I did two presentations four hours apart which made for something of a rushed day. I’ve attached them over the fold in PDF format.
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I did two presentations four hours apart which made for something of a rushed day. I’ve attached them over the fold in PDF format.
John Quiggin 
John, it seems like the Federal Coalition is in tatters for the sceptics would rather believe marrying frogs will please the rain gods and bring rain than in the science.
Do you have any comment on the announcement of the Safe Climate Australia organisation? If governments are unable to do anything effective, groups like this may be our only hope.
John, I tend to agree with Dr Martin Parkinson when he says “It is crucial that we keep the debate honest in the final stages and work together to achieve a successful outcome’ for there has been a lot of unsubstantiated and unscientific bulldust being put forward by sceptics from within the Coalition. Time for Turnbull to stop the rot.
I heard some news today. Tony Abbott said the ETS was “a good political solution”. In my experience, “political solutions” are just that. They are solutions in no other sense.
JQ states, “Emissions trading gives certainty on reductions, uncertainty on marginal cost… (the) reverse is true for carbon taxes.”
Yet the Govt Green Paper tells us,
“The Government will set and extend scheme caps and gateways, decide the nature and extent of international links, and decide when allocations of free permits to emissions-intensive trade-exposed industries should cease.”
“The Government would announce an indicative national emissions trajectory to provide broad guidance on the pathway towards the medium-term target range.
“The scheme cap would not be adjusted in the event that it is incompatible with internationally negotiated national targets and, if necessary, the Government would make up any shortfall in internationally agreed targets by purchasing international emissions units.”
Note the phrases “set and extend”, “indicative trajectory”, “broad guidance”.
OK, if one believed in the honesty, good will and integrity of the proposers one might accept that these phrases encapsulated necessary flexibility. However, if one is convinced of the total mendacity of the two major parties and the corporates who donate to them then these phrases appear in another light.
To claim that this “cap”, which hovers and shimmers like a desert mirage in all its qualified, hedged and caveated verbiage, gives “certainty” is to strain all credibility.
Neither “caps” nor “carbon taxes” will give us certainty. I would argue this. Direct government action using the direct mechanisms of carbon taxes (in general) and hard mandated caps for specific hard case industries would have a higher probability of succeeding than indirect action using “floating caps” and the market as a “one remove” remote control tool. I’m tempted to ask a little flippantly; Are we a democracy or a marketocracy?
Can we be confident that “cap and trade” is not a trojan horse wealth transfer tool or likely to be used as such? To give one possible scenario; businesses that pollute heavily and see serious red-ink trouble ahead for them in the GFC could (a) break up and sell off the company and (b) sell all their free permits for clear return.
Interestingly, Tony Abbott’s first pitch was a carbon tax … that says something.
Fran – Tony Abbott would sell his christian right to enter heaven right now to avoid a double dissolution election.
I posted a question about this on John’s facebook site, thinking it was linked to here. (Yes, technology and me are uncomfortable partners.) I am assuming it is OK to transfer the posts here since they were public there.
I asked whether 450-550 ppm was enough. John replied:
JQ: It seems the best estimate at present. If we have the scheme in place, and the evidence suggests a lower target, we will have to make more drastic reductions, which will be v costly, unlike 450-550.
I responded by saying I thought 350 ppm was a better goal and that when survival might be at stake cost didn’t seem to me to be th main consideration. (Actually my comment was slightly less well expressed than that). In part this was prompted by hearing a professor of geo-paleontology from the ANU argue for 350 ppm at a recent demonstration about climate change.
From memory NASA’s Hansen supports this too as do a range of other scientists.
In his review, Stern supported a range of 450-550 ppm carbon dioxide equivalent of greenhouse gas concentrations. Hansen supports not stabilising at 350 of carbon dioxide or less, which could involve a higher concentration of grgeenhouse gases, but carbon dioxide hangs around much longer than most greenhouse gases. I would prefer to bring greenhouse gas concentrations to lower than 450 ppm, but if the global 2020 targets are on a trajectory consistent with 450 ppm CO2-e, it could be possible to tighten the trajectory to less that 450 ppm, but not if the scenario overshoots too much (or carbon cycle feedbacks are too great).
In order to do this we will need some sort of carbon pricing. Unfortuinately many who support a stabilisation target of less than 450 ppm oppose carbon pricing because they consider it to be “market based”. I agree with John’s criticisms of the efficient market hypothesis, and also agree with Krugman who has recently stated that opposing “market based” approaches to emissions reductions is bad for the planet.
Much good work that is relevant to carbon pricing instruments (e.g. Weitzman 1974, Roberts and Spence 1976) does assume a form of efficient markets hypothesis in that they assume that a price or quantity signal leads to their being a cost minimisation function. This is useful and mathematically convenient, and allows us to make useful deductions, even though markets are not necessarily very good at being cost minimisation mechanisms. We need to recognise that markets often fail, but we also need to recognise that just because a policy is “market based” does not automatically make it bad.