Happy Carbon Tax Day

So, today was the first day of the Clean Energy plan, highlighted by the introduction of the carbon price on major emitters.

There are 294 companies to pay the tax

So, let's set a couple of things straight.  There are 294 liable entities for the 2012/13 who have to pay the carbon tax.  No, it isn't 500 companies as been widely reported.  It's just 294.

Most of them are involved in energy or mining, plus a number of councils who operate landfills.

Hardly any impact on the average person

How is this going to affect the regular person? Well, some prices will go up, but the average person will be compensated, so there will be very little impact.  In fact, many people will finish off better off.

Given that prices go up and down for various reasons, it will be very surprising if the carbon tax impacts are as noticeable as the GST.  It isn't as if prices will suddenly go up by 2% this week.  Instead, companies that have to pay the carbon tax will carefully consider their pricing, and will make decisions as to whether they will pass the price on.

Companies that increase their prices will risk losing customers, so that is quite a disincentive. And given the level of industry support, there is a good chance that many won't shift their prices, at least not straight away.

So if people won't lose and companies won't put prices up, how does this work?

Just to clarify, there will be some price rises.  But, the real way that the carbon tax will work is to penalise companies that pollute and advantage those that are clean.

Very quickly, capital will move towards the green companies (we are already seeing that happen). And the big energy companies are accelerating their green programs.

Dirty coal plants like those in the Latrobe Valley will be phased out, and workers in those plants will transition to other jobs.  Some will stay in the energy industry and others will do something different altogether.

Economists call this the productive use of resources. I call it helping to get workers out of dead-end industries.  There are hardly any blacksmiths any more, and that's because there are a lot less horses being shod.  In a few years time, there will be a lot less brown coal workers, and that will be because we will have weaned ourselves off brown coal.

Any change is contentious and emotional.  The carbon tax is a good change.  Time will show this to be true.

Let me know what you think

Mark S

P.S. Check out the http://www.cleanenergyfuture.gov.au/ website for more information

It affects me - that's why I must support the private health insurance means test

I want Australia to be more productive, more creative, more fair and economically successful.  Some of these goals require change - change that impacts on real people.

So, when the Gillard government proposed the private health insurance means test, I had to ask myself, does this fit the criteria? Will it make us more productive, or economically successful.  The answer is probably yes.  We need to afford a health system, we need a public dental care system, and for individuals earning over $83,000 or families over $166,000 it seems fair to reduce the rebate they are receiving for purchasing health insurance in return for a $2.4 billion saving over just 3 years.

And it affects me - so I can't very well argue for some changes that don't impact me directly if I won't support changes that do affect me.

Productivity changes affect real people - that's why we need them

If productivity changes didn't impact on anyone, then they are probably not doing anything.  At the moment, Australia is in a once in a century mining boom.  Yes, it's impacting on many industries.  Yes, a lot of people can't see that this is doing them any good.  But, the impacts are real, and they have the potential to transform Australia for the better.

If we want to preserve old manufacturing industries, who is going to pay for it? All of us.

If we want to protect old fashioned retailers, who is going to be affected? All of us.

If we want to continue to drive our economy with polluting, carbon-intensive fuels, who is going to be affected? All of us.

So, we need to embrace the changes that are needed and take advantage of the one in a century opportunity that we are being handed.

I might have to pay and we all might have to change

At the moment, my job isn't impacted by the changes to the economy.  It wasn't always that way - I've been made redundant when the Marketing industry went through change.  So, if you are a manufacturing worker at the Toyota plant, or a retail worker whose shifts are being cut, it would be natural to be concerned. 

For most workers, there are other opportunities.  95% of people who want a job currently are employed.  For the retail worker, you have sales skills - there are currently over 2,000 sales jobs being offered in Melbourne alone.  For the manufacturing worker, there are over 1,500 jobs in Manufacturing, Transport & Logistics in Melbourne.  Change can seem scary, but it's what we have to do as society changes.

For me, I have to pay more for my private health insurance.  I can't ask you to adapt if I won't.  We all have to share the journey.

Tony Abbott's position makes no sense

Given that I will have to pay more for my private health cover, I don't understand why Tony Abbott wants to give me a hand out. Here is his statement on radio...

"Private health insurance is in our DNA. It is our raison d'etre, that is why we exist as a political movement, to give more support and encourage for people who want to get ahead. So, look, private health insurance is an article of faith for us. We will restore the rebate in government as soon as we can.''

So, is he saying that if you are wealthy, we will give you more money to make you more wealthy? Huh?? Honestly, that makes no sense.

Or is he saying he wants to do away with Medicare, and just have private health insurance? That would make even less sense, and be even less equitable.

I'm really trying to understand his perspective, but frankly, I can't see it at all.  Then again, I can't see why Prime Minister Gillard insists on bailing out foreign car companies either ... but that's a discussion for another day.

Times are changing, and we all have to step up to the plate.

Let me know what you think

Mark S

Australia's carbon price legislation is a sign of growing up

After years of dithering, today's decision by the Senate to pass the Clean Energy Bill is a momentous occasion in more ways than one.  Yes, I think the policy itself is a good one, but it's the maturity as a country that has really struck a chord internationally.

So the largest polluters will pay for carbon emissions, pass on the costs to consumers who will be compensated, and clean energy innovation will thrive.  Economically and ecologically the evidence suggests this will be a positive for Australia.

Huge international interest

But what has been more compelling is the positive international response. Within 12 hours, there are over 800 global news stories covering this decision, and a variety of opinions.

BBC: Australia's Senate has approved a controversial law on pollution, after years of bitter political wrangling.
WSJ: Australia's Carbon Tax Clears Final Hurdle
Xinhua: A latest report showed the carbon tax will cost 0.98 trillion U. S. dollars on the Australian economy, or 39,086 U.S. dollars per Australian from July next year to 2050.
TVNZ: Australia passes landmark carbon tax laws

Leadership by Gillard

Whether you like the law, or dislike it; whether you see it as an economic positive or negative, this story has put Australia's leadership credentials on the global stage.  Rather than waiting to be led by the next Kyoto round, or following the path of larger countries, Prime Minister Gillard has shown real leadership.

Whether you agree with him or not, you can't ignore the power of Al Gore.  And when he says, "With this vote, the world has turned a pivotal corner in the collective effort to solve the climate crisis,” it is a clear sign that Australia is setting the agenda on a major issue.

After failing to vote for a Republic 12 years ago, finally Australia is growing up.  Whatever your views on the Clean Energy Act, we should be proud to take our place on the world stage. Oh, and it's good for our brand.

Let me know what you think