In Summary

Peter Brent, Swinburne University of Technology
This article appeared on Inside Story. Read the original article.
The Labor Party is fighting a battle over terminology. At stake are the decisions political journalists, editors, sub-editors and nightly news scriptwriters will make when they’re referring to the party’s climate change policy. As election day approaches, will it be called an “emissions trading scheme” or a “carbon tax”?

A draft Labor plan for an ETS has been passed to News Corp, and the Abbott government has leapt on it enthusiastically, warning of the return of the diabolical “carbon tax.”

Shadow environment minister Mark Butler insists, with a note of desperation, that it’s nothing like a carbon tax, it’s an emissions trading scheme – and these are very different things.

The opposition has already said it’s likely to take a carbon price plan to the next election. The aim of this week’s leak was presumably to force Bill Shorten to drop the idea. The ambush betrays such a simple-minded, reductionist view of political dynamics that we can reasonably conclude it involved people associated with the party’s NSW Right.

In Labor’s perfect world, the issue of climate change would just go away. Back in the here and now, if the party fronted the next poll promising not to take meaningful action, no one would believe them. As Kevin Rudd and then Julia Gillard discovered in 2010, having no policy is much worse than having one.

After years of Labor hyperbole about the importance of meeting this “moral challenge,” the Rudd government’s April 2010 decision to “postpone” its carbon pollution reduction scheme, or CPRS, not only revealed the prime minister as a flake, it also created a vacuum into which the opposition shovelled permutation after combination of horror stories about what Labor might actually do.

Yet just a few years earlier the Howard government had scrambled, not terribly convincingly, onto the climate change wagon, and then Kevin Rudd had swept into government promising action. How did we get from then to now? Back then, an ETS sounded nice but the devil was in the detail: the fine print of cost-of-living increases, although compensated for, provided scare campaign fodder. Still, even after Rudd dumped the policy, a Nielsen poll found 58 per cent support for “an emissions trading scheme for Australia.”

The CPRS was troublesome, but it is grotesque revisionism to portray it as unpopular in 2010. Rudd’s determination to cause political mischief for Malcolm Turnbull, and the need to deal with a Coalition–Family First veto in the Senate, eventually led to his undoing. It was also a case study of modern Labor political malfunction, of excessive influence enjoyed by people who know everything about polling and nothing about voters.

Fundamentally, though, the politics was driven by semantics. What is a tax and what is a scheme?

Rudd’s CPRS was an emissions trading scheme that would commence in July 2011. It would have a fixed price for one year and then a floating price. When new opposition leader Tony Abbott christened it a “great big new tax on everything” he was indulging in rhetoric, in metaphor. (The current opposition took a leaf out of his book by describing the Coalition’s now-abandoned Medicare co-payment a “GP tax.”)

A year earlier, Abbott had actually explained that he preferred a carbon tax to an ETS. In a Sky News interview (nine minutes and fifteen seconds in) he seemed to have in mind a consumption tax.

Gillard, upon assuming the leadership in June 2010, bizarrely declared that action on climate change would have to wait for “deep and lasting consensus.” But when it became evident that the government would need a policy for the election, “cash for clunkers” and the citizens’ assembly were born. The Coalition opposition warned that Labor would introduce a “carbon tax.” No, Gillard insisted, there would be no carbon tax under a government she led.

Yet, just a day before the 2010 election, the Australian’s Paul Kelly and Dennis Shanahan commenced an article with these words: “Julia Gillard says she is prepared to legislate a carbon price in the next term.” They reported that she had said, “I don't rule out the possibility of legislating a carbon pollution reduction scheme, a market-based mechanism – I rule out a carbon tax.”

What did Gillard mean? She probably didn’t know; the aim was to kill any possibility in voters’ minds that something called a “tax” was on the way. She knew very well that the “t” word is a powerful negative motivator to the unengaged voter; it takes money from their pockets and can damage the economy.

Then in February 2011, alongside Bob Brown, she announced the carbon-pricing scheme. Whereas Rudd’s had involved a fixed price for twelve months before moving to a floating price, this one would be fixed for three years. Fatefully, diabolically, the government made a decision to immediately wave a semantic white flag. Yes yes, Gillard conceded, you can call this a carbon tax if you want; let’s not quibble over words.

She changed her mind before too long, but the damage was done. It was widely known as a carbon tax, with the Greens as co-authors, and a broken promise to boot.

Not long after Abbott’s 2009 carbon tax ruminations, high-profile businessman Dick Warburton wrote of his scepticism about human-induced climate change in the Australian Financial Review. He then turned to the Rudd government’s policy:

Until we know for certain [that anthropogenic climate change is real] we should take a measured approach, which means limiting man-made carbon dioxide emissions. There are two strongly promoted means of doing this. The first is to introduce an emissions trading scheme (ETS) such as the federal government’s proposed carbon pollution reduction scheme. The second is to introduce a carbon tax. Both aim to induce people and businesses to reduce carbon dioxide emissions. Both have pros and cons and both have strong support. I believe either could work. 

He explained that a carbon tax would be preferable because it “is more transparent, more direct and, importantly, more flexible. Should the supporters be right, you can ramp up the tax, but should they be wrong, you can diminish or eliminate the tax.”

Two years later Warburton publicly opposed Gillard’s plan; when asked about the apparent contradiction he argued that “the carbon tax was just going to be a tax as such” back in 2009, “but now we are getting into permits and rights which the ETS is involved in.” In other words, Gillard’s policy was not a carbon tax, but an ETS.

From 2011 to 2013 Labor MPs – leaving aside some moments of indiscipline – always referred to the Gillard government’s policy as a “carbon price.” But across the media it was almost universally described as the “carbon tax.” Until it came into operation in July 2012 it was widely feared, but then for most people it turned out to have been a lot of fuss about not very much; they discovered no extra deductions from their paypackets and witnessed no towns wiped out.

After Rudd returned to the leadership in June 2013, he miscalculated by announcing he would “terminate the carbon tax.” What his policy change actually involved was bringing the floating price forward a year, to July 2014.

His sudden backflip and embrace of his opponents’ nomenclature meant that the party conceded that Gillard’s scheme was a “tax,” but that Kevin was going to kill it. Perhaps he was determined to differentiate himself from Gillard, but his capitulation validated the Coalition’s campaign. Again, the decision revealed such a linear view of the psychology of voter behaviour that the brothers and sisters of Sussex Street can’t have been far away.

Gillard’s 2011 surrender on the wording, and Rudd’s two years later, continue to cause problems for Labor. But the importance of the “carbon tax” to the 2013 election result is vastly over-hyped by the political class. That election was predominately about debt and deficits.

And a threatened return to the “tax” would not be as terrifying to Australians the second time around, given how little noticed its introduction (and abolition) were. But no opposition wants to take a new tax to an election.

So how will Labor’s climate policy be projected into suburban households? Will Channel Nine consumers hear Laurie Oakes describe it as a scheme or a tax? Will it be seen as the progeny of Rudd’s policy, or Gillard’s? Or, ideally, of neither of them?

Let the word games begin. Because that’s what this contest is about: words.