Abbott Axed The Tax, And With It What's Left Of His Credibility


Farewell to the carbon tax. It was repealed this morning. As the old Irish folk song goes: Johnny, we hardly knew ye.

Originally a promise of John Howard’s government, the long struggle to price the climate-damaging fossil fuel emissions of Australian industry has dominated Australian politics for seven years.

No other issue has been as politically controversial and damaging as carbon and climate policy. It played a key role in the downfall of Malcolm Turnbull as Liberal opposition leader.

Kevin Rudd’s backflip on the “great moral challenge” of climate policy was the beginning of the end of his prime ministership.

And, of course, axing the carbon tax was the central plank of Tony Abbott’s single-minded drive to the Lodge. Julia Gillard’s ill-fated decision to reverse herself on a carbon tax under the government she led dogged her entire term in office.

In the process, the carbon tax became the subject of one of the most dishonest and inaccurate media campaigns in Australian history, as the Murdoch newspapers and the right-wing radio broadcasters exerted all their influence to defeat the policy.

One study of 10 major newspapers in a six-month period in 2010-11 found 82 per cent of News Limited’s articles on the carbon tax were negative.

Despite the controversy, Julia Gillard, in motley coalition with the Greens and country independents Tony Windsor and Rob Oakeshott, was able to put a comprehensive climate policy in place in 2011.

By the time Gillard left office, Australia had a cap on emissions, a modest but rising price on pollution, and a suite of complementary measures to drive investment in clean technologies and renewable energy.

As I argued at the time, while hardly the best of all possible policies, Gillard’s carbon tax was certainly the best Australia could hope for given the political exigencies of the issue.

It was better than Rudd’s CPRS, involving less compensation for dirty industries and a higher long-term target of an 80 per cent cut in emissions.

And it worked.

The carbon tax was in place for scarcely 25 months. In that time, it lowered Australian carbon emissions by between 11 and 17 million tonnes, according to this ANU study.

Price rises flowing from the carbon tax were negligible.

So small was the impact of the carbon tax on prices, in October last year the Australian Bureau of Statistics reported that it couldn’t measure it.

As Fairfax’s Peter Martin reported last year, the ABS actually put out a statement saying that it was “not able to quantify the impact of the introduction of carbon pricing… and cannot produce estimates of price change exclusive of the carbon price”.

After two full years in operation, Australia’s inflation rate remains below three per cent. The economy is still growing, interest rates are at record lows, the price of a leg of lamb has not hit $100, and the grateful citizens of Whyalla can report that their fair city has yet to be wiped off the map.

This is what good policy is supposed to look like. The carbon tax gently nudged polluting industries towards cleaner practices, while the broader economy hardly noticed.

Ordinary taxpayers received generous tax cuts. Innovation in new industries like solar, wind and wave power was encouraged.

All that is in ruins now. The carbon tax has been repealed, but, as Lenore Taylor notes, the Abbott government has nothing credible to take its place.

As we’ve long argued here at New Matilda, Greg Hunt’s Direct Action policy is a joke, and everyone knows it.

It can’t work: it has no cap on emissions, no price on carbon, and no valid mechanism of ensuring greenhouse gas reductions.

Its main action will be to recycle yet more taxpayer dollars to big polluters, who have already enjoyed a bonanza of compensation for a carbon tax that lasted barely two years.

Meanwhile, the Abbott government has been assiduous in dismantling complementary measures, axing the Climate Commission, moving to abolish the Clean Energy Finance Corporation and the Australian Renewable Energy Agency, and placing a card-carrying climate skeptic in charge of the review of the Renewable Energy Target.

“What a complete and catastrophic failure of the political system,” Taylor writes. And she’s right.

Australian democracy is hardly unique in struggling to come to terms with the planet-wide consequences of industrial pollution. But even so, the repeal of the carbon tax is a doleful moment in our recent political history.

There’s plenty of blame to go around. Even Bill Shorten now admits that Labor mustered a poor job of explaining climate policy to a fearful and disengaged electorate.

Kevin Rudd had the chance to fight an election against Tony Abbott on climate change in early 2010. It was an election most observers think Labor would have won.

But if blame is being distributed, there is one man who must be apportioned the lion’s share: Prime Minister Tony Abbott.

Repealing the carbon tax will be his dubious legacy. In time, it will come to negatively define his entire government.

Abbott cleverly used carbon as the rallying cry for the troglodyte right inside the Liberal Party. For the true believers, like Nick Minchin, climate change was nothing but a left-wing conspiracy to “deindustrialise the western world.”

Abbott rallied these climate revanchists to his banner. Despite polling fewer votes in his own caucus than either Malcolm Turnbull or Joe Hockey, Abbott was able to ride the anti-carbon cause all the way to the Liberal leadership.

Now, as the 28th Prime Minister of Australia, Abbott has succeeded in his singular campaign to junk Australia’s climate policy. It’s a triumph of short-term politics over the long-term health of the Australian environment and economy.

There is no indication Abbott has any particular views on climate change: he’s been a weathervane on the issue, swinging freely with the political wind.

At various times he has denied and acknowledged the existence of global warming, opposed and supported the idea of a carbon tax, and supported and opposed the idea of an emissions trading scheme.

In a 2008 debate with Chris Bowen, for instance, you can find Tony Abbott ridiculing Labor’s ETS as “a carbon copy of what the Howard Government proposed.”

In this 2009 blog for the Daily Telegraph, Abbott supported a carbon tax.

All that changed as soon as he saw the opportunity to use carbon policy as a vehicle to ride into power.

For Abbott, the future of our planet is nothing more than a short-term political weapon with which to attack his political opponents.

Today’s repeal ensures that he will go down in history as one of Australia’s most damaging opportunists: a man prepared to put the interests of himself and his party ahead of the long-term best interests of the nation.

Today’s vote will haunt the Liberal Party for a generation. Climate change is the defining political issue of the 21st century. Nothing is bigger or more important. Nothing is potentially more dangerous to the future well-being of Australian voters.

Long after Tony Abbott has left office, the rising waters around Australia’s coasts, the worsening fires and droughts, and the dying rivers and reefs: all will stand testimony to his anti-carbon folly.

That’s a tragedy for the future of Australia.

Ben Eltham is New Matilda's National Affairs Correspondent.