Australia’s climate policy failures are set to create a new revenue stream for major trading partners. There are many problems in the world of Australian politics but the area with the most amount of problems would be the climate change policy. There is on one side the Coalition party who has come out on top in the last decade with all the advantages it could get from the media as well as minority parties, then on the other side there is the Labour Party that has gone through a battering and Is now recovering from the bruising it took and a fair share of their members having internalized what the party should stand for.
In the last 13 years the plan for a carbon price has gone from bipartisan policy in 2007 to a reviled, broken promises to a carbon tax not even three years later. The government then made an arrangement with the green to which the Labor’s seven year in opposition didn’t really help. It is unlikely that the federal opposition will take anything that is of depth about climate change to the next poll, after all they would ideally like to be in office again. As seen in the election in 2019 complicated policies with massive price tags are fine as long as you are on the opposing side of them.
If looked at closer while the contribution to global warming in high per capita from Australia it is quite miniscule in absolute terms. The good news in this is that with President Joe Biden coming into to office there will be more international action, it was just this week that Prime Minister Boris Johnson stated that he had asked the British government to come up with options for carbon border levies. This only means that whilst Scott Morrison and Anthony Albanese are on their own bubble stating that that they don’t need a price for their carbon bigger players such as the United States and Europe are saying no problem we will price it for you and keep the proceeds.
There was quite a few objection to the unilateral carbon price and one was that it gives an advantage to competitor countries with more lenient environmental laws and standards making it easier for those countries to sell more than Australia, but this being said if there had been a tax or levy on carbon in Australia it would have made an even playing field for the good entering the country. There is some version of carbon border adjustment where the price would be adjusted where good from Australia could compete with the goods sent for countries with more lenient environmental laws. This could of course soften the blow on the Australian carbon price but it will also force the other countries to also come to terms of following rules.
It is in fact good news for the planet that these giants are taking note to make sure that the carbon foot print is to be minimized. Although this is good news for Australia it means that there is a huge chunk of money going into the pockets of international pockets but this is also due to their own stubbornness of not wanting to put their own levies and taxes. While some people will vent on protectionism others will vent on distortionary but the ultimate goal from both should be to push human behavior towards producing less greenhouse gasses.
Australian political parties have in the past kept plans under the table during election campaigns then suddenly bringing them to the table when in the middle of the office term. This is now becoming harder and harder as journalist and even the people are asking for the policies straight out on the table during the election campaign itself so that there are no real surprises of increased taxes when the party who wins takes up office. With this happening it is impossible for the political parties of Australia to keep policies and taxes hidden from the public. So, all going well, Australia will have a carbon price, leading to lower emissions, but it will be levied on us by the rest of the world. Our government (that is we) will miss out on the revenue. One day, maybe, our political system will allow a government to behave rationally and price it ourselves.
