The World Warms As Australia's New Government Promises to Drop National Carbon Tax

For global warming there are two competing truisms. The first truism is that the most efficient and effective means of reducing carbon emissions is through a carbon tax. The basic economic rule is that people buy less of something when it’s more expensive. And a tax on carbon would make all things reliant on carbon emissions—gasoline, electricity, etc.—more expensive. Folks would buy less of this stuff and there would be less carbon thrown into the air.

            The most common approach around carbon taxes is levying them on industries that are heavy users of fossil fuels, mostly the electric utilities, with the increased costs passed on to consumers. These taxes can be finessed, with rebates going to lower income individuals to mitigate their hardship from these taxes. A good thing about a carbon tax is that the revenue can be used to promote cleaner and greener energy options.

            The other truism is that people hate to pay taxes. It doesn’t matter what sort of tax it might be, an income tax, a carbon tax, a sales, tax, folks hate to pay taxes.

            We just saw the clash of these truisms play themselves out in Australia, where the recent elections delivered a whopping blow to the Labor Party that had been in power for the past six years. The new Prime Minister-elect, Tony Abbott, proclaimed in his acceptance speech that one of his prime objectives once he is in office is an end to Australia’s carbon tax.

            Down under the carbon tax has not been around a long time, only about a year. In its short life it proved to be, as with all taxes, unpopular. It was one of the issues that Abbott used to hammer the Labor Party in his campaigning.

            This was not a single-issue election. The Labor Party might have been voted out anyway. In power, the Labor Party was unstable and prone to internal bickering, although their popularity increased when Kevin Rudd, who had been Prime Minister from 2007 to 2010, replaced Prime Minister Julia Gillard in something of an internal party coup in the past few months.

            The death of Australia’s carbon tax is nonetheless disconcerting. The planet, and humanity, will be in a lot better shape if human beings reduce their use of fossil fuels, but we’re not going to magically do that sort of thing without being prodded to do so. Despite the good that a carbon tax might be able to do for us, we just don’t like being prodded.