Tuesday, April 27, 2010

Is there a plan B for the ETS?

F. Scott Fitzgerald once remarked:  "The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function."  By this criterion, Kevin Rudd is a highly intelligent politician.

At the weekend, the Prime Minister told the Sydney Morning Herald that he was still fully committed to an emissions trading scheme.  Climate change "remains a fundamental economic, environmental and moral challenge, he said.  "Whether it's newsworthy or not in a particular season is beside the point.  We haven't changed our view of this."

Today, without missing a beat, the same newspaper revealed the Prime Minister's decision to shelve the ETS for at least three years.  According to Lenore Taylor, Labor "has decided to put the scheme on ice to undercut the 'great new tax' scare campaign."

So, Kevin Rudd is either committed to an ETS or he is not.  He is either prepared to sell his case on the hustings;  or he is scare of a political fight.  He either truly believes climate change is a great moral challenge that justifies a new policy to reduce carbon emissions;  or he doesn't.  If it is the latter, he is an opportunist of such proportions that the only thing that exceeds his reach is his grasp.

He can't be both.  His back flip over the ETS may confirm Fitzgerald's tart remark, but it also represents two political truths.

The first is his decision to shelve the ETS represents a betrayal of the many thousands of Australians who voted for him at the last election in the hope that his government would take decisive action to reduce carbon emissions.  Many of his loyal high-profile supporters during the 2007 election -- think Robert Manne, Phillip Adams, Tim Flannery -- will surely now concede that the Prime Minister is not one of them, that there is always an air of detached calculation about his public performances, a sense that in different circumstances he will just as happily be arguing the opposing case.

Nor is his position on the ETS an isolated incident:  think of his oscillations over border protection, economic reform and population growth.

The second truth is that Rudd's back-flip represents a victory for Tony Abbott, Nick Minchin and other conservatives who have opposed what the Liberal leader calls a "great big tax" that could cause economic pain for no environmental gain.

Put simply, they did not follow the press gallery's script -- and they have subsequently been vindicated, both politically and intellectually.

Until Malcolm Turnbull's defeat in the Liberal party room last December, the conventional wisdom held that climate change would wedge the conservative parties.  If the Liberals opposed the ETS, the argument went, it would lead to a massive backlash at the ballot box.

But however much this argument had merit in 2007-09, it increasingly lacks validity in a post-Copenhagen world that does not conform to the expectations of Al Gore and Clive Hamilton.  Politics, after all, is never fixed;  it is always in a state of flux.  The only certainty is that the political climate always changes.  And the wind, far from blowing conservative parties off the electoral map, threatens to turn into a perfect storm for Kevin Rudd.

Which is why he has flip-flopped on the ETS so dramatically.  The power of his U-turns and reverse gear is up to the best international standards.

Meanwhile, climate change fatigue is setting in all over the globe.  The governments in Beijing and Delhi insist they won't join the West in what they see as an economic suicide pact.  In France, the Sarkozy government recently shelved plans to introduce a carbon tax.  In Germany, polls show only 42 per cent of Germans worry about global warming.  In the European Union, the ETS has been a victim of fraudulent traders and done little to curb emissions.  In Canada, climate law is stalled in legislative limbo.  Even New Zealanders now doubt the merits of a going-it-alone strategy!

Kevin Rudd still held out hope that the climate could change in his favour.  In Obama's America, which accounts for 20 per cent of all greenhouse gases, it was argued that somehow the Senate would pass a cap-and-trade (or emissions trading) bill that would reignite global talks for a new international agreement.  Indeed, just yesterday [Monday], three US senators were scheduled to introduce comprehensive climate and energy legislation to reduce carbon emissions.

But with the Senate's apparent decision at the weekend to shelve climate legislation and instead take up President Obama's call for urgent immigration reform, one key law-maker Lindsey Graham is likely to withdraw his support from the landmark bill.

The chances for any US climate and energy law in an election year were already small.  But Senator Graham's likely defection represents a death knell for the White House's campaign to deal with climate change.  That is not just because he is the only Republican senator to endorse a broad approach to tackling global warming.  It's because the climate, politically speaking, has also changed dramatically in the US since June when the House of Representatives narrowly passed a climate bill.

The recession, record snowstorms, massive Tea Party rallies, rising public scepticism of climate-change science, mounting industry opposition, climate-gate and glacier-gate scandals, other pressing policy priorities (financial reform, immigration, Afghanistan, tackling 9.7 per cent unemployment) -- these have all dampened the political climate for a cap-and-trade law.

As Interior secretary Ken Salazar recently acknowledged:  "I think the term 'cap and trade' is not in the lexicon anymore".

All of this has grave consequences for the next round of global climate talks in Mexico City where world leaders hope to map out a successor treaty to the Kyoto protocol which expires in 2012.  Judging by Kevin Rudd's and Barack Obama's rapidly changing priorities in recent days, hopes for any verifiable, enforceable and legally binding agreement to reduce greenhouse gases -- and to include developing nations such as China and India that are polluting their way to prosperity -- are a chimera.

Is there a Plan B?


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