The political inversion of the climate change debate

A number of journalists ranging across the spectrum from Fairfax's Annabel Crabb to News Limited stalwarts Dennis Shanahan and Andrew Bolt have identified the apparent contradiction between Rudd's 'I feel your pain' pitch to 'battlers' (or as the Piping Shrike has put it 'The New Sensitivity') and the inherent need for energy prices to rise to combat climate change.

On paper, it looks like a recipe for a Latham-Downeresque implosion. However, it both gives the voters no credit by implying they cannot hold two ideas in their collective heads at the same time and misunderstands the reasons for Howard's demise. Firstly, it is a well-established fact that voters can differentiate between state and federal politics. For at least two terms of the Howard government, large swathes of the country voted for completely different parties at the state and federal level. In fact, where Labor has run into trouble in the past is by dismissing many voters as 'ignorant' or 'unsophisticated'. The key basis of politics is persuasion, and a failure to persuade, while open to inteference from outside forces, ultimately comes down to whether the audience sees an essential truth in your message and your capacity to deliver. Rudd seems to be aware of the dangers of underestimating the public mind.

Secondly, Howard's fall from grace came from Rudd altering the economic debate from the macroeconomic level to the nanoeconomic level. Hence he recognised the problems of petrol and grocery price vulnerability and promised government assistance around the margins. Petrol and food prices operate however as free markets without government command and control influence, so real power here is limited to a 'watching brief', keeping an eye on price fluctuations and opening up the field for more competition.

What Rudd aims to do with climate change is again redefine the economic debate, this time on the macroeconomic level. Setting a price for carbon will integrate environmental costs into the economic system. That is the first step. The second will be for environmental and economic management to be seen as covalent. The third step is to break the nexus between economic growth and environmental emissions growth thus ensuring a political, economic and environmentally sustainable future. Unlike previous reforms such as the GST, support for an emissions trading scheme is consistently over 50%, while opposition sits around 25% with around 20% of people waiting to hear more details. Thus aligning economic and environmental action is what the people want at this point in time.

Unlike petrol and food commodities, the Rudd Government will have the power to set the starting price for carbon, define the parameters of the market and redistribute revenue from carbon permits to compensate the people. This market will afford government a measure of control rather than the watching brief seen in the nanoeconomic field.

The other thing that climate change does is transform energy increases into issues of personal responsibility. It thus becomes almost a civic duty to accept and embrace higher energy prices and encourage a larger share of renewable energy usage. In this climate, the goodwill to government is not dependent on keeping prices down but ensuring there is appropriate action being taken which is manageable on both the national and personal level. So government will both have more power to act and a proportionally lower need to act to ease public concerns.

The critical factors with the climate change carbon transition process will be the quality of the Rudd Government's communication with the people and its capacity to persuade voters that action is in all our interests. On this, expect to see a lot of Garrett and Rudd, and very little of Wong, who will be behind the scenes dealing with business and other large stakeholders.