Friday, 2 December 2011

How Not to Sell the Carbon Tax

The Australian Senate passed the final version of the "Clean Energy Future" bill (in other words, the Carbon Tax) on 8 November, amidst much fanfare and no small amount of criticism.  This means that assuming Tony Abbott is just posturing when he says a Coalition government would repeal it, from June next year it will cost money to release carbon into the atmosphere.  $23 per tonne, at least at the beginning.

This is not a popular measure.  Over the past few years support for a carbon price and carbon trading has eroded.  Big polluters have sowed seeds of doubt, funding visits and lecture tours by climate change deniers like Lord Monckton and mounting scare campaigns about the damage to our economy.

Meanwhile, I've been going through the pile of periodicals and occasional publications that has been growing in my in-tray for the past eight months.  One of the little gems I found was a Commonwealth Government publication called What a carbon price means for you: the pathway to a clean energy future.  It was put out a few months ago, when the legislation was first introduced to Parliament, and it is the major promotional document for the package. 

It would have to be the oddest piece of marketing I have ever seen.  The summary page lists four key points.

9 in 10 households will receive some combination of tax cuts and increased payments to help with the cost of living impact of the carbon price.

Over 1 milion extra Australians will no longer need to lodge a tax return.

Almost 6 million households will be assisted to meet their average price impact.

Over 4 million households will get assistance that is at least 20 percent more than their average price impact.

What's missing from this summary?  Oh yes, that's right, that whole climate change thing.  Damn, we forgot all about that!

The rest is not much better.  Three of the twenty pages are devoted to talking about reducing carbon pollution.  On none of these pages is there any explanation of how a carbon tax will help with this.  Instead there are generalities about how important it is to reduce carbon pollution, and assurances about the effectiveness of the tax.  "Trust us," they seem to imply, "we know what we're doing."

After this brief non-explanation about what the policy is actually about, the next ten pages are devoted to spelling out how Australian households will be compensated for the price increases caused by the tax.  There are precise details of the amount of cost increases we can expect to see, and the amount of tax cuts, pension increases and other such baubles ordinary Australians will receive to help pay for them.  Everyone is covered - workers, students, low income earners, pensioners, people with disabilities.  No stone is left unturned to reassure us that we will not be worse off.

Why am I not convinced?  Why, with such a wealth of detail, is the Australian public as a whole not convinced? 

Well, we have before us a classic example of poor communication.  The good thing about a carbon tax is that it provides a financial incentive for businesses, particularly power generators and large scale users of energy, to cut their emissions and move to low- or no-emission technologies.  They pay for every tonne of carbon they emit.  Renewables suddenly have a huge head start if only they can make their technology efficient enough to compete.  Emissions reduction technologies have a tangible financial benefit.  Offsetting measures suddenly make a lot more economic sense.  The carbon tax speaks to polluters in the language of capitalism, saying "reduce your emissions, and you will make more money".  It is an ambitious attempt to move capitalism towards sustainability.

Yet this core message, this basic rationale for the policy, does not appear anywhere in the marketing.  All that appears is the downside.  This will cost you money, it says.  Don't worry, it won't be as much as you think, and we'll make it up to you.  But of course if you have to spend 10 pages explaining how people will be compensated, the message which underlies those ten pages is that this is a destructive policy.  Why do it, if people need this much compensation? 

It suggests the government has no faith in its own policy.  It has no confidence in the vision and imperative to tackle pollution and climate change, or in the effectiveness of its chosen strategy.  The carbon tax may be a necessary evil, but nonetheless it is evil.  So we need to reduce the evil as much as we can.  The deniers, be they in the business community or the Opposition, have got into the government's head, and made them afraid of their own policy.  If they are afraid, why should we not be?

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