Canberra Times
Thursday 23/4/2009 Page: 21
Kevin Rudd needs to get back to his climate change position from last year's 2020 Summit, Ian Lowe writes
At the 2020 Summit last year, Kevin Rudd said climate change is "the over-arching issue" that should inform all policy choices. Twelve months later, he has dropped the ball. Distracted by the financial crisis and snowed by a campaign of systematic misinformation from the big polluters, he has only been able to put forward the hopeless carbon pollution reduction scheme.
With an inadequate target and no allowance for voluntary efforts, it would do little to reduce Australia's greenhouse pollution. The handouts to the dirtiest industries are so generous it has been dubbed the Conspicuous Polluters Reward Scheme. Worse, it would lock in this inadequate response for a decade. If other nations follow our lead, the world will be condemned to dangerous climate change. We have more to lose than any other advanced country and deserve a better response.
Kevin Rudd wrote a thoughtful article for The Monthly about the state of the world. He was about half right in his analysis of the current crisis. Most observers now see that the extreme pre-Keynesian economics espoused by Reagan and Thatcher has failed in economic terms. The global financial crisis has exposed once and for all the folly of governments leaving the economy to Adam Smith's "invisible hand".
While the "Washington consensus" has now been exposed for its economic shortcomings, it had a more serious consequence. That ideology prevented any concerted reaction to the warning in global think tank Club of Rome's Limits to Growth. It said nearly 40 years ago that continuing 1970s growth trends would produce the drastic situation we now face.
The report was belittled at the time by politicians and economists, most of whom never read the document but relied on simplistic media accounts. It showed growth in population, resource use, agricultural production, industrial output and pollution would see its reach limits by the middle of the 21st century. The most likely result, it concluded, would be a decline in natural and social systems in the early decades of this century. Recent CSIRO analysis has compared the business-as-usual future modelled by the Club of Rome with 30 years of data. It shows we are right on track for the projected decline.
The financial crisis began with the United States sub-prime mortgage debacle. That was precipitated by the impact on US suburbia of fuel prices, the first tangible indicator of "peak oil". More generally, the crisis can be sheeted Home to the failure of economists and politicians to recognise that there are biophysical limits to human activity. They assumed that growth could continue for ever. We are now paying for that naive approach.
Even such conservative bodies as the World Economic Forum are going further than Kevin Rudd, arguing that we need an integrated approach to climate change, peak oil, the financial crisis and water and food security. So our response must involve, as US President Obama realises, structural changes to slow down global warming and prepare for reduced availability of oil.
The International Energy Agency has also got the message. Until recently the agency was predicting increased use of coal, oil and nuclear energy. It is now saying the future demands "nothing short of an energy revolution".
Rather than cash handouts to encourage consumption or greater subsidies to big polluters, we must invest in a clean renewable energy supply and improving the efficiency of using energy. We should re-build our economy around the future growth industries, rather than propping tip energy-intensive production of low-value commodities.
We should invest heavily in educating our workforce and funding the research that will allow its to play a constructive role in the future lowcarbon economy. With tens of billions of dollars of public money to throw around, we should be using the resources to position its for the 21st century.
The proposal before the Senate would reward the carbon-intensive industries that have done little since the 1997 Kyoto conference to accept the new reality. If they had spent as much time and energy cleaning up their industries as they spent lobbying Canberra for special treatment, we would be well on the way to our target. Having profited from our past generosity, they now have the chutzpah to claim the hard economic times prevent them from adapting.
The Washington consensus is clearly dead, but dancing on its grave is not good enough. As he said 12 months ago, Kevin Rudd mast develop an integrated approach to secure our future. A serious emissions trading scheme is the first step.
Emeritus Professor Ian Lowe AO is president of the Australian Conservation Foundation.
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