Friday, December 04, 2009

Abbott loses credibility on carbon policy

The following letter was published in The Australian on 4 December 2009. I reproduce it here for your enjoyment.

The Liberal Party of Australia has lost all credibility with its rejection of market-based policy responses to climate change ("Abbott’s tax-free carbon plan”, 3/12).

Tony Abbott has committed the Liberals to meeting a 5 per cent emissions reduction target by 2020 through direct action. It appears that this direct action will be a combination of government investment and regulation. By supporting this approach the Liberals are, in essence, supporting the type of command-and-control Stalinist approach that they purport to oppose.

Foolishly the party has adopted a climate change response that involves picking winners rather than letting private market participants respond to incentives dictated by market forces. It seems that the Liberal Party is committed to losing its economic credibility and the next election.