The cost of Kevin Kong's carbon con

We now face the extraordinary political situation in which both major parties have vowed to retain all of Labor’s carbon price ‘compensation’, made up of tax breaks, pensions and benefit increases, while reducing or removing altogether the ‘cost of living increase’ for which we are being compensated.

On the Coalition side, Tony Abbott knows that taking money from pensioners or hiking taxes (the 1.5 per cent parental leave levy on big businesses notwithstanding) would be electoral suicide.

Moreover, his own carbon tax, the Direct Action plan, which will cost around $3.2 billion over forward estimates, is also a ‘cost of living’ pressure on taxpayers. So that would appear to be another reason for Abbott to leave all the goodies on the table.

But now Prime Minister Rudd, and his faithful policy-rejig henchman, Treasurer Chris Bowen, are doing the same – talking up the decrease in the carbon price from around $24 a tonne to supposedly $6 a tonne, but reassuring voters they won’t scale back the generous compo for the Gillard carbon ‘tax’.

This is all grossly disingenuous politicking.

Labor’s line, which, in purely logical terms they should have stuck with – though logic seems irrelevant to the political fantasy series ‘Rudd 2.0’ that has replaced the evening news – is that the carbon tax is a very minor component of ‘cost of living pressures’.

Treasury modelling has revealed that a couple living on a single income of $75,000 would save about $380 per year if Rudd makes the switch to an ETS a year early.

So let’s break that down. That’s approximately $32 a month, $7.30 a week, or $1.04 per day.

Yes, I have a calculator here.

Now let’s look at the impact of the next 25 basis point increase in the RBA’s cash rate. On an average mortgage of $250,000, if passed through directly by the banks to homeowners (5.6 per cent rising to 5.85 per cent), that is worth an extra $37 per month – more than the Rudd reform.

If interest rates rise by 100 basis points, the household budget is hit by four times the ‘cost of living’ amount of the Rudd reform – $153 per month. And these are the swings in household budgets that Australians routinely take in their stride.

A couple with two kids living on the average weekly pay packet of just $1080 (this ABS figure is averaged across full and part-time workers), take home a measly $875 a week and would be doing it very tough indeed. But is there really a material difference if that take-home pay was $7 different, once Rudd has shifted to an ETS?

The point is that cost of living pressures in Australia don’t really get much of a look-in while the nation is transfixed by a ‘giant new tax on everything’ that really doesn’t cost families very much at all.

There are plenty of things that do.

Infrastructure is probably the biggest one. To return to the family of battlers trying to survive on $875 a week, how many hours a day does the sole bread-winner sit in traffic jams on the way to work? How much petrol does that waste? Or how many hours per week are wasted on inefficient public transport?

ABS figures show that normal-hours full time earnings in Australia are $1393, but when overtime is factored in, that rises to $1453.

If Mr or Mrs Battler wasn’t wasting hours driving across cities of crumbling infrastructure, or wasting time on public transport systems that, in comparison with the systems in cities like Hong Kong or Bangkok look positively backward, they might consider taking a few more hours over overtime at work.

That’s worth more than $7 to their household budget, and worth a fair bit to Australian productivity to boot.

Media attention has been captured by the ‘carbon’ and ‘boats’ issues, thanks to a prime minister who is rampaging through his own party’s policies in a cynical ploy to return to power at any cost.

Like a latter day Kevin Kong, the spectacle of the prime minister climbing Labor’s policy edifices and ripping them down is breathtaking. But look back down at street level and there are real cost of living pressures that real policy makers could do something about. 

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G'day Rob. Where have you been? I missed your updates on the going's on in Rudd's mind. Or what passes for one. Have a nice day

Mr & Mrs Battler? They retired along with Mr Howard. Julia's Mr & Mrs "Working Famles" are now, like her policies, extinct. So what will "Kevin's People" be called? Mr & Mrs Zip?

They will be greeted with Zip Heil

Tonky Tony will save all using his cloak of invisibility. After all, it's real only if you can see it.

Carbon dioxide is colorless. At low concentrations, the gas is odorless. At higher concentrations it has a sharp, acidic odor. In atmosphere CO2 level ranges 0.036% to 0.040%

Yep, whoever wins the election is gonna deal up another bout of short sighted poll driven policies. We're all doomed!

Either way it'll be interesting. The problem for Labor if it wins will be after 9 years it'll "own" any problems outstanding at that time. Won't be able to say "oh, we have a 10 year plan" or any such tripe. Did anyone see the pathetic performance from the Labor aging minister last night on Lateline. They had a special about abuse of elderly in aged care. The ministers response was "oh because we had to knife 2 of our PM's I'm new on the frontbench and don't really know how to do my job and comment on abuse of elderly in aging homes". It was an embarrassing disgrace.

I suspect after another 3 years of Labor the debt will be starting to get out of hand and they'll get absolutely hammered and wish they'd lost 2013. This is exactly what happened in NSW and QLD for Labor. Voters stupidly (and Australian voters are stupid; make no mistake) gave Labor another chance even though it was clear they'd done a bad job. I remember in 2007 I was in Thailand and heard that Sydney's train network had broken down (http://www.smh.com.au/news/national/transport-meltdown/2007/03/14/117372...) I had a chuckle and thought "Labor is gone now". But lo and behold! Voters said "Thanks Labor. I'll have 3 more years of that!".

What happened to the "Working Families" of '07?? I think they were killed off just prior to Rudd's first demise and then buried by Julia. I think it's fair to say that anything Kevin says now will be completely irrelevant and forgotten about (by him) in 18 months time.

The number of people losing their jobs at present from what I am told by my clients is mind-blowing. Why are the unemployment statistics so low, or are all these unemployed suddenly going to surface after the election.
As to Kevin forgetting what he has said in 18 months, he is a Politician. Thought bubbles are forgotten once they pass the lips. Only the media and Google can hold them to account, that is if they actually do their job properly.

imo it is possible to write millions of articles and as many taxes on climate change without addressing or solving the problem a single time :

“Capturing the methane hydrate escaping from the melting permafrost(the main cause of the greenhouse effect) and slowing down the very large polluters, not us.”

It is really entertaining to watch Kevin twisting and turning to re-package Labor's mistakes in an attempt to wedge Abbott before the election. It is also entertaining to see compliant media and in particular the ABC commentators (though a bit galling as we pay them) in their desperate attempts to help him with the wedge, including ignoring or under reporting items not in Kevin's interest such as unemployment and other worsening key indicators. This morning they attempted to verbal the Indonesian foreign minister in their quest for support for Kev's latest double back flip with pike on asylum seekers.

Someone should ask him, and his new cabinet, why the policies they spent so much time, effort, political capital (and our money) putting in place and endlessly justifying are no longer suitable for the "Australia I want to lead", and why they should not be held accountable for them. Kevin is executing the greatest policy back-flips in living memory, in a desperate attempt to hold on to power, and Abbott is being asked by the media to "please explain."

This government is a rabble, now led by a policy chameleon, and, notwithstanding the policy convulsions, is a chance to be re-elected. Kevin has not forgotten what he said in the past 18 months: we can only hope that voters also have not forgotten...............that is the real down to earth Aussie voters he scorns and patronises.

Rats in the Ranks was one of the most enlightening of stories about the machinations and treachery of contemporary Labor. I suspect a record number of books will be written about the last ten years of the Labor party, and they should make Rats look like a family picnic.

It is really entertaining to watch Kevin twisting and turning to re-package Labor's mistakes in an attempt to wedge Abbott before the election. It is also entertaining to see compliant media and in particular the ABC commentators (though a bit galling as we pay them) in their desperate attempts to help him with the wedge, including ignoring or under reporting items not in Kevin's interest such as unemployment and other worsening key indicators. This morning they attempted to verbal the Indonesian foreign minister in their quest for support for Kev's latest double back flip with pike on asylum seekers.

Someone should ask him, and his new cabinet, why the policies they spent so much time, effort, political capital (and our money) putting in place and endlessly justifying are no longer suitable for the "Australia I want to lead", and why they should not be held accountable for them. Kevin is executing the greatest policy back-flips in living memory, in a desperate attempt to hold on to power, and Abbott is being asked by the media to "please explain."

This government is a rabble, now led by a policy chameleon, and, notwithstanding the policy convulsions, is a chance to be re-elected. Kevin has not forgotten what he said in the past 18 months: we can only hope that voters also have not forgotten...............that is the real down to earth Aussie voters he scorns and patronises.

Rats in the Ranks was one of the most enlightening of stories about the machinations and treachery of contemporary Labor. I suspect a record number of books will be written about the last ten years of the Labor party, and they should make Rats look like a family picnic.

So Rob, if 'the carbon tax is a very minor component of ‘cost of living pressures’' why was the Labor party so transfixed on compensating people for it (can't work out how that is supposed to make people change behaviours) and why are they so concerned about changing to an ETS in order to reduce cost of living impact ? I thought we were told it had no impact ? Suddenly discovered it does have we ?

The truth is, this tax is a typical socialist wealth redistribution tax. It never was about climate. It was about introducing an, insidious, hidden tax to transfer wealth from the wealthy and business to others. In true socialist style, it was deliberately set up in away that no-one could work out its true impact or audit it because if it was possible, it would be recognised as what it is.
A good comparison is the GST where everyone can reverse-engineer the formula to work out its true impact. But that was never the intention of the carbon tax. Labor and the greens didn't want to know its impact. That's why they are running scared from it now - they have introduced a monster they can't control.

According to the Business Council of Australia, this tax has cost 10,000 manufacturing jobs in Australia. Yes, this government has caused the biggest off-shoreing of jobs in many decades.
Still waiting for Howes to sell his home. Hypocrite!

The carbon tax hoax is up. Yes, people share a concern for the climate and they share a belief that the environment should be looked after. They don't share the idea that a tax will solve it - only socialists believe that. Scientific problems do not conform to political solutions.

Forget middle-eastern crime, WMD etc. The biggest threat to Australia right now is socialism - one can see it in many of the responses here. And if people don't want socialism, then they must make sure they do not vote Labor or green.

The yanks have a term that may enlighten you. Wall st v Main st. As far as main st is concerned Howard, was the Starlin of Australia. He redistributed the wealth to the top. And feed the workers with debt.
Give it what ever name you lick the result is still the same.

There will be no carbon tax under a government I used to lead!

But there will be an emissions trading scheme instead operated by governments in Europe I have no control over. Abbott will dump carbon tax con.

Why is it that no one is mentioning that the budget papers forecast an ETS price going from $30 a ton to $50 a ton over the next few years ?
Why are the greens complaining about that ?

I did hear some where, I can't conferm the price at the moment. But the European's average carbon price is under 10 euros per tone. at the moment. Switching to the market price, will mean Australia's ETS will have to be the same as that. Not the taxed $30 to $50 per tone.
When Europe and the US recover from recession then maybe the price will improve.
By the reports I have seen the system is working as it stands, maybe not for Gina and peers. But it is doing the job it was intended to do.

40% of the mining boom was fossil fuels and for Australia that means coal. The price of thermal coal has been on a continual slid since 2008 but just this year it has nose dived, basically because nobody is buying it.
It seems that Gina's lobbyists are on the ball.

Rob, you are first of any journalist to discuss the issue in practical ways yes that includes all your fellow journalists at Businees Spectator . Be practical to explain things beyond the "pop" or "poll" headlines that we have to suffer. It deserves a Walkley