Daily Telegraph Blog
Posted on Friday, 12 August 2011
Even people who support a price on carbon are against this tax at this time.
With the world economy at its most fragile since the initial shock of Global Financial Crisis, the last thing Australia needs is a big new tax.
This week, a procession of senior business leaders, led by BHP chairman Jac Nasser, said that this was the wrong time to introduce a carbon tax. It’s never a good time to introduce a bad tax but worldwide share market chaos, United States and European debt fears and unemployment edging up here in Australia mean that this is the worst possible time.
If the Prime Minister had any judgment, she’d recognise this and at the very least postpone the carbon tax until the global situation was better and the government here faced fewer challenges of its own making.
Her stubbornness confirms that this is a government with no sense of priorities and no ability to respond intelligently to changing circumstances.
The government is using international economic uncertainty to back away from good policy but to reinforce a bad one. It’s now calling the return to surplus a mere “objective” rather than a more-or-less-accomplished fact while it’s insisting that a carbon tax is more necessary than ever, even though no other country has an economy wide carbon price and the carbon tax and the mining tax are exacerbating Australia’s sovereign risk problem.
Over the past fortnight, the government has tried to change the subject from the carbon tax to anything else on which it could release a report or re-announce an intention. The only way that the government can stop people from focussing on the carbon tax is to drop it.
As Graham Richardson has observed, gathering economic storm clouds provide the government with a plausible excuse to do so – and to again keep the commitment that there will be “no carbon tax under the government I lead” – but the Prime Minister is too stubborn to seize the lifeline that circumstances have thrown her.