In this article Tristan Ewins reflects upon the Australian carbon tax debate as transpired recently on the ABC television program 'QandA'. (Questions and Answers) He considers issues such as compensation, welfare reform, and 'trivialisation' in Australian politics. The treatment of Cate Blanchett for participating in a related commercial is a case in point.
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Tristan Ewins, 2nd June 2011
If anything the focus on Cate Blanchett as a personality detracted from the real debate over climate change. This was no accident – but was a tactic of distraction intended to avoid engaging on the issues; to prevent the message of this campaign from ‘getting through.’ This ‘trivialisation’ of politics in
Perhaps the greatest deception of all by the conservatives, here, is the underlying assumption that a carbon tax would see cost-of-living pressures passed on to the public: while an Emissions Trading Scheme or Abbott’s so-called ‘direct action’ would not. This is crucial as an ETS has in the past been supported by past Liberal Party leaders John Howard and Malcolm Turnbull.
In reality a market-driven ETS would see the price paid for carbon credits being passed on to the public in about the same dimensions as with a carbon tax. And Malcolm Turnbull has estimated the cost of Abbott’s ‘direct action’ approach could approach the vicinity of $18 billion a year were the government “buying offsets or otherwise directly paying for abatement”, and aiming for an 80 per cent reduction of emissions by 2050, as urged by scientists. A much more modest target of a 5% overall cut in emissions by 2020 would cost $2.1 billion/year in today’s terms.
These costs would of course be passed on to Australian families also – via the tax system. Only it would be ‘hidden’ in a wide range of other different taxes – rather than an overt and obvious carbon tax.
But the right kind of direct investment in renewable energy could make a very significant difference, combined with other incentives. In particular new public initiatives in the power industry could be combined with a German-style program mandating compulsory purchase of energy from renewable sources fed into the national energy grid. In 2009
But in Australia the figure is only slightly over 5 per cent.
Perhaps now there is a need for introspective reflection within Labor on a cross factional basis – to reconsider the mixed economy, and concede past mistakes. And even within the Liberal Party there could well be recognition that the mixed economy was undisputed under Menzies.
The final issue we will consider here will be the nature of carbon tax compensation.
In ‘The Age’ on 1st June 2011 Ross Garnaut was quoted as arguing for 55% of carbon tax revenue to be passed on to tax-payers, rising to 64 per cent by 2021-22, with industry receiving 35 per cent, moving down to 20 per cent by 2021. (presumbly as industry adapted and modernised) But ‘The Age’ also reported him as arguing that there should be “less compensation for pensioners and welfare recipients…because of [the] 2009 rise in benefits.” Effectively this would mean ‘no overcompensation for pensioners’.
There are a few issues here.
Firstly overcompensation is essential for Labor in ‘selling’ the carbon tax. This is as much the case for pensioners as for anyone else. Pensioners vote!
It is also key for social justice imperatives. Pretty much all pensioners struggle, and many disability pensioners and carers in particular don’t have many options in improving their financial circumstances.
Writing in February 2011, Peter Martin noted that :
“Working households faced extra costs of 4.5 per cent in the year to December, age pensioners 3.1 per cent and welfare recipients 4.5 per cent. The
This means that even in the face of onerous active labour market policies and ‘work for the dole’ programs, Newstart has been eroding greatly relative to other pensions for a long time.
Carbon tax overcompensation is a great opportunity to finally provide for the basic cost-of-living pressures faced by all pensioners, and especially by Newstart recipients. Most Newstart recipients ought receive overcompensation of $50/week. And those working two days a week under the government’s new ‘work for the dole’ provisions could receive overcompensation of at least $100/week. (for progressives this would be ‘making the most of a bad situation’)
Other full-pensioners (disability, carers, aged pensioners), whose financial situation is not necessarily so dire as that of the unemployed, could receive overcompensation starting at $25/week. Single Parents also deserve a significant extension of benefits.
And all such increases should be fully indexed on top of existing formulae.
Although improvement for Disability and Carers pensions – and associated services- could also be achieved via a National Disability Insurance Scheme; which would have Labor seen as ‘moving onto the policy front foot’. Perhaps providing such reform for Disability Pensioners and Carers separately would enable proportionately greater carbon tax-related compensation for other low to middle income groups, making the carbon tax ‘easier to sell’. But on social justice grounds Gillard Labor would still have to provide for Disability pensioners and Carers separately via a National Disability Insurance Scheme (NDIS) well before the end of the current term. Labor needs a positive message to re-engage with voters, and a NDIS could be crucial here.
The Greens and Independents especially need to make the most of their leverage over Labor to promote this reasonable and achieveable social justice agenda.
Here’s hoping that conservative forces fail in their strategy of attempting to ‘deprive the climate and carbon tax debate of oxygen’; manipulating voters through distraction and focus on trivalities. The issues are just too important to be engaging in these kind of cynical games.