crucial services to the public, especially in health and education, they lack the financial capacity to fund those services without Commonwealth assistance. Hence, beginning in the 1950s, the Commonwealth began funding education, firstly universities and later schools, as the states proved incapable of providing sufficient funds for them.

This condition where the central government raises more money than it needs and the states are incapable of doing so is referred to as vertical fiscal imbalance. It means, in practice, that the Commonwealth is able to use its excess funds to dictate policy to the states. The states become subordinate entities to the Commonwealth.

It is interesting to note that Turnbull refers to the states as sovereign entities. They are in their areas of responsibility, but the power conferred on the Commonwealth through vertical fiscal imbalance has seriously eroded that sovereignty. The states have become mendicants who regularly go to Canberra to beg for money.

Equally of note is the use of the word “subsidiarity” in the Commonwealth government’s first federation issues paper from 2014:

“subsidiarity, whereby responsibility lies with the lowest level of government possible, allowing flexible approaches to improving outcomes.”

If subsidiarity is to be a fundamental principle of governing in Australia, then those responsible must also be financially responsible. Otherwise they cannot be sovereign and just become tools of the central government.

In the final analysis it all comes down to finance and financial independence.

The problem is that at present the Commonwealth holds the whip hand in financial matters. To achieve subsidiarity and make states genuinely responsible they will need to find sources of funding outside of going to the Commonwealth.

Unfortunately, the cards are stacked against them as the High Court has ruled that “excise”, which Section 90 of the Constitution says is granted exclusively to the Commonwealth, also covers sales taxes. This is why the Commonwealth became the exclusive owner of the GST, which it distributes to the states.

As the states lost the capacity to levy income tax in 1942, their taxation options are very limited. There is land tax (including council rates), stamp duty and payroll taxes, none of which raises an enormous amount of money. They also run lotteries. This is why income taxes are viewed as the best way of restoring some of the financial independence of the states.

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If the states are to levy income taxes, it only makes sense if, in the longer term, each state can determine the rate of that income tax. The great fear is that this will contravene the principle of horizontal fiscal equalisation, or the idea that each state should have the same level of service as the others. Competition, it is argued, will lead to a “race to the bottom”, with the consequence that lower taxation will lead to a lower quality of service in health and education.

But to truly restore sovereignty and the principle of subsidiarity, some power to tax income must revert to the states.

Alternative options

Turnbull has sought to encourage innovation and “agility”, and perhaps there may be other ways out of this dilemma. Here are some possibilities.

Give states power over sales tax

As the High Court defines sales tax as excise, the wording of Section 90 could be changed so that sales tax is explicitly excluded from the definition of excise. This would require a referendum, but it would give the states much greater flexibility in their taxing regime. It wold mean that states could, in effect, raise their own equivalents of the GST, as happens in some other countries, thereby allowing the Commonwealth to lower the rate of its GST.

Expand land tax

Whenever this topic is raised one response that is invariably raised is that the states should look at ways of expanding their land tax. This could be done by increasing the rate at which land is taxed and/or lowering the threshold at which payment begins.

Restore inheritance taxes

The states once raised funds through inheritance taxes, but these were abolished some 40 years ago. Given the amount of money now locked up in real estate in places like Sydney and Melbourne, there could be significant sums to be raised in this way.

Moreover capital acquired by simply living in a house for a certain number of years can hardly be compared to the money one earns working at an occupation. Beneficiaries of an estate cannot be construed as having deserved their inheritance.

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In all of the cases listed above the imposition of any such state taxes would need to be matched by a decrease in Commonwealth taxes.

The restoration to the states of some power to impose income tax appears on the surface to be the best way of both restoring sovereignty and embedding subsidiarity into the practice of government in Australia. There is much to be said for doing it. But if we are to grasp the opportunities of the present we need to consider other possible options.

What matters is less the means than the end: to restore Australia to a genuine federation.

Gregory Melleuish receives funding from the Australian Research Council. He is a member of the Academic Advisory Board of the Menzies Research Centre

Aboriginal artefacts found at Sydney light rail site

Thousands of Indigenous artefacts have been uncovered during excavation works for Sydney’s light rail project in the eastern suburbs.

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The project managers have stopped work on the site for now, but there are calls for a complete halt, with concerns it could be a mass Aboriginal grave.

The New South Wales government is not confirming whether it will continue construction on a section of Sydney’s new light rail line where thousands of Indigenous artefacts have been found.

About 20,000 artefacts were discovered in excavation pits around the rail line’s proposed tram stable yard in Randwick, in the city’s east.

They include items believed to have been traded from the state’s Lower Hunter Valley which have never been seen before.

Transport for New South Wales recognised the significance of the find between late 2015 and January this year, but has not said if it will stop work on the $2.1 billion project.

Altrac Light Rail chief executive Glen Bentley says the company is communicating with all the stakeholders.

“With the heritage experts and Aboriginal stakeholders, with all that evidence, we’ll be able to put together the story of what happened here.”

Indigenous heritage advocates have called for the site to be classed as an Aboriginal heritage area.

Some of the excavations could contain graves.

A cultural heritage specialist with the consultancy Tocomwall, Scott Franks, says it is a significant find.

“This is a site of significance, nationally. Whatever means, we need to know. It’s holding the Australian government to account, or the Crown. It’s about understanding what happened here, so our old peoples can rest.”

Another cultural heritage specialist with Tocomwall, Danny Franks, says the range of objects is of major historical significance.

“The density of artefacts that were found go into the tens of thousands, and a higher proportion of them were tips, blades. Now this leads us to suggest there was conflict here, which very well was a high probability of meaning there was death associated with this site.”

Citing journals from 1791, Scott Franks says it could have been the site of conflict between traditional landowners and Governor Arthur Phillip’s troops.

“This site represents a clear confrontation of women, children and men who were taken from the land. Ripping this up and not treating it like a proper archaeological dig is criminal.”

While the objects have been recovered and catalogued, there is no guarantee the site will be protected.

Altrac Light Rail’s Glen Bentley says it is too early to tell what will be done with the discovery.

“So there’s no works happening in this area, where we’re continuing with this investigation. So, until we finish that investigation, there will be no further works. The social value of this to the local Aboriginal community is immense, and we’re very committed to continue working with Aboriginal stakeholders to unlock the puzzle.”

 

 

 

 

 

Kyrgios into Miami Masters semi-final

Like him or loathe him, Nick Kyrgios is the new king of Australian tennis after breaking new ground in Miami.

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Kyrgios will crack the world’s top 20 and leapfrog Bernard Tomic to become Aussie No.1 on Monday after upsetting power-serving 12th seed Milos Raonic 6-4 7-6 (7-4) to reach his maiden Masters 1000 semi-final.

Three weeks shy of his 21st birthday, the volatile talent is the youngest man ever to make the last four in Miami and first Australian to do so since Lleyton Hewitt in 2002.

He next faces Japanese sixth seed Kei Nishikori for a likely shot at world No.1 Novak Djokovic in Monday’s (AEST) title match.

Raonic has been one of the hottest players on tour in 2016, downing Roger Federer to win the season-opening crown in Brisbane and racking up 17 wins from 20 matches.

His only previous losses this year came against Andy Murray in a five-set Australian Open semi-final thriller and to Djokovic in the Indian Wells Masters final.

But the Canadian was on the back foot from the outset after Kyrgios made a flying start by breaking Raonic in the opening game of the match.

“To be honest, I didn’t think I was going to break during the match,” Kyrgios said.

“I came out really energetic and got pretty lucky. That definitely made me more relaxed.

“I really learned how to return this year. That’s the major thing this year. I am giving myself so many more chances and getting so many more opportunities to take over matches.”

On Monday, Kyrgios is guaranteed to rise to at least 20th in the world and eclipse Tomic to become only the third player to hold Australia’s top ranking in the past seven years.

Tomic ended Samantha Stosur’s unbroken six-and-a-half-year stint as the country’s highest-ranked player – man or woman – last September, but is projected to fall out of the top 20 next week after skipping Miami with a wrist injury.

Nishikori overcame five match points to deny Frenchman Gael Monfils 4-6 6-3 7-6 (7-3) in their quarter-final.

The 16th-seeded Monfils was soaked with sweat on a sweltering afternoon but rallied from a 4-1 deficit in the final set.

Nishikori fell behind 0-40 serving at 4-5 but erased those match points and another in that game, and overcame one more match point serving in the 12th game.

He played a solid tiebreaker and closed out the victory with a forehand winner.

Djokovic faces Belgian 15th seed David Goffin in the first semi-final on Friday (Saturday AEDT) before Kyrgios takes on Nishikori.

Trump confirms US withdrawal from ‘unfair’ Paris climate accord

With his announcement, President Donald Trump fulfilled an election promise to pull the United States – the world’s second-largest polluter – out of the Paris climate agreement.

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Under his predecessor, Barack Obama, the US was instrumental in securing consensus from almost 200 countries to work towards limiting global warning to two degrees Celsius by 2030, compared to pre-industrial levels.

But Mr Trump says the deal threatens millions of US manufacturing jobs – as well as coal, iron and steel production – and would cost its economy over AU$4 trillion, while creating onerous energy restrictions.

Mr Trump says it’s his duty to protect US citizens.

“The United States will cease all implementation of the non-binding Paris accord and the draconian financial and economic burdens the agreement imposes on our country. This includes ending the implementation of the nationally-determined contribution and, very importantly, the (UN) Green Climate Fund, which is costing the United States a vast fortune.”

Donald Trump says the Paris accord is less about the climate, and more about other countries gaining a financial advantage over the US.

He’s vowed to pursue more favourable terms within the existing framework, or a completely new deal.

Mr Trump says he cannot support conditions that punish the US without, as he puts it, imposing meaningful conditions on other major polluters.

“For example, under the agreement China will be able to increase these emissions by a staggering number of years – 13, they can do whatever they want for 13 years, not us. India makes its participation contingent on receiving billions and billions and billions of dollars in foreign aid from developed countries. There are many other examples, but the bottom line is that the Paris accord is very unfair at the highest level to the United States.”

China and the European Union have firmly pledged to uphold the climate agreement.

In a joint statement Italy, France and Germany expressed regret over the US decision, adding that the accord is not open to negotiation.

French President Emmanuel Macron says the US has turned its back on the world, but France would not turn its back on the US.

“I wish to tell the United States, France believes in you, the world believes in you. I know that you are a great nation. I know your history – our common history. To all scientists, engineers, entrepreneurs, responsible citizens who were disappointed by the decision of the president of the United States, I want to say that they will find in France a second homeland. I call on them, ‘Come and work here with us.'”

The United Nations Secretary General, Antonio Guterres, issued a statement read by his spokesman, Stephane Dujarric.

“The decision by the United States to withdraw from the Paris agreement on climate change is a major disappointment for global efforts to reduce greenhouse gas emissions and promote international security. The Paris agreement was adopted by all the world’s nations in 2015 because they recognise the immense harm that climate change is already causing, and the enormous opportunity that climate action represents.”

Tom Burke heads the London-based climate research agency E3G.

He’s told Al Jazeera the US move will have an effect.

“What Paris did was put us on the right road to dealing with climate change, but as was recognised at the time it wasn’t going to take us far enough, fast enough – and so it built in a mechanism for increasing its ambition every five years or so. And I think Trump pulling out will slow down that acceleration that we need. But it won’t stop it. And as all of the commentators have been saying, the fact that he’s pulled out won’t change what’s going on in the real economy where the world is already starting to make the transition to a low-carbon economy. And Paris, of course, was one of the big initiators of that, so now you’re seeing most of the investment in energy around the world is going into renewables, into electric vehicles, into developing that low-carbon economy.”

Mr Burke believes it’s not in the economic or geo-political interest of the US to turn away from the landmark deal.

“There’s going to be quite a price to be paid for repudiating an agreement that everybody else in the world – apart from Syria and Nicaragua – has signed up to. He has just blown in the face of America’s most traditional allies and said, ‘I don’t care what you think is important, I’m going to go my own way’. Now, if there was some reason for it that you could make sense, people might be prepared to accomodate it. But just doing it in this arbitrary and inexplicable way leave everybody baffled as to what on Earth is he trying to accomplish, and where else will he be as unpredictable?”

Prior to the announcement, President Trump had been urged to support the Paris agreement by major companies – including oil producers ExxonMobile and Chevron, and technology firms Microsoft and Google – who have already invested heavily in emissions-lowering measures.

 

 

Trump gets mixed response from companies

US President Donald Trump said withdrawing the country from the Paris climate accord would stave off an economic crisis and protect American jobs – but many American companies seemed to disagree.

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Criticism of his decision rolled in from blue-chip companies like Facebook, Apple, Ford and Microsoft, while the response from fossil fuel groups with the most to gain from a relaxation of US carbon emissions standards was muted.

Tesla Chief Executive Officer Elon Musk and Walt Disney CEO Robert Iger said they would leave White House advisory councils over Trump’s decision.

President of the World Coal Association, Benjamin Sporton, said he had mixed feelings about Trump’s announcement, adding he was eager to see a US policy that actively promotes a place for coal in the global energy mix.

“What we really need to see, if the president wants to re-enter the deal, is that he can change the agreement to recognise the role of all sources of energy, including coal,” Sporton said.

The American Petroleum Institute, the oil and gas industry’s biggest trade group, meanwhile, issued a statement saying it had never taken an official position on the Paris accord.

A number of its members, including Exxon Mobil and ConocoPhillips, had publicly supported the deal.

Some other groups expressed measured support for Trump’s decision, saying it provided an opportunity to fix problems with the deal.

“Manufacturers support the spirit of the Paris Agreement and the effort to address climate change through a fair international agreement. But as the president has acknowledged, certain elements of this deal were not equitable for US manufacturers,” said Ross Eisenberg, vice president for energy and resources policy at the National Association of Manufacturers.

Trump vowed during his campaign to pull the US out of the Paris deal, arguing the pact would cost the country trillions of dollars, kill jobs, and stymie economic growth without providing tangible benefit.

His critics have argued, however, that the risks of climate change require action, and that a shift to a low-carbon energy economy can create more jobs than it eliminates.

Brexit dominates now close-running British election

With less than a week to go, polls ahead of the United Kingdom’s election are showing a less clear-cut response than first thought.

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While earlier forecasts had predicted Prime Minister Theresa May would have an easy victory, some analysts are speculating she may now fall short of a parliamentary majority.

The gap between her Conservative Party and rival Labour continues to narrow.

A year on from the UK’s so-called ‘Brexit’ decision to leave the European Union, the issue of how to handle the delicate process has cast a shadow over campaigning.

Ms May argues she is not only the best choice for Brexit negotiations, but for the country’s future in general.

“They have a choice to decide who they want to lead this country into those Brexit negotiations, get the best deal for Britain from those Brexit negotiations, but also lead us to building that stronger, more prosperous future for our country. It’s a very clear choice. I think it’s me and my team that have that strong and stable leadership, to be able to take this country into those Brexit negotiations, get the best deal, but build that stronger, more secure, fairer, more prosperous future as well.”

Her hardline stance on Brexit, her insistence that “no deal is better than a bad deal”, could complicate trying to form a coalition should her party not achieve an outright majority.

Her policy of budget improvement through continued austerity, and reforms on issues such as funding for social care and education, have also proved unpopular.

Speaking at a recent debate attended by five political parties, deputy leader of the Scottish National Party, Angus Robertson, called on the Conservatives to change so-called “unfair” policies.

“Some of those people on the lowest incomes have been massively hit by welfare cuts, and I think the time has come to end punishing disabled people, end a bedroom tax, and leaving people with the lowest incomes with too little to pay for the essentials. That can change, it’s about political changes.”

Labour leader Jeremy Corbyn, who voiced strong opposition to exiting the bloc, says he’s now working to get the best possible deal out of the situation.

“It’s rather better than the current government’s process of megaphone diplomacy and threatening. And so we are ready to get on with those negotiations straight away. And we want to get on with it quickly because we want a number of these issues to be settled as quickly as possible, particularly that of EU nationals and tariff-free access to the European market to protect jobs in this country.”

The ‘Leave’ vote succeeded 52 per cent to 48 in June of 2016, angering Scotland and Northern Ireland where a majority voted to remain.

Mr Corbyn’s push to align Labour more closely with its socialist roots and leftist ideals has alienated some party members.

Voters in the Labour stronghold of Hartlepool in northeast England agree Brexit will play a major role in voting choices.

Heather Chapman says she worries “that he doesn’t have the backing of his own party, but the people seem to back him, which I like. I like his old style Labour values as opposed to Labour pretending to be Tories.”

Paul Atkinson, meanwhile, says “I think Theresa May, even though I’m not a Tory voter, I think she’s very very strong at the minute. And even though I’ve been Labour all my life and my family have, I think I will be voting for her because I think she’s going to be the strongest thing for the country right now.”

Peter Robinson points out “There was a massive vote for Brexit in the town, almost 70 per cent, so how many of those people will feel a little bit betrayed by Labour and their inability to push for Brexit, I don’t know. But I suspect there will be quite a few people who would vote Labour, won’t because of Brexit.”

The vote will take place on June 8.

 

 

Superannuation body slams Trump on climate

The organisation representing some of Australia’s biggest superannuation funds has slammed US president Donald Trump’s decision to withdraw from the Paris climate accord.

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The Australian Council of Superannuation Investors, which counts Australian Super among its 31 member funds, was one of the nearly 300 global investors who in May wrote to governments, including the US, urging them to stand by the Paris agreement to limit global warming.

President Trump said the world’s largest economy was quitting the agreement because it cost money and jobs, but the ACSI – whose members manage more than $450 billion in assets for more than eight million Australians – echoed global political and business leaders in condemning the move.

“It is disheartening to see a decision like this, by a wealthy industrialised nation, which flies in the face of scientific knowledge and investor concerns,” ACSI chief executive Louise Davidson said.

“The decision by the Trump administration to withdraw from the Paris Agreement is out of step with community expectations that governments will act in the face of these very real dangers.”

Ms Davidson welcomed the Australian government’s adherence to the Paris agreement and said it remained key to reducing investment risk due to climate change.

“We will continue to work with governments, companies and regulators to manage the risks of climate change for the benefit of our members and investors globally,” she said

“In spite of the disappointing news from the US, we are confident that the high level of global support for action to address climate change means that efforts to manage these risks will continue.”

Archer jailed 22 years for Jody’s murder

A South Australian man who killed his partner and buried her body under a concrete slab has been jailed for at least 22 years.

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Neil Archer, 31, murdered 20-year-old Jody Meyers in August 2015 during a heated argument at their home east of Adelaide.

In the Supreme Court on Friday, Justice Trish Kelly imposed the mandatory head sentence of life in jail but set a non-parole period of 22 years.

The judge described Archer as a controlling individual who believed he owned his partner’s life.

She said Archer believed relatives of Ms Meyers were trying to break up their relationship.

When he revealed his concerns to his brother-in-law, he was told he had two options, put up with it or leave.

Archer’s response was to say “I will just kill her”, Justice Kelly said.

“That statement speaks volumes about your mindset towards Jody.

“It betrays the attitude of a man who thinks he owns his partner’s life.

“It is all too commonly seen in controlling and abusive men, like you, who end up killing their partner.”

Justice Kelly said Archer told a series of “extravagant” lies to police and the media to try to explain Ms Meyers’ disappearance.

After he killed her he buried her body under the floor of a toolshed in the backyard of his parents’ home.

He returned the next day and covered the grave with fresh concrete.

Justice Kelly said police investigating the disappearance of Ms Meyers were struck by Archer’s lack of concern and distress and described his conviction as “well nigh inevitable” based on the evidence.

He subsequently pleaded guilty to murder, with a member of Ms Meyers’ family telling him to “rot you piece of s***” as he was led away from the dock on Friday.

Outside the court, Ms Meyers’ brother-in-law Michael Bates said the family was basically happy with the outcome.

“It would be nice for him to be in there for life and never see the light of day again,” Mr Bates said.

“But with the way the system is, that’s a good outcome for us.”

National domestic violence helpline: 1800 737 732 or 1800RESPECT. In an emergency call triple-zero.

Myles lucky in Origin tackle: Barrett

Nate Myles was lucky to escape with an elbow injury after being on the receiving end of an ugly tackle in Queensland’s State of Origin I loss, says Manly coach Trent Barrett.

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Myles has all but been ruled out of Sunday’s NRL match against Canberra after scans on Thursday confirmed the Maroons veteran had torn a ligament in his elbow.

Barrett initially feared Myles had his shoulder ripped out by Blues skipper Boyd Cordner, but could now be back as soon as next week’s clash against Newcastle.

It also means the under-pressure forward would be available for the Maroons in game two.

“I think he’ll be right. If it was a semi-final type game on Sunday, he’d put his hand up to play. He’s not happy about it,” Barrett said on Friday.

“But I’ve got to think about the club and we’ve got a five-day turnaround after this. I’m banking on him being available for that.”

Barrett also said he had no issue with the tackle, which Myles bravely played through and went unpunished by the match review committee.

“(Cordner) didn’t mean it. It was more his body. It wasn’t a chicken wing, I didn’t think. Just put in an awkward position and lucky to get out of it with what he’s got,” he said.

“I thought it was more his shoulder. He’s come out of it okay, it could’ve been a lot worse.”

While the 31-year-old received good news on the injury front, he is facing increasing pressure to keep his Maroons spot following their insipid loss at Suncorp Stadium.

A number of ex-Queensland stars have already called for his axing, however Barrett insisted Myles was in good form for the Sea Eagles heading into the series.

“I haven’t read anything about any backlash to be honest. I thought NSW were dominant across the park and it was good to see,” Barrett said.

“Defensively he’s very good around the middle of the ruck. He tightens it up, does a lot of stuff here off the field, particularly with our younger guys. He’s certainly helping their development.”

Barrett also addressed rumours Myles could be granted an early release from the final year of his contract to join Melbourne in 2018.

“Nate’s contracted here until the end of next year,” he said.

Anger as Trump announces US withdrawal from Paris climate deal

In a sharply nationalistic address from the White House Rose Garden, Trump announced the United States would immediately stop implementing the “bad” 195-nation accord.

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“I cannot, in good conscience, support a deal that punishes the United States,” he said, decrying the “draconian financial and economic burdens the agreement imposes on our country”.

Trump repeatedly painted the pact – struck by his predecessor Barack Obama – as a deal that did not “put America first” and was too easy on economic rivals China, India and Europe. 

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“I was elected to represent the citizens of Pittsburgh, not Paris,” he said. “We don’t want other leaders and other countries laughing at us anymore. And they won’t be.”

Trump offered no details about how, or when, a formal withdrawal would happen, and at one point suggested a renegotiation could take place. 

“We’re getting out but we’ll start to negotiate and we will see if we can make a deal that’s fair. And if we can, that’s great. And if we can’t, that’s fine,” he said.

That idea was unceremoniously slapped down by furious allies in Europe, who joined figures from around the United States and the world in condemning the move.

“The agreement cannot be renegotiated,” France, Germany and Italy said in a joint statement.

‘Reject the future’

The United States is the world’s second largest emitter of greenhouse gases after China, so Trump’s decision could seriously hamper efforts to cut emissions and limit global temperature increases. 

Amid Trump’s domestic critics was Obama, who said the United States was “joining a handful of nations that reject the future.” 

Nicaragua and Syria are the only countries not party to the Paris accord, the former seeing it as not ambitious enough and the latter being racked by a brutal civil war.

Hillary Clinton, Trump’s opponent in last year’s White House race, called the decision to pull out an “historic mistake”.

“The world is moving forward together on climate change. Paris withdrawal leaves American workers & families behind,” she said in a tweet.

Watch: ‘US climate deal withdrawal is a mistake’: Macron

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Obama insisted that US business, state governors and mayors of major cities would step up.

The Democratic governors of New York, California and Washington states indeed formed a quick alliance, vowing to respect the standards agreed on under the Paris deal.

With much of the implementation of the accord taking place at the local level, the Paris accord’s supporters hope the deal will be in hibernation rather than killed off entirely.

Trump’s decision is likely to play well with the Republican base, with the more immediate damage on the diplomatic front.

The US president called his counterparts in Britain, Canada, France and Germany to explain his decision.

But traditional US allies were uncharacteristically blunt in their condemnation of the move, which comes amid already strained relationships with the hard-charging president.

Germany said the US was “harming” the entire planet, and European Commission President Jean-Claude Juncker called the decision “seriously wrong.”

Related readingReality TV-style

Ever the showman, the 70-year-old Trump had given his decision a reality TV-style tease, refusing to indicate his preference either way until his announcement.

Opponents of withdrawal – said to include Trump’s  daughter Ivanka – had warned that America’s leadership role on the world stage was at stake, along with the environment.

A dozen large companies including oil major BP, agrochemical giant DuPont, Google, Intel and Microsoft, had urged Trump to remain in the deal.

Ultimately, the lobbying by Trump’s environmental protection chief Scott Pruitt and chief strategist Steve Bannon urging the president to leave won out.

In the wake of the announcement, Tesla and SpaceX boss Elon Musk and Disney chief Robert Iger announced they would no longer take part in presidential business councils. 

“Climate change is real. Leaving Paris is not good for America or the world,” Musk said.

GE head Jeff Immelt said he was “disappointed” with the decision: “Climate change is real. Industry must now lead and not depend on government.”

Related readingChina pledge

White House officials acknowledged that under the deal, formal withdrawal may not take place until after the 2020 election.

Hours ahead of Trump’s announcement, China’s Premier Li Keqiang pledged to stay the course on implementing the climate accord in a joint press conference with German Chancellor Angela Merkel, and urged other countries to do likewise.

China has been investing billions in clean energy infrastructure, as it battles to clear up the choking pollution enveloping its cities.

China and the US are responsible for some 40 per cent of the world’s emissions and experts had warned it was vital for both to remain in the Paris agreement if it is to succeed.

The leader of Asia’s other behemoth, Indian Prime Minister Narendra Modi – who is due to visit the White House shortly – has said failing to act on climate change would be “morally criminal”.

Mixed signals

Trump’s announcement comes less than 18 months after the climate pact was adopted in the French capital, the fruit of a hard-fought agreement between Beijing and Washington under Obama’s leadership.

The Paris Agreement commits signatories to efforts to reduce greenhouse gas emissions that cause global warming, which is blamed for melting ice caps and glaciers, rising sea levels and more violent weather events.

They vowed steps to keep the worldwide rise in temperatures “well below” two degrees Celsius from pre-industrial times and to “pursue efforts” to hold the increase under 1.5 degrees Celsius.

Watch: Trump’s full speech

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$8b offshore wind farm plan for Vic

Australia’s first offshore wind farm off the eastern coast of Victoria could provide almost a fifth of the state’s energy.

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The proposed plant would see 250 turbines built off the Gippsland coastline and produce enough energy to power 1.2 million homes.

Offshore Energy says the project could bring $8 billion worth of investment into Victoria and create 12,000 jobs during the construction phase, with local campaigners hoping recently retrenched coal workers can be retrained.

Managing director Andy Evans says the wind farm could reduce carbon emissions by 10.5 million tonnes a year.

“When placed in the right wind conditions, like those off the coast of Gippsland, offshore wind delivers a high, consistent flow of electricity,” Mr Evans said in a statement on Friday.

The feasibility phase is expected to take three years, the company says.

Energy Minister Lily D’Ambrosio says a preliminary analysis of the proposed site is promising.

“This is a massive project. It’s an exciting project; it is unprecedented and one that our government supports and we’ll continue to work alongside Offshore Energy to work through all of the planning requirements,” Ms D’Ambrosio told reporters on Friday.

Gippsland has been hit hard by job cuts with the closure of the Hazelwood coal-fired power station, and Environmental Justice Australia lawyer, Bronya Lipski, says coal workers could move to the renewable energy sector.

“In Wyoming, in the USA, a wind farm manufacturer recently jumped at the opportunity to retrain former coal workers to take advantage of their electrical and mechanical expertise,” Ms Lipski said.

“There is no reason why this can’t happen for Latrobe Valley workers.”

The government hopes the project will be generating power in time to contribute to its renewable energy target of 40 per cent by 2025.

Victorian Greens leader Greg Barber says the plan has the potential to “displace highly polluting brown coal generators from Victoria’s electricity grid”.

But Mark Wakeham from Environment Victoria cautioned it will have to prove it doesn’t impact marine life.

Right-wing extremism on rise

Right-wing extremism is on the rise in Australia with the potential for violence to be used, according to experts.

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Professor Geoff Dean from Griffith University is the co-author of a recent study published in the Journal of Policing, Intelligence and Counter Terrorism.

Prof Dean says there is evidence of a significant shift in Australia’s right-wing movement towards a more extreme far-right ideology and, in some instances, violence.

The study identified six core themes to the “new” right-wing groups; anti-immigrant, anti-establishment, protection of western values, commitment to democratic reforms, traditional values and a “strong state”.

It examined the online comments of four “new” groups (Reclaim Australia, United Patriots Front, Australian Liberty Alliance and Nationalist Alternative) as well as four “old” groups (Blood and Honour, Southern Cross Hammerskins, Women for Aryan Unity and Australian Sovereign Citizens).

Prof Dean told AAP there had clearly been a rise in right-wing extremism not only in Australia but globally.

“It’s spread through America and France, and Australia is not immune to that,” he said.

“And Pauline Hanson is riding on the back of that.”

Prof Dean said right-wing extremism represented three types of threat to western society; political, security and community.

“The political threat is about gaining political support and a broad base. Their populist politics resonate well, especially when globalisation has taken peoples’ jobs away.

“Remember it was the rust belt of America that put Trump in.”

He said the security threat was about inciting violence and it was the “old groups” or disaffected members of the radical right who were more likely to be involved.

“The security threat is minimal, but it’s there,” Prof Dean said, pointing to last year’s arrest of a Melbourne right-wing extremist for plotting a bomb attack.

The community threat is illustrated by Senator Hanson’s campaign for a ban on Muslim migrants.

“If they can create a backlash against all Muslims … all (right-wing political groups) have something to gain,” Prof Dean said.

“They want to create a community out of fear.”

He said right-wing groups were not a homogenous movement, but there were some basic steps governments could take to reduce their support base.

“Long-term solutions have to be at the political level – where people feel the government is helping them rather than just delivering political spin,” Prof Dean said.

Tackling the rising cost of living and unemployment, taking on the banks, providing a more nuanced picture of Muslims, and explaining globalisation were some of the steps which could be taken.

The brothers who bombed Nazi Germany

In war-gripped London – then occupied by eight million people – Murray Maxton stumbled upon his brother in a small cafe in The Strand.

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After overcoming a bout of the measles, the RAAF pilot was picking up the mail at Australia House in 1943 when he thought he would grab a coffee.

“You wouldn’t believe this but there was my brother sitting there,” he said.

“I didn’t even know he was in London.”

Murray and Eric, a wireless operator, realised they were both being sent to an airfield in Lincolnshire the next morning.

“We went and had too many beers – forgot about the coffee.”

That serendipitous meeting would begin a rare military association – they flew in the same Bomber Command crew over Germany.

“Wherever I went in the air there he was with me,” Murray said.

Their mother was kept in the dark until they had completed their 30 operations.

Both didn’t want to join the army because their father, who was gassed in the First World War, warned them against it.

Murray couldn’t join the navy as he didn’t have the education after leaving school at 14.

Now well into his 90s he recalls being none too happy about bombing German cities towards the end of the war.

“But when I heard what (Hitler) was doing to the German jews, gassing them then I thought everyday we could shorten the war, we’d just bomb the hell out of them.”

Murray was on the “hotline to heaven” one night – their 27th mission – when a German night fighter damaged their aircraft. While Eric fired shots at the enemy, Murray corkscrewed the plane into a cloud and to safety.

Visiting the Australian War Memorial in Canberra on Friday, Murray stepped into the cockpit of ‘G for George’ – the Lancaster bomber he flew once to the south of England.

He remembered the main spar being much lower – but then again he was only 20 back then – but the throttles and controls were all the same.

His visit to the memorial coincides with the 75th anniversary of RAAF squadrons joining combat operations with Bomber Command.

“These men were the brightest and the best,” memorial director Brendan Nelson told reporters.

“They volunteered knowing only 40 per cent would survive the 30 operations.”

After the war Murray moved to a farm outside Albany and agreed to a mate’s request to give a young German a job.

They worked alongside each other for years before he discovered he was one of Hitler’s bodyguards.

“He’d never take his shirt off because the SS were branded under the arm,” he remembered, even on a day that reached 100 degrees.

“We never mentioned the war.”

Murray said he married a good cook and the pair made apple pies every day for 30 years – nowadays they’re self-funded retirees.

“I’m proud to say I haven’t cost Australia one cent. I’ve paid my taxes, earnt enough money to retire on and we’re just going to live happily every after.”