The Carbon Tax is, in my view, a complete and utter waste of time and just another way to win votes from Labor's heartland while ensuring the (very necessary) support of the Greens. It won't do a single thing to slow down or stop global warming and for us to act in the way Gillard is hell bent on acting without corresponding action from other countires is just stupid on a number of levels. However, this thread was started on the following basis:
This thread should be entered into with the assumption that we need to reduce our carbon dioxide emissions, and therefore debating the best way to go about it (and in particular the Australian governments methods).
So I shall try to behave.
For starters, to deal with some preceding comments, it isn't only "luxury goods" that will be impacted, unless you define "luxury goods" as "Any manufactured, modern convenience reasonably necessary for a reasonable quality of life in the 21st century". Lots of punters on less than $80,000/year buy plenty of co2-intensive products, but they'll be compensated. I feel sorry for the poor bloke working 70 hours a week to make $100k/yr to support a wife and 4 kids. You think he's rich do you? This threshold and compensation structure is a cynical political stunt. The Carbon Tax is so riddled with pay-offs and compromises that it's pre-existing futility is rendered even more pointless.
Lets get a definition of what a "co2 intensive product" is shall we - and get some examples down so we know what we're really talking about. I have had some difficulty getting clear guidance on this from the intertubes, perhaps someone else is more adept than I am. Anything made from metal, plastic or paper or which has chemicals in it seems to be a co2 intensive product. And that's if we just ignore anything to do with the petroleum industry. So that's any car, not just BMW's. Any TV - Sony Bravia's as well as Kogan's. All clothing, not just Armani and your childs school laptop as well as the fanboy's Macbook Air. This notion of a Carbon Tax being easy for the average punter to deal with because they can just stop buying "luxuary products" is ridiculous.
The other thing that's ridiculous is the notion that we can avoid these carbon intensive products by disciplined and frugal living. Food is a seriously co2 intensive item on your budget, good luck leaving that one off. So is the car you drive, the clothes you wear and the stuff that makes your lights turn on. But everyone else on the continent will be compensated for that and actually be BETTER off according to the Spin. Unless you earn $80,000 a year in which case the Nation has decided that you alone shall bear the brunt of everyone elses carbon consumption. You're kidding right?
And why are we so passivley accepting of this implication that we must sacrifice our standard of living so that this symbolic but pointless law can be passed? Don't use your airconditioner, don't run your pool filter, have smaller families so you can tiny cars and live in 2 bedroom apartments. And on top of that, it'll cost you more anyway. Brilliant scheme.
And there'll be no profiteering or abuse of this scheme. No artificial or excessive price rises. And that's because all of Labors schemes work so flawlessly and well. And the fact that we make a bunch of industries less competitive globally barely rates a mention. Why should that matter to anyone.
If we MUST have a Carbon Tax, and clearly that much is true, at least for now (and don't think it's really that hard to replace it with something more sensible if Abbot keeps his Blood Oath) - it should NOT be a political footbal and a way for Labor to ingratiate itself with it's voter-base. If Labor thinks it's such a good thing, then shouldn't all Australians be treated equally? Lower income earners already pay less tax, get more benefits and welfare etc. It's not like there is a discriminatory application of other taxes like, say, petrol tax.
So, what is the best way to go about it? There sure isn't any global consensus if the fractured myriad of schemes kicking around at the moment is any indication. Our seems to be the most draconian and expensive however. Yay for us. The countries that really matter (like the USA, India and China) either don't have one or its Mickey Mouse. Sadly, there's no guidance there.
I'm no economist, but to me if the things at least going to do as little harm as possible, it can't start life as this politically compromised thing designed to keep the Greens happy and the traditional labor voters onside.
Now, what we have is actually, according to the Government, not a Carbon Tax but an ETS - see below from the Governments own website:
Just before the 2010 Federal election, Julia Gillard said “There will be no carbon tax under the government I lead”, and critics have been calling her a liar ever since the multi-party committee on climate change released their statement on the plan to price carbon. The issue here is that what has been announced is not really a carbon tax.
It is an emissions trading scheme with a fixed price on permits for the first three years. Permits are still able to be bought and sold, but at a fixed price. A carbon tax implies that the government would simply tax companies for their carbon emissions, and is not the same as a system where permits are tradable, and in some cases provided for free.
So, its more like a Cap and Trade with a fixed orice for 3 years then? Great. Arguably the worst of both worlds. The below is some stuff from Wikipedia that seems relevant:
James E. Hansen has argued in his book (Storms of My Grandchildren) and in an open letter to President Obama, that policies to cap carbon emissions and trade permits for them (see cap and trade) will only make money for banks and hedge funds and allow 'business-as-usual' for the chief carbon-emitting industries.[156][167] He advocates phasing out and protesting against coal-fired power stations that do not have onsite carbon sequestration and imposing a progressive carbon tax.[157][158][159][160]
Carl Pope, executive director of the Sierra Club, supports a carbon tax over cap-and-trade because employers will know exactly what they paid for the carbon dioxide they produced, and because a cap-and-trade system (with grandfathered permits) rewards those who have the highest emissions now and have done the least to reduce them previously.[168]
Gary Becker, a conservative economist, expressed his support for carbon taxes over cap-and-trade.[169] Becker won the Nobel Prize in economics in 1992.
On December 11, 2008, Rex Tillerson, the CEO of Exxonmobil, said a carbon tax is "a more direct, more transparent and more effective approach" than a cap and trade program, which he said, "inevitably introduces unnecessary cost and complexity." He also said that he hoped that the revenues from a carbon tax would be used to lower other taxes so as to be revenue neutral.[170]
The American Enterprise Institute, Environmental economist Jack Pezzey,[171] economist Jeffrey Sachs (director of the Earth Institute of Columbia University),[172] Yale economist William Nordhaus,[173] The Earth Policy Institute, The Australia Institute, the Centre for Independent Studies, and Harvard professor, Gregory Mankiw also prefer carbon taxes to cap-and-trade.[174][175]
So its NOT a Carbon Tax. Bummer, I guess. If we had to have one, maybe it would have been better to have made an honest decision about it and been honest with the Australian people instead of playing semantics to get around a stupid promise made to win an election.