TiP

Here we go again: Ross Garnaut is back reprising his carbon price arguments, the federal government is suddenly active pushing the need for climate change action, coincidental with the floods and the cyclone (last time it was the allegedly endless drought) and the Greens are arguing for more radical action.

Many trees will be felled to print the newspaper and media reports on Garnaut’s return to the limelight, but this is all background noise — the real political action today is in the back rooms of Parliament House, Canberra, where the government and the Greens are seeking to find enough common ground to put forward a carbon price bill that can then be rolled through the Senate after July with the backing of the new Greens senators.

Amid all the verbiage, the essential fact appears to be that the Gillard government is attempting to introduce a fixed carbon price rather than an emissions trading scheme, allowing, of course, Tony Abbott to repeat his claims about “a great big tax on everything.”

Suggestions that Garnaut has blown Abbott out of the water with his new report don’t make sense to me. Householders (aka voters) do not have Australia’s role in “leading” the global abatement charge on their radar — they are focused on their budgets.

Already lost to media view — because after all it was published in November last year, an age ago in media land — is the Macquarie Bank commentary that pointed out that the 15 per cent rise in residential bills for all utility services in 2009-10 was the highest since 1983 and can be expected to be followed by a 12 per cent hike this year. What will it be in 2012-13, when we have a carbon tax to add to the cost — and that’s the federal election year?

How high this carbon price will be is the critical issue and, when this becomes apparent, its impact on community costs (and perhaps on jobs) may be the fact that has the most impact on polling and focus groups.

An important side-argument will be on compensation.

As Kristina Keneally’s panicked moves in New South Wales show, the focus groups are sending messages that voters are up in arms over power prices.

The basic point, cutting through all the media hype, is that, using the Rudd/Wong introductory carbon price, powers bill (taking in to account network charges, the RET and so forth) will double from their 2008 level by 2015.

Still hidden from the voter gaze is the fact that it will take a carbon price of around $35 per tonne to achieve the national carbon abatement target. This by itself will send up end-user prices by around 25 per cent.

In Victoria, if the carbon price is high enough, it will drive coal-burning power stations out of the market and their replacement gas-fired plants will be more expensive. In NSW, the carbon tax will ensure that the next tranche of baseload power is not cheap(er) coal, but higher-priced gas.

But this is all for later in the decade.

The here-and-now is a Groundhog Day repeat of Garnaut-mania in the media, who seem to be unaware that the previous flood of Garnaut views was actually followed by a fall in public support for climate change policies, a slump from which they have not recovered (see the latest Essential Research polling).

Garnaut’s central thesis still won’t fly: the ALP government, having lost its nerve under Rudd, won’t try to introduce an emissions trading scheme.

Contrary to one assertion in the media, Garnaut has not turned up the heat on Tony Abbott, but on Julia Gillard.

Garnaut’s latest assertion that the ALP “must not bow to pressure of special interests” is a good example of the butterfly preaching contentment to the toad beneath the harrow; coping with special interests is the driving force for politicians in this environment.

Gillard’s greatest fear may be that the next Groundhog Day will be the one repeating the death-by-opinion-polls of a Prime Minister, a fear that may well be heightened in late March when, as widely expected, the biggest State Labor party is smashed at the NSW election, a poll in which apparently power prices are a big issue.

Meanwhile Garnaut, Labor and the Greens, aided by the media, are adhering to that old political adage: never let a catastrophe go to waste. Whether even Queenslanders can be persuaded that a carbon tax will stop bad weather, I take leave to doubt.

And one may assume that Abbott and the Liberals have already drafted a TV advertisement for the next election (or even earlier). The one that shows Julia Gillard on Channel 10 on 16 August last year promising voters in the federal election: “There will be no carbon tax under the government I lead.”

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