Mungo MacCallum- Political Corrections

Sugar coating the bitter green pill

Kevin Rudds big trip can be described as a modest success at least in its own terms, which, in spite of the media ballyhoo, were not all that ambitious.

Contacts have been made, flesh has been pressed and Australias positioning on the wars in Iraq and Afghanistan made clear even to the thickest of our allies (George W Bush). Our renewed commitment to the United Nations has been underlined by our somewhat quixotic bid for a seat on the security council, our continued commitment to free trade confirmed and our approach to China and Japan rebalanced.

In the process Rudd himself has been accepted and even applauded by his international peer group (if not by the hysterical fringe who objected to him waving Bush a cheery salute) and Australias credentials as an international player greatly strengthened. Mission, as they say, accomplished.

But the big challenges remain, the first being the inflation-busting budget, which will be quite painful enough for starters. And beyond that looms the far greater, ongoing pain of dealing with climate change.

There is no doubt that Rudd takes it seriously; shortly after he became leader of the ALP he described it as the great moral challenge of our times, later adding that it was the great economic and political challenge as well. He made it a centrepiece of the election campaign, committed Labor to a 60 per cent cut in greenhouse gas emissions by 2050 and commissioned Ross Garnaut to report on the way to get there. Garnauts preliminary ideas have now emerged, pointing to what appears to be a fairly even distribution of cost between consumers and producers, with the details to come shortly.

So far so good. But there still appears to be a very limited appreciation among the general public of just what the cost will entail. It is not just a matter of changing the light bulbs and turning a few things off for Earth Hour. We are looking at a long term change in lifestyle indeed, at a permanent lowering of living standards. And the real challenge is whether Rudd and his colleagues will have the courage to inflict it upon us, because there is no way known that we are going to do it voluntarily.

The softening up process has at least begun. The NSW Government has produced an alarmist report warning that we could be facing a four per cent drop in productivity by 2030, with a consequent decline in national wealth. Given the healthy growth rate of the economy overall, this would not be terribly serious. But the report does not spell out just where the pain would be felt.

The first step in any comprehensive attack on emissions will be the setting of a cap, followed by the implementation of a carbon trading scheme, which will have the effect of making energy in all its forms electricity, gas, petrol, you name it more expensive. Lobby groups are already arguing that both suppliers and consumers should be compensated for the price rises, but this is to miss the point.

As both Garnaut and the Reserve Bank chairman Glenn Stevens explained last week, the whole idea of pushing the price of energy up is so people will use less of it. This is the only short-term method by which emissions can be reduced. Subsidising peoples bills (as the Howard government effectively did by ending the indexation of petrol excise in 2001) not only sends the wrong signals but is demonstrably the wrong policy. No pain, no gain.

In the long term, of course, when we have made the switch to non-polluting sources of energy, we can all stop worrying. But that will take a long time and a hell of a lot of money. Alternative energy does not come cheap. Given the continuing sensitivity of the voters hip pocket nerves, the next few years will require governments which are both very clever and very brave.

To put it at its crudest level: Im not going to give up using my car until you do too, and neither of us will unless the government makes us. And if any government does, well vote the bastards out of office. Over to you, Mr Rudd.

So another domino has fallen. Peter McGaurran, once spoken of as a possible leader of the National Party, has left parliament for the racing industry. He will be neither missed nor mourned.

However, his erstwhile cabinet colleagues Peter Costello, Tony Abbott, Alexander Downer and Phillip Ruddock are hanging on, to the frustration of their leader (call me Brendan Im listening), who would much prefer to cleanse the Augean stables in one mighty flushing but lacks the Herculean strength needed to do so.

It is not quite clear why Downer and Ruddock continue to infest the place; presumably they have nothing better to do. Abbott, we know, still harbours dreams of leadership. The question is whether Costello does too.

Certainly his small but perfectly formed cheer squad, News Limiteds poison dwarf Glenn Milne, has not given up, and there is probably a rump within the Liberal Party prepared to forgive the indolence and self-indulgence which has led to Costello lurking on the backbench. But when the party decides Nelsons time is up, will it really want to go back to the man who, as Labor would gleefully put it, let the inflation genie out of the bottle and sent interest rates skyward, and never had the guts to stand up to John Howard?

Well, not if Malcolm Turnbull has anything to do with it. And like him or loathe him, at least everyone agrees that he has the ticker for the job, unlike Costello the Yellow, the man who never was.


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