The Australian government Armed with a report into climate change done by an economist is now rushing headlong into an ‘emissions trading scheme’ to raise taxes, redistribute wealth, and stroke the ego and vanity of Kevin Rudd.
Going into such a scheme without the rest of the world, (and the major developing countries, G5 have made it clear they do not intend to do so) is the height of economic suicide. We make our products which are eminently competitive on world markets less so, increase all costs across the board as this slug ‘washes down’ through the system, all for a piddling reduction in CO2.
With the resources boom and the current shortage of oil, there has already been a huge increase in the carbon price caused by market factors we hardly need an extra one from the government.
This should on its own cause an explosion in research into alternative energy on the basis of those higher cost methods becoming more competitive.
This thing will end up as a mess as was stated in the ‘Australian’:
John Roskam, executive director of the Institute of Public Affairs, thinks the ETS will make the Income Tax Assessment Act look easy to understand by comparison. It will involve government planning and regulation on an unprecedented scale. He says one can only wonder what sort of regime will be needed to ensure that companies do not profiteer unfairly.
The proposal as stated today appears to be a dog’s breakfast of taxes on emissions and efforts to compensate for them making the whole thing a bizarre exercise in the ridiculous. Even if we were to assume that such a scheme could be revenue neutral; that is that the costs imposed were offset by reductions in other taxes the extra weight of the bureaucracy required to implement it would be enormous.
Why not just let the market respond to the increasing cost of energy, by introducing new efficiencies, ideas and technology to solve the problem, instead of a massive exercise in social engineering?
Well, the reason is if the market were to do it Rudd and the government would get no kudos from it. By imposing massive costs and ‘compensating’ they are highly visible, and with ‘assistance’ to the poor and needy create more dependency on the state and hence less freedom.
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