I promised myself that I’d stay away from Global Warming, at least until some new wrinkle turned up that promised some sort of interesting discussion. But seeing as GE is away, surfing apparently (you’ll forgive my antipodean snickering as I try to visualize this), I thought I’d look at the common approach to the issue that seems popular among left-leaning western democracies these days: the Carbon Tax.

A potted history of Australian politics in 2010: Prime Minister Julia Gillard went to the last federal election promising there would be no carbon tax. Before her, PM Kevin Rudd had promised there would be one. Several things ensued: first, his popularity in the polls plummeted to the point where most commentators wrote off the Labor Party at the next federal election. Then, his Education Minister (the aforesaid Gillard) advised him to drop the tax. Rudd accepted this advice. Given that Rudd had already proclaimed Global Warming the great moral and economic challenge of our time, his backdown merely made him appear weak and lacking in conviction. His polls slumped even further. So then, he was challenged in a party room spill. By—you guessed it—the very same Gillard.

The electorate responded to all of this at the polls with the greatest swing against a first-term government seen since Federation. But not quite enough to return the Liberal-National coalition to government. Labor cut deals (the precise details of which we’re unlikely to ever be told) with three independents and the new lower-house member from the Australian Greens to form a makeshift coalition that has governed a hung parliament till the present. It’s telling that ever since, at every press conference at which Gillard has announced some new policy initiative, the leader of the Australian Greens, Senator Bob Brown, has pointedly loomed behind her in camera shot. No-one’s fooled as to who’s really running Australia at the moment.

Ventriloquist: Bob Brown (second from left) announcing new Carbon Tax

Surprise, surprise: right on cue, Julia’s backflipped. So now, Australia will have a carbon tax. Or a “Carbon Pollution Reduction Scheme”, if you prefer. It’s just that Gillard isn’t calling it that, so she hasn’t exactly broken her election promise. No, what we’re getting is an emissions trading scheme. One in which emitters of carbon dioxide trade with each other for the privilege, on a per-tonne basis. Only, (and this is the bit that is clearly at the behest of the Greens) for the first year the price of CO2 will be fixed at a level decreed by the federal government: in other words, a carbon tax in all but name.

I’m not an economist. Never had a lesson. But I think I get the fundamentals of how this is supposed to work. In a nutshell, make carbon dioxide expensive to produce, and people will use less of it. Says so right there in the Economics 101 textbook. After all, tobacco taxes stopped people smoking, didn’t they?* The government, of course, has left out one or two little things. First, they figured that there was nothing business could or would do in retaliation to this new tax. They’ll just lie down and cop it sweet, right? Silently and obediently pass on the costs to consumers, who will go on to use less CO2. Thus saving the planet. Or something pretty close to it.

Incidentally, to make sure I wasn’t missing something fundamental in all this, I ran it past a mate of mine who is an economist; in fact, he lectures the subject at one of our most prestigious Graduate Schools of Business (and parenthetically, he’s a convinced AGW believer). He reckons I’ve got the basics pretty much right.

Of course, it’s all bunkum. Manufacturers here have threatened en masse to take their operations offshore, to countries with no carbon tax. And with little or nothing in the way of our strict emissions standards, either. The result: a net increase in CO2 emissions, devastation in an already-dwindling Australian manufacturing sector, skyrocketing unemployment, and carnage at the polls next time round. Why would a Labor government, of its own volition, do something which is simultaneously ineffective, economically devastating, and politically suicidal?

It’s bunkum, and those behind it know it full well. That’s why they’re fixing the price of carbon (for the first year only, they say, but I’ll lay any odds they’ll extend it just as soon as they think the voters are used to the idea). They don’t dare leave the price of CO2 to the market; they’ve seen what happened to the Chicago Climate Exchange, what’s happened in Europe, in New Zealand, and the growing number of states in the USA who are pulling out of proposed state-based emissions trading schemes.

So now, our government’s in damage-control mode. They’ve had the Climate Change Minister, one Gregory Ivan Combet (former secretary of the Australian Council of Trade Unions, and darkly rumoured to be privately sceptical of AGW) in the media today declaring that 50% of the proceeds of the new tax will be returned as compensation to households most affected by the inevitable price rises in electricity and essential commodities.

Pardon me? The whole point of this exercise was to change individual behaviour by inflicting pain, wasn’t it? But now, it’s turning into something else. First, it’s a garden-variety wealth redistribution from high-income households to low-income ones, by a Labor party for whom wealth redistribution is its métier. Second, it’s a far more cynical redistribution of employment, from Australia to the developing world, at the behest of a Green party of unreconstructed communists delighted to see the decadent capitalist world getting its just deserts. And third—as far as I can make out—it is some sort of scorched-earth policy by a federal government which is staring down the barrel of certain defeat at the next election, having deceived the voters and imposed on them a Carbon Tax they have rejected at every available opportunity.

And in the end, not a molecule of carbon dioxide is saved.

* Didn’t they???

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13 Responses to Carbonomics

  1. Dr. Dave says:


    I’m sure you peruse the fine offerings at the SPPI site and of course WUWT. The USA is the #2 emitter of CO2 on the planet (second to China). The entire population of Australia is about 60% of the population of just California and only slightly smaller than the population of Texas. You could absolutely shut down all hydrocarbon fuel use in both states (and I’m talking about nothing other than bicycles, solar panels, windmills and nuke plants…no wood fires, no petroleum products like gasoline, diesel or jet fuel, no natural gas or “natural” beeswax candles…not even the lamp oil harvested from clubbed baby seals). Even if the IPCC were right (and we KNOW they aren’t), by using their own calculations we wouldn’t be able to measure the difference in temperature reduction even with our best satellite data 50 years from now. The entire US could shut down and it wouldn’t make a damn bit of difference for many lifetimes – if it ever would!

    In terms of land mass, Australia is almost 11 times larger than the state of Texas, the Texas population is greater by a couple million and the annual GDP is approximately the same. If the entire state of Texas were to shut down it wouldn’t make a damn bit of difference in terms of global climate (global economy is a different matter). I can’t understand how the Australian people could be so gullible to believe that forcing unimaginable harm on your country’s economy could possibly make one whit of difference when we could shut down Texas and it would make no difference at all (see the SPPI archives for the specific report).

    The secret to the Green’s utopia is to get the entire planet to do the same thing and fall in line with their way of thinking (typical of communists). Well guess what? Ain’t gonna happen. China and India are extending a middle finger salute to the idiots in the US, Europe, OZ and Canada who buy into this crap. AGW quit being a legitimate scientific issue years ago. It is now a purely political and economic issue and it’s all cost and no real benefit. On a grand scale it truly is redistribution of wealth from poor people in rich countries to rich people in poor countries. Politicians are intoxicated by the AGW fraud because it gives them a “popular” excuse to tax and thus fund a larger and more intrusive government. All the while robbing the productive citizenry of their liberties.

  2. Luton Ian says:

    Carbon tax is a win : win : win for socialists.

    1) They get to raise more taxes and employ more captive voters to enforce the system.

    2) They extend the ranks of permanent welfare dependants, who’ll vote for them, if they can be bothered to get out of bed, and, even if they don’t vote, they’re not going to vote against the socialists.

    3) Exporting industry to China, makes for jollier Chinese new year parties at the Chinese embassy, and smooth way for ploductive state visit to Chinahh.

    What’s not to like?

    Just add in a bit of land grabbing…

  3. Luton Ian says:

    Check out last weeks Dilbert cartoons, for the Pointy Haired Boss glove puppet.

  4. Kitler says:

    Oz now you know why they disarmed the Australian public. This should also kill off the mining industry or will they make allowances as they send a lot of what’s mined to China.
    Gordon Brown did a similar scorched earth tactic for the incoming Tories and made sure he signed up for every idiotic EU policy to make matters as worse as possible.

  5. Ozboy says:

    Here’s an economist’s view on the tax: the Melbourne Herald-Sun’s business editor, Terry McCrann.

  6. Dr. Dave says:


    Loved the article. Ms. Julia has what we call a “puss gut” (you must be so very proud). I’m always astounded at the folks who buy into this idiocy. No matter how outlandish a load of horseshit it is…you can always find at least the 40% of the folks who’ll buy it. The government will return 50% of the money? Yeah? To whom? By what criteria? What is the overhead? Why do you even need inefficient whirligigs? If I’m not mistaken, y’all have a shitload of coal. China’s CO2 emissions make Australia’s look like a fart in a wind storm. Who’s planet are you saving?

  7. Luton Ian says:

    From cotton picked in fields ploughed by unicorns and watered by the tears of angels, spun in a factory powered by solar and staffed by the unpaid children of indentured serfs…

    Oh Sheep!

    Thanks Mel ;^)

    Heh heh Ian, you’ve just reminded me of this…

    Oh yes and ditto, thanks Mel – Oz 😀

  8. Luton Ian says:

    That’s about the level of it

  9. Ozboy says:

    Check out the Australian Greens gloating about their minority stranglehold on the Gillard Labor government:

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