Ross Garnaut has retreated to populist nonsense in his evangelism on behalf of carbon emission abatement. By urging us repeatedly to “do our fair share” he takes up the Diana Moon Glampers (*) banner of a stultifying, imaginary “equity” that will damage our national comparative advantage.
““Failure to do our fair share is not a clever position for Australia, which is the developed country most vulnerable to climate change. Especially when we are going through a once-in-history boom in incomes,” he said.” Extract from Garnaut Review, press release May 31, 2011
As the Chair of the Productivity Commission notes, a tax on our carbon riches is a tax on our comparative advantage in production and trade. It is madness to endorse an $11 billion tax on our most important export industries and on Australian households—impoverishing ourselves and reducing our capacity for future technological adaptation—for the sake of some imaginary “equality” of effort in a futile endeavour.
Speaking at an industry forum in parliament house yesterday, Mr Banks said it was “common sense that achieving any given level of abatement is likely to be costlier in a country with a comparative advantage in fossil fuels”.“Crucially — and this point seems not to be widely understood — it will not be efficient from a global perspective (let alone a domestic one) for a carbon-intensive economy, such as ours, to abate as much as other countries that are less reliant on cheap, high-emission energy sources,” he said.Extract from The Australian
There is no global regime for cutting carbon emissions. By rejecting this bad idea we would not be “defecting” from anything except a unilateral folly—Kevin Rudd’s un-legislated 5% pledge—partially matched at the Copenhagen “Kyoto” Conference. Even if there were a global regime, it would never make sense four us to “throw rocks in our own harbour” (Joan Robinson’s —or maybe Frederic Bastiat’s—argument against reciprocal protectionism) just because the current UK government decides to do so.
(*) Bonus: if you’ve never read Kurt Vonnegut’s hilarious short story Harrison Burgeron then here’s your chance to enjoy one of his seminal early works (from a reprint in the US National Review magazine)