As the 26th annual UN climate summit (COP26) in Glasgow approaches, we are seeing a good deal of movement — or at least positioning — from the Morrison Coalition government.
The first of four core areas for discussion at COP26 is the most important : securing net zero. The government finally seems to be accepting that it’s going to have to commit to net zero by 2050. And unlike folks in some countries, Australians will demand that it does what it says.
Wentworth MP Dave Sharma led the charge from within the Coalition for more aggressive interim emissions reduction targets. In remarks at UNSW’s Energy Institute, he said: “A 2035 target of 40-45% below our 2005 levels is achievable on the technology and policy levers available today, and will put us on a managed transition to net zero by 2050.”
Bigger news still was a volley (pun kind of intended) of media appearances by Treasurer Josh Frydenberg making the point that Australia would be punished by international capital markets if it was seen as recalcitrant, and that punishment would have tangible effects on ordinary folks.
“Reduced access to these capital markets would increase borrowing costs, impacting everything from interest rates on home loans and small business loans, to the financial viability of large-scale infrastructure projects,” he said. “Australia has a lot at stake.”
It was tempting to see this as a case of “shots fired” within Coalition ranks. But even Barnaby Joyce, the government’s fossil-in-chief, seemed to accept this reality. On ABC’s Insiders he said the Australian coal industry shouldn’t decline because of “any domestic policy” but shrugged that if it happened because of “world markets” then, you know, whatever.
Curiously, host David Speers interpreted this as a case of Joyce “digging in”. The better reading was that Joyce was heeding Simpsons character Chief Wiggum’s aphorism: “Dig up, stupid!”
In case you were in any doubt about Frydenberg’s strategy, it’s this:
- Point out the truth — that capital markets are demanding serious action on emissions reduction and are punishing those who fail to take such action
- From his position as the chief Australian authority on what financial markets mean for the country, note that it doesn’t matter whether we want to be green or not. We’re going to lose out big time if we don’t embrace net zero
- Stand back and let Joyce use markets as air cover for grudgingly agreeing to serious action on emissions reduction.
Smart.
What needs to happen now, though, is twofold. First, ensure that Australia doesn’t unnecessarily constrain itself in achieving net zero by exempting whole sectors of the economy from climate action. The idea that it would commit to net zero but exempt agriculture is bizarre. Not only are there huge economic opportunities for the agriculture sector in the green economy, the rationale for net zero is that Australia can still have emissions in some parts of the economy provided they are offset in other parts.
Second — and there’s really no getting around this — is Australia needs a price on carbon in the economy. The government’s “technology not taxes” bumper sticker completely misses the point. Australia won’t get technological innovation and adoption without a price on carbon.
Pursuing technology alone risks a misguided detour into 1970s-style industry policy, complete with waste, gaming, rent-seeking and worse. Technology and taxes (or more precisely subsidies for green tech and a price on carbon) are what economists call complements (as opposed to substitutes). Doing more of one makes it more appealing to do more of the other. Adopting green tech is more appealing when the alternative is paying more (through a price on carbon) if one doesn’t.
And putting a price on carbon is more attractive when technologies are around for it to help drive efficiency and change. Technology and taxes aren’t binary alternatives. As I observed previously on these pages — in language to which our PM might relate — they’re like a beer and a pie, or a hi-vis vest and a camera.
The Coalition is finally moving on climate. At least a bit. It is tempting for people like me who have long been advocates of strong action to see this as giving in to domestic electoral and international political pressure. But so what? There’s movement. That’s good for the country and good for the planet.
And when people finally do some of the things critics want, rather than cry “hypocrisy” we should — as American baseball fans say — “just take the W”.
Is the Coalition really committed to net-zero emissions? Let us know your thoughts by writing to letters@crikey.com.au. Please include your full name if you would like to be considered for publication in Crikey’s Your Say column. We reserve the right to edit for length and clarity.
Yes, but we have to be aware of Morrison’s Machiavellian plan. Remember it’s ALL about the election and staying in power (with ideological noses in the trough). Morrison will be making a cosmetic “Grand Shift” in position in a month or two, outflank Labor, leaving them high and dry after supinely agreeing with LNP ‘Policy” rather than being a strong opposition. He’s not going to Glasgow because he’s limbering up for and end of year or early new year election.
The rubbish politics hasn’t worked in Europe or with Biden (in spite of Pelosi’s unhelpful brain snap, undermining Biden and praising Morrison! So Morrison knows he’d be in for a rough time in Glasgow and will send a sacrificial lamb along.
The LNP’s linguistic gymnastics preparation in the run up to COPout26 in Glasgow is outstanding. While Smirk is examining his navel for personal media portents his Deputy, Beetrooter, has already staked his usual incoherent claim to the Delegation leadership in a master class performance on the last Sunday’s Insiders programme. There appears to be some confusion in the LNP however, on whether the event is the Edinburgh Fringe Festival or the Glasgow COPout? Party members appear to be favouring their usual participation as policy fringe dwellers rather than engaging participation in international policy dialogue and implementation events.
It is hoped that FIG, no not the frequently used political leaf, but the international gymnastics governing body will be able to bring some clarity to the matter shortly. I am concerned that our trusty Beetrooter is likely to do himself an injury should he be called upon for repeat performances over a long event qualification programme. For his part, Smirk is still researching his navel fluff in the hope of locating an antidote to Beetrooter and a fairy tale culturally sensitive to Celtic traditions.
When a Coalition member projects to “A 2035 target of 40-45% below our 2005 levels” , he is almost certainly referring to the replacement of coal with gas. A subsequent government might well replace some of the gas with renewables, but the insertion of intermittency would make complete removal of gas difficult. Nowadays the target is no longer token reductions, but the complete eradication of coal, oil – and gas.
Yes. First – Always remember the 3 Golden Rules on this, and indeed most issues. 1. Do not trust anything a Coalition member says. 2. Do not trust anything a Coalition member says. and 3. you guessed it.
These bastards will say anything and ignore their 20 plus years of denial and refusal to now to supposedly ágree’ to the net zero by 2050 target. It should be 2035 or 2040. They have to be held responsible, totally.
Scumo is dealing with this as usual, as a political problem to be dealt with; he is not genuine. World wide weasel words. thats all!
There seem to be two parts to this article. What Morrison and co are saying, hinting at, waffling about, talking about announcing and what they could and should and need to do. The first is just their business as usual in a change of clothes (still very warm ones) the second is things they have not done, have been opposed to doing and will not do in any serious way. Their policy is consistently, no matter how it is it dressed or labelled, looking after fossil fuels industries and continuing global warming. The best you could get from them is warming slower. There is no win here, just a different way of losing.
“Second — and there’s really no getting around this — is Australia needs a price on carbon in the economy.”
Richard Holden is another economist educated in classical-based economics. In fact he is a micro-economist, not a macro-economist, and hence he vociferously denies the capacity of the currency issuer (ie, the sovereign federal government) to create money ex nihilo (along-side the accepted money creation ex nihilo in private banks, see MMT). on the false assertion inflation will necessarily be the outcome.
Fact is the Nats will not accept a carbon tax resulting in higher electricity prices. Does another PM have to fall, before orthodox ‘flat-earthers’ like Holden wake up?
The solution is “planning , not pricing”. As for technology, Australia – with existing technology – can already reach 100% zero emissions much sooner than 2050, while at the same time continually lowering electricity prices AND maintaining incomes of displaced coal workers, by nationalizing the fossil industry, and building solar/wind plus pumped-hydro AASAP, all funded by Reserve ‘money printing’ (see MMT).
But the flat-earthers still reign supreme. Holden won’t get a look in with the Nats and their leader Barnaby Joyce, nor even Morrison who knows a carbon tax is political suicide.
Easy for Holden and other neo-Keynesian bigots to keep spouting their efficient market orthodoxy, because they are comfortable on their secure, well-paid tenures: but coal miners in the regions, and low-paid and unemployed everywhere, have to face higher electricity prices….all in the name of ‘market efficiency’.
“The solution is “planning , not pricing”. As for technology, Australia – with existing technology – can already reach 100% zero emissions much sooner than 2050, while at the same time continually lowering electricity prices AND maintaining incomes of displaced coal workers, by nationalizing the fossil industry, and building solar/wind plus pumped-hydro AASAP, all funded by Reserve ‘money printing’ (see MMT).”
You mean by nationalising the generation and distribution of electrical power?
I’m sure coal workers can transition to other mining positions. Not sure if they will have to cut their pay, but they will still have jobs.
A number of jobs in the mining sector are construction workers – which can be used to build other stuff, I’m sure.
Based on my experience of coal miners, many would rather lose their jobs than agree to a cut to “pay and conditions, hard won, over generations of struggle against the bosses.”
The present day coal miners never had to strike and struggle to achieve the working conditions they enjoy today.It was their fathhers, grand fathers and great grand fathers that won those conditions.This generation has sacrificed things like the eight hour day and other conditions to work twelve hour days and a fortnight on and a fortnight off for the big dollars.Also, the mining indudtry has changed immensely over the years with mechanisation and technology doing away with the need for miners lying on their backs in three foot seems.As Australia’s greatest prime minister , Ben Chifleyonce so profoundly said,”It’s the hip pocket nerve that the voters worry about”.To compare today’s coal miners with the coal miners of the 1940’s, for example is to compre chalk with cheese
Well said, you and I are aware of what the unions enabled workers to enjoy, gone now thanks to Howard, Keating and Hawke
“You mean by nationalising the generation and distribution of electrical power?”
Yes. The continuous privatization of the economy since the 70’s means government is subject to dictates of the market, as espoused by the current crop of neo-Keynesian NAIRU economists. Hence we see the call for a carbon tax by all orthodox market economists (comfortable in their secure, well paid tenures), even though carbon taxes are political suicide for politicians, and affect most negatively the unemployed and low paid workers, when electricity prices rise as a result of the carbon tax. The only way to lower prices progressively through the transition, and guarantee no-one is worse off, is via government planning, not market pricing, using the currency-issuing capacity of the Fed reserve.
See Ross Gittins SMH article:
ROSS GITTINS: Funding the budget by printing money is closer than you think
The current economic orthodoxy is the reason why democracies today are shaky; politicians are despised while orthodox economists are the real villains.
eg, No surprises re the dismal 25% support for the major parties in Germany today (with 8% support for Greens restricted to young voters), while the hard left also lost votes, given the left is also misled by economic orthodoxy since the demise of the USSR. Talk about a confused electorate, given those figures!
Interestingly a MMT-literate party is standing in the next Oz election. Can heterodoxy get a look in?
Funny how electricity prices didn’t go down afterwards like Abbott promised.