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Australia

Carbon credit-worthiness and Australian #climate politics; an historical perspective

A friend and supporter of this project has asked me to write about “carbon credits,” which are right now a ‘hot topic’ (sorry) in Australian climate politics.

What follows is not a comprehensive history, and only partly references posts that have already gone up (more are lurking in the near future). The second half is given over more to – well, why the big focus on ‘carbon credits’ – what is allowed and disallowed by that focus?

Comments very welcome, but not about the existence or severity of climate change – the time between now and the Actual Fricking Apocalypse (AFA) is short, and I don’t intend to waste even a minute of it on trolls, bots and poster-children for the Dunning-Kruger effect.

Australia and economic instruments around climate change.

In 1973 (not 1971 as the Tweet says!) Treasury, responding to concerns about the “diseconomies” of economic growth, released a report.

It basically wasn’t that bothered. And with hyper-inflation and all sorts of other economic mayhem, the Whitlam Government seems not to have paid attention.

Blah blah Fraser and his support for coal, and the way he ignored the Office of National Assessments report in 1981.

So, let’s skip forward to the coming of the “Greenhouse Effect” in the late 80s – and we should always remember that thanks in part to Barry Jones (Hawke’s Science Minister) Australians were well-informed (Commission for the Future, Phillip Adams, The Greenhouse Project, Greenhouse 87, Greenhouse 88, Stephen Schneider, Barrie Pittock, Graeme Pearman etc).

In 1988, Barry Jones pointed out that a price on carbon dioxide was a reasonable economic measure. Other people were saying the same – this is uncontroversial – Pigou etc etc – you want to discourage something, you make it more expensive. “The market” then finds a way. So the story goes.

But in Australia, on climate, until 1995, the major focus was on a carbon tax rather than emissions trading. And it had advocates, beyond the Australian Conservation Foundation. And they pushed it within the “Environmentally Sustainable Development” process of 1990-91. And they lost. Or rather, the determined efforts of a growing “greenhouse mafia” (to shoot Guy Pearse’s useful formulation back before the existence of the AIGN) were successful in defeating a carbon tax. Ros Kelly, Hawke and then Keating’s Environment Minister, explicitly ruled out any price on carbon, both before and AT the Rio Earth Summit-

June 12, 1992 – Australia refuses to put a tax on carbon: “It’s a question of who starts the ball rolling. We won’t.”

In 1994/5 the next (sort of) Environment Minister John Faulkner also tried to get a carbon tax going.

April 24, 1994 – a carbon tax for Australia?

And was defeated, by an even more determined and sophisticated resistance.

And after this, for various reasons (mostly to do with what the Americans wanted/were willing to countenance) taxes fell away (Clinton, don’t forget, had been defeated on his BTU tax in 1994) and “emissions trading became the flavour of the month. You can see it in various Australian Treasury documents, in conferences, speeches etc.

The basic idea is you create a “market” and so its magic then… reduces emissions. Meanwhile, certifiers, bankers, lawyers all get rich.

There were two big efforts under Howard to get a national Emissions Trading Scheme going. Both were defeated – the 2000 one by Nick Minchin, the 2003 one by Howard himself. Check out Guy Pearse’s High and Dry for gory details, and also Marian Wilkinson’s The Carbon Club. And there is the work of Clive Hamilton too (esp Scorcher).

Advocates of emissions trading soldiered on. One key entrepreneur was Bob Carr (there are blog posts on this site about him coming up). At a time when all states had Labor governments, they were co-ordinating on a bottom-up emissions trading scheme. Howard was not happy.

Then, when climate change “took off” in the second half of 2006 in Australia, Kevin “I’m from Queensland, I’m here to help” Rudd latched onto climate as a wedge issue.

BUT he had to go carefully, not to scare Queensland voters.

So, there was a massive emphasis

Howard tried to come back against this, saying he WOULD now introduce a carbon trading scheme if re-elected. But too little too late etc etc

What do we learn here? That carbon trading, carbon credits etc, are regarded as “common sense” (read Tony Gramsci on this!) as normal, reasonable and the best respectable position. Despite zero evidence that they would actually “work” at reducing emissions.

I don’t intend to go through the insane gory details of the period 2007 to 2012 (and onwards) – you have not bought me enough Cooper’s for that. But I will say this.

In early 2010, after Rudd’s “Carbon Pollution Reduction Scheme” had failed twice, and while Rudd was being too spineless to call a double dissolution election on the “great moral challenge of our generation” the Greens proposed an interim solution, a … carbon tax. Labor ignored the proposal (hi Penny!).

So, let’s skip over the last 10 years of “carbon pricing.” Except this, from the Turnbull-Frydenberg era, may amuse…

What is allowed, disallowed?

By getting into carbon credits, you can give the appearance of wanting to do something/doing something, and getting everyone focussed on a very small/technical issue which few understand. Perfect! It makes it virtually impossible for civil society actors, with their pesky legitimacy and demands for morality and far-sightedness and courageous decisions, to be involved.

It means you don’t have to piss off those very rich people who are funding you.

That’s the political purpose/attractiveness of carbon credits, over and above any actual “efficiency”.

Two final things. What I am saying is not new, or profound. Check out

The Veil of Kyoto

And, by my good friend Dr Robbie Watt, “The Fantasy of Carbon Offsetting”

Compare it with a so-called “inefficient” tax. Which is easier to collect, offers far fewer opportunities for evasion, gaming, arbitrage, get-rich-quick-scamming. Funny how the complex stuff always wins out, eh?


What is to be done?

Oh, god, I have written about that so much. Try this.