Draft statement on carbon tax

Draft statement on carbon tax

Socialist Alliance does not advocate adoption of a carbon tax. Instead, Socialist Alliance advocates that measures be taken that can rapidly and effectively reduce carbon emissions. These include:

  1. Government regulation (e.g. policies that prohibit establishment of polluting infrastructure - "no new coal or gas" - or that impose limits/restrictions on existing polluting activities); and
  2. Direct public funding (and ownership) for renewable energy infrastructure, expanded public transport and other projects that can replace existing pollution generators.  

The latter measures can be paid for by eliminating subsidies to fossil fuel industries (currently approx $10 billion per year) and by increasing corporate taxation. (For example, the Beyond Zero Emissions plan for 100% renewable energy in Australia by 2020 could be paid for in full by increasing corporate taxation to annually recoup 12.7% - merely one eighth [!!] - of the 2008-09 gross operating surplus of corporations operating in Australia. Alternatively, a more specific tax on the super profits of banks and the mining industry could be devised. No doubt the corporate executives would squeal about such proposals but the fate of the world's climate is at stake and such action to save civilisation is justified.)

Even for the government to borrow the full amount at commercial interest rates would be a better option than allowing the climate emergency to continue getting worse.

Supporters of carbon taxes ("putting a price on carbon") typically (albeit falsely) argue that utilising "market mechanisms" is the most effective means available to reduce emissions and that measures can be taken to avoid the negative social impacts such taxes would almost inevitably create. However these arguments ignore:

  • that even the best designed carbon tax can only work indirectly (i.e. relatively slowly) whereas the climate crisis demands an urgent transition across the whole economy at emergency speed;
  • that leaving the timing and nature of investment decisions to "the market" is in contradiction to planning a socially just transition (i.e. ensuring jobs and livelihoods for workers currently working in polluting industries and a fair transition for communities);
  • that most actual proposals for carbon taxes (i.e. those put forward by corporate figures, capitalist governments, politically "realistic" NGOs and academics, etc) are hopelessly inadequate to the task of driving the emergency transition to a zero carbon economy that is needed. (In some cases, these proposals for a carbon tax are cynically designed to be ineffective while creating the public impression that climate action is being taken. However, even the most genuinely conceived proposals tend to divert public awareness away from the necessary measures referred to above that can effectively reduce emissions.);
  • that there is little, if any, evidence that carbon taxes in other countries have actually been effective in reducing emissions; and
  • that any measures taken to reduce the negative social consequences of a carbon tax tend to undermine the effectiveness of the tax itself in reducing emissions.

For these reasons, we don't believe that it is useful for the climate movement to campaign for a carbon tax. Instead, the climate movement should campaign for measures, as described above, that can more reliably be expected to reduce carbon emissions.

Notwithstanding the above arguments, the Socialist Alliance recognises that important components of the climate movement do support the adoption of a carbon tax.

We also acknowledge that it is conceivable that a carbon tax could be designed that could assist in reducing emissions. Therefore, we do not oppose the adoption of a carbon tax on principle. We reserve the right to give support (critical or otherwise) to a particular carbon tax proposal if it:

  1. will actually help to reduce emissions;
  2. will place its burden most heavily on the profits of polluting industries;
  3. will protect the living standards of poor people and wage workers; and
  4. it is a component of a broader climate policy.

Nevertheless, the Socialist Alliance does oppose outright any carbon tax that:

  • is coupled with subsidies to polluting industries;
  • is not targeted at making polluting industries pay;
  • places any significant burden on the living standards of poor people or wage workers; or
  • is put forward as a substitute for taking effective measures to reduce carbon emissions.