The CPRS - a failure of the left not just the right

In April 2009, I wrote an On Line Opinion piece entitled “Will the Emissions Trading Scheme be our next Republic?”

The piece argued that, due to the unusual conjunction of both the left and the right combining to oppose the government’s Emissions Trading Scheme (the Carbon Pollution Reduction Scheme or CPRS), it was possible we were facing a republic-like scenario where a major reform would be stopped dead in its tracks. Unfortunately, that scenario is looking even more likely now than it was a year ago.

However, that outcome was far from a foregone conclusion. Astonishingly, the Rudd Government did manage to get the support of sections of business, the environment movement, the trade unions and the Liberal Party for its CPRS. If Malcolm Turnbull had remained Liberal leader, or if challenger Joe Hockey’s supporters had known how to count, we would have a CPRS today. As it was, Tony Abbott became Liberal leader by one vote. The Liberal party moved to the right of John Howard and now effectively opposes an Emissions Trading Scheme (ETS) -despite supporting one in the 2007 election campaign.

However, it would be all too easy to blame climate change sceptics in the Liberal party for the demise of an ETS. In fact the failure to pass the CPRS owes just as much to left as it does to the right. After all, two Liberals crossed the floor when the CPRS was originally voted on in the Senate. So, if the Greens had supported the legislation, the government would have had the numbers to pass it.

In other words, we really are facing a Republic-like situation where it is sections of the left’s opposition to a particular model of the ETS that it is stopping the reform being achieved, not just the right’s opposition. In the case of the Republic, sections of the left opposed having a president appointed by parliament rather than being directly elected, so voted against the Republican model being put forward at the 1999 Referendum. In doing so, they overlooked that the more radical model of an elected president would be really hard to get up. The latter would require a major overhaul of the Constitution to ensure that there weren’t conflicts between an elected Prime Minister and an elected President. This is particularly the case given the enormous power our existing Constitution gives to the Monarch and Governor-General (whom a President would replace) while the Prime Minister isn’t even mentioned. Yet, substantially changing the Constitution is notoriously difficult. Consequently, we still don’t have a Republic.

In the case of the CPRS, sections of the left who support the CPRS’ basic aims of having a market price on carbon and making the polluter pay, nonetheless disagree with Labor’s model. They believe Labor’s scheme has overly low emission reduction targets and provides too much compensation to big polluters. The Greens have some scientific support for their argument that the government’s proposed cuts (of 5 per cent to 25 per cent by 2020 compared with the Greens 40 per cent) are inadequate. It is also true that, in the transition period at least, the government’s scheme involved substantial compensation to polluting industries. Nonetheless, the Greens’ decision to vote the CPRS legislation down altogether, rather than passing it with minor amendments as better than nothing, seems to be based on two fundamental misjudgements.

First, the Greens seem to have hoped that the government would hold a Double Dissolution election on the CPRS. A Double Dissolution would see more Greens elected to the Senate (because the quota for election is much lower than in a normal election), so the Greens might hold the balance of power in their own right. That would obviously be to the Greens’ advantage but they also seemed to hope that Labor would then introduce a far more radical ETS in order to pass it with Greens’ support. However, it seems doubtful that the government would either risk holding a Double Dissolution election on the ETS or introduce a more radical scheme than the CPRS already is. Not only is the ALP ideologically opposed to radical left policies but it faces genuine political and economic constraints.

I’m not just referring here to the difficulty of getting up the CPRS in a post-Copenhagen world where key Asian countries rejected western targets on emissions reductions as attempts to shore up the west’s declining economic power against that of the East. Nor am I just referring to Obama’s difficulties in implementing an ETS; nor the fact that the Liberal party has gained electoral traction with its arguments against a great big green tax (which incidentally make suggestions of a carbon tax alternative to the CPRS even less electorally feasible). I’m referring to the structural power of business in a capitalist economy. Labor governments have a long term fear that overly antagonising business will result in the flight of investment overseas, with resulting increases in unemployment. They also fear the type of concerted business campaign against Labor that contributed to the defeat of Chifley in 1949, Whitlam in 1975 and Latham in 2004.

That is why Labor wanted significant business support for their CPRS model not, as Christine Milne sometimes implies, because they are craven or corrupt. Perversely, if the Greens were as Marxist as Nick Minchin and others accuse them of being, they would have more understanding of how power operates in a capitalist society and of the economic constraints which all Labor governments have faced historically.

So, the Greens misunderstand the strategic considerations underlying Labor’s CPRS. It was designed to win broad initial support but to be incrementally strengthened over a period of years as business and public opinion is gradually won over to tougher measures. (After all, an incremental method has been used to introduce most major Labor government economic reforms.)

Second, the Greens seem to believe that the detrimental impact of climate change will become so obvious that public opinion will automatically fall behind a more radical ETS, forcing Labor to introduce one. This is a huge assumption to make and shows little understanding of how ideology works. Many climate change scientists do argue that the evidence of catastrophic climate change is becoming more obvious. Nonetheless, climate change scepticism is growing, as is opposition to the CPRS. Furthermore, even if a changing climate is acknowledged, it can still be interpreted, as Tony Abbott sometimes suggests, as being due to natural changes that have happened throughout history.

So, even if the Greens are right about the catastrophic environmental impact and causes of climate change, large sections of the public might prefer the comfort of denial. Recent events suggest that those believing that a more radical ETS is inevitable may find themselves in the same position as those members of the left who used to argue that socialism was inevitable.

The CPRS has now been deferred until May, so the Greens have time to reconsider their strategy. If the Republic is delayed for decades that is merely unfortunate. However, can we afford to delay the introduction of an ETS for many years (or even for ever)? Shouldn’t Australia do its bit to combat climate change now? In a capitalist market, you really do need a price on carbon if you are to have any hope of changing business behaviour and substantially reducing carbon pollution.

How many other Green parties internationally have actually stopped an ETS being introduced, as the Australian Greens have so far done? The failure to introduce an ETS in Australia is not just due to a failure of the right, it is also due to a fundamental failure of the left in Australian politics. Labor’s policy may be inadequate but it is at least a start.