http://www.theaustralian.com.au/nat...carbon-tax-fears/story-e6frg6xf-1226016628626
Swan is either a liar, or an idiot, or possibly both. Does our treasurer really not have any basic idea of economics or financial management?
Only a few weeks ago Julia Gillard was telling people that it was semantics calling it a 'price' not 'tax', and of course then kept calling it a price. Who started the semantics, Gillard?
Now Swan is in on the act - only the big emitters get taxed, but I wonder what that is going to do to their costs, and who those costs are going to be passed on to?
These guys really think we are all idiots.
I'm in a little bit of hurry, so I'll be brief, but I just wanted to put in my 2c worth on the carbon tax/cap and trade system.
Forget about selling policy, this lot couldn't give away solid gold ingots in Somalia. But the bumbling stupidity of the information campaign isn't an argument against the policy itself.
I obviously accept the science of climate change, and, as a result I feel we need to act to correct the problem. I'm usually skeptical of targeted taxation like this, but in this case I think it's the only workable solution that can be made. The arguments for greater R&D spending by conservatives run directly contrary to their own economic theories. Don't get me wrong; I certainly think we should spend more on R&D, but it has to be accompanied by a carbon price.
We haven't been paying full price for carbon, because we have deferred the paying for the ecological damage these emissions cause. It's not just carbon - western capitalism has been virtually incapable of building any environmental issues into the cost of goods and services. At the end of the day the user needs to pay for the full cost of the product life cycle, and if that part of the cost isn't naturally attached to the product, then it has to be applied.
Price rises have a secondary benefit. State sponsored R&D is not a particularly effective way of promoting technological change unless it's accompanied by changes in demand, and for that you need a shock of some sort. Necessity, as they say, is the mother of invention. The greatest change in car engine efficiency in the 20th century occurred as a direct result of the 1970's oil price shock. If the carbon price is right, we will see the emergence of the technology we need to combat climate change in the long run. And if we do it first, and we get the right mix of price and R&D, the long term economic benefits of the industries we develop will far out-weigh the shock of the cost in the short term.
If we don't force change now then we've potentially got a much higher cost to pay in the future. Can you, for instance, begin to imagine the cost of reprocessing our atmosphere, relocating the 300+ million people directly threatened by sea level rise, or completely changing our agricultural system?
There are much better, and more we supported arguments for what I've just alluded to... I might try to post something during the week about the arguments for different approaches, my favored set up for any tax/cap and trade system, and where I think any R&D should be targeted.