Certainty required, uncertainty required: the Bali paradox

The Bali Conference on climate change is now being described as a 'road map' for further negotiations re the setting of emission reduction targets. The UN Secretariat wish is for a text to be initialled 'KMR' et al sometime this week which contains a committment for developed countries to reduce targets by 25-40% by 2020. This appears to be what the UN is defining as proceeding within the Kyoto framework.

This is an indication of how serious the post-Kyoto round of negotiations are. The non-binding position advocated by the US, Canada and Japan demands that a 'global goal' be pursued to cut emissions by 50% by 2050. Canada and Japan are unequivocally telling developing countries they must accept targets before they will sign on. This fit of pique stems from the Canadian government's skeptic attitude to climate change - it attempted to repudiate Kyoto and was forced by the opposition Liberals to pass a bill binding the Canadian government to cut emissions at gunpoint. The Calgary based Conservatives could best be described as the lumberjack-oil drillers alliance.

Japan has lost face from the failure of Kyoto, and has experienced problems with nuclear energy since an earthquake damaged a plant earlier this year. It is also exposed to Chinese and Indian development.

The US position is schizophrenic. Like Canada, opinion is divided between the progressive states allied to the Democratic Congress and the regressive Bush administration. The official US delegation is under Bush's imprimatur, but US politicians attending the conference include the guru Al Gore and John Kerry. Kerry's role appears to be emissary for the Democratic administration-in-waiting, saying that the US would accept binding targets of 25%+ at some point in the future.

Australia's vaciliation on binding targets stems from Rudd's committment to be economically responsible while ushering in revolutionary change. Nelson's ploy of ratifying Kyoto and then exploiting angst over short-term target pain is cheap politics and a decided headache for the PM.

Against this backdrop, the EU's alliance with China and a group of developing countries such as India, Brazil and South Africa acknowledges the necessity for action and their common philsophical belief that developed countries must accept targets before developing countries.

Rudd's position is a diplomatic tightrope that requires either an expedient piece of fudging or a leap of good faith. The clear import of the UN's desired negotiation range is that 25% would be the minimum target. The range is merely the set of numbers available under the common-but-differentiated principle that Kyoto utilised. Rudd is not going to jeopardise a global agreement, but nor is he going to look like a fiscal gambler so early in his term. Given Rudd needs the Garnaut report, due in June, to set a target, he would surely push to settle the target question at the next COP. His '60% target by 2050' could be the circuit breaker: if he can push for a compromise for the US, Canada and Japan to accept a binding 50% target by 2050, rather than a global goal, it might satisfy the developing-EU bloc.

This would explain why Rudd is making a procession of statements stating Australia is fair dinkum about climate change. It also explains why Greenpeace are accusing Australia of not going hard in pushing for the binding 25-40% negotiation range in the Bali text.

In spirit, the Rudd government wants to support the binding target range, but practicality demands it delay. The US in a state of flux pending its next presidential epoch. The other procrastinating nations may not be so sanguine.

Bald eagle flys blind on election choices

Having seen the demise of the deputy, the quest (and it is a long and arduous journey, one half expects it to be directed by Peter Jackson) to find the global sheriff's replacement is on in, well, stage-managed, media confected earnest. Unlike our wonderful system of internal machinations, Americans are rather fond of ritually electing every position possible. Which brings us to the primaries.

Owing to the malignant albatross around Bush's neck, Dick Cheney, being the Vice-President and Condoleeza Rice showing no current interest in higher office following the 'pick up seashells' adventure in Iraq, the Republican candidature is about as clear as the chowder unfortunate candidates get served up on a myriad of campaign stops. So we have both the Republicans and Democrats running competitive primary races.

Both sides have apparent front runners. The Democrat juggernaut-in-chief is attached to one Hillary Clinton, Senator for New York. Curiously, the putative Republican frontrunner is former New York mayor Rudi Guiliani. Has some odd revolution occurred where people suddenly listen to the Yankee states again? Probably not, but the mid-term elections demonstrated the visceral hatred held for the Iraq deployment and disapproval at the abject presidency and behaviour of Congress.

Hillary's campaign is based around the idea that she is the professional, assured and experienced candidate from central casting. Peregrine's distant observation here is that it is Kevin07 without the self-deprecating humour. Hillary's rivals are Barack Obama, who seems to be trying to be the postmodern Kennedy with his appeals to a hope for a better America while being tough on terrorists, John Edwards, whose candidacy is towards the left of the US spectrum is the other frontline contender. Behind them are Bill Richardson, former energy secretary, US Ambassador to the UN and governor of New Mexico and Joe Biden, senator and haunter of foreign policy committees. Hillary's fanbase constitutes a solid bloc of Democrat voters in the larger states, but she has to rely on enough generic Democrats to feel she will provoke the Republicans marshalling to prevent her return to the White House. Hillary is viewed in the traditional Livia mould of the scheming hand behind the throne by her Republican adversaries.

In order to get the nomination, candidates need a coalescence of fundraising and consequent advertising capability and the ability to carry voter support in various states. On paper, Clinton and Obama are competing for the same solid Democratic areas on the Pacific and Atlantic coasts, Edwards should pick up support in the Mid-West and the South and Richardson should do well in the South-West. Interestingly, Obama is doing better than Clinton in the Iowa polls. Peregrine suspects that the key factor will be whether nagging doubts about Obama's capability or concern over the polarising Hillary phenonmenon win the day.

On the Republican side...oh dear, oh dear. The party is wedded to bringing out the 'Christian conservative' vote for it to carry the day. The only reason the Republican party can ever even win a presidental election these days is because it relies on a lot of voters voting against their own economic interests. A big factor may well be the pain Iraq is causing to small town communities voting Republican. Early leader John McCain really won't do it again because of his hawkish attitude to Iran. After recent intelligence revelations, he is not likely to improve his ground. Rudi Guiliani has the 9/11 gravitas angle to run on, but has been accused of exploiting it. Not to mention his curious way with women (including one he announced his separation from via a press conference) which is not likely to endear him as a champion of family values. Still Guiliani does remain competitive as a moderate candidate with national security credentials.

Behind these two is the strange case of Mitt Romney, the Mormon who dare not speak his name about anything. On values, it is as though he took his paintball gun loaded with enlightened positions on abortion, gun control and taxation and traded it in for an NRA rifle, fully loaded with the views of the 'Christian Right' (or as Perergine prefers 'the Unchristian wrong'). Compared to Romney, the hapless Kerry was a model of consistency. Mitt might have a name for baseball but it is only the sheer apparent hopelessness of the Unchristian wrong's prospects that even led to his candidacy being taken seriously. What the Republicans really want is to have Schwarznegger run for president.

In the meantime, another Unchristian wrong pretender, Fred Thompson, was drafted to run. Fred reminds me of Comedy Inc's superhero Blokeman, who saves the day but doesn't work Sundays or me day off. Fred has a youthful wife who is a high powered operative, and is probably hoping to run as Messalina to Fred's Claudius. Only Fred seems by his lack of enthusiasm to be doing the pumpkinification for his opponents, even walking out of a campaign stop to eat a burger on his bus.

The search for a credible contender has led to Mike Huckabee, a hoky multi-term Governor of Arkansas. Huckabee is playing the Bush Trojan horse game of appearing folksy, conservative and ingenue. No he is not. A former Baptist minister, Huckabee espouses rejection of evolution and a flat tax policy. Huckabee has flown under the radar but one does wonder what the media might do with him once he gets into their sights.

Huckabee is going to do pretty well in the southern states. The critical question is whether he can eliminate Romney's plastic challenge and get into a direct fight with Guiliani. If he can, he has some hope of getting the nomination. If not, Guiliani has to be a strong chance.

When America finally votes, we will have some idea of the conviction the various campaigns have instilled in the voters.

Nelson in search of Trafalgar...he won't find it with Garrett

Possibly the best thing about the unlikely ascension of Brendan Nelson, possibly the only medical doctor to sit on a front bench and never go near the health portfolio, is the ready list of allusions to that great English naval hero. Nelson, whom Peregrine took to calling The Human Cockatoo some years back owing to his unique coiffure (perhaps the real reason why Bronwyn the anti-socialist has been recalled was as special advisor on hair care?), sounds like the sort of soft-spoken individual needed to soothe the ructions in the post-Howard Liberal party.

The key target at the minute appears to be Peter Garrett, who Nelson has promised to chase down every foxhole, alcove and locked vault Labor attempt to hide him from scrutiny. Aha! perhaps if Labor had gone after Tony Abbott when he was elevated to the frontbench many moons ago, it would have got itself elected prior to the Sydney Olympics. Nelson appears to be chasing a chimera. Rudd has separated out climate change and water from Garrett's responsibiities. This has much more to do with the fact that both the jobs require negotiation and economic management, whereas the environment portfolio is essentially cause-based. Hence appointing the negotiator, Penny Wong, to the job makes more sense than the advocate Garrett. If memory serves, there is no hard and fast relationship between answering questions in one house or the other and any similar portfolio.

Nelson has an unenviable problem in the fact that he has to balance 'the Howard legacy', the raging bull, Malcolm of Wentworth and a complicated set of factional rivalries. The Liberal kingmaker, Julie Bishop, is trying her darndest to model herself on Julia Gillard, shadowing her in both the deputy and IR roles. This should in no way surprise given both are IR lawyers. Meanwhile, the good doctor has decided to rely on the wisdom of another Kevin, the disembodied 'tremendous amount of wisdom' and former minister Kevin Andrews. Apparently he is an authority on federal-state relations. Given Andrews' views are best typified by his skillful use of s109 of the Constitution to invalidate the NT's voluntary euthanasia law, it appears the cooperation he will advocate will be of the jackboot variety.

Given the kingmaker's followers are WA work choices supporters, there is a serious question about how they are going to react on supporting Labor's legislation. Nelson is the compromise candidate elevated because Abbott is beyond redemption, not because anyone seriously thinks he is the best leader. He would look like a total mug given his ALP background if he rejected the legislation, but he could well lose support from Bishop's posse if he accepted it.

Malcolm's support comes from a very small group who actually believe in liberal principles (at most maybe ten or so), plus a somewhat larger share of pragmatists. Pragmatism plays a key role here as none of the candidates have both a core group of party supporters or widespread public appeal.

Personality-wise, Nelson conveys an image somewhere between calming and comatose. Depending on how things are going, this either works to his advantage or runs the serious risk of appearing like Crean without the character. Abbott is a hopeless case who will probably inadvertently end up apologising for everything. He is more like Latham than Michael Duffy ever knew and hence no one would put him in charge of anything. Malcolm has something of a Whitlam-esque pompousity to him. He very much conveys the idea of a crash or crash through persona. He undoubtedly has a high intellect and equally high opinion of his own capabilities. The question would be could he fashion sufficient stability in the party and his support base to justify his election.

All of this is a product of the chaos rent by Howard's treatment of Costello as a latter-day Tiberius. Howard did not want Costello to succeed him and did everything possible to set up alternatives. Abbott and Nelson were both elevated and both proved unelectable. Turnbull was then introduced, but he went feral. Brough was the last to be groomed, but he went down with the ship.

Nelson's column of support is made of less stern stuff than its namesake. His key challenges are to find a sensible and coherent partyline on workchoices and climate change. At the minute, the Liberals are behaving like they haven't lost the election, but mum and dad have popped out for the afternoon and left the kids running the house. Mum and Dad are never coming back and the kids have to grow up if they want to get themselves seen as a competent alternative government.

Rudd's rhetorical game of Twister

Kevin Rudd has been elected on a platform of responsible change. Herein lies his essential difficulty. He must plan major transformations to policy in the areas of education, the economy, health and perhaps foremost of all, climate change, while causing the minimum level of disruption and operating in an economic and historical straitjacket. Like the wayward partner given one last chance to prove he or she can change, Rudd must be on his economic best behaviour.

Rudd is effectively left trying to hold down a series of rhetorical committments without being able to committ to the substance necessary for their immediate fruition. This pattern is most obvious in relation to the education revolution that while criticising the Howard government's woeful performance, does not provide any additional funding for universities.

It is also now playing out on the world stage with Rudd all but suggesting he was verballed by his delegation at Bali. Rudd continually emphasises the long term 60% reduction target by 2050 and refuses to be drawn on specifics until the Garnaut report is released. Determined to be a leader and a honest broker with China and the developing powerhouses, he has to sign up to big cuts but cannot actually say that until Garnaut reports. Here again he is making grand rhetorical statements while fudging on the detail until the evidence of economic responsibility is available.

The perils of retail politics - particularly in a country given five years of successive tax cuts - means that Rudd was forced to offer some tax cuts. Swan is running two messages that are true but inherently contradictory, namely that Howard was the highest taxing PM in history and that the economy is subject to inflationary pressures. He cannot very well turn around and cancel the tax cut because he would look like a hypocritical Scrooge. This puts $31 billion of extra pressure on Rudd over the budget cycle which constrains his ability to close the gap between rhetoric and real spending. On the other hand, a number of economists have commented that while Rudd gets some credit for his dramatic end to the spendathon, his record is tarnished by acquiescing on the original tax cut.

Rudd is thus left with a sackload of aspirational promises with very tight constraints for their delivery. At some point, responsibility demands that the community will be asked whether it carea more about microlevel relief or solving problems on a national or internaional scale.

Drafting the Bali Protocol

The Kyoto Protocol was intended to be a test drive of applying market mechanisms to achieving environmental policy objectives. In addition to this, it has proven what happens when skeptical neoconservatives interfere in a process they never understood nor were party to in the first place. Given the Peugeot model neoconservative, Nicolas Sarkozy, is a firm believer in the need for climate action, there is hope this nonsensical stalemate will not detract from the main game.

The Bali Protocol is the main game. The IPCC's warnings on climate peril are now becoming so strong that it would be a monumental disaster to not at the very least get underlying agreement on a timetable for binding targets for all countries. The question remains how should this be done.

The crux of climate negotiations is how to accommodate both the need to cut greenhouse emissions and the right of countries to develop their economies. The fundamental principle here is that targets must be equitable both on an intergenerational and intragenerational level. Kyoto operated on the principle of common but differentiated responsibility, which in short means coal-fired Australia got a small increase entitlement on 1990 emission levels while hydro NZ got a small decrease.

Taking this principle up collectively, what the international community should do is divide the emission share of the developed world and the share of the developing world. The first step is to construct a business as usual baseline (BAU) for emissions by say 2100. Then using the IPCC science, establish a desired stabilisation level (DSL). The period during which greenhouse emissions have been sent into the atmosphere could then be broken up into a past and future industrialisation phase, representing the two ages of industrialisation, one for the developed and one for the developing world. The phase change could be the year 2000.

The past and future industrialisation phases can then be calculated by seeing when the DSL will be reached. Say the DSL is 500 ppm and this will be reached by 2050 on BAU. Developed nations could take targets based on both phases, while developing nations could take targets for only 2000 onwards. Developed nation targets could be effective immediately, while developing nations could be deferred until a phase-in date, such as 2020. In the interim, developing nations could sign up for a range of preliminary programmes such as renewable energy targets, afforestation targets or energy efficiency standards.

This would mean that developing countries would have probably met sizable targets during the non-binding period, giving them plenty of scope and development capacity to handle targets once the phase-in date was reached.

Liberal recipe for chaos

Having just had the building Howard locked them in burn down around them, the remaining Liberals now have to regroup into something resembling an alternative government. At present, the temptation appears great that they will resemble Iraq after the fall of Saddam. Devoid of their strongman, tribal tensions and personality clashes will rent a suitably mindless civil war upon the landscape.

The problem the Liberals would always have was what would happen when they lost control of the agenda. Howard prospered by constructing his own virtual reality where ideology reigned supreme. Once Rudd became leader, Howard lost control permanently. The election merely made this official. His wise heads, Costello, Downer and Ruddock are so repugnant to the public and vulnerable to attack that none wanted the thankless job of heading Howard's faction.

During Howard's tenure there was a large majority backing him and a smaller group backing Costello. At various times, Abbott and Nelson rose briefly before proving unelectable. Late in the term, Turnbull arose to challenge Costello as successor-in-waiting. When Howard lost, a vaccuum arose which Abbott attempted to fill. Unfortunately for Tony, his not so good friend Bernie Banton had died and so his first official duty was likely to be attending the state funeral of a man he had accused of 'not necessarily being pure of heart' a few weeks earlier. Hence Nelson was drafted from the deputy candidate ranks to fill the Howard void.

Costello mused on his career prospects and then reinvented himself as party whip. Costello's former faction fell in behind Turnbull, who also picked up some of the more pugnacious realists in the party who considered him to be some kind of Australian Schwarzenegger capable of taking his green Wentworth appeal national. However Howard's faction could not swallow Malcolm's prescription and preferred Nelson's apologia to genuine contrition.

Complicating matters is the Thatcherite kindergarten teacher from Perth, Julie Bishop. Bishop seems to be labouring under the illusion that she has been elected leader of the autonomous state of Western Australia, primarily on a platform typified by workchoices. In her kingmaker capacity, she has the potential to create a mighty headache for her eastern leaders for whom workchoices is electoral poison. Methinks she rather fancies a celebrity death match with Julia Gillard and will stay in the deputy position until Gillard takes over. This raises the prospect of Abbott and Costello returning to create further mischief as bearers of the workchoices mantle. Costello's stocks may rise if the economy performs badly over the term and economic management comes back into vogue. Abbott has proven to be accident-prone, nasty and out of touch and is totally unelectable.

Given Turnbull lost by three votes, he is unlikely to give up the fight when so many observers consider him the best chance of unseating Rudd, not least the Australian newspaper, former loyal supporter of Howard's regime.

Washup on Howard's Wipeout

Peregrine has been on not so much a seven second as a seven day delay and hence this summary comes somewhat after the collective bloghorse has bolted (although no one has heard much out of Mr Bolt himself recently).

Rudd won this election because he found a persuasive narrative that gave concrete reasons why Howard had passed his use-by date. The key to his success was to restrict Howard's economic advantage to the Liberals' citadel seats. The swings in many citadel seats were lower in this election than the previous one with Latham as leader. It seems a proven leader is required to challenge generational incumbency.

Rudd's economic wedging of Howard first on microeconomic issues like grocery and fuel prices and housing affordability then on the macroeconomic issue of interest rates effectively neutralised the economic trump card in the marginals. Throw in workchoices resentment and a swag of outer suburban and regional seats voted Labor, particularly in Queensland where Rudd had both home ground advantage and a swelling band of former One Nation voters suspicious of economic reform. The fortuitous replacement of Peter Beattie seemed to diffuse the council amalgamations issue.

This also explains Rudd's curious assurance that he would not push for referenda on a republic or reconciliation during his first term in office.

This election was thus similar to 1998 - except the marginals preferenced Labor, not the Coalition.

Climate change acted largely as a consensus issue with most voters who turned on economic issues in agreement with Rudd on the environment. The seats of Corangamite and Eden Monaro fell largely on this issue, while swings in numerous South Australian and Victorian rural seats appear to correspond to water concerns. However due to the failure of citadel liberals to consummate their flirtation with progressive politics, few seats fell on this basis alone.

The net result is a clear rejection of workchoices and inaction on climate change. It also indicates a residual concern among liberals that Labor cannot manage the economy. Thus Rudd has a provisional licence to govern and prove his credentials to the community.