The Repeal Of The Carbon Tax

The Repeal Of The Carbon Tax

This article from the July 2014 edition of the IPA Review is by editor and Policy Director at the IPA, Chris Berg.

‘What a complete and catastrophic failure of the political system’, wrote the Guardian’s Lenore Taylor a few hours after the carbon tax repeal bill finally passed the Australian Senate. ‘As eight years’ work by thousands of people disappears with the Senate’s vote, many may have cause for regrets.’

Perhaps many do. But from this vantage point the political system has worked messily but as intended.

Having promised in opposition to axe the tax, on 17 July 2014 the Coalition axed the tax.

Against all odds, even. The showy last minute political games played by Clive Palmer made it look touch-and-go for a bit.

Nevertheless, given the serious problems Australia has had in recent years about governments keeping their promises, the repeal of the carbon tax was a pretty good case of democratic function, not democratic failure.

Taylor’s lament isn’t really that the political system has failed, per se; it’s that the political system has failed to achieve one specific goal—a legislatively driven programmed reduction in Australia’s carbon emissions.

Of course that bipartisan goal of a five per cent reduction of carbon dioxide emissions from 2000 levels within the next six years ostensibly remains.

But nobody thinks the Coalition’s Direct Action plan—an apparently un-ironic throwback to the days of corporatist industry policy, with taxpayers simply paying private companies to cut their emissions—will achieve that goal.

The carbon tax has been a centre-piece for three elections.

In 2007 John Howard followed the lead of the energetic Kevin Rudd and the Coalition announced its own emissions trading scheme.

In 2010 Julia Gillard promised that there would be no carbon tax under the government she led. Instead, there would be a ‘citizens’ assembly’ into the evidence for climate change—possibly the most cringe-worthy idea in the history of Australian politics—with the eventual aim of introducing an emissions trading scheme at the end.

Finally in 2013 Tony Abbott defeated a briefly resuscitated Kevin Rudd with a promise to abolish the very carbon tax Gillard had promised not to introduce.

Buried in that potted history is a wealth of extraordinary drama, and nuance, and subtlety—real or imagined. We’ve had multiple formal emissions trading scheme proposals—including Kevin Rudd’s Carbon Pollution Reduction Scheme and Julia Gillard’s Clean Energy Future.

We’ve had a host of government inquiries—most prominently those done by Peter Shergold under the Howard government and Ross Garnaut under the Rudd government.

We’ve had a diverting but ultimately empty debate about the definition of a ‘tax’. When Kevin Rudd in 2013 announced that he was going to ‘terminate the carbon tax’ by moving it to an emissions trading scheme slightly ahead of schedule, those semantics of when a tax becomes a trading system became a parody of themselves.

It is hard to over-emphasise the shift in the politics of climate change over the last five years. Throughout 2009 commentators and the press gallery urged the Coalition to join the carbon tax bandwagon. There were claims that the Coalition had not ‘learned the lessons’ of 2007—a viable party had to embrace an emissions trading scheme policy.

Today the emissions trading scheme is history and those who proposed it toppled from their leadership roles.

For climate activists the task is now to regroup. Christine Milne proposed a ‘website of climate criminals’ that would include such names as Ian Plimer, Gina Rinehart, George Pell, Andrew Bolt, Martin Ferguson and the IPA’s John Roskam. This sort of name-and-shame is probably good politics for the Greens with their base, but it’s worth recalling that the Milne and her party voted against the Rudd government’s emissions trading scheme in 2009: they were on a joint ticket with Plimer, Rinehart, Pell, Bolt, Ferguson and the IPA.

The carbon tax is repealed but it is not dead. Bill Shorten has promised to take a carbon tax to the next election.

Clive Palmer, who was a climate change sceptic as recently as the 2013 election, has had a Road to Damascus conversion and is now seen holding press conferences with Al Gore and being closely advised by Australia Institute staffer and former Greens chief of staff Ben Oquist.

Palmer has forced the government to retain much of the infrastructure around the carbon tax—the Clean Energy Finance Corporation, for instance, but most gallingly the Renewable Energy Target.

So the carbon tax is gone. But its associated policies are still in place—ineffective, wasteful, and unfortunately resilient.

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