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Socialism Today 161 - September 2012

Carbon taxes won’t halt global warming

ON JULY 1 Australia’s Labour government introduced a highly controversial carbon tax amidst overwhelming public disapproval. Polls at the time showed that up to two-thirds of Australians were opposed to the government’s ‘Clean Energy Future’ package of which the carbon tax is a major component. Around 45% of people polled considered themselves ‘strongly’ opposed to the new tax.

In a worrying sign for Labour premier Julia Gillard and her informal coalition partners the Greens, a majority of people (57%) approve of a future conservative Liberal Party-National coalition government repealing the policy. This includes almost 40% of voters who ‘always’ or ‘sometimes’ vote for the Greens.

Much has been made of the polls showing that people believe they will be financially worse off with the introduction of the carbon tax. Initially a clear majority expected the carbon tax policy to negatively impact upon their own household. This has recently reduced to 38% of people believing they will be worse off under the tax.

These fears were reinforced by a number of businesses, most prominently Brumby’s bakery chain, having been caught telling their staff to ‘blame the carbon tax’ for price rises unrelated to the tax. An Australian Industry Group survey recently found that 40% of service sector businesses surveyed admitted to planning to increase prices to coincide with the introduction of the carbon tax. The highest ratios of businesses planning to increase selling prices were communication services (82%) and retailers (48%).

This points to the underlying reason for the unpopularity of the carbon tax. People understand that price increases, whether directly related to the carbon tax or not, will be passed on to them. At the same time people remain unconvinced the carbon tax will be effective in forcing polluting industries to lower their emissions.

This has led the Labour government to focus all of its attention on trying to win support for the carbon tax policy through the Household Assistance Package. This is aimed at compensating low income households for increased costs in energy and other consumer goods. The concerns of the public, however, have not been fully alleviated by the promised compensation.

The fact is the Gillard government has spent very little of its time explaining to people exactly how the carbon tax, followed by an emissions trading scheme, will actually help reduce emissions. And the main reason why people do not support the carbon tax and believe the Clean Energy Future package will not be effective in reducing Australia’s carbon emissions is because it won’t. Despite both major parties claiming a target of reducing emissions by 5% by 2020, under the carbon tax and emissions trading scheme policy domestic carbon emissions are set to increase by an estimated 40 million tonnes by 2020. On Treasury Department modelling, under the current policy local carbon emissions are set to rise until 2030, then decrease by just 2% by 2050.

According to Beyond Zero Emissions, climate scientists suggest that "to have a two-in-three chance of keeping global warming to less than two degrees Celsius above preindustrial temperatures, developed nations with the highest per capita rates of emissions [such as Australia] would need to decarbonise their economies by 2020". Rather than taking steps towards this goal, Labour and the Greens are instead promoting a policy that ensures the increase of local carbon emissions throughout this crucial period!

Some climate change activists have rallied behind the carbon tax, suggesting the policy is a ‘starting point’ to cut emissions. The Socialist Party, however, has consistently warned that the carbon tax, followed by an emissions trading scheme, represents nothing more than an attempt to sidetrack the environmental movement. The introduction of this policy cuts across our ability to demand from government more serious action to reduce emissions now and in the future.

The carbon tax has served to alienate ordinary people from the goal of taking action to address climate change by making them foot the bill for an impotent policy. Winning mass popular support for genuine action will prove more difficult following this betrayal.

Ignoring the fact that the current policy is completely inadequate in addressing Australia’s need to reduce carbon emissions, many supporters of the carbon tax suggest ordinary people are simply too selfish to support any action to address the climate crisis. In contradiction to such claims, a recent poll by the Institute of Public Affairs demonstrated that around 60% of people are in favour of spending money to reduce carbon emissions, with 56% willing to personally pay between $100 and $1,000 or more per year towards the goal. Amongst young people aged 18-24 years, 70% are willing to individually contribute between $100 and $1,000 or more per year to address climate change.

This shows that despite the deceit of the major parties, ordinary people do want to see action taken and would support a policy that would genuinely reduce emissions. The problem lies in the fact that no major party is willing to implement such a policy.

Both Labour and Liberal, and increasingly the Greens, prioritise big business interests over the interests of ordinary people and the environment. The market ‘solutions’ they promote leave the question of climate change in the hands of business. Putting a price on carbon simply allows business to pass on these costs to consumers. The transition to an emissions trading scheme turns pollution into a commodity to be bought and sold by financial speculators, again with increased production costs being passed on to consumers. So while the cost of living increases, there is no guarantee that business will take any measures to reduce emissions!

The alternative to market ‘solutions’ is widescale public spending on renewable energy to ensure the transition to a zero emissions economy. This would necessarily include the retraining of workers in the fossil fuel industries and providing thousands of new ‘green’ jobs in renewables. A similar approach would need to be taken to transport, prioritising the improvement and expansion of public transport over building more roads.

The reason the major parties refuse to advocate and implement such obvious solutions is because they undermine the business interests of the fossil fuel industry and the road lobby, those who fund Labour and Liberal election campaigns. Big businesses such as coal miners and energy producers are content to keep polluting for as long as they can, regardless of the devastating consequences. They will continue to pressure whichever party is in power to allow them to do so, as we saw the mining companies do when a modest mining tax was proposed.

This is why the fight for action on climate change must go hand in hand with the fight for democratic socialism. Only by bringing major industry into public hands under democratic public control can we make the changes necessary to avoid a climate disaster.

CWI Australia


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