The Government’s proposed emissions trading scheme is bad — wretchedly bad — policy. It establishes a complicated and burdensome scheme that in effect rewards big polluters, which will create minimal incentive for a transition to a low-carbon economy. It has all the bad points of an ETS and none of the benefits.

That’s not Penny Wong’s fault. This is Kevin Rudd’s scheme, a scheme crafted by Cabinet to keep big polluters and unions happy.

But Wong is now making it bad politics. She is turning what was a political strength for the Government into a growing weakness.

Again, this is not entirely her fault. The Government had two viable options on the ETS: follow up its “great moral challenge” rhetoric and engage in a genuinely bipartisan process for developing an ETS that would pass with the support of the Coalition. It would have been even worse than the current model, but the Government would have at least been able to point to a concrete result. The alternative was to develop a genuinely effective ETS that the Greens could have come at supporting, wear its climate change credentials on its sleeve and attack the Coalition if Fielding or Xenophon helped block it.

The Government elected to pursue “None of the Above” and develop a scheme that everyone hated, even if much of the outrage from the big polluters is confected, as part of a strategy of sticking to the political middle ground and painting its opponents as extremists.

Wong has since repeatedly made a virtue of the fact that no one supports her scheme, as if being a Minister who has not a single supporter amongst any of her portfolio stakeholders is a good thing. She has also repeatedly declared that the Government is “determined” to get the ETS through the Senate.

In which case, she’s going about it in a rather peculiar way. Sources point out that a number of Labor ministers, right up to Julia Gillard, have made a serious effort to negotiate in good faith with the crossbench Senators, and deals have resulted on important issues such as the second stimulus package and IR reform. Wong is different, they say. She point blank refuses to discuss amendments or even suggestions for improvements, and is outright rude in meetings. “She stonewalls at every opportunity,” was one comment. Wong simply appears incapable of negotiating.

Wong also seems programmed to swing the discussion to the Opposition at every point. This was smart politics last year when the Coalition was making a spectacle of itself on climate change, but it has adopted a small target strategy now and is now letting the Government take the heat. In a remarkable press conference yesterday, Wong repeatedly talked about Malcolm Turnbull no matter what the question. This is what she said:

WONG: So the question is for Malcolm Turnbull. Malcolm Turnbull can give Australia a green light on the road to Copenhagen or he can give Australia a red light. The choice is his … Malcolm Turnbull must show the leadership that is necessary…

JOURNALIST: Minister, this legislation is not just unpopular with the Opposition though it’s also the Greens, the minor parties — it’s being described as the legislation that doesn’t have any friends. How do you make it more popular?

WONG: Well can I say that this is a reform that is about the national interest… But the question for Malcolm Turnbull will be whether he is prepared to give Australia a green light at Copenhagen…

JOURNALIST: Malcolm Turnbull aside for a moment though…


JOURNALIST: So what happens if that plan doesn’t, if the legislation isn’t passed for the end of the year, before you go to Copenhagen? Does that mean it is dead in the water?

WONG: No what I am saying is that the Government is determined to get this legislation through. The government is determined to get this legislation through because it is the right thing to do. It is in the national interest for us to take action on climate change, and that’s what this legislation does. The question will be whether Malcolm Turnbull and whether the Senate will ensure it takes the responsible path…

JOURNALIST: Minister you talked about certainty today. Are you certain this legislation will be passed in time, I mean you’ve only got limited parliamentary time.

WONG: The people who are standing in the way of the certainty that business has said is required to respond to climate change are Malcolm Turnbull and the Opposition. It’s Mr Turnbull who is standing in the way of certainty.

Wong gave the interview after a remarkable address to the Lowy Institute which seemed almost entirely devoted to claiming that the Opposition was undermining the chances of a global deal at Copenhagen later this year. This attributes remarkable influence to a party out of government in a nation responsible for 2% of global emissions.

“Wrecking this reform shortens the odds of a global deal on climate change,” she said.

Presumably she meant lengthen the odds (“I hope she’s better at her international negotiations than her basic arithmetic,” said Greg Hunt).

I’d have thought making a commitment, a year in advance of Copenhagen, that Australia would under no circumstances go above a 15% target, no matter what was agreed at Copenhagen, would stand a far greater chance of undermining an agreement than the views of Malcolm Turnbull. And that is Wong’s and the Government’s current position. If anyone is “shortening the odds” on a deal, it is this Government — and that’s before you even get to the design of its scheme, which will reward polluters.

Wong’s rhetoric was developed at a point when voters still believed the Government was far ahead of the Opposition in addressing climate change. She continues to use that rhetoric, full of questions for Malcolm Turnbull and claims about how she has “got the balance right”, apparently unaware that the politics of climate change no longer favour the Government. Not even Ross Garnaut in effect saying the ETS shouldn’t be passed was enough to wake Wong up to what has happened.

“If Australia falls at this hurdle,” Wong said in her speech, “we risk being seen as returning to the years of the Howard Government Kyoto sceptics, when we were part of the problem, not part of the solution.”

But Wong is now part of the problem and she should be moved. By alienating every single political and industry participant in the debate, she has virtually guaranteed the legislation will be defeated. If the Government is as “determined” as it says it is, it is time for a new Minister to try to repair the damage done by Wong and craft a last-minute deal that might see the passage of whatever can be salvaged from this mess.

But that’s assuming the Government really does want its ETS legislation passed.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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