Matthew Sinclair: The political price the Conservatives are paying for embracing the green rip-off
Today my new book Let them eat carbon is out. It looks at the incredible cost of failing climate change policies; the special interests profiting; the corporate lobbying and taxpayer-funded environmentalist ideology driving it all; the myth of green jobs; and much more. But what I wanted to focus on here is the politics, and answer one important question: what political price do the Conservatives pay for embracing the green rip-off?
After all, there is a consensus among the three main parties so there are limited options if someone wants to vote against draconian climate regulations. And as I wrote all the way back in 2006, it might work as a dog-whistle issue for politicians, much more than immigration ever has. Because even if those who really support this agenda are a tiny minority, that doesn't mean it is a vote loser if everyone else doesn't know, or doesn't care, about the price they are paying.
There are two reasons why the political price for embracing radical climate chance policy is high despite that. First it means missing out on the opportunity to be the party of lower energy prices and get the kind of electoral advantage conservatives in Australia, Canada and the United States have enjoyed. Second it is set to put additional pressure on family budgets making the fiscal adjustment feel a lot less like a gentle squeeze and a lot more like painful austerity.
In the United States, cap and trade was a huge boon for Republicans. The deeply unpopular cap and trade bills wound up activists, couldn't pass the Senate and were then a potent campaign issue in Congressional races. Democrat Joe Manchin, albeit a candidate in West Virginia, was so keen to distance himself from the legislation that he actually shot the bill with a rifle in a campaign ad.
But the political results were even clearer in Australia and Canada. The Australian centre right Liberal Party and the Canadian Conservatives both campaigned against what they called a "tax on everything", a fair description for carbon taxes and cap and trade. The Canadian Conservatives won an election with that as the key issue. The Australian Liberals recovered from what many thought was a defeat for a generation, and managed a similar result to the one that took the Conservatives here four terms, in just one.
Since then the Australian Labor Party have clung to power by their fingernails. And they have pressed ahead with a carbon tax despite having no democratic mandate to do so (the lack of a democratic mandate is a common theme in climate policy). The polls give a sense of how it is absolutely killing them. If an election were held today, Nielsen report that the Liberals would win by a landslide with 56 per cent of the two-party vote. 56 per cent of Australians oppose the carbon price, against just 39 per cent who support it. And those who oppose the scheme feel more strongly about it.
That is the opportunity the Conservatives are missing out on. But they are also making their other objectives harder to achieve. Unilateral climate policy that drives jobs in energy intensive industries abroad will make it harder to get the economic growth that is critical to their electoral fortunes.
Most importantly the fiscal adjustment will feel a lot more painful when combined with expensive climate policy. The fiscal adjustment is hard enough without also having to pay for billions upon billions in investment to meet climate targets at the same time. Citigroup expect it will take €229 billion and add more than 50 per cent to household bills, even with greater efficiency (and before paying for all the insulation and double glazing that will take) the rise will be well over 30 per cent in real terms. It will hit the poor and elderly families who rely on benefits most the hardest, making it harder to keep public spending under control
Of course the main reason climate policy needs to change is that it is expensive and failing. But there is also a lot at stake politically. The next election could be a lot harder for the Conservatives than it needs to be if they don't insist measures to curb emissions are a lot more affordable.