Rudd's political honeytrap

The Rudd Government's Green Paper will no doubt earn the ire of some climate and environmental organisations for its gradualist approach to emission reduction.

Petrol is in the scheme but compensated by 'cent-for-cent' excise reductions until 2013. Agriculture is out until further notice (possibly starting in 2015) and coal power generators will receive government assistance. The Government appears to be easing voters into copping nanoeconomic pain, by hitting them first with upfront power bills (softened to an extent by increased government payments). This suggests that fast tracking renewable energy - as indicated by the proposed 20% national renewable energy target by 2020, is seen as a more palatable and effective option for achieving emission reductions. If stationary energy emissions make up 50% of all emissions, rising to close to 60% by 2020, a 20% rise in renewable market share would achieve between 10-12% emission reductions. That would suggest that Rudd's interim emissions target cannot be much higher than about 15% by 2020 from the current nominated suite of abatement options. Even to achieve these savings will require a considerable improvement in fuel efficiency and or energy efficiency at the current target levels. Such a target looks low by world standards and will barely be in the pack once developed nations crunch the carbon numbers.

This may well be the genius of Rudd's plan. The bar is so low that it reflects a pragmatic Liberal policy wish list. So low that in one sentence Nelson chastisted Rudd for lifting their excise-permit neutral idea and in the next called it a petrol tax. The end result of Labor's policy is that it puts the onus on the people to push it to take more action. It is almost the minimal possible response without jeopardising the integrity of action altogether. Rudd has effectively offered an election year handout with the electricity rebates and absolved the government of responsibility for excessive petrol hikes.

Nelson is left in nanoeconomic limbo. He has to either junk the scheme entirely or have a technical debate over the merits of 2012 action. Nelson has flirted with a faux policy debate about the hybrid model but if anything has smacked of 'The Hollowmen' in national politics, that search for an alternative was it. Possibly locking Turnbull, Hunt and Bishop into his Central Coast caravan for a weekend and designing a proper policy alternative would be more beneficial both to the debate and the long-term coherency of his party.

At the minute his argument boils down to 'there's a right way to do it (mine) and a wrong way (Rudd's)'. If the excise cut is my idea it's good policy and if it's his policy it is bad. The fact that all this operates in the future - i.e. after the battle has been won at the polls, makes Nelson's 'Rudd's 2013 review is Rudd-speak for ending the excise cut' ring hollow. If Rudd is to pay for injudicious action it will be in 2010. If he is to pay for inaction it will be 2013.

The scheme offers so much to the vulnerable polluters and the kind of targeted compensation scheme now becoming the Rudd trademark that it is highly unlikely the final draft will be any weaker. If anything, the challenge is being thrown down to voters to tell the government they want action and are prepared to pay for it.

Watching Penny Wong at the Press Club demonstrated a player in control of her material, confident in the merits of the argument and open to being pushed to further action. Watching Greg Hunt on Lateline demonstrated a puppet forced to parrot a line he did not believe in, wishing he had something coherent if not constructive to say. Only when Hunt got onto his pet subject of solar panel rebates did he seem to have conviction. Perhaps he should show some boldness and adopt the German bipartisan solar feed-in tariff where homeowners get four times the price for their surplus solar energy fed into the grid.

The danger with Rudd's policy is that in forcing the Liberals over the climate cliff, it will force a very swift acceleration of targets in the medium term. But by then Greg Hunt might be PM.