Roosters, feather-dusters and high stakes poker

A lot of nonsense is being written by pundits about Julia Gillard’s supposedly terminal leadership situation in the light of the carbon tax issue. The reality is that if she manages to broker a deal that gets through Parliament this year, then she’ll be seen as a strong leader who had the determination to force through a solution to an extraordinarily difficult issue where others have failed. Moreover, as with Kim Beazley in the wake of implementation of Howard’s GST, everyone will realise that it was no big deal and that Abbott was lying to them. On the other hand, if she fails to nail down and implement a carbon tax, Gillard is almost certainly dead meat whatever happens.

In the meantime, all Gillard can do is take the fight up to her opponents and seek to persuade as many people as possible about the facts and the necessity of a carbon price as part of the solution. She won’t achieve a decisive majority in that time, because it’s just too easy to sow doubt, fear and confusion about any proposal that hasn’t actually been implemented (or in this case even spelled out in detail). Look at the Republic Referendum a few years ago. A more innocuous constitutional change would be hard to frame, but monarchists had no difficulty in totally confusing an electorate that had little time for the Royal Family but equally saw little compelling reason for change. Fortunately Gillard doesn’t have to carry a clear majority of Australians with her at this point, just the Greens and Independents in Parliament. If she can do that the people will follow in due course after the carbon tax is in place. I’m sure Tony Abbott knows that too. Both leaders are playing high stakes poker.

So far I think Gillard is doing well. 11. KP: Leaving aside the fact that, as I argued in a recent post, she would be much better advised to flesh out more of her proposal now with enough qualifiers to allow for the detailed negotiations that certainly need to take place before any policy is finalised. [] Her performance on Q and A the other night was very impressive despite a quite skeptical audience. She was strong, persuasive and well briefed on all issues. To me this was the money passage of the evening:

AUDIENCE MEMBER: Prime Minister, isn’t the whole point of having a carbon tax to affect the prices that consumers pay? If there’s no change in consumer behaviour, you’re not going to achieve what you’re trying to achieve to reduce carbon pollution. So if it’s compensating households, aren’t you simply undermining the effect that your tax is going to have and ultimately make no change?

JULIA GILLARD: That’s a very perceptive question and I think a lot of people are thinking about his, about how does it work? If I’m getting compensation, what’s actually changing? Let me just explain that. The carbon price affects the big polluters. Yes, they will cause some price impacts for consumers. That’s true. We will then assist consumers and I can understand why people then intuitively go, well, how does all of this work? Isn’t, you know, sort of money going in and money going out? What’s the effect? Well, the effect is that in the shops when you come to buy things, products that are made with relatively less carbon pollution will be cheaper than products that are made with more carbon pollution. So you’re standing there with your household assistance in your hand. You could still keep buying the high carbon pollution products if you want to or what you’re far more likely to do is to buy the cheaper, lower carbon pollution products. That means that the people who make those things will get the consumer signal, gee, we will sell more, we will make more money if we make lower pollution products. That drives the innovation. So I want you to have that household assistance in your hand but I also want you to see price effects which make cleaner, greener things cheaper than high pollution commodities. That’s why it works.

Quite so. Now let’s hear more of it.

About Ken Parish

Ken Parish is a legal academic, with research areas in public law (constitutional and administrative law), civil procedure and teaching & learning theory and practice. He has been a legal academic for almost 20 years. Before that he ran a legal practice in Darwin for 15 years and was a Member of the NT Legislative Assembly for almost 4 years in the early 1990s.
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14 Responses to Roosters, feather-dusters and high stakes poker

  1. joe2 says:

    Spot on Ken. It seems the more confident and clear Gillard becomes on the subject- and her careful and thoughtful response to that particular question was a turning point- the louder the mumbling has become about her inability to drive through a carbon price.

    She is a good negotiator, has some time to argue the case further against the perpetual no brigade, needs to win this one to solidify her authority and should have the numbers in both houses- what more could she want, apart from a less hostile msm?

  2. Hillbilly Skeleton says:

    Good points. However that quote you give from Q&A on Monday night was so good because the PM had an earlier run-through giving it as a response to one of Tony Abbott’s inane attempts at a Gotcha! question in Question Time. Nevertheless, it is exactly the sort of methodology she needs to adopt more broadly to get around Abbott’s Disinformation and Scare campaign, abetted by the grubs in the media like Alan Jones. It’s called a common sense response.

  3. wizofaus says:

    Sounds eerily similar to my “cakes made with inefficient ovens using polluting power will be more expensive, cakes made with oven powered efficiently and cleanly will be cheaper” suggestion :-)

  4. derrida derider says:

    That answer by Gillard is better, but still too longwinded and complex. It should have been something like either wizofaus suggests or words like:

    “Yes, your power bill will go up. We’ll use the money we get from this to give everyone back a fixed sum of money to compensate. If you use less carbon than the average person, you’ll come out ahead – way ahead if you’re really frugal. If you use more, you’ll come out behind. That way everyone will be trying to use less, which is the whole point of the exercise.”

  5. Incurious and Unread (aka Dave) says:

    I love it how commenters on this blog try to do better than the pollies and end up doing worse.

    Wizofaus: your comment is simply factually wrong. All cakes will be more expensive. Even bakers with 100% renewable energy will increase their prices to match their competitors’ increases. Indeed, “green” bakers (if there are such people) are likely to be able to continue to command a premium price from green customers.

    DD: your comment is correct, but it emphasises the wealth transfer effects, which raise all sorts of extraneous issues: eg I use more carbon because I live in a rental house that my landlord refuses to insulate etc. Obviously Gillard was trying to avoid those issues.

    I think Gillard has done pretty well. Like a good lawyer, she has mastered her brief.

  6. paul walter says:

    Yes, when compared to Abbott she has bulk credibility. But how shallow and cynical is politics, today?

  7. Rafe says:

    This looks like a handy position to adopt. Could become popular.

  8. Mike Pepperday says:

    “Look at the Republic Referendum a few years ago. A more innocuous constitutional change would be hard to frame, but monarchists had no difficulty in totally confusing an electorate…”

    Oh boy.

    Ken, political scientists were scathing (I read 8 or 9 papers on it at the time). Innocuous? If we had to sum up their condemnation in two words they would be precisely the populist no-slogan: “politicians’ republic.” “Monarchists” is mere invective. Did those filthy monarchists confuse political science? Did they confuse me? Nonsense. Exit polls showed the majority of no-voters were, like me, actually in favour of a republic.

    It was the yes-voters who were confused. The proposal was phony. All praise to the bullshit detectors of the tabloid readers that saved the country from middle-class, broadsheet foolishness. If democracy and compulsory voting never achieves anything else, it justified itself that day.

    “A few years ago”? It’s over 11 years. And it is quite irrelevant to your topic. Come on, get over it.

  9. wizofaus says:

    I&U, my initial statement had a qualifier “cheaper, with adequate compensation”. If carbon pricing and compensation is done properly, then the cakes that require no CO2 to produce *should* cost a smaller percentage of a typical family’s disposable income than they do currently.

  10. Patrick says:

    I agree with Mike about the Republic. That was a fantastically stupid proposal, particularly the bit about it not changing anything.

    The sad fact is that convention is kinda the glue that holds it all together and convention is really hard to change with any certainty at all!

  11. Peter Whiteford says:

    That is the first statement I’ve ever read by a Prime Minister that explains price substitution in plain language – possibly a bit wordy, but she clearly understands it.

  12. Nicholas Gruen says:

    Yes, pity she couldn’t get it down to a couple of lines. But otherwise – good.

    It would also make sense to explain it as you would water rationing in a drought.

    Pop a tax on water, everyone pays more. Use the extra money to lower taxes for households and those who use less water win, those who use more lose – but everyone wins who can change their behaviour.

  13. Fran Barlow says:

    Yes Ken, I thought this was a solid response to the question. I don’t agree that it was too wordy. It’s not merely the Q&A live audience but the audience at home that needs to follow and those extra words allow them to keep up with the flow.

    It’s very easy for those of us who live and breathe this stuff to assume that everyone else can get it. Abbott on this issue as on most only wants to look at the side of the ledger that suits his pleading — in this case — how much is coming out of your wallet but really the government has to keep the compensation close to the price.

    The government could actually go onto the offensive — running a campaign with a question like — how much better off will your household be after you stop paying for pollution?. They could even ape that super campaign with the people on equal incomes meeting at the escalators with the person cutting their CO2 footprint receiving money but not having to pay it out and the other receiving money and then paying it back to a polluter before calling to his friend: hey wait for me, I’ll catch you up! and getting on board the escalator to a clean economy.

    Sidebar: The republic — yes that was a pretty good example of FUD, but the main problem was that it was too easy to wedge supporters of a republic. There should have been a simple referendum question “Should the Commonwealth, subject to provisions provided in a subsequent referendum, legislate for Australia to have an Australian Head of State?

    Proponents could vote yes and opponents could vote no. Simple.

    I suspect that would have passed easily. The next referendum could have proposed a range of models which people could have voted for preferentially. Finally a specific constitutional amendment embodying the terms of the most popular proposal would be put and people could reject it or support it.

    Not that it matters much. Speaking as a leftist, I’m in favour of inclusive governance. Whether exclusive governance takes a constitutional monarchical or republican form is a matter of complete indifference to me and I’m not all that convinced that the cost of changing over the stationery would be worth it. It is said often enough that the US is a republic rather than a democracy, and that’s not merely being cute. There’s very little evidence that low-to-middle income Americans are, by and large, more empowered to make public policy than are low-to-middle income Australians or that the title of the Queen impinges upon that here.

  14. Mike Pepperday says:

    “The republic — yes that was a pretty good example of FUD, but the main problem was that it was too easy to wedge supporters of a republic.”

    I disagree. Since the yes-voters by definition had no fear, uncertainty or doubt, you are in effect saying that the no-voters were duped. It is not the case. Fear, yes, but I did not stand all day in the warm sun handing out “Vote no” slips out of uncertainty or doubt.

    The wedge was driven by the politicians at the 1998 convention. Like most of our federal referendums this was to be another attempt to concentrate power. Here’s an anecdote.

    The nature of political science lecturing and of running tutorials requires of academics a certain amount of ideological reticence and a degree of detachment from the antics of daily politics. But they do have their opinions. And since they study constitutions and referendums and so on these tend to be informed opinions.

    In the tea-room an academic idly asked me if I’d been keeping up with the 1998 convention. I said I had watched some of it on TV but not the last day or so.

    “You know that the proposal is that the PM will be able to fire the president?” he asked.
    “What? No!”
    “Yes, it was a last minute amendment.”
    “Are you sure? On what grounds?”
    “Oh, the PM doesn’t have to give any grounds.”

    I stared at him. Could it be true? Apparently it was. I started to smile. He started to smile. For a long moment we stood and grinned at each other.

    In their greed for power the politicians had shot themselves in the foot; the referendum would fail.

    It made my day.

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