ONE of the main reasons the Gillard government is so unsuccessful in selling its carbon tax is that its overall narrative is so utterly dishonest.
Here is the key example. The government and its countless, mostly paid, carbon tax spruikers would have you believe that the Australian carbon tax is in line with most international practice…
Nicholas Linacre … was director of carbon markets in the Climate Change Department in Canberra … (and) wrote the World Bank’s official State and Trends of the Carbon Market 2011 report. He told me he agrees with McKibbin’s assessment: no existing market mechanism is having much effect anywhere…
There are two main US state-based schemes. The western scheme is based on California but it doesn’t start until next year and is very unlikely to have any substantial effect. The other, in the northeast, has such a high cap and such a low price that it has negligible economic, or greenhouse gas, consequence…
Says Linacre: “In the case of China I find myself very sceptical. They say they are going to do something one day but they are arguing so strongly against the European aviation carbon trading scheme… I don’t believe the Chinese are going to do anything myself.”
The New Zealanders have watered down their low-price scheme. The Canadians say they will never have one. The Japanese lost interest in a carbon market after Fukushima; and while the South Koreans have made a notional pledge to start a scheme in 2015, it is yet to be designed and is likely to be infinitely less consequential than ours.
South Korea has recently passed legislation for an emissions trading scheme but the issuing of free permits means the scheme’s effective start date is 2020. And the pricing of carbon will then be contingent on prevailing world prices. Europe has operated an ETS for years, although the annual revenue raised by it – which applies to economic activity many times the size of the Australian economy – is about one-third that likely to be raised in the first year of operation of the Australian tax. Moreover, the European carbon price is presently trading at about $10 a tonne.
New Zealand has a very limited ETS, but moves to extend its coverage have been shelved. The carbon price in that country is between $6 and $8 a tonne.
Andrew Bolt’s columns appear in Melbourne’s Herald Sun, Sydney’s Daily Telegraph and Adelaide’s Advertiser. He runs the most-read political blog in Australia and hosts Channel 10’s The Bolt Report each Sunday at 10am, and his book Still Not Sorry remains very widely read.