Australia moves backwards, repeals carbon tax

Weather Map Australia
Public Domain Australia's Bureau of Meteorology

Australia knows about heat. Last year, parts of the country were so hot that they had to add a new color to the temperature map (purple), and this year, while North-America was freezing in the polar vortex, Australia was sweating in a heatwave so bad that bats were falling from the trees...

Yet, the country's politicians seem to be going backwards in time when it comes to doing their part to prevent further global warming. While there are some very encouraging signs from Australia, such as its booming rooftop solar industry, the country has just became the first one to repeal repeal carbon laws that put a price on greenhouse-gas emissions after a 39-32 vote in the country's Senate.

Flickr/CC BY-SA 2.0

This is particularly bad because Australia is still heavily reliant on coal for its electricity - around 80% - and a very large exporter of coal to Asia, making the country one of the biggest per-capita emitter of greenhouse gas.

"In 2011, daily emissions per head amounted to 49.3 kilograms (108 pounds), almost four times higher than the global average of 12.8 kilograms, and slightly ahead of the U.S. figure of 48.2 kilograms," writes the Wall Street Journal.

Wikipedia/CC BY-SA 3.0

Putting a price on carbon is an elegant way to reduce emissions and encourage a transition to cleaner technologies, but it's not politically easy to sell. That's too bad, because the world would be a much better place if we taxed "bads" rather than "goods". This can even be done in a revenue neutral way; for example, if you raise 10 billion dollars from carbon taxes, you can cut some other taxes by the equivalent amount. This shifts incentives, and maybe now it costs less for a business to hire more workers, and it costs a bit more to pollute, so over time things will shift to cleaner energy, more efficient technologies, etc. In theory it's better than trying to pick winners, like directly subsidizing certain technologies. We've seen that with the corn ethanol fiasco in the U.S., which shows that often subsidies go to politically powerful group first, rather than to the most promising technologies (solar, electric cars, energy efficiency, etc).


Tags: Australia | Carbon Emissions | Carbon Taxes


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