Desertification Australia and the perfect storm
Its time to implement an Australian Sovereign Wealth Fund
Across Australia we are seeing the effects of more and more extreme drought. The landscape is drying up rapidly, rivers are running well below expectations and aquifers are shrinking at record rates. Trees are dying, pastures are disappearing and the soil is more exposed than ever to potential wind and water erosion. Is it good enough to simply think it will all go away at the end of the next rain? Is this not desert intensification and why hasn’t anyone put forward a plan of recovery. Like a rabbit stunned by the headlights of a coming car, Australia is motionless and seems unable to act as it awaits a perfect storm.
Signs of the perfect storm
The term desertification is a form of land degradation and refers to the expansion of arid areas across a landscape. This is typically areas where vegetation, wildlife, biodiversity and water bodies begin to disappear leaving large tracks of land that have bare soil. This leads to depletion of soil organic matter and nutrients essential for revegetation following rains. It is caused by deforestation, overgrazing and poor agricultural practices (all human induced activities). As shown on the USDA’s Global Desertification Vulnerability Map, Australia has vast areas that have a high to very high vulnerability to desertification (USDA Ref 1)
Why is desertification increasing in Australia and why isn’t it being discussed
Like many places around the globe, Australia has failed to recognise that many of its current agricultural practices are destroying soil health and leading us to an ecological abyss. One of the most common causes is overgrazing which severely reduces root mass and finally leads to plant death. Through a process known as exudation, roots secrete the glue that holds soil together, retains water, helps recycle nutrients and are an important photosynthetic mechanism to sequester atmospheric carbon dioxide and put it in the soil for a long time. In other words, plant photosynthesis with good root systems is one important solution to anthropogenic carbon emissions. On the other hand overgrazing leads to poor root dynamics, compaction of the soil, reduced diversity, exposure to erosion and declining food quality. It comes about from a mixture of farmers lack of understanding of good grazing and land management practice (providing suitable rest times for pasture regeneration) and the financial pressure of banks pushing farmers and graziers to increase rather than decrease stock numbers.
The other cause of desertification is an oversimplification of cropping agriculture and the development of monoculture landscapes (that is the antipathy of nature). In our quest to follow the holy grail of economic efficiency, large tracts of timber have been cleared, fences have been removed and integrated farming practices (mixture of diverse crops, pastures and livestock) have been replaced by single crops that spread from horizon to horizon. Historically important crop rotations and diverse pastures have been replaced by single species annual crops often rotated with long term bare fallows (leaving the soil bare for up to 18 months). Nature abhors bare ground because it shuts down the liquid carbon exudate pathways provided by photosynthesis. These pathways recycle nutrients and stimulate healthy biodiverse microbes to convert these liquid carbons into stable soil humus. It is the soil humus that hydrates the landscape and provides and ecological living bridge between wet and dry periods. Fallows sterilise the soil and rocket the soil towards desertification.
The irony of “modern technological farming” is that breeding of these high yielding high input grain crops since the mid 1900’s has also led to smaller root systems unable to withstand dryer climatic conditions. The older taller varieties that shaded out weeds and had large root systems have been replaced with dwarf varieties that need herbicides in order to compete. We have created a farming monster that it reducing biodiversity, reducing soil health and drying the catchment.
The end result is we have completely changed the hydrology of the landscape within the last 70 years. We have replaced multi species perennial grasses, legumes, herbaceous plants and trees with annual crops, bare soil and environmental wastelands full of salinity and soil erosion. According to the early explorers records (George Robinson and Sir Paul Strzelecki Ref 2, 3), Australia was once was a fertile series of plains with raised connecting ponds that formed rivers in times of extended rainfall. The soils at this time were historically rich in organic matter holding valuable nutrients and water. Overgrazing and monocultures of grain crops have destroyed a once fertile oasis. No one wants to discuss how we tackle this problem because current research is based on short term productivity, partly and fully funded by large fertiliser, chemical and seed companies. These companies are represented by their peak body Crop Life Australia who actively lobby the Federal Government to make sure things stay the same.
In essence, modern farming has led to declining soil organic matter levels and less resilience to extremes in climate. This results in reduced returns on investment and more debt with many farmers now being serfs to the banks and financial system.
Throwing good money after bad
Both Federal and State Governments have made countless media releases in 2018 announcing over $1 billion in aid for the farming sector. The real question is where will this money end up and will it make the farming community more resilient to drought and climatic extremes. It is my firm belief that most of this money will end up addressing outstanding debt and hence flow back into the banking sector. Would it not be better to help farmers identify the farming systems and methodologies that make farming more drought proof, more resilient to extremes in climate?
A reconnaissance of exemplary drought farmers and an agricultural policy
One of the first things the Federal Government could do is send out a team of agricultural specialists to investigate what farmers and farming systems have survived through this devastating drought. Rather than focussing on the squeaky wheel, this team should look at examples of best management practice for combating extremes in climate. These will included farmers who have adopted cell grazing, holistic management, natural sequence farming, key line farming, contour farming, ley farming, organic and biological farming. This report to the Federal Government should be public information and should form the beginning to a climate resilience policy. It may come as a surprises to many but Australia still hasn’t developed a National Agricultural Policy. This climate resilience policy should be part of the National Agricultural Policy with bipartisan support. It needs this because many agricultural policies require long term planning, something that politicians have not been historically good at. Also this National Agricultural Policy must override both State and Local government policy as it is in the national interest that we get this right. It runs through catchments, not electoral boundaries.
Deforestation, the biotic pump and waiting for less rain
Despite the fact that 75% is desert, Australia has lost 40% of its forest with the remaining being highly fragmented (Bradshaw 2012 Ref 4). These remaining fragments are made up of aging and scattered trees on private land, Crown Land, State Forests and National Parks. On private land overgrazing and poor management (like burning) has led to compacted soils under trees, young trees being killed or eaten and increasing susceptibility to insects and disease. Recent large scale deforestation has continued on larger private farming properties in QLD and in coastal regions nationwide as large private holdings make way to subdivision and housing development. This timber (once koala habitat) is then sold to unsuspecting home owners as hardwood firewood, in effect “Koala Wood”. On Crown Land and National Parks forest biodiversity is also under severe threat from weed infestations. State Forests have been reduced to minimal species and according to Huang et al 2018 (Ref 5), biodiverse forests fix twice as much carbon as single species forests. This means biodiverse forests will hold and transpire more moisture, rehydrating the landscape.
The result of this wide scale deforestation across one of the driest continents on earth is there has been a significant reduction in rainfall. In WA the removal of large tracts of forests during 1960-1980 led to rainfall reductions of 16% Ref 6). With many of the remaining forests now under extreme stress this figure is likely to be much higher. In 2010 Myrtle rust (Austropuccinia psidii) was introduced from overseas effecting 350/1646 (21%) of the Myrtaceae (Eucalyptus) family (Ref 7, 8). Together with desertification, deforestation and subdivision (till oblivion) Myrtle Rust is contributing to this perfect storm of disasters.
Biodiverse intact forests play a huge role in recycling water across a landscape. The theory of a biotic pump outlines the importance of forests in determining rainfall across a region, dehydrating the rivers and aquifers. It helps explain why regions close to these forests always attract rain especially where the forest connects itself to the sea. You see this in Tasmania (where hillsides have not been cleared) green valleys and mists remain. The same can be seen in Northern NSW, SE QLD where the Border Ranges National park connects itself to the sea bringing large amounts of rain to the region. The same theory explains why large amounts of rainfall makes its way to central African rainforests and the Amazon. When you remove these diverse forests the biotic pump is cut and the landscape dries leading to less river flow and falling aquifer levels. This is what is happening to Australia and very few see the relationship between biodiverse untouched forest cover and rehydration.
Australians are now transfixed with the hope that the next rain event will herald the end to all our woes. Annual rainfalls are now at near record low levels and when it does rain these bursts are often violent resulting in erosion, hail and damaging floods. This will only get worse as predicted by climate change modelling. We seem to be oblivious to what has caused the problem and how to address the problem. We appear to be are stunned rabbits waiting for less rain.
A fresh vision and the cost of doing nothing
As discussed above, following an initial reconnaissance of existing climate resilient farmers and practices, a Climate Resilience Policy needs to be prepared and written into law. It will form the basis of all future Federal funding and must override both State and Local Government laws. In particular, a National moratorium on clearing forests for both farming, grazing and subdivision for housing. This Climate Resilience Policy (part of a long term bipartisan National Agricultural Policy) will encourage private landholders to adopt longer term planning practices. Some of the practices that may come out of the initial reconnaissance may include:
1. Grazing and farming systems that monitor the farm for changes to soil carbon/humus levels and plant biodiversity and the relationship to productivity and profitability.
2. Farm designs that enhance hydrological and biodiverse microclimates by reducing crop and animal stress
3. Set a minimum percentage of forest cover for each farm to produce optimal microclimate effect
4. Identification of the economic value of Ecosystem Services (free services provided by nature) that benefit both the environment and farming
In additional, a National approach to reforestation needs to be adopted. One possibility is to first begin protecting the existing biodiverse forests close to and surrounding the headwaters of the major river systems. This may entail the Federal Government buying out strategic farms for the sole purpose of trying to create a wide region of biodiverse forest that connects itself back to the coast. This will provide employment and assist in the improvement of water quantity and quality. Coupled with a National Irrigation Policy (that may entail building a water grid – Ref 9), this will help producers transition away from flood irrigation to drip and sprinkler irrigation. This will free up more water for further agricultural development, the environment and strategic revegetation along the river systems.
Currently Australia has no Climate Resilience Policy, National Agricultural Policy or National Irrigation Policy. In addition, we have no real understanding of the value of Ecosystem Services nor the long term cost of our current system. There is an implicit cost (downside externalities) of salinity, erosion and loss of biodiversity that will be paid for by future generations.
The other benefit of developing a Climate Resilience Policy is that the Federal Government will be able to minimise climate refugees. The Syrian crisis and refugees that scrambled to Europe can be linked back to the huge droughts of 2006-11 (Ref 10). Over 1.5 million Syrians moved from the countryside to the city where there was little food, water and jobs spawning the social unrest that was to follow. Across the Fertile Crescent, Africa and Asia there is already mass migration from the countryside to the cities and with climate change this will only get worse. By having a Climate Resilience Policy, the Australian Government can direct its foreign aid in the form of climate and food security expertise potentially stopping a problem before it starts. Giving money away to corruptible countries does not benefit our country or achieve lasting results.
Funding – the no brainer case for a Australian Sovereign Wealth Fund
Whenever a problem and solution to any issue is raised, the naysayers often come up with the excuse “we cant afford it”. With an ageing population and budgetary restrictions in almost every sector its time for Australia to set up a Sovereign Wealth Fund (Ref 11). A Sovereign Wealth Fund is a large super fund set up for all Australians providing a short term secondary income stream separate from taxation. In Norway for instance, their Sovereign Wealth Fund, funded by oil royalties, is 40% bigger than their economy and is the biggest in the world with a total asset exceeding $1 trillion (it even funded their 50% electric car policy). It works by never spending any of the capital put into the fund and only withdrawing a small percentage of the interest earned on the capital. In essence, the fund exponentially increases year on year. The only Federal fund Australia has at present is a fund set up for paying our Federal politicians.
Currently Australia has the 8th largest reserve of natural resources in the world exporting over $250 Billion of product a year. This resource is owned by the Australian people with the mining rights leased by mining companies who then pay a small royalty to each state. This money goes into consolidated revenue and is spent immediately. Currently Australia has an unprecedented number of expired mines that have never been rehabilitated (over 10,000 in QLD). Many of the larger mining companies strategically sell off their mining rights with a small attached resource to smaller companies who are then responsible for any rehabilitation once the mine is finished. In many cases these smaller companies often go broke leaving the rehabilitation costs to the States further compounding the problem.
In order to establish a Sovereign Wealth Fund, it is proposed that a rehabilitation tax of 5% is levied on all resources mined from Australia. This money would then be placed in a Sovereign Wealth Fund managed by a separate board. This capital is then managed like any Sovereign Wealth Fund investing in assets that benefit the country (the Norwegian Sovereign Wealth Fund no longer invests in non renewable energy). Only 10% of the interest earned on this capital is available for public spending (like reforestation and drought initiatives) with the remaining 90% going back into the capital fund. Once the life of the mine or resource is over the capital is then returned to the company once they have proven that rehabilitation is finished. By doing this each mining company provides a mechanism for both rehabilitation and developing the country.
If we use the example of exports totalling $250 billion a year, a 5% tax equates to $12.5billion each year going into the Sovereign Wealth Fund. If this fund returns a long term average of 8%, this will return in the first year $1 billion in interest of which 10% (100 million) is available for Federal Government spending. The remaining $900 million goes back into the Sovereign Wealth Fund. The fund then quickly increases, by year 5 it produces $577 million in income, by year 10 $1.395 billion, by year 15 $2.552 billion, and by year 20 $4.19 billion. At the end of 20 years the fund has approximately $561 billion in assets.
A final word
Desertification and deforestation are reversible through good farming practices and a strategic approach to forestation (Ref 12). In order to mitigate the effects of extremes in climate Australia needs to adopt a proactive approach to rehydrating the landscape and building humus rich soil. The solutions are out there but lobbying from vested interests is steering the Federal Government and ultimately policy in a very unsustainable direction that wont cope with the projected climatic extremes facing us in the near future. This approach is affordable if we begin the process of setting up a Sovereign Wealth Fund. It is one of the most equitable ways of rehabilitating both mine sites and providing an additional source of funds for building a sustainable farming and rural community.
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