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 Why Rudd's ETS fails: John Anderson 

Why Rudd's ETS fails: John Anderson

26 Sep, 2009 04:00 AM
SO Kevin Rudd wants to rename Paul Kelly's topical work to 'The March of a Patriot' singular and give all credit to Labor.

Funny, I didn't see him in the Expenditure Review Committee when we redressed years of Labor misrule and debt.

Neither will the Coalition see him in that much to be pitied future committee when the same will have to be done again but on an exponentially expanded scale.

Rudd's singular take on patriots and derision of 'neo-liberalism' are totally at odds with his Government's emissions trading scheme.

The shallowness of conviction and depth of pretension are no better revealed than in Rudd's approach to climate policy.

Rudd castigates 'the theory of self-regulating or self-correcting markets and of an ideal role for government which is shackled in its role as market regulator, as well as restricted in the provision of public goods'.

Yet his ETS is a classic 'let the market rip' model. Carbon is fed into a market system and expected to reduce emissions as market forces take hold.

Apart from limited start-up assistance, the Government will sit back and watch. What it will see is a slide in our national competitive advantage as the new cost on energy flows to every nook and cranny in our economy. We have heard mostly from our exporters in the mining and agriculture sectors but the ETS will make everything cost more.

I fail to understand how putting millions of dollars of extra costs on the bottom line of hospitals and aged care institutions facilitates that great social contract between government and Australians.

As a member of the seven million strong who live in export-generating regional Australia, can I say that we've done our sums? Estimates vary but the salient point is that it will cost significantly more to produce the nation's exports. Margins of profitability are predicted to fall so much as a result of Rudd's ETS that there will be significant shrinking of our farm produce sector. Food and fibre imports will rise, coming from countries with lax emission regimes.

It is unjust and unworkable to expect a political party representing this regional constituency to support such a plan.

We will lose markets, lose exports, lose jobs here at home: hardly helpful for setting funds aside to bring emissions down.

Production will be curtailed, that's all. The slack in supply from Australia will be filled by other countries with no such carbon market. Their dirtier emissions will go up. All we will have done is forfeit our prosperity as well as our ability to help the world and ourselves with cleaner technology.

How neo-liberal of Rudd to send Australia out ahead of the world armed only with a domestic market based policy. He will take the government jet to Copenhagen and offer round a menu of our businesses to foreign countries to take their pick of the industries they could supplant and relocate. Self sacrifice is hardly the weapon, as Rudd puts it, 'to secure our nation's future in a tough, competitive and unsentimental world'.

Rudd professes to be part of a great tradition that brings the people along with reform, especially workers. The nation wants a response to climate change that has integrity. This ETS does not.

If you don't have rural and regional Australia on side with a massive structural change like this, you do not have a mandate to proceed. Labor is running into every shed, holding paddock and harvest with a new tax collector to rip thousands of dollars from every family on the land.

Workers dependent on farms, mines and downstream processing are at risk. Rural Australia says no to that kind of contract with their government. And so they should.

Rudd has claimed for years to have an obsession with productivity.

Yet the ETS creates a new marketplace where the output per worker is immediately and significantly reduced because power costs suddenly jump.

If he was consistent in his own neo- liberalism Rudd would also put a dollar cost on food security and on the human cost of hunger.

That would make for a more perfectly informed market. We produce enough food every year for anywhere between 60 million and 100 million people - many more than our domestic population of 21 million.

Loading extra costs on agriculture means that not only do we lower export capacity but we won't be feeding so many people.

No economy can withstand a shock like this ETS and simply carry on as before.

There is absolutely no doubt in my mind that Labor's approach to climate policy will affect our ability to keep on feeding so many people.

Maybe Rudd is happy to abandon Australia's Millennium obligations des-pite a further estimated 50,000 people in our immediate region suffering from malnutrition already as food inflation hits.

I have long believed that we need to reduce reliance on fossil fuel energy as insurance against global warming and the end of cheap oil.

With our current technology we are utterly and hopelessly dependent on oil for food production and transport.

It is estimated that the average western family pours as much oil into their fridge every year as they do into the family car. Climate change asks the core question of how we change that equation.

The answer does not lie in punishing those countries and industries that are the most efficient fuel users and investors in clean technology like Australia.

The answer lies in rewarding them and facilitating their efforts here and abroad.

Once Rudd's 'harsh and forbidding world' starts eating our ETS afflicted industries alive, the world loses a climate change leader, it doesn't create one.

Australia is a leader in many environmental technologies, particularly conservation farming.

We can't keep winning if we are weighed down with costs not born by our competitors across the world.

Many have pointed out that the Coalition went to the election on a platform with an ETS.

It is inconceivable to me that the Coalition would have brought in an ETS that would damage industries that are global leaders and our major export earners, particularly where our humanitarian objectives i.e. feeding people, were also at stake.

Further, we would have taken proper account of the need to ensure competitor nations were similarly bound to a global agreement before closing the ETS design door.

Rudd's ETS and its modelling stand entirely on fanciful hopes that our competitors will price carbon as we do, when we do.

The Coalition should never be on the policy side of delivering export industries to those of our competitors who cannot produce as cleanly as we can.

Rudd's policy puts all its faith in a market operated system to bring down emissions.

There is no bringing the community along, there is no provision of climate change public good.

A prime minister keen on genuine reform would insist on a policy approach with the proactive support of major stakeholders.

No Coalition that respected its own ability to govern better would support radical policy without regional Australia onside.

The ETS is like changing the nation's economic constitution - you don't do that without all players' support.

If The Nationals are left alone on the other side of the chamber on the ETS, it would be a historic breach of trust with seven million regional Australians. It would so damage the Coalition contract with Australia that it might never be mended.

In government we pursued neither a Brutopia nor a Utopia. We were guided by what was best for Australia.

It can be that simple. It has to be. For the Coalition has never been 'prepared to accept hundreds of thousands of Australians as collateral damage as a consequence of a 'market correction' as Rudd is now doing.

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Date: Newest first | Oldest first
John, Please stop being so selfish. At a time of our generations greatest need you have heeded the call to home. Please return to poiltics and save us from the current crop of jelly back "leaders" with their "follow me, which way did they go" approach. Take a leaf from Lawrence's book, abandon this redundant coalition and form a political party of opposition, make the process work like it was intended. We have all had enough of this crap and you're the bloke to fix it. Fill your boots man !
Posted by chops, 4/10/2009 12:51:03 AM, on Queensland Country Life
How right you are John. An Extra Tax System is far from the answer. Putting their efforts into actually doing something positive, like converting from Coal fired Electricity generation to Geothermal would be a win, win, win situation but I am confident they aren't that foresighted.
Posted by don w, 13/10/2009 2:23:15 PM, on Queensland Country Life

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Former Deputy Prime Minister and Nationals Leader John Anderson.
Former Deputy Prime Minister and Nationals Leader John Anderson.

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