by straight talker » Thu Jul 28, 2011 6:06 pm
THE Greens must have been so astonished by the brilliance of the carbon tax that they just ignored page 18 of the Treasury’s overview.
The modelling, which the government relies on to back up just about every fiscal decision it makes, reveals an interesting twist to the carbon tax tale.
People may have been allowed to believe this carbon tax was all about reducing Australia’s annual carbon emissions. Not necessarily. It was about reducing our annual “growth” in emissions.
According to Treasury, our total annual emissions will go up. That’s right, Australia will pump out more carbon annually in 2020 than now, even with a carbon price and ETS.
According to Treasury, our annual emissions are 578 million tonnes a year. By 2020, with a carbon tax and an ETS, our annual emissions will be 621 million tonnes. The difference is that without the tax, those emissions would have risen to 679 million tonnes. And this was always the case. So, while the government can claim it will reduce emissions by a net 50 million tonnes because of the carbon tax, our total annual emissions will still be higher in 2020 than they are now.
Even with a carbon tax, Australia will not be able to find enough domestic reductions to meet its target of reducing annual emissions by 5 per cent on 2000 levels and instead will have to buy carbon farming credits, new renewables and go to Europe to buy 100 million tonnes of abatement schemes to reach our target.
Coalition environment spokesman Greg Hunt estimates this will cost taxpayers about $3.7 billion in today’s terms, which is money which will not be pumped back into the Australian economy.
Not that the Coalition has a plan to reduce growth emissions by any larger margin. But this scheme, for Labor at least, was never just an environmental manifesto.
Julia Gillard and Greg Combet have crafted a document that is devilishly political in its dimension. To Combet’s credit, he has managed to outsmart the Greens who walked away from the deal not being able to admit that they had agreed to a scheme which was not a lot different to the CPRS which they had opposed twice.
The PM now has a document with which she can finally try and wedge Tony Abbott.
The PM says there is no money tree. Well there may have been. But the PM has put a chainsaw through it and doled out its proceeds as toothpicks to the poor in a major redistribution of wealth across the nation.
Gillard’s argument is that she has divided the proceeds of the tax to redistribute to 90 per cent of households as tax cuts or family payments. She said money would be going to those most in need. But it also serves a significant Labor political need.
She has drawn a line around those voters she believes Labor needs to back and will weld them to her government for the next two years with pension payments, family payment rises and tax cuts.
The carbon tax was a sop to Labor’s Left, and the compensation an appeal to Labor’s true working-class base which had otherwise abandoned it.
Think i am getting there with copying and pasting. justa bit more work to do.
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