I didn’t see Q&A on Monday night (I rarely watch it these days; and consequently I missed Julian Assange’s video question as to whether Julia Gillard has committed treason). But there seems to be a view about that Gillard explained the carbon price process rather better than some of the confused messages from Labor ministers over recent weeks might have suggested. The transcript is here.
The problem with the selling of the carbon price, aside from its initial framing (which I wrote about here), appears to be that it’s largely been reactive. That is, Tony Abbott has been setting the agenda, and the government’s arguments have been calibrated to responding to his lines. Ben Eltham, for one, doesn’t think it’s too hard to argue the carbon price positively.
Abbott himself hasn’t been put under nearly enough pressure, Greg Combet’s demolition of his risible Direct Action strategy aside. As Tim Dunlop suggests, there is still some sort of reluctance to portray his “science isn’t settled”/we have a plan two step for what it is.
Conventional wisdom seems to have it that the period of time between the announcement of the principles and the legislative process is a negative for the government. I’m not too sure. You can already see a bit of desperation in how various media outlets are trying to extract something “new” from the carbon price argument – perhaps inevitable if they are not going to actually write about policy debates. Ross Garnaut’s wish that the issues be debated more seriously might yet come to pass. And Tony Abbott’s relentless negativism may wear out its welcome.
After all, the only way is up.
In the immediate context, Julia Gillard has been (mis)reported as characterising The Greens as “a party of extremists” in a speech in Adelaide last night. She’s also been scoffed at for saying with respect to the initial fixed price design that “The Greens made me do it”. But if you actually attend to what she’s saying, she’s no doubt telling the truth. At the same time, she’s obviously trying to reclaim some policy kudos for Labor, and I doubt, actually, that doing that will result in what is implied by the feverish talk of “a split with The Greens”.
Gillard, who’s been wearing red a lot lately, is, I think, embarking on a series of interventions to relate her government’s positions to Labor tradition, probably including her weird speech in Washington. But, from her point of view and the ALP’s, that’s no bad thing to be doing.
I know this is off-topic, but some interesting numbers on the cost of PV cells:
http://www.scientificamerican.com/blog/post.cfm?id=smaller-cheaper-faster-does-moores-2011-03-15
“Conventional wisdom seems to have it that the period of time between the announcement of the principles and the legislative process is a negative for the government. I’m not too sure.”
Conventional wisdom is always that. I would not bother with it. They wanted more immediate detail so they could play merry hell with the distorting of it, just as they have already with the deleted critical information of compensation for the price increases involved.
Media here are ‘drips’ so that seems to be the best style to deliver information to it; in a way it can understand.
The Abbott Direct Action plan has not yet been properly demolished. Best to leave it standing so the remains can be picked over slowly along the lines of ‘deceptive great big new tax’ or ‘hospital, school and critical services slasher’ to the cost of around 8 Billion and paid directly to the polluters.
Joe2,
I also agree with the “drip feed” approach, but because of the intellectual limitations of the electorate at large rather than the media.
Carbon pricing – and its ability to reduce carbon emissions – seems straightforward to us, but I would guess that it is baffling to the majority of the population. Hence, for example, the question on QandA on whether compensation means that behavioural change will not occur. I reckon a majority of people would believe that, including some commenters on LP.
Abbott and his plans are a sideshow. The main game is to ensure carbon pricing – as a concept – is more widely understood. Rudd’s communications strategy seemed to be, “it’s too hard to explain, and anyway if people do understand they might vote against it”. That was a disaster.”
Gillard’s strategy is a huge improvement.
Good stuff, like here, on this by Ken Parish @Troppo, as well.
http://clubtroppo.com.au/2011/03/16/roosters-feather-dusters-and-high-stakes-poker/
Latest update from Garnaut looks promising (and gives media more info to run with). I especially like the sound of the Henry tax review being incorporated into the compensation plan.
http://www.smh.com.au/environment/climate-change/garnaut-calls-for-carbon-tax-of-up-to-30-a-tonne-20110317-1by6p.html
“whether compensation means that behavioural change will not occur.”
Or, more colloquially, “if it ain’t hurting, it ain’t working”. The converse of which is “if it’s gonna work, it’s gotta hurt”.
That is the myth that Gillard needs to bust.
OK – the PM has committed to not losing any jobs and not exporting any jobs or emmissions of CO2.
I’d like to see that.
She deserve the Nobel Prize in Economics if she can do that.
“She deserve the Nobel Prize in Economics if she can do that.”
Same for Swannie and Kev for saving us from GFC.
Analysis of Garnaut update at Crikey
http://www.crikey.com.au/2011/03/17/carbon-price-garnaut-backs-labors-scheme-but-switches-on-compensation/
And Garnaut update paper here
http://www.garnautreview.org.au/update-2011/update-papers.html
Garnaut update paper no.6 or direct link here
http://www.garnautreview.org.au/update-2011/update-papers/up6-key-points.html
@8 – ahhhh . . . No.
GFC = major crisis in the international debt markets leading to problems in the banking industry.
Australia had the following:
No over-supply problem in the real estate industry (in fact serious undersupply – still).
Miniscule number of real estate loans that went into default.
One of the best, if not the best, regulated and capitalised banking sector in the world (mainly as a result of the experiences of the 1980/81 Westpac disaster) with little or no exposure to defaulting real-estate loans or the various derivatives that caused the problems.
A government with no-debt and funds stashed for the rainy day that arrived.
Unemployment at record lows.
An economy leveraged off the Chinese miracle who pump primed like there was no tommorow.
So, while there is reasonable debate about the margins of the Australian policy response on how much should have been spent and on what and whether the deposit guarantee was required – the fact remians that the proverbial Drover’s Dog could have succesfully navigated Australia through the GFC.
No Kewpie Doll for the ALP on that one.
Perhaps you could point out a country in a similar economic position that did worse?
I would have thought the PM would have learned by now about not making promises she can’t keep.
Razor, what is your assessment of Costello’s handling of the 1997 Asian financial crisis?
Any Kewpie dolls for pistol Pete?
This is commensurate with England’s price on carbon, which is $29 per tonne. At this price, both Australia and England would be world leaders.
On her recent trip to Washington, Gillard said to Obama that she did NOT want Australia to lead the world in pricing carbon, so it is difficult right there to see us adopting Garnaut’s price. Gillard has to be confronted on this issue of lack of Australian leadership in the world.
Why is $30 per tonne a good starting level? On Lateline a few nights ago, Greg Combet said that a price of $25 to $30 per tonne is what is required to see a shift from coal-fired to gas-fired power production. Of course, the shift won’t happen all at once. The shift has to be managed by the federal government, with coal-fired power stations being shut down in a manageable fashion, with the oldest being shut down first, at the same time as gas-fired stations are brought online, and in a way that minimizes the loss of jobs in the coal sector (that last bit to satisfy the Martin Fergusons out there). This might take place over, say, ten years. Combet also said that when gas totally replaces coal in Australia, this will halve our GHG production. Now that is something admirable to aim for.
The problem with this is that these gas-fired stations will be entrenched, and if or when the carbon price is increased to around $60, or whatever the price is to make solar-thermal economically competitive, the introduction of solar-thermal will be resisted on the grounds that the gas-fired stations will not yet have lived out their full lifespan.
So, my proposal is that we go with Garnaut’s price of $25 to $30, but that the government give a leg up – a dedicated subsidy – to solar-thermal, to put it on a par with gas-fired stations.
Ah yes, treasurer Peter Costello, who engineered the sale of two thirds of the reserve bank’s gold reserve for around US$330 per oz in 1997 selling 167 tons or 2 thirds of Australia’s holdings. There was a man with foresight.
Gillards speech committing to compensation for trade intensive industries etc promising that no-one will be worse off and no jobs will be lost was a complete farce and a cop-out. The whole point of pricing carbon is to make polluting industries more expensive so people use less of their products thus forcing them to invest in cleaner technologies. Providing Compensation defeats the whole purpose of pricing carbon because then polluting industries dont have to cop the extra impost to pollute because the get it back in compensation.
Cmon guys, get past the ‘do anything to support Labor’ drill and acknowledge that if it’s gonna work it has gotta hurt and there is no way Labor will even try to promote that.
“I would have thought the PM would have learned by now about not making promises she can’t keep.”
I suppose you also extend that comment to Mr Rabbit and his promise to end the carbon price legislation if he wins government even when he hasn’t even written it down yet and the Greens, most likely, still have Senate control.
Jamo, are you attacking Labor from the right (Libs) or the left (Greens)?
Jamo said:
Personally, I’d prefer they got no compensation but did get the benefit of a BTA if any actual goods arrived here that were profiting from more industry-friendly CO2 treatment. If any actual offshoring happens, some will go to places that are less CO2-intensive than we are — that is most likely in aluminium smelting for example. The real problem is ensuring that compensation is paid only to bona fide EITEs rather than the spurious ones that snuck in under the Rudd CPRS. Mining, energy, forestry and agriculture ought definitely to be out.
Really the problem is a political one, to do with claims of fugitive emissions. Very few industries are going to start shopping around for new places to go, because to do so would impose some pretty serious costs in lost production and in sunk costs at a time when you don’t want to be alienating customers or creditors. So Gillard is almost certainly right — there will be very few if any lost jobs.
I still say that without addressing the efficacy issue (will the tax make any difference to the climate???)Gillard is on a hiding to nothing here. Frankly when the product is as dodgy as this tax then who will buy it from any sales person let alone one like Gillard.
Silkworm, the economics of gas and coal are different.
In Australia (particularly Victoria), the coal is free (and essentially worthless for anything else), the equipment to dig it up, burn it and turn it into electricity is expensive.
With gas, the fuel is valuable, the plants are cheap.
Gas-fired plants also have a shorter working life than coal plants.
@ 18
Jamo, are you attacking Labor from the right (Libs) or the left (Greens)?
Mate, from the centre. I believe in Climate Change but I also believe if we are going to price carbon to reduce it then we’ve got to do it properly. And as I said, the whole concept works on the principle of paying more for pollution, and if we’re just going to compensate them for the price they pay for polluting then what the hell is the point.
Jamo @16,
“acknowledge that if it’s gonna work it has gotta hurt”
Yes, you are one of the people of limited intellect that I was presciently referring to @3 and @6 upthread.
Probably best just to keep it to yourself next time.
This bit made Lateline lastnight, from her Dunstan speech
http://www.abc.net.au/lateline/content/2011/s3166033.htm
JULIA GILLARD: The scientific consensus is stronger than ever. Given these realities, I ask: who would I rather have on my side? Alan Jones, Piers Akerman and Andrew Bolt, or the CSIRO, the Australian Academy of Science, the Bureau of Meteorology, NASA, the US National Atmospheric Administration and every reputable climate scientist in the world.
This is the gear.
Jamo, Garnaut covered that very point at his press conference. The levy will by and large be returned to people, especially low and lower-middle income earners. At the same time they will still make choices on consumption for electricity and car fuel. These will likely be price-affected, leading to renewable choices ahead of fossils.
“Abbott and his plans are a sideshow.”
Incurious and Unread, I will leave your comment about “the intellectual limitations of the electorate at large” only to say that good minds require sound information to form reasoned opinions – currently the fourth estate is shoveling shit.
That manure can be made valuable, however, by turning over the “Direct Action” plan- how are these jerks getting away with a title like that while concurrently changing a “carbon price” to “carbon tax”, just for a start?- and looking at the proposed Coalition slush fund for what it is.
People like Jamo, here, should know which proposal is the one that is about paying out to polluters. Flushing out Tony and co on the question of where does the money come from?, when they have not a 3 week election deadline escape to hide behind, is a dish best eaten in slow food style.
In short, they should not be let to get away with this crap, like they did with their pre-election black hole, and it will help in showing how the other proposal is far better.
@ 13 – not a lot – kudos to Hawke/Keating for floating the AUD with the support of the Coalition.
@15 – please prove me wrong, however I believe the RBA made that decison independently – not Costello’ call – did you buy any gold seeing it was such a wrong call?
@ 6 & 16 – great line! “If it’s gonna to work – it’s gotta hurt” – look for my placard at the 23rd March Rally at Parliament House in Perth.
@17 – hoopefully he will have more courage than the ALP and go to a DD on the issue of the Greens block him.
If only the “wealthy” are going to take it in the neck – is that not wealth redistribution – a long held mission of the left?
Joe2,
The problem with trying to pin down Abbott on his “direct action” is that nobody really believes he is going to do it anyway. So what’s the point? You are chasing a mirage. It’s a distraction.
The media are what the media are. No point in complaining about it. Gillard has to find a way around them or through them. That’s why she has to take it slowly and consistently.
In the end, it is tiresome to keep blaming the media. Might as well blame the weather. It isn’t going to change any time soon.
Razor @27,
Oh dear! I have inadvertently created a new slogan for the dimwitted.
Jamo seems to have picked it up at face value, but I will give you the benefit of the doubt and assume that you are being cleverly ironic.
I’d like to hear the PM talk more to the “we are carbon pipsqueaks, so why do anything, it’s pointless” argument. This theme (we’re small, the world is big, why should we have to change?) resurfaces during any and all global reform process and seems to attract the easily distracted.
She’s great at selling it as long as no one asks a question, then it gets shrill and incomprehensible. She’s not up to it. You can’t sell something by attacking everytime a question is asked.
Look at that… no value loons assembling.
Compensation to both industry and householders was always in Garnaut’s plan. The key here in today’s news is linking it in with income tax reform, I think this is extremely clever.
Incurious and Unread, compensating people for increased costs is not the same as saying there will be no cost, no matter how stridently you try to assert it.
The mining Super-profits tax was an attempt to impose a greater cost on mining companies, whilst trying to make it more enticing to the general public by linking it in with a tax reductions for businesses and increased superannuation for PAYG employees. How they managed to stuff it up is beyond me, but I think part of the reason that reform failed was because mining companies were able to propagate concerns about diminished returns amongst shareholders. And I think it is here where your concept of trying to sell the message that it ‘aint gonna hurt a bit’ might strike some challenges.
I hope that they manage to sell this process better, but I think berating people because they understand that putting a price on something that has hitherto not had a price will indeed increase costs for someone seems unnecessarily combative and counterproductive to me.
The point about compensation is simple. People have more money in their pocket. But electricity, etc. still costs more. Therefore they have an incentive to make different consumption choices.
furious balancing,
Ah, you have moved silently, almost unnoticeably, from the microeconomic to the macroeconomic and quite subverted my position. The fallacy of composition lives on. I argue that you can change the behaviour of an individual without imposing any cost of them. Am I then asserting the same thing for the economy as a whole?
I am not, but your point is well made. There will indeed be some overall cost and the government shall decide how to share it around. Should I generously infer that this is the point Razor and Jamo were making? I think not.
It is the government’s challenge to explain these subtleties. That is why I think Gillard is doing the right thing in taking her time to do that.
@Grogs
http://grogsgamut.blogspot.com/2011/03/carbon-price-catch-22.html
Well, sort of. The compensation could be simple.
However, the deal that Rudd negotiated with Turnbull was an outrageous rip-off of consumers, and handed most of the compensation to the polluters.
It remains to be seen whether we, the consumers, will be faced with another rip-off this time.
Note that it’s not always possible to tell from the political rhetoric whether you’re going to get ripped off.
Part of the rhetoric is a reliance on describing compensation to polluters as being compensation to consumers. That was a key feature of the now defunct US carbon trading proposal, Rudd’s CPRS, and Keneally’s electricity price reduction system. In short, the theory is “we’ll take the money from you, and give it to the polluter, in the hope that the polluter will lower its prices instead of just pocketing the money and laughing a lot”.
the truth is here
http://blogs.news.com.au/heraldsun/andrewbolt/index.php/heraldsun/comments/gillard1/
Laura Tingle has been saying that Gillard has a legitimacy problem, inherited from the putsch through which she came to the leadership, confirmed by the inconclusive election result and now by the ‘broken promise’ with which she has been tagged, whatever the rights and wrongs of her position. Hence there is a tendency to pay out on her and treat her with less respect than they commonly afford PMs.
If she’d sprung a fully detailed proposal, ready for legislation on them they would have complained that she didn’t consult the stakeholders.
There is both honour and logic in the approach she adopted. With a bit of luck people will come to see that something had to be done and that the scheme she is proposing has gradualism, responsibility and a longer term vision of a necessary economic reform.
People have more money in their pocket
Well, the people who are already passengers in the economy at least.
Minor PC, you should never put “Bolt” and “truth” in the same sentence. He’s either a liar or a fool, or at least seriously deluded.
Actually, the link that PC includes is pretty funny. It seems that all Bolt can come up with is some minor pedantry over the terms ‘carbon’ and ‘carbon dioxide’.
I guess he hates the conflation of the two terms because people associate carbon with something like charcoal, rather than the ‘they call it pollution, we call it life’ ‘odourless, colourless gas’ schmaltz that they want to run with.
Most of the rest of the column is the same. Particularly
One shouldn’t throw bricks when one lives in a glasshouse, Bolt. You keep denying the scientific method, then I’ll put you in the same category as a Holocaust deniers, homeopaths and other loonies who think they can establish fact by personal fiat. You can come out when you want to have a rational debate based on fact, not cherry-picked fiction.
Thanks PC – it lightened my morning anyway.
Brian@39 the legitimacy problem seems more likely to be about Gillard’s gender, class and party- female from Altona takes power away from the ‘born to rule’ Liberals.
There seems a lot of jealousy about ‘just who’ broke through the glass ceiling imo.
joe2, agreed. This morning Fran Kelly was addressing Rudd as “Minister” whereas the typical form for Gillard is more familiar.
Jess @42,
I was reminded of the distinction between carbon and CO2 in the comment from Abbott yesterday that:
I hope he is talking about the CO2 emissions from the cement and brick manufacturing and not the carbon “embodied” in the wooden frame!
PC @ 38, comedy gold, if you are searching for the truth from a sophist like Andrew Bolt i am not surprised that you are puzzled.
Iain Hall @ 20, Tell your story walking pal because no one is afraid of the Libs and their pathetic scare tactics any more.
The kids want to know what Tony will do to the NBN as the lower classes have been looked after regarding the price on carbon and they are already satisfied.
You are praying Tony will get real and start punching because he looks pathetic trying to slow the world down by himself! you are praying he gives you something else to talk about as this argument is lose and you know it!
Go Liberal Party! Yeh, ………… ?!!?
WHO REMEMBERS Andrew Bolt accusing Tony Abbott of acting on climate change without believing in it on THE INSIDERS LAST SUNDAY?!!?
WHY WON’T TONY ABBOTT DEFEND HIMSELF?!!?
Lol, Who saw that?!!?
Bolt nailed her
Keithy
you are protesting too much mate.
In any case its not a matter of people being scared by the Liberals its a case of no one is buying the horse pucky that you alarmists are trying to sell, The people are on to the fact that this carbon tax won’t do anything to “fix’ the climate and they just don’t think that the pain will be worth it even if they “believe” in AGW.
The sad reality is that your side of politics are doing a good job of scoring own goals so Tony does not have to work that hard at present…
Kim,
Re #34 – perfectly correct, the idea is to rebalance consumption and investment decisions – but please use the correct English for this plan. It is a plan for a carbon tax, not a carbon price. If this is a carbon price, then an income tax is really an income price – the GST should be renamed the GSP and so on.
oooooh Andrew you are going to upset Katz . . .
que Katz
@ 53 – sorry Katz.
It is Fran Barlow who get’s uppity about calling it a tax but doesn’t give a rats about it referring only to carbon.
Andrew R said:
No, it is indeed a price on CO2e emissions — a charge for dumping. Accepting waste is a service. A service is not a tax, even if the state charges for it, or has someone charge on its behalf. See for example Air Caledonie v Commonwealth (1988)
Andrew, it’s not a tax like income tax or a medicare levy because the cost does not fall on Joe public. It will fall on the burners of coal such as the power generators. That’s why it’s better to call it a price. I think politicians like Tony Abbott are pushing the word “tax” to take advantage of the confusion that it brings.
Andrew Reynolds @51,
The difference between the carbon tax and conventional taxes like income taxes and GST is that the carbon tax is a Pigovian Tax. It is intended to change behaviour rather than raise revenue. Conventional taxes are intended to do the opposite: raise revenue but not change behaviour.
In this context, the tax level is economically similar to a price in that the level will determine the extent to which behaviour changes.
You can call it what you like, but it is useful to understand this distinction.
silkworm@55,
Wrong answer. There are lots of taxes that do not fall on “Joe public”: eg corporations tax.
Sorry silkworm and Fran – nonsense. That must sound weak even to you. Should we rename corporate taxes a “Corporate Price”?
This tax meets the High Court’s definition of a tax – as it meets every other definition of a tax that I have ever seen. The government does not want to use the “T” word as then it would have to admit that they have not met their pledge not to have a carbon tax.
Surely the site that runs a regular thread on pointing out spin should not be indulging the spin themselves.
In any case – this tax, like all others, will be passed on. Ultimately all taxes can only ever be paid by people working and producing something – there is no other way to pay one.
.
Fran,
Are you seriously claiming that the government will be accepting the “waste”? Where are they going to be storing it? Does the PM have a secret sequestration plan?
Incurious and Unread,
I am not arguing whether this tax is Pigouvian or not. It is, as you correctly point out, a tax.
Fran,
I should clarify my rebuttal of your point. I have read Air Caledonie v Commonwealth (1988). It looks like you have not – or if you have you have not understood it. To qualify as a fee for service some form of “service” has to be provided. Merely allowing someone to do something if they pay the exaction is not a service – there actually has to be a service provided.
You attempt to use waste disposal as an analogy. This is simply wrong, as I indicated. The government would have to provide a sequestration place and then charge for its use, if this was to qualify as a fee for service. Clearly, they are not – ergo this is a tax, not a fee for service.
Andrew Reynolds tried:
You and Terje must have had a committee meeting. The salient question is — is provision of a service involved?. Corporate taxes are not directly attached to actual services. A corproation cannot change the quantity or quality of the services it gets by varying its tax. Similarly, one pays land tax without qualifying for any particularly level of service. One cannot decline a service and evade land tax or demand more service in exchange for more land tax. Arrangements of this type are clearly fees or charges or if you like, prices.
They use it in pretty much every interview. Gillard accepted it in the now famous Q & A session a week or so ago. I disagree with them but there you have it. The actual term — the fixed price period — is more accurate, but now that the government has become the plaything of the Murdochracy, this is what they are doing.
That’s true, unless they choose not to by avoiding some or all of the products to which the charge applies. If a producer finds ways to produce goods and services with very low CO2 intensity, then the end users of that good/service will not ultimately pay the price/fee/charge. If the cost of low CO2 intensity production is higher ceteris paribus, they will nevertheless pay a premium of course but in that case the high and low Co2-intensity producers will operate on a playing field closer to one which fully accounts for the externality that those emitting significant CO2 impose.
Yes. They are accepting it on behalf of the community. The community is refunded in cash or kind and can choose to use that consideration to abate in one way or another. Some of the money could be used to build new low-Co2 intensity capacity, to do geosequestration, assuming it could be done within the budget, or to reconfigure cities so as to reduce the call on fossil hydrocarbons.
It may well be that projects such as soil carbon or algal farms do some of this work. Perhaps geoengineering projects might mitigate the climate forcing, reducing the impact of the emissions that are being charged. These are projects that go well beyond the lifetimes of individual governments.
Andrew Reynolds said:
They are providing a “sequestration place” — in this case it is the atmosphere along with every other CO2 sink. These form the commons and the government is the trustee of the commons, which belong of course, not to any individual but the community as a whole. What this does is ensure that private parties repay the community for the right to dump.
If you don’t see this as a valuable serbice, consider this.
Would it cost more, less or about the same to generate electricity using coal or gas or oil if all states required that all those in the chain of provenance from harvest site to smoke stack captured 100% of all waste and stored it securely and indefinitely on their own land until the end of days?
I’m going to go with — substantially more. Would their fossil HC assets be worth less or more in these circumstances? I’d say — a lot less. Clearly, asset values of fossil HC and the relatively low price of fossil HC energy is the result of a valuable and currently free service — the right to use the biosphere as an industrial sewer. Why should this valuable service be provided free by the commons? Aren’t the commons simply encouraging a decline in the quality of ecosystems services to the population as a whole by making it free? I’d say yes.
Now normally, if I act in a way that improves the value of another person’s asset, or makes it possible to trade on more favourable terms, the primary beneficiary will regard my actions as a service, even if my action is largely passive — allowing someone to use my garage for example. The biosphere is a truly huge midden. That access is a service unless one sees dumping as a non-excludable practice.
Fran,
Firstly, I have never met Terje.
Secondly, already rebutted. The words “[i]t may well be that…” and “[p]erhaps” give that game away. There is no service provided, as per that decision you tried to hang your hat on, ergo this is a tax.
So – the government provides the atmosphere? Is that where you need to go to try to justify your argument?
What’s next – they provide the water? The government provides the Earth? If so, then surely they can tax us for just allowing us to exist or to have the temerity to privatise the benefits of the atmosphere (i.e. to breathe)? Would that be a fee for service?
Sorry – and I don’t mean too much disrespect here – lol.
Re-read (or is that read) the actual decision. Please. You introduced and relied on it, yet it makes an absolute nonsense of your argument.
Andrew said:
The government, on behalf of the community, suffers it to be used. At the moment, it suffers in silence. It is prposed that the government demqand, on behalf of the community, a fee in exchnage for this valuable service. The government imposes licence fees for broadcast use of the airwaves. These are not called taxes either.
They make it available.
Its services are made available.
Technically yes, but in practice, since breathing is a necessary condition of life, and since all civilised communities accept the right to life as inviolate, it follows that breathing is a non-excludable service. Moreover, 100% of humans breathe and derive approximately equal benefit from doing so (they stay alive), so there is no distinction between private and public benefit and thus no warrant for charging for the service.
The right to use the atmosphere as a sewer to secure a private benefit however is not inviolate and in so far as industrial scale pollution is necessarily at the expense of the amentity of others there is a very clear distinction between public and private benefit — and thus a warrant for pricing this service.
This is what is most salient:
The emhasised portions very clearly underpin my claims.
It is clear that the biosphere is a piece of property albeit a public property rather than a private one. Access to it for private purposes is a service — and a very valuable one at that. Commercial entities can choose not to avail themselves of the service or avail themselves up to but not beyond the point at which the marginal utility, considering the fee fell to zero. Stern estimates the community cost of CO2 emissions as being above about $85 per tCO2. A fee of $30 would be well under that mark.
QED — it is not a tax.
oops mods:
I seem to have inadvertently changed th font attribute on the page.
Would you please close italics and also my blockquote after “FB}”
TIA …
. . assume a can opener . .
Fran, surely you can recognise that the claim that naturally occurring water, and the life-supporting properties of the Earth more generally, are “made available” by government is absurd?
Tim Macknay said:
How so?
While they predated government, today, the government is the trustee of the community interest, and the integrity of these services certainly falls within that interest.
Sorry, Fran – you clearly read but do not understand. Again – your claim that somehow the government owns the biosphere is a complete and utter nonsense. The fact that you need to rely on this to make your case shows just how silly it is.
As for the “make it available” stuff – you are placing the State in the role of a deity.
I would contend that there is not a High Court (or other supreme court) in the world that would claim that. Even the most theocratic dictatorship would not make that claim.
The emphasised points, btw and incidentally, do not support your claim. There is no data around that would support a carbon tax of any particular (low) level actually doing any good for the biosphere. If you can point to some research that says that 1 tonne of CO2 emissions does $26 (or any other number) worth of damage then, apart from anything else, I will eat my hat.
As for “has no choice” that would, in this case, and again btw and incidentally, be met as a test. Realistically, we all consume power or the benefits of that power. The CO2 embedded in power, water transport and just about everything else we do effectively gives us no choice about paying this tax.
So – if you are willing to live off the land, without computers, water supply, food distribution or other activity then you have a choice. Realistically? That is no choice.
Sorry – it’s a tax.
Andrew @59,
Call it a tax, price, levy, impost, fee, charge or whatever you want. But do not make puerile arguments like:
That is just garbage.
Because the ability of people to make use of universally available life-supporting aspects of the biosphere are completely independent of government.
I agree with the concept that the government, as custodian of the public interest, has a key role in protecting ecosystem services from degradation, but that is a completely different proposition from the claim that ecosystem services are provided by government, which is the claim you are making.
Incurious and Unread,
Perhaps you can point out why it is “purile” rather than just making unsubstantiated assertions that it is.
If this is a tax, as you have correctly argued, then to accept calling this a price is (IMHO) to mean that we accept any other tax could also be rebadged as a “price”.
I don’t see that as “purile” – I see that it is a logical extension of the argument.
If not, please show why rather than just bandy such terms around.
Andrew @73
Tony says:
Tony gets it, and economics is really not his strongest point.
Andrew @73,
OK, here is your puerile argument, with a few words changed.
“Apples and pears are fresh food. So are onions and lettuce. If you are going to call apples and pears “fruit”, you might as well call onions and lettuce “fruit” as well.
Wow, I have just proved that apples and pears are not fruit. Clever me.”
Incurious and Unread,
So a 10% Goods and Services Price means how much on your groceries bill? How much does a Corporate Price mean on your dividend return? How much does an Income Price reduce your net income?
OK – now I understand.
BTW – are you now saying you were wrong at #56 when you said it was a tax?
Andrew tried:
Perhaps you should have put that in upper case. It would have been twice as compelling. What a miss!
Ah … roll on Michael Crichton, even after death …
Argument from incredulity … Can I be incredulous that you made it and let that stand as refutatation?
Yes … it is well known in economics that price doesn’t shape patterns of demand. I’ve forgotten the reference though so perhaps you could cite it.
Tim said:
People and businesses have quite different relationships to ecosystem services. One can exclude businesses from all of them but once cannot exclude people from all of them. Nobody has an unfettered right to pollute. And even people can be fined expectorating, defecating or urinating in a public place.
On the Pigouvian question …
It is certainly possible to have sumptuary taxes. The “luxury car tax” certainly counts as a tax. Here, a levy was imposed not in exchange for any service provided by the community but in consideration merely of the fact that those buying luxury cars could afford it and money was sought for public purposes. Plainly, the state was not wanting to discourage purchase of luxury cars. It was revenue raising.
Levies on alcohol and cigarettes are both sumptuary and Pigouvian. The state wants to mitigate consumption and recover some of the community cost associated with this consumption. No service is provided by the community in exchange for the levy.
But a charge on CO2e emissions is clearly a cost imposed pro-rata for each tonne of CO2 absorbed by the biosphere. It is clear that this service advantages the emitters by a lot more than the cost imposed (as well as damaging the community by a lot more than $26 per tonne). So it is not a tax.
Just a reminder, Fran – rather odd attempts at ridicule do not substitute for argument. I obviously have to remind you as you seem to have forgotten.
Were there any actual points in there or was it all just abuse?
Oh – in the blockquoted section there may have been two attempts.
1. You said “…one could alter how one prioduces [sic] goods to reduce CO2 intensity…” – i.e. you will have to pay the tax, just you might be able to come up with some way of paying less. Remember, the test (as you supplied it) was “…is given no choice about whether or not he acquires the services…”. We have no effective (and their Honours were clear that it must be an effective choice, not a false one) choice – to live a modern life we will need to pay this tax. As a side note, in the Air Caledonie case their Honours considered returning to Australia was one of the rights of an Australian, and so charging to do so was a tax, not a fee for service. How do you think they would feel about being told that emitting CO2 could be a “fee for service”?
Again – a clearly silly argument.
2. You said “…an inadequate CO2 price under $30…” – i.e. there is no real “…discernible relationship with the value of what is acquired…” (as required in your bolded section earlier. So – nothing acquired (crucial point) and no discernible relationship.
Again – to examine your argument you do not have to “Reductio ad absurdum” – you hit absurdam in the core of the discussion.
So – even if you were correct that the government owns the entire biosphere and that therefore anything we use from it constitutes something that we can be asked to pay a fee for using (which, IMHO, you are not correct) the other possible prop for your argument fails on the two legs needed.
Thanks for making my points for me.
It’s a tax. Get over it.
Andrew tried a version of the pot calling the kettle black as follows:
Irony alert …
Well if the principal reorganises business affairs to avoid CO2 emissions, then (s)he pays no fee. That’s still a choice. Admittedly, it would cost a lot more than $26 a tonne, which rather makes my point.
That it is inadequate doesn’t mean it isn’t discernible. An umbrella may be inadequate in a rainstorm, but its use has a discernible relationship with the prevailing weather.
Once again, thanks for affirming that it is a fee not a tax.
No, they have exactly the same relationship in the relevant sense. Both are able to freely avail themselves of these ‘services’, except to the extent that they are prevented from doing so by the actions of someone else (whether the ‘someone else’ is the government, a private property owner, or a bandit). One can exclude either both businesses or people from availing themselves of ecosystem services if one has the means and intention to do so. Whether or not it is ethical to do so is another question.
I put the term ‘services’ in quotes because it is not clear that ecosystem services are services in the sense that the term is usually understood. The use of the term ‘ecosystem services’ is in effect a rhetorical strategy designed to alert people to the fact that natural ecosystems provide something of great economic value, which is in fact essential to human activity, notwithstanding that its value is not measured in conventional economic terms. There are obviously limits to this approach however. Part of the reason ecosystem services are excluded from ordinary economic calculations is precisely the reason that they are provided by no-one.
True, but irrelevant to the question of whether or not the government can be thought of as the provider of ecosystem services. Pollution can be regulated in a number of ways, including through civil litigation by those affected by it, prohibiting it outright under criminal penalties, prohibiting it except where licensed or authorised by regulatory authorities, or imposing some form of Pigovian tax on it, or some combination thereof. The method of prohibiting pollution except on conditional authorisation most closely approaches a scenario where there would be ‘fees or charges’ (i.e. licence fees) for polluting, as the fee would be in consideration of the right to pollute.
The current government proposal to regulate GHG emissions does not involve prohibiting such emissions, either outright or conditionally. In that sense the ‘right to pollute’ remains unaffected by it.
The ‘ecosystem services’ argument is interesting, but I think misses the basic point that governments have always charged for permission to exploit the natural environment. From purchased licences to harvest rabbits through to purchased mining permits, regulation of how citizens interract with the natural environment has forever been a core government activity. One of the main crimes for which draconian punishments were meted out in pre-modern times was poaching (i.e. harvesting without authorisation). Similarly, activities by individuals that harm neighbours have been regulated by the law for centuries. Modern scientific understandings of the extent of human capacity to degrade environments have simply extended the range of the commons regulated by government. At least since the Montreal Protocol on ozone-depleting gas pollution, it has also been recognised that some environmental harms are international in scope. I’m surprised that anyone seriously argues this is something new.
@75 I & U said:
Now THAT is truly puerile!
Fran,
I was just pointing out that you had indulged in an attempt to “argue” in that way. If pointing that out is to do likewise, then the worst you can say is that I followed your lead. Can I suggest that you stop it and move on?
.
Remember – the main point here is not the two other points (raised by the judges in ober dicta) that you seem to be concentrating on, but the main one you avoided in your last comment. The government does not own the entire biosphere and there is, therefore, no “fee for service” as they are not providing a service.
Once again the decision is clear – please read paragraph 11.
A fee for service is “…a fee or charge exacted for particular identified services provided or rendered individually to, or at the request or direction of, the particular person required to make the payment…”.
As I said – give up. The decision you brought up completely and utter demolishes your case.
This is the main point – the rest is merely further points that show you are not correct. For the other two points to come into play (see paragraph 9 of the decision) there needs to be something “…special…” about the “fee”. Clearly, there is not.
The choice has to be an effective choice – not the false choice you have given. The decision was perfectly clear on that. In that case an airline could have avoided paying the tax by not flying to Australia – or carrying no people while it did so – yet it was still held to be a tax as this would have meant not doing what they did as a business. If any and every business could, in a practical fashion, reorganise themselves to pay no carbon tax while still doing the same things then you may have a point. As it is that one holds no water, as I have pointed out numerous times. A business has no real choice to not pay it. Ergo – you are wrong on that point.
As for the other one – you yourself said it is “totally inadequate” – not merely a bit wrong.
Again, though – just so you do not waste too much of your time, the other two points are not the main ones. The whole point of a fee for service is the one I pasted in from the decision. If you cannot deal with that (other than by claiming the government owns the entire biosphere, a view I very much doubt the High Court would agree with, given their narrow interpretation of “fee for service”) then we do not even get as far as the other points.
It is a tax.
Andrew claimed:
The environmental commons, as the term implies, are the inheritance of all humanity — an asset which, precisely because it is both vital to human existence and not excludable to any human who seeks to continue living, imposes upon all in the human community who attests to the integrity of human life, an obligation of protection. Every individual human stands in relation to it as a bailee casting our governments as executive trustees. They are our agents and must stand above and separate from those seeking to make private use of the commons in ways that would undermine its value to present and future humanity. It is a very special piece of inalienable community property, and not “marketable” save in ways consistent with the above brief to protect), but it is property nonetheless. To suggest that communities (or their agents, the governments of the world) could be indifferent to the subversion of the community interest in the protection of the integrity of this asset is plainly paradoxical. A government that purported to so act would undermine its status as agent of community. A government may err in discharging this duty — typically they do — or lack the means to discharge the duty adequately — but the duty remains.
Inevitably, when commercial activity makes use of the commons, the biosphere is, at least to some extent, disrupted and degraded — which is one reason why debates about “sustainability” have aroused such passions but it is scarcely conceivable that sustainability would be meaningful when raised against commercial or private interest unless the idea of the community being bound to treat the protection of the integrity of the biosphere as a binding obligation lay at the foundation of human expectations. We are all aware that those who subvert its integrity, do so at the expense of remaining humanity now and until the end of days. Such folk are embezzlers of the commons, or perhaps guilty of the tort of conversion by wrongful user albeit that few apart from tort lawyers might articulate the problem that way.
Fran @85 – that’s why I don’t want a normal output of nuclear waste and mine tailings, let alone spills or accidents, all over my Commons.
Gillard already winning the CO2 debate: http://www.abc.net.au/news/stories/2011/03/22/3169998.htm
I’m now confident Abbott will lose the 2013 election. Positions need to be taken, and held, not baulked at.
Abbott has been sucker punched by Swan and Garnaut – now they’re the ones opposing compo for families.
http://www.theage.com.au/national/hockey-promise-gives-labor-ammunition-for-scare-campaign-20110321-1c3vb.html
I cannot see Abbott winning this debate now.
Helen said:
Nor I. I unconditionally agree. All hazmat (i.e. agents with a prospect of measurably damaging human health) should be securely sequestered from direct or indirect contact with humans.
Of course, we know in practice that that is not technically or operationally feasible. Every conceivable choice we might make in relation not merely to energy but other apparently banal modern usages will cause or permit one kind of health hazard or another to challenge human wellbeing. At best, we can minimise human contact with these harmful agents, or trade less harmful agents for more harmful agents. While urban and industrial society imposes overheads on humanity that were not borne by our ancestors of the early Holocene era it also relieves humanity on a every large scale of most of the impositions of nature they they were forced to endure. If there is a story of human progress, it is the story of human beings, individually and collectively wanting to live better than their predecessors and imagining something like: I like those odds. That was true when our ancient ancestors took chances eating food, worked out how to start fires, or somewhere along the coast of Africa 50,000 years ago contrived the first fishhooks. It was true when they built and got into small craft and crossed large bodies of water or began settled agriculture and animal husbandry, exposing themselves to influenza and measles on a large scale.
We human beings are and always have been traders in risk, uncertainty and reward, because risk- and uncertainty- free existence has never been available. While our species’ attempts to trade advantageously in risk have often proved to be unsound, pure folly and even disastrous, on each occasion we have tried to trade, those who have survived it have learned and passed on something to our advantage. Like the famous allegory of Schroedinger’s Cat, there are some things that cannot be understood until you try doing them. We dare not allow unreasoning fear to drive us to flee that legacy. Nothing worthy or enduring can come of that.
Rather, we must insistently seek insight into the constraints on human freedom, attempting where we can, to lessen these constraints and enlarge the scope for insight of all of our number. If we are to do that we will inter alia need to continue to improve labour productivity, to narrow the baleful impositions of privilege on the marginalised and of course protect the integrity of the biosphere on which we and all who follow us depend. We will need very low-ecological-footprint energy on a very large scale to achieve these things.
It may well be Helen, that we will come to discover something rather more feasible than nuclear power to underpin this project — and if so you will quickly count me amongst the advocates of this impressive new technology. Let us continue to to do the R & D to ensure that that day arrives as soon as possible. Until that day comes however, we have nothing better than to refine the ways in which we generate nuclear power, since Fukushima notwithstanding, this source remains the best risk-trade we have. Nature has shown that the risk trade the designers made was flawed not just for the Japanese, but for the whole planet, since it has caused a rise in unreasoning fear or nuclear power, and very probably in practice bolstered the political fortunes of coal and gas with all of the negative externalities associated with these sources. If so, this will be yet another example of flawed risk trading, from which those in the decades to come will need to draw lessons.
And further on my point Helen — I just noticed that nuclear power now has an unlikely ally — George Monbiot of all people.
http://www.guardian.co.uk/commentisfree/2011/mar/21/pro-nuclear-japan-fukushima
His reasoning is very close to that which I put above.
Fran, I have to say your argument that the CO2 fee is not a tax on the basis that it’s being used to pay for a service provided by the government is a little tenuous, if nothing else because most of the funds collected will NOT be directly used for the purpose of providing the service of “storing CO2 emissions”.
I wouldn’t have a problem with saying it’s a ‘permit fee’, however. In that sense, it’s not substantially different to a driving license, fishing permit, or whatever other existing permits there are that business must purchase in order to release pollution into the air or waterways – e.g. SO2 or NOx emissions permits. Does anybody generally consider the fees for such permits ‘taxes’?
Wizofaus commented:
It doesn’t have to be used for that to qualify as a service. The value of the service lies within the scope of the right to dump. This is easily shown since a refusal to allow dumping would inevitably impose costs on the putative dumper far greater than the fee. The costs of the dumping on the community are spread about in a somewhat randomised pattern, including upon the yet to be born, but the benefits are concentrated with the dumper and the dumper’s most significant clients and stakeholders. This is a classic collective action problem.
Resistance to seeing this as a service from the community to the dumper relies on the view that the right to dump inheres in business enterprises, yet this is rarely explicitly argued. That is the case that dumper advocates should put.
That, if you’ll pardon me saying so, is a distinction without a difference. Permits and licences are not regarded as taxes. So if the state simply said that the charge was for a quantity-based permit it’s hard to see how that would be different from a fixed price period (FPP) leading up to an ETS.
Which brings me to another point — In so far as the FPP is intended to enable a transition to an auction-based permit system aimed at abating emissions, and the permit system has even less in common with a tax than does the FPP, it’s also wrong to adjudge the character of the FPP in isolation. As has been pointed out, Rudd’s CPRS also had one without being regarded by sensible folk as a tax.
British Conservative of 35 years MP John Gummer in town.
http://www.abc.net.au/rn/breakfast/stories/2011/3168989.htm
http://www.theaustralian.com.au/national-affairs/climate-change-doubters-are-endangering-our-common-future/story-fn59niix-1226025032986
He spoke of the UK and how they’re passing a bill to introduce a carbon tax on top of their Euro ETS and ROCs (renewables oblication certificates, like our RECs I assume). He also mentioned the last climate action bil only got ~3 dissenting loons from a 650 member parliament.
I find this fascinating. Only in Australia and USA are there conservatives that deny science and economics. Everywhere else, even NZ, conservatives overwhelmingly respect their scientific institutions and market economic theory with the admirable virtue of prudence in the case of indeterminables. Here, it’s post-modern made-up “science” that’s on par to crystalology along with corporate welfare to foreign owned power companies using command and control policies raiding tax revenue to pay for them. Prudence is non-existent.
And it’s not because of the media. The Daily Mail and other Murdoch media are a haven for deniers – BBC plays footsies ‘for balance’ with liars showing lies dressed up as docos such as Swindle, or the home grown nutters such as Monckton. Yet no one but Australia and USA takes this rot seriously (Abbott saw Monkcton on his recent tour and Republicans got Monckton in as expert advice to Congress. Over in the UK, he’s known as a clown). What makes our conservatives and the USA so gullible, so stupid?
Except there is a difference – if the government *did* plan to use all revenue collected from CO2 emission fees to provide the service of removing CO2 from the atmosphere and/or to pay for whatever external costs were entailed by such leaving it there then I would agree it was clearly a fee paid in exchange for a service.
Perhaps, at a stretch, you could argue that the service the government is supplying is “enabling Australia to transition to a low carbon intensity economy”. But you could just as well argue that income taxes pay for the service of “enabling Australia to operate as a stable, peaceful and prosperous democracy” or something equally vague, and claim therefore that income taxes are fees. Which may well be technically true, but goes against how the terms are commonly understood.
Fran,
Do you now, through claiming that the government somehow owns the commons, want to arrest and imprison us all for breathing? Given we all exhale more carbon dioxide than we inhale, perhaps we all “…subvert its integrity…” and “…do so at the expense of remaining humanity now and until the end of days…”.
Sorry, Fran – more nonsense.
I note, by the way, that you now want to go beyond what the lawyers want, despite having introduced the Air Caledonie case in the beginning. I assume that you are now not quoting from that case as you have implicitly acknowledged that it does not support your argument.
Again – that decision was clear in limiting the scope of “fee for service” – remember, they found in that particular case that the “fee for service” concept had to be read narrowly.
It is a tax.
Wizofaus observed:
You miss the point. You are blurring the lines between the service provided to the dumper (trading more profitably relative to non-dumping competitors by being allowed to dump for free) and the broader desire of the community to be relieved of the impositions of the dumping. Handing the funds raised by the fee back to the community can allow them to begin buying lower CO2 alternatives, but that is beside the point.
Not that it matters here but also, since you raise it:
AND
are scarcely comparable claims, their common syntax notwithstanding. The first amounts to a specific and measurable policy objective — (in this case AIUI to be 5-15% below 2000 emissions levels) and the second is just motherhood-style handwaving which anyone could claim. I’d be surprised if Gaddhafi couldn’t make a case for describing Libya that way.
Taxes are very much used to underpin public policy, but in this case, the FPP is a quite specific fee for service to a polluter, regardless of how salutary its effects on the commons turn out to be.
its a good question Dave. But watching Miranda Devine and Whiney Pyney on Q&A last night though, I couldnt help but think they’ve now passed well under the median point: the average punter is definitely smarter than the idiotic guff they’re now peddling.
This once again shows the strategic advanagteg of a crash through or crash approach to dimwits – they really cant handle a full frontal attack. They need the ALP where its been since Beazley – ducking in the trenches, fighting their own fears.
Andrew, in a moment of frustration at his inability to defend the integrity of his cultural position continued as follows:
It’s better not to utter nonsense — especially when it is refuted by the prior discussion — than to apologise for it. You’re clearly frustrated however, so I’ll let it slide.
You can stamp your feet all you like, hoping that your preferred terms of debate will somehow prevail and turn back the damnable mitigaters and permit the polluters to dump at leisure, but no amount of bluster can sustain your claim. This is a fee for service.
Why not try demonstrating the effect on the price of fossil HC if all energy sources had to take total responsibility for their waste through the full lifecycle of usage? When you can show that it would make no difference at all either to usage or the value of these assets, you will have proved that the dumpers have not received a valuable service.
Until then, I suggest some tai chi.
Whoops – you are back to abuse are you? How about some reasoned discussion – like actually discussing the point?
No – that would mean you actually have to read the decision you brought up and then you might have some cognitive dissonance.
Instead of tai chi, why not some understanding of logic – or how to parse a legal decision?
Well Fran you’ve lost me – and I’m basically with you that it would be more sensibly considered a fee rather than the tax.
How is it a service to the *dumpers*? The dumpers (for the most part) don’t care if the CO2 is cleaned up. At best you might be able to claim that the Australian government owns the airspace above Australia up to a certain altitude, and therefore emitters must pay the government for releasing pollutants into that airspace, but clearly the purpose of the CO2 emissions fee is not to pay for the costs of providing the service of keeping that airspace pollutant-free.
Wizofaus said:
That’s very probably true, but is it relevant here? The service to the dumpers is not protecting the integrity of the biosphere and the community. The service dumpers currently get for free is the right to dump, which in turn underpins their trading position, including especially against those not dumping or dumping a lot less.
Should dumpers continue to get this service for free, or should they pay a suitable fee to acting on behalf of the harmed communities? I’d say they should pay a sutiable fee. The current mooted fee is too modest, IMO, but it’s better than nothing. The dumpers are still getting off very cheaply (possibly at between 20-30% of its true value on CO2 alone, and even less if one includes other externalities) so they are getting a service.
Andrew uttered as follows:
There was no abuse by me. I’ve hurled no epithets. I merely pointed out that you were uttering nonsense and were frustrated by your inability to defend your cultural position.
If you really want reasoned discussion, here’s a tip: Try advancing some reasons for thinking as you do rather than silly banter.
As I noted above:
Why not try demonstrating the effect on the price of fossil HC if all energy sources had to take total responsibility for their waste through the full lifecycle of usage? When you can show that it would make no difference at all either to usage or the value of these assets, you will have proved that the dumpers have not received a valuable service.
Good luck with that.
Fran,
No – the discussion I was having with you was whether this is a fee or a tax. I have shown why the High Court decision you introduced comprehensively demonstrates that this is indeed a tax.
You have so far failed to show otherwise. Ergo – it is a tax.
The decision excludes fees for service, dumping is a service, so ergo, it’s not a tax
Oh, dear. Read para 11 – as I have advised you to do before – it clearly and explicitly does not permit that interpretation. Just in case you have not read it in full:
Sorry – your argument is a nonsense.
It is a tax.
I’d called accepting industrial effluent a particular identified service(s) provided
ergo … not a tax …
What the whacko fringist sign behind ABbott at the revolting people rally? “Agenda 21 GENOCIDE”. Huh?
Apparently only 3000 people turned up. LOL
Sorry, apparently that’s 1000 revolting persons: http://www.theage.com.au/national/ditch-the-witch-strong-antigillard-emissions-at-canberra-carbon-tax-protest-20110323-1c5w7.html
1000 people, LeftyE? Shit, I attended meetings of Students for Democratic Action that were nearly that big, back in the day.
Seems they had some problems staying on message too: http://yfrog.com/h8q28xwj
What a dodgy lot! And note the misogyny. I love Alan Moran’s comment; “The only alternative is to do nothing”. Except if other countries do something and then we should as well.
Is there not a skerrick of logic amongst these people?
Fran,
Reading how the Court limited that interpretation very strictly (as I copied in above) I cannot see how it can “…be read in that general impersonal sense…”. Clearly, it has to be a personal service, not a general, impersonal one as you have to argue.
Sorry – you remain clutching at straws. It is a tax.
Andrew said:
Corporate entities have long been treated as if they were persons, for most legal purposes. As we found out during the Gunns’ matter, corporations can even even be defamed.
Accordingly, if the government renders a service to a corporate personality, it is entitled to charge for it without it being deemed a tax.
One could argue that perhaps the service should be withdrawn, and instead, corporations not just here but the world over, would have to engage in total stewardship for all waste until the end of time. In that scenario, subject to due diligence coming up roses, I’d agree that no charge would be fair because the corporation and its partners would have fully internalised this cost. In some ways, such an approach appeals to me rather more than a CO2 emissions charge. Instead of the misnomer “GBNT” polluters would get a “GBNR” — a great big new responsibility.
I daresay though that in such circumstances the wailing and gnashing of teeth from the world’s waste dumpers would make what we are seeing now seem barely audible, because the value of their assets would crash.
Although you have, predictably, tried to dodge this question, it does underline just how important a service to the polluters the right to use the biosphere as an industrial sewer is. No wonder you’d sooner call it a tax!
This statement highlights the silliness at the core of your argument Fran. How can the government “withdraw” the “service”? Somehow change the composition of the atmosphere so it no longer absorbs carbon dioxide?
Of course, the government could prohibit emissions of carbon dioxide, but that would be, well, prohibiting it, not “withdrawing a service”.
OMG, check the anti_CO2 price rally freakshow pics!: http://www.abc.net.au/news/stories/2011/03/23/3171486.htm
And isn’t it wonderful that Abbott is happy to stand in front of a banner calling Gillard a bitch.
Seems to be a gathering of random far-right crankery.
@115
“It is important to have an intelligent response – not a stupid one” Abbott tells his bussed-in audience as he stands centre stage in front of signs calling “Juliar” Gillard “Bob Brown’s bitch” and a “witch.”
This is much viler than usual. I feel sick.
I would be interested to hear how the shock jocks who were supporting the revolting rally report this. They could hardly call it a success when they only get a couple of thousand people turn up, I hear in Perth it was 100 who attended the rally at parlt house. If a school group was visiting it would have out numbered them.
It’s funny but those organizing the revolting rally have probably given the goby additional strength by showing the paucity of support for their campaign.
For goby read read govt
Just came from the pro-carbon tax rally in Perth. Around three times the size of the anti one, and generally much younger, more upbeat and optimistic. A stark contrast.
Tim Macknay
It only sounds curious because your starting point is that businesses are allowed to emit as a matter of right. Once you reject that, and assume that they can interact with the biosphere only with the permission of the whole community –in the person of the state, the idea that the service could be withdrawn makes sense. A great many people assume that view of business prerogative without even contemplating it. I take a different starting point to the discussion.
Of course, given this assumption, a more precise term might be: denying a service.
The Bob Brown’s “b*tch” was of course not merely misogynist but homophobic (given the prison allusion). Moreover, the fact that the “b*tch” sign included flames completed a neat paired link with the misogynist “ditch the witch” since “witches” traditionally were burned.
Also, if you watch the video link, there’s someone there carrying a sign alleging that mitigating CO2 is a UN/IMF genocide plot.
Now wasn’t it only yesterday that the opposition was alleging that being referred to as “climate deniers” was tantamount to calling them apologists for the N*zis?
Hmmm …
No. It has nothing to do with what businesses or non-business entities are “allowed” to do. That is a separate issue. My point is that the ability to emit CO2 into the atmosphere is a function of the physical and chemical characteristics of the atmosphere and is unrelated to the ability of governments or any other entity to allow or disallow anything.
Of course the government can regulate or prohibit an activity, incuding the emission of pollution, if it sees fit to do so. I have no diffuclty with this whatsoever. But to pretend that the activity prohibited or regulated by government is thereby a “service” provided by it is obtuse and rather silly.
That is implicitly an admission that the government does not provide the “service”, notwithstanding that you continue to use the latter term. What you are actually talking about is the right to emit carbon dioxide. Governments can certainly withdraw the right of a business to pollute, and this language makes a whole lot more sense than the strained and implausible use of the word “service”.
Of course, the government’s actual proposed carbon price policy does not involve the regulation or withdrawal of the right to emit greenhouse gases, but rather the imposition of an economic cost on it.
New post on today’s rallies of crazies:
http://larvatusprodeo.net/2011/03/23/newspoll-and-rallies-of-crazies-trouble-for-tony-abbott/
Tim Macknay said:
I disagree. Currently, the polluters are availing themselves of free biospheric services as part of their business model. This is clearly a valuable factor in their business — one much more valuable than the charge being sought for it. The agency that must decide whether a business should be prohibited from availing itself of the service, or made to pay a quantity-based charge for it is the state, since the state is the trustee of the interest communities have in ecosystem services that are rival to the dumping. Until quite recently, states have ignored their obligation to protect this community interest in respect of CO2 emissions but now some are considering attaching a charge upon some of those businesses availing themselves of the hitherto free service. The charge is clearly related to the damage being caused to the community interest (it’s pro-rata) and could be seen as a form of compensation for a cost imposed upon the community, in exchange for allowing the continuing right to dump.
It is true that the state does not propose to prohibit dumping, and rather seeks to use what it calls “a market mechanism” (“a price on carbon”) to discourage the dumping action while allowing so much of it as is inevitable, given other expectations within the community. Nevertheless, it is clear that this action is an attempt to restrict the service indirectly and thus affirms that a service is being charged.
Fran,
So – it is only possible to emit CO2 if you are a corporation, now? What would happen if an unincorporated entity – a sole trader or a partnership, for example (or, heaven forbid a charitable association) happened to emit CO2 in a way that would be taxable under the Act? That’s fine by you, is it, as they are not an impersonal corporations?
More nonsense.
Let’s see – only corporations emit CO2, the government owns the biosphere, CO2 emitters are criminals – or at least guilty or tortious behavior.
Any other “odd” thoughts you need to believe in to try to not admit a simple truth?
It is a tax.
Andrew, is the fee you pay for your driving license a tax?
Fran, a service charge is leveed for providing a service, not for restricting access to one.
If seen this way, it would not be a service charge. Compensation for damage is not a service charge.
Of course, it’s not a particularly accurate way to view a carbon price policy, since the price is not really related to the cost to the community (the costs of climate change are difficult to estimate, but most estimates based on business-as-usual scenarios measure them as much larger than the revenue from any carbon price). A better way to see the policy is as a method of reducing or removing the cost-advantage of pollution in order to encourage the uptake of low-pollution ways of doing business.
You are correct, though, in relating it to a right to pollute (i.e. nothing to do with government providing a service).
This is a misleading comparison. The government restricts the right to drive to those who meet certain approval requirements. Hence the term ‘licence’.
The proposed carbon price policy doesn’t restrict the right to emit greenhouse pollution – it just imposes a cost on it.
Correct, Tim. Another way to put it would be that the government is not proposing to license you to emit certain gasses, just, under certain circumstances, to tax you if you do – in proportion not to the harm caused (an indeterminate number) but to the amount of CO2 emitted.
For it to be a license this system would have to be to prohibit you emitting unless you have a license. For it to be a fee for service, as Fran is contending, then the government would have to be providing a place to store the CO2 and then charging a fee based on the cost of providing that dump.
That’s what is forcing Fran into the (IMHO) nonsensical position that the government owns the biosphere.
It is a tax.
“For it to be a license this system would have to be to prohibit you emitting unless you have a license.”
But that’s exactly what they will be doing – if you emit CO2 without paying for the emission permits you will be presumably be penalized under the law.
wizofaus,
No. For a it to be a license you would need to get a license in advance and then you could emit however much you are allowed to emit. As with a car license – having one means you can drive as much or as long as you want. Fishing license – buy one and you can then catch certain fish, perhaps up to a limit.
Again – read the Air Caledonie case I linked to (but Fran introduced) up the thread. It is considered the definitive statement in Australia of how to define a tax. This clearly points to the Carbon tax being a tax.
Tim Macknay said:
You misconstrue. The service charge is for the privilege of dumping. Dumping privileges are possible because the biosphere is proximate, but access to it should be considered to be at the pleasure of the state, which represents the community interest. As regrettable as it is that the state has largely abandoned its responsibilities in the past and is just barely considering them now, it was never the case that polluters had a right to expect to dump for free. A combination of ignorance, class privilege and technological immaturity conspired to establish an illegitimate but de facto privilege which the state is now considering qualifying. Clearly, this privilege is valuable, making it a service, if the state permits it. So the question arises, at what rate and how should this service be charged?
The discussion on licencing above traverses the same ground, merely renaming the terms to satisfy Andrew’s evident cultural passion that the state should in no sense be considered the trustee of the biosphere. That seems in substantial part to be his rationale for objecting and insisting, in the face of good sense, that this is a tax. That, and one supposes, the demands of this particular instance of the culture wars. Taxes arouse right of centre populist passion and feed the “Juliar” talking point, whereas fees and charges do not.
No, but it underpins the rationale for imposing one. If I agist horses on my land, then by definition, I am restarined from using it. Perhaps my land will in some way be damaged. I could grant access for free, but would bear these costs. So I impose an agistment charge or insist that the horse owner make his or her own arrangements. Now if that land were an Alpine National Park owned by the state, that would not make the charge a tax.
Andrew wittered:
I’m ready to stand corrected here, but AIUI, all of those businesses likely to fall within the purview of the CO2 fixed price permit provisions are incorporated bodies. If it comes to pass that there are some nonincorporated business entities, then my comments should be read as including them too.
So, then Fran – the government can, in your opinion, withdraw from us (as natural persons) the “right” to emit CO2 at any time – or tax us for that right.
Is that the case?
Seriously? A tax on breathing. Wow.
.
You keep missing (or perhaps avoiding) the point here Fran. You introduced the Air Caledonie case in an attempt to fall in with our PM’s spin on rebranding this tax as something it is not. I have shown, time and again, how the judges in that case were clearly taking a very narrow view of the meaning of “fee for service”.
Your attempts to try to spin it have now got to the point where you are forced to imagine a “trusteeship” of the entire biosphere for governments and that governments have the right to tax us all for the right to breathe out CO2.
Apart from anything else (and there is a lot else) a trusteeship would create a fiduciary relationship between all of the denizens of the biosphere – present and future, human, plant and animal – with the current government. Perhaps you can find a lawyer to sue the government for each and every breach of that duty.
If you cannot see that position as ridiculous then you have truly reached the Nirvana of spin.
Andrew continued:
Asked and answered already. Since 100% of people are compelled to breathe as part of life and the principal purpose of the commons is to underpin life, it’s implicit that everyone has a right to breathe and to emit. They even have that right when breathing spreads infectious disease. So unlike businesses, individuals cannot be deprived of their right to breathe, or have that infrignegd by imposition of a charge. It’s part of the right to life after all.
Nor could any good purpose be served by the charge as it could stand no chance of maintaining the quality of ecosystem services against decline. The imposed upon and beneficiary groups would be identical.
Andrew, that’s pretty much how I envisaged it would work . If it really is the case that businesses are simply required to report their estimated CO2 emissions and then be charged a fee for doing so, I’d agree ‘tax’ is an appropriate term. Personally I don’t understand why they aren’t simply introducing a permit scheme where fee is initially fixed.
wizofaus,
Companies will report their emissions and be taxed on that basis.
The correct term is, therefore, as you say, tax.
.
Fran,
Surely, though, if the government is somehow the trustee of the biosphere then they hold it not merely on trust for the human inhabitants, they hold it on trust for all of inhabitants – present and future, animal and vegetable. If you are constructing a trust, as you are arguing, then the trust would have to encompass a class of all of those who benefit from that biosphere.
If you argue that this is too wide, I would say that then there is no trust, as the identified beneficiaries must, logically, include them.
The “imposed upon” and beneficiary groups are not, and cannot be, identical – as the beneficiaries must include future being.
It is a tax.
Andrew said:
1. I am first of all a humanist. My primary concern is the collective interest of humans and how to defend it against decline and to advance it where it may be. Biodiversioty is of interest to humans and accordingly I favour it as an extrinsic good. So the trust, IMO, is held on behalf of humans, present and yet to be born.
2. There’s no problem with trusts operating on behalf of future claimants — as the Hardie Group trust does on behalf of existing sufferers from asbestosis, and those yet to be identified as having suffered damage.
In the case of a charge on breathing, the imposed upon and beneficiary groups would indeed be the same, since everyone (rich and poor) tries to consume as much oxygen as their physiology demands. No behaviour change in breathing is possible or proposed, nor could any benefits that might be mooted flow to anyone but the charged group, even allowing one might be entertained. In short, the action could have no warrant.
So – if there are too many humans about now, then surely the “trustees” have to take action on behalf of future beneficiaries. If we are producing too much CO2, then the “trustees” should be taking action – wipe out as many people as needed to make our population sustainable.
.
Anyway – as I said, this is beside the point.
You introduced the Air Caledonie case in an attempt to fall in with our PM’s spin on rebranding this tax as something it is not. I have shown, time and again, how the judges in that case were clearly taking a very narrow view of the meaning of “fee for service”.
It is, at Australian law, and in the common use of the English language, a tax – and no amount of sophistry will get around that.
No it isn’t. I’ll repeat here what I just said on the Crazy Rally thread.
When Tony said that the carbon tax would not just apply to the polluters, but would fall on each Australian, he was being dishonest. If Labor’s carbon price on the polluters is a tax, then so is his “direct action.” He knows that the $30 billion required for his “direct action” will cost each Australian $1500. Spread out over 5 years, that is $300 per person, the same it would cost each person under labor’s carbon tax.
Likewise, if his direction action is not a tax, then neither is a carbon price.
Andrew said:
You’re the one asserting that businesses have a presumptive right to use the biosphere as a sewer, and on that basis reject the notion of exercise of that right as a service. Imposing a right-of-centre libertarian assumption at the start of the discussion is textbook sophistry. No attempt to twist the words of the judges so as to shoehorn your own tribe’s preferred terms into the debate can work.
It’s clearly a charge, or as Combet said this morning — a price on carbon (dioxide).
Fran,
No – I am not. You are desperately trying to construct a trust where none is needed.
Again – read the decision, particularly para 11. The judges, like most speakers of the English language, take a fairly narrow view of what a “fee for service” is.
You, OTOH, have to try to create a trust structure, include all the inhabitants of the world in it, both present and future, extend the nature of a trust into an effective ownership position and then broaden out the definition of “service” to include doing nothing at all.
All of this you need to do to try to justify the use of the word “price” when the reality is obvious.
It is a tax.
Andrew said:
That was nearly correct. You have batted bravely for your team and the defence of its privileges and advocacy position, but your view is no longer untenable. The CO2 charge is a fee for service.
I don’t really accept that, Andrew. The PM has already said it doesn’t matter whether you call it a tax or not, and has not denied that it’s a tax. I agree with her position on that, although I also agree with you that Fran is drawing a very long bow in trying to claim that it’s a service charge.
Sigh. But it’s not a privilege, Fran. It would be a privilege if the government scheme proposed to restrict the right to emit, except where authorised to do so. In that case, the right to be emit would be ‘at the pleasure of the State’ as you suggest. But at present, there is no restriction on the ability to emit, and the government’s proposal does not intent to introduce one. So the ability to emit greenhouse gases is not at the pleasure of the State. It is available to everyone.
This analogy doesn’t work for two reasons. First, in the agistment example the relevant land is legally recognised as your property. The government does not make an equivalent claim to hold property in the atmosphere, notwithstanding your claims to the contrary. Second, in a commercial agistment arrangement, the price would generally be based on what the horse owner is willing to pay for the benefit of the agistment. Any unforeseen damage to the land would be an additional cost for which the horse owner is potentially liable. If the financial benefit of the agistment to the landowner is less than that of any alternative land use to which it could be put, the agistment wouldn’t make commercial sense. If you were doing it out of generosity, I’d suggest that you wouldn’t ordinarily charge a service fee. You might ask the horse owner to pay for any damage that did occur, but no-one would sensibly call that a service fee. It would simply be compensation.
No. The assumptions underlying a regulatory licensing regime are quite different from those of a market mechanism such as a Pigovian tax. The only relevant similarity between them is that both are government policy arrangements intended to reduce pollution. In any case, neither model requires the adoption of the fictions that government is the provider of ecosystem services. I contend that it is you who are trying to ‘rename the terms’ in order to maintain that highly implausible (IMHO) position. Trying to redefine compensation for loss as a fee for service, for example. You are also equivocating between the idea of government as an entity responsible for the protection of the environment, and government as owner (or ‘trustee’ for collective ownership).
Tim Macknay said:
This distinction is more apparent than real. Would you accept that it had vanished if the state adopted your form of words? If it added that to the preamble I doubt it would be newsworthy. Far more significant parts of the enabling structures are scarcely reported. There’s also no doubt in the minds of objectors that this is precisely the intent of the government. One hears this in their persistent complaints that “the government wants to ban carbon/carbon dioxide” and indeed one hears an echo of this line in Andrew’s trolling references to “taxing breathing”. The original legislation was after all called the “Carbon Pollution Reduction Scheme”.
You are the one playing with words here.
Well that undoubtedly reflects what Marx might have called the tradition of all dead generations — the polluters have had it their own way without good cause for … well forever — though at one point Edward 11 (IIRC) banned coal burning in the vicinity of London because he didn’t like the smell (I might have the wrong Edward). Yet it doesn’t really what governments say. The obligation to protect (ha! Gareth Evans with a twist!) exists independently of its assertion by the state. It’s implied.
Actually, we are discussing here damage and loss that is substantially foreseeable, and so the charge would have at least to take account of this.
The former flows from the latter. They are distinct ideas but they cohere.
I don’t accept that the potential for the State to regulate or control something means that something only occurs ‘at the pleasure of the State’. However if, as you say, if were the case that the distinction is merely linguistic, that would amount to an admission by you that the carbon price could be as readily called a tax as anything else. That is what you seem to want to strenuously deny.
Seeing that there’s also no doubt in their minds that it’s a tax, it’s rather odd that you seek to rely on their point of view at this juncture.
You raised the example in attempt to claim that a service fee and compensation for damage are the same thing. Entering into an arrangement in which you will knowingly suffer significant damage and loss would be rather silly, I would have thought.
Legally speaking, all persons and corporations have a responsibility (or various responsibilities) to take into account the welfare of persons affected by their activities, and to a lesser extent, the environment. The enforcement of some aspects of this responsibility fall to government, others to individuals or corporations. The responsibilities are not implied, but expressly stated in law. As I said before, I have no difficulty with this. However, this type of responsibility does not necessarily imply ownership. Where the State, or some other party, is held to own some aspect of the natural environment, this is generally explicitly recognised by law. No such claim has been asserted with respect to the atmosphere.
Various references in international documents to global commons as “the common heritage of mankind” is not an assertion of ownership but its denial – the intention is to prevent individual states from asserting ownerhsip.
I disagree entirely. However, I suspect I am unlikely to sway you on that point, so I disavow any further attmepts.
Tim Macknay said in part:
Nice try, but specious. You grant terms that allow me to call it a service, and when I point out that the distinction between that and what I have proposed is the the case is more apparent than real you assert that I have collapsed the distinction between a tax and a service. You are the one putting terms that are merely rewarded terms for a service that would comport with what I proposed. Having conceded the ground you are trying to shift the concession to me by obfuscating.
and, at the same time to assert a common human project — a trusteeship — to which all states subscribe through “common and differentiated responsibilities” (their words). Such an arrangement already obtains in a limited sense over Antarctica. In a limited form, Law of the Sea acknowledges this too. The CITES treaties adopt similar concepts.
Well not with what you and Andrew have put so far anyway. It’s your prerogative to differ of course, so if that’s all you have to say, let us leave it there. Thanks for the civil tone you maintained.
If you insist on doing violence to the English language then I cannot stop you. Just keep in mind that it is supported neither at law nor in any dictionary.
It is a tax.
Andrew repeated his meme du jour:
I’d say you have, in this thread, easily satisfied the requirements for declaration of faith in the right-of-centre libertarian catechism. Of course, those of us who don’t share it will see this attempt to ground it in law and lexicology for the transparent special pleading that it is.
By all means pretend that dumping is a service of no value to industrial firms. Those not suffering from your particular instantiation of Stockholm Syndrome will continue to wonder if the long dark night will ever end for your kind.
Fran, I’ll make a couple of responses to your last (@148), the leave it.
I dispute that I granted you those terms, or that I was obfuscating, or being specious.
I don’t accept the basic claim that the capacity for the atmosphere to absorb pollution is capable of being sensibly described as a service for which government is able to charge a fee, whether such a claim is based on a concept of government ownership or trusteeship of the atmosphere or not.
I think under certain regulatory arrangements, it is sensible to speak of the government charging a licence fee for a right to emit pollution, but even in those circumstances it would still not be sensible to talk of it as a service fee.
I never agreed that the distinction was more apparent then real, but I stand by the view that if it were nothing more than a matter of semantics, it would effectively collapse the distinction. I don’t consider that to be specious.
I don’t expect you to agree, however, so I’m happy to agree to disagree.
The problem (IMHO) with your claim that the language describing certain global commons as the ‘common heritage of mankind’ in various international treaties (such as UNCLOS) represents an assertion of universal trusteeship is that some powerful states do not accept it. The main motive for not accepting this idea is that it may interfere with ownership claims such states may want to assert in future (justly or unjustly). A quite different (arguably the opposite) situation pertains to Antarctica, where a number of States (including Australia) have asserted exclusive ownership of portions of it, but the claim is not recognised by most states.
This misunderstands my point somewhat. I was not claiming that the two concepts are mutually exclusive, but merely that they are not intrinsically linked, and that one does not necessarily imply the other.
Anyway, that’s all from me on this topic. Cheers.
Fran,
Again you feel the need to drop to attempts to insult. Pretty low.
It is a tax.