Black Inc., 2014, 302 pages, $29.99 (pb)
Review by Phil Shannon
In 2007 in Australia, “climate policy was a reform full of promise and excitement”, writes Monash University journalism academic, Philip Chubb, in Power Failure. Six years later, however, an “exhausted and confused” electorate had installed a climate-change-denying government that was dismantling the previous Labor government’s few fossil fuel carbon emission reduction programs. Chubb dissects, with much sorrow, the climate change “policy fiasco” of Labor that led to this outcome.
Labor’s climate change policy in government was to establish a market mechanism to price carbon within an emissions trading scheme to theoretically provide a cost disincentive to the use of fossil fuels. The schemes of both Labor Prime Ministers, Kevin Rudd and Julia Gillard, seriously misfired, however.
Rudd’s proposed scheme (the Carbon Pollution Reduction Scheme – CPRS) suffered from delay, conceptual complexity, dense technical detail, poor communication, a back-office technocrat (Penny Wong) as climate change minister, the sidelining of the Greens, an autocratic but erratic Prime Minister who refused to call a double dissolution election on the issue when popular support was still significant, and an intensifying political and corporate opposition from aggressive climate change deniers and electricity generators threatening power cuts and job losses.
People “did not know what the government was doing on climate change or believed it was doing nothing”, says Chubb. They queried Rudd’s commitment and questioned how important the whole issue of climate change could really be given such chameleonic leadership, especially when Rudd suddenly abandoned the CPRS, and, with it, any governmental lead on what he had called ‘the greatest moral, economic and social challenge of our time’.
Gillard was more inclusive on policy process than Rudd, was a more focused communicator and a better manager of the Greens (buying their support with concessions, albeit important, such as a $10 billion green investment bank) but an antagonistic Murdoch media had so soured the fixed-price carbon tax entrée to her floating price emissions trading reduction scheme that her package died along with the Labor government in the disastrous 2013 election.
For all the apparent differences between Rudd and Gillard, and their respective carbon reduction schemes, however, both were offering essentially the same product – market-based emissions trading in carbon pollution. What finally sunk both schemes was not, as Chubb proposes, the different flaws in the leaders’ psychology or presentation skills but the common elements of both schemes, namely weak targets and a gushing money tap of compensation for industry.
The pathologically shy target (5% less carbon by 2020) did not match what the science said it should be whilst the free carbon pollution permits and cash compensation for industry was logically contradictory because “the government was trying to force companies to change their behaviour, but then paying them so they did not have to change”. As could have been predicted, and as subsequent research on the carbon tax (in Victoria) found, says Chubb, coal-fired electricity companies simply passed on the cost of their carbon emissions to consumers through higher prices whilst reaping windfall profits from their taxpayer-funded compensation.
The problem, largely ignored by Chubb, was not the messenger (Rudd versus Gillard) but the message (emissions-trading markets). Nor was the problem what Chubb terms an “excess of purity” from those environmentalists who were opposed to Labor’s inadequate policies. Voters were simply underwhelmed by what was on offer.
Chubb does note, without, however, expanding on it, the strong popular support for renewable energy which continues to exist, across class and political divides, including government investment in renewables and the Renewable Energy Target (a Rudd legacy which mandates that electricity generators source a percentage - currently a modest 20% - of electricity from renewables). There, with state intervention in the market and not in political genuflection to it, lies the future, for a political party willing and capable of grasping it.