Friday, August 24, 2012

"There will be no carbon tax under the government I lead"

It is refreshing to find a journalist who has done a little bit of homework prior to an interview and is ready to question spin, half-truths, strategic inexactitudes and "misstatements" from political leaders.

Rather than contribute another dissection of this particular interview, instead I thought I'd gather a few thoughts on the Australian carbon price and its place in contemporary Australian politics.

As Leader of the Opposition Tony Abbott is so fond of reminding us (especially when facing an interviewer turning the screws on his own truthfulness), Australian PM Julia Gillard did indeed say during the 2010 election campaign, "there will be no carbon tax under the government I lead". Yet one of the signature pieces of legislation from this minority government has been the introduction a price on carbon coupled with income tax reform.

A straightforward broken promise? Yes and no.

It is axiomatic that a minority government will need to compromise its electoral platform in order to get the support of other parties or independents required to govern. If a party could gain the support of enough MPs without altering its policies, then the extra MPs would just join the party. It is abundantly clear in this case that the price on carbon was the top item on the Greens agenda (and also on the radar of the independents) and so compromise was necessary. Once the election results were known, that such legislation would be the price of Greens support (needed by either party to govern) was entirely predictable.

As far as I can see, there were really only four other alternatives: (a) for the Greens to have dropped this demand, which was considerably more core for them than a promise made once on the campaign trail (did Gillard make this claim more than once? If so, I am not aware of it), (b) for the Greens to have negotiated an agreement with the Coalition, which would have faced the same sticking point (along with likely even more disagreements on other policies), (c) for the two parties who were against a carbon price (Labor and the Coalition) to have made this the sine qua non of their respective positions and so come to a power-sharing agreement between them in order to prevent the Greens from introducing such an idea, or (d) for no agreements to be reached and a new election called.

As I've said before, too much is usually made of campaign promises. Governments exist to execute wise political authority, not merely to implement the majority will.

While it is a minor point, it's worth noting that the carbon price is not a tax. The current system is based on carbon credits that are sold to the five hundred or so largest polluting companies in a market mechanism that spends the first few years with a fixed price and unlimited credits in order to give business certainty and then shifts to a fixed number of credits (declining each year) and a moving price (with a floor and ceiling imposed). It may well have been better as a direct tax at the point of extraction with proceeds distributed equally to all Australian citizens (tax and dividend), but that is not the system that was chosen. Now it is quite arguable that most Australians do not understand the difference, but that is because there has been such an effective effort by the Opposition to muddy the waters and no effort on the part of the government to explain it. Public ignorance is assumed and reinforced by both sides.

More importantly, the current legislation is way too unambitious, with tiny targets that put Australia towards the back of industrial counties in its level of ambition and which, if adopted by all advanced economies, would most likely see us sail past two, three and four degrees. Furthermore, current legislation does not including our massive coal exports, which are already the largest in the world and are planned to double in the next decade (blowing any domestic reductions out of the water), nor the embodied carbon in imported goods, nor international aviation or shipping. It provides extremely generous free credits to many industries to soften the initial burden. And it includes international offsets, so that we can continue to emit locally while paying someone else to make changes elsewhere that Treasury does not actually expect domestic emissions to decline very much, if at all.

Yet perhaps the greatest failure by the government regarding this legislation has been the failure to make use of its introduction to keep raising climate literacy, explaining the basics of climate science (which are still widely misunderstood), why serious action of carbon emissions are morally justified (getting beyond short-term cost-benefit analyses) and necessary at every level (personal, local, national, international), why Australia must do its bit (which is considerably more than most other nations, not less) and why this battle is worth fighting, even if it looks like we're currently losing.

So be assured that I am no particular fan of the present legislation or government, but repeating Gillard's broken promise - while it may be a satisfying way of expressing anger at a government that has had its fair share of controversies while being surprisingly effective at getting more than an average amount of legislative work done - is doubly misguided.


byron smith said...

Adelaide Now: Abbott the opportunist.

"Privately, BHP executives were briefing state and federal Labor MPs this week and were asked point-blank if the carbon tax and mining tax had contributed at all, or whether they were briefing the Liberals that it had.

"The answer was an emphatic no. These facts are made even starker by the legal requirements for disclosure by listed companies, which are bound by law to give honest reasons for a decision of this magnitude."

Juggernaut1981 said...

I am constantly surprised by the Labor Government's lack of willingness to explain their actions and straight-talk society.

Why is it that I can explain the idea of a carbon price to 14-yo so they understand it, accept it and see that it will work... but an entire party of tertiary trained people can't come up with a good analogy to teach the electorate??

byron smith said...

I strongly suspect is less a matter of competence and more of seriously misguided strategy. In the last few years (especially post-Copenhagen) there has developed a widespread idea amongst mainstream political thought on climate change that the first rule of climate change communication is that you must not mention climate change. The idea is to "bright side" the issue by only speaking about the co-benefits of action on climate change - green jobs, green growth, tax reform, clean energy, and so on. If you look at messaging from elected political leaders in the English-speaking world (excluding those deluded about the science), you'll be hard pressed to find many examples in the last few years of those who will repeatedly and carefully lay out the nature and scale of the threat climate change poses, or build a moral case for action based on the these dangers. This has been a deliberate shift in strategy from say five years ago, when such comments were far more common. There is a complex story to be told about this shift, but is basically comes down to some (in my view) questionable social science research and political calculations that become self-reinforcing and undermine the possibility of moral leadership from political leaders.

You can read further analysis of these ideas in the linked series on this post.

Gillian King said...

I totally agree with your second last (?) para about the need for the govt to discuss climate change head on.

I'd like to see Gillard to a 50 minute, ask any question, press conference on the topic of climate change. She comes across well when she's on her feet fielding questions.

Too much brightsiding has left an information black hole.

byron smith said...

Gillian - that would be a good start. I'd like all ministers to have the basics firmly under their belt and be willing to talk coherently at any time. And I'd like higher profile ones (including the PM) deliberately include references on a regular basis.

Although I was critical of how some social scientific research has been translated into messaging strategy in my comment above, quite recent studies point to the regularity and strength of cues from political elites being the single most important factor in public perceptions about climate and public support for climate mitigation (having a much stronger effect than weather extremes, which was the received wisdom until recently).

byron smith said...

I am no fan of the Gillard administration's half-hearted baby steps (and/or cynical greenwash, depending on mood) on climate policy. Yet I've always been struck by how off-the-mark the endlessly repeated accusation from the opposition that she "lied" prior to the election is. Here is an Murdoch article prior to the 2010 election in which she clearly says she is open to a carbon price but rules out a carbon tax. A large part of the issue is that people don't understand that these are not the same thing.

byron smith said...

Courier Mail: Abbott's populist and contradictory policies.

byron smith said...

SMH: Turnbull calls Abbott's climate policy "bullshit".

byron smith said...

Conversation: Redefining the lie. An insightful piece where Gillard's pre-election promise is one of the examples.

byron smith said...

Australian: Julia Gillard's carbon price promise.

Someone has been lying. Not sure it was Ms Gillard...