The failure of the Senate to pass[1] the CPRS today means that the Rudd-Turnbull deal is dead, and that Rudd now has little choice but to go for a double dissolution, early in 2010. Assuming he does, and that Labor wins, the worst outcome we can get is the original bill. But, given that Labor will have no choice but to deal with the Greens for the foreseeable future, it would make much more sense to go for something better. Whereas a couple of days ago it looked like we would get a shabby deal, politically profitable for Labor, mildly embarrassing for the Coalition and barely passable for the environment, we now have the prospect of getting it all – a decent emissions trading policy, an open debate in which the delusionist conspiracy theorists are exposed for the loony fruit loops they are, and a split in the Liberal party that will keep it out of office until it dumps its current base and moves a long way to the left (see UK Tory party)

Some observations over the page

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Suppose that the delusionists can manage to force a party meeting tomorrow, and move a spill motion which will surely succeed. Then presumably, even if Hockey gets up, the Libs will kill the ETS deal. At this point, it makes sense for Labor to want a double dissolution. More it makes sense for them to keep Parliament sitting as long as possible to get extra triggers. Obviously the Reps is no problem. For the Senate, the Libs presumably need their votes + 2 more to pass a motion to adjourn. So, if Labor can keep Xenophon and the Greens onside, which would make sense for them in a lot of ways, they can keep Parliament sitting for another couple of weeks while the Libs tear each other apart. Any thoughts on the practicality of this?

Tony Abbott’s resignation must surely mark the end for Malcolm Turnbull’s leadership and therefore, in all probability, for the deal with Labor over the ETS.

Ultra-optimistic scenario: Turnbull quits and Abbott is installed, the deal is cancelled and Rudd calls a double dissolution based on the original bill, winning easily. Since the original bill clearly needs amendment he doesn’t use the joint sitting mechanism but instead makes an agreement with the Greens who now have the balance of power.

Rudd’s preferred scenario: Turnbull holds on long enough to deliver seven senate votes tomorrow and pass the watered-down ETS. He is promptly rolled and the Liberal party splits. Abbott as new leader, starts with a commitment to repeal the scheme, but abandons it because this is the last thing big business wants. Labor reduces the divided opposition to rump status at the next election, and ends up dealing with three or four different parties in the Senate, needing only one to get its legislation through. This is probably more plausible than mine, but the timing will be very tight tomorrow. The decision is to be made at 3:45pm, apparently.