Wed, Jul 09, 2014 - Page 9 News List

Misconceptions help kill Australia’s carbon emissions tax

Many mistakenly blamed the tax for soaring electricity prices and did not know that most households were compensated through tax breaks or welfare

By Rod McGuirk  /  AP, CANBERRA

In 2007, Australians were ready to do something to combat climate change, even if it was expensive. More than two-thirds of them said so in a poll and both major political parties vowed to make industries pay for greenhouse-gas emissions.

The undoing of that perspective is likely to be complete after a new Australian senate was sworn in on Monday. It is expected to give Australian Prime Minister Tony Abbott the votes he needs to repeal a two-year-old tax charged to about 350 of Australia’s biggest carbon polluters. Three top political leaders lost their jobs over the issue as support for climate-change measures plummeted.

A global recession, political miscalculations and failed negotiations only partially explain the dramatic change.

Opponents of the carbon tax implemented in 2012 had the media largely on their side. Electricity prices soared — not mainly because of the tax, but because power companies were spending billions on infrastructure. Most electricity users were compensated for the added cost of the tax, but many of them did not know that. And rising gas prices fed the fury — even though the tax did not apply to gasoline.

Australia’s experience illustrates how easy it is to scuttle complicated environmental laws, and serves as a warning to US President Barack Obama, whose recent proposal to force a 30 percent cut in power plants’ carbon emissions is drawing anger from both sides of politics.

“One of the keys was the fact that we did lose bipartisan support for emissions trading as one of the solutions,” said John Connor, chief executive of the Sydney-based Climate Institute think tank. “And that then threw this issue into the sort of political and cultural trench warfare that you see in the US, but not so much of elsewhere.”

Australians’ concerns about global warming peaked before elections in 2007. Then-Australian prime minister John Howard had grown unpopular for joining Washington in refusing to accept UN Kyoto Protocol targets for cutting carbon emissions. Both Australia and the US are leading producers of coal, a major source of the pollution.


An annual poll by the Lowy Institute for International Policy shows the proportion of Australian voters who saw global warming as a serious problem that demanded immediate steps — even at significant cost — peaked at 68 percent in 2006. The telephone survey of 1,007 voters had a 3.1 percentage-point margin of error.

Facing defeat, Howard’s conservative coalition back-flipped. Both sides advocated a cap-and-trade scheme in which free-market forces set the price of emitting a tonne of carbon dioxide.

Former Australian prime minister Kevin Rudd’s center-left Labor Party won, but the senate thwarted his efforts to introduce a cap-and-trade system. Some senators considered his plan too extreme, while others found it too weak. Meanwhile, the global economic crisis eclipsed the environment in Australian politics.

The government and the leader of Australia’s conservative opposition, Malcolm Turnbull, were on the verge of a cap-and-trade deal in 2009. However, Turnbull lost his leadership post to Abbott, then a senior opposition leader and a fierce opponent of the proposal.

Rudd shelved the plan. His popularity plummeted, and he lost his job in a Labor Party leadership vote to then-Australian deputy prime minister Julia Gillard.

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