Cabinet ETS paper makes my toes curl

I have received a copy of a confidential Cabinet briefing paper obtained under an Official Information Act request. It was prepared by Nick Smith as Minister for Climate Change Issues before his resignation.

The paper sets out proposed amendments to the Climate Change Response Act 2002 and the ETS.

It begins by stating the Minister’s key motives. I could scarcely believe them — they so strongly exclude each other they make my toes curl, yet the language makes me feel good! I trust them, I really do! I’m sure I do. No matter what self-contradictory aims the government expresses, I’m full of faith that a) it means well and b) it can do exactly what it says. Like the following:

Key strategic drivers for my most significant proposals outlined in this Cabinet paper are to:

  • ensure that the ETS more effectively supports the government’s economic growth priorities: providing more flexibility and mitigating short-term costs for business whilst ensuring clear long-term price signals that encourage a smooth transition to a low-carbon economy.
  • ensure that the ETS is flexible enough to cater for a range of international outcomes in the period 2013 to 2020, and in particular can more precisely deliver whatever level of international emissions reduction effort New Zealand may wish to demonstrate in this period.

Nobody, not even the Greens in high-spin mode, could seriously dispute that the ETS is an impost on production. That is because it assesses a small subset of an enterprise’s productive emissions (CO2 and a few other gases) and applies an artificial cost to them. It’s artificial because the gases are not being bought or sold, or even delivered or received — hell, believe it or not, they’re not even being measured. The cost is paid from the proceeds of production as there is no other source of funds. Those gases were free until the government declared otherwise. (The government squirms in denial, but that fact alone makes it a tax.)

So the Cabinet is being told in this briefing paper that the extra ETS cost on production can not only support, but it can more effectively support “the government’s economic growth priorities”. Really? How?

How can an extra cost help economic growth? Why would the proceeds of production increase when there’s an extra payment to make? It doesn’t make any sense. These words are used simply to make the concept seem acceptable.

Then he wants the ETS to reduce short-term costs while making sure that long-term costs still sting. By “mitigating short-term costs” while calculating a “long-term price … that encourage[s] … a low-carbon economy.”

What? “We must make this rope longer while it gets steadily shorter!” This is nuts. If New Zealanders accept this blatant soft-soap treatment, they deserve to have their mouths fill with bubbles. These are lies.

And they are lies we can’t believe. Because if they’re based on facts, on truth, people will actively seek out good solutions. They won’t need to have unfriendly remedies invented by starry-eyed environmentalists rammed down their throats by the government.

If a so-called low-carbon economy is for any reason more beneficial than our present normal carbon economy, the marketplace will discover that fact and implement its own solutions to achieve it. All it needs are the facts. It doesn’t need any committee-created incentives – no horse with humps. Committees are NEVER better than actual people.

When timber reached the right (high enough) price, the marketplace found answers in plywood, particle board, bison board and customwood. We still got the furniture we wanted and no government incentives were required.

When horses proved dirty and expensive to keep in large numbers in urban settings, visionaries saw the possibilities in the new petroleum products. They recreated convenient transport in modern cities in a stunningly productive way without government incentives.

When a disease makes millions of victims, medical science develops solutions wherever it can without government incentives.

If our environment really does start to deteriorate as a direct result of our carbon dioxide emissions, the marketplace will find out and make adjustments. Nobody wants deliberately to soil their own nest. A politician who believes that we do is a gullible puppet hoodwinked by green extremists who hate humanity and consider us a cancer upon the earth.

Whereas in fact we’re as natural as the purest wind-blown snow.

The second paragraph of motives is concerned with our international image. There’s a clear signal that our government doesn’t consider itself entirely independent; it looks to developments on the international stage to refine the NZ direction. They obviously consider the ETS little more than a shiny hat to wear to impress our trading partners.

Yet there is, alarmingly, still no evidence at all that a single trading partner is even looking at us sideways over our environmental performance. They are not even demanding a better performance, much less threatening to withdraw any business from us.

Our own government is blackmailing us to convert a meaningless, but lucrative, environmental scheme into a permanent tax.

It would be slightly interesting to hear how the advice that Smith received before he wrote this clap-trap managed to convince him.

12 Thoughts on “Cabinet ETS paper makes my toes curl

  1. Andy on May 20, 2012 at 9:44 pm said:

    I believe NZ is number 3 in the world in terms of renewable energy, after Norway and Iceland.
    Our country is covered in trees and grass.

    These guys are delusional

  2. PeterM on May 20, 2012 at 10:07 pm said:

    Barry Brill’s letter in http://www.nzcpr.com/guest284.htm to the PM is relevant to this and the previous discussion.

    In reply to a letter about climategate addressed to my local MP (unacknowledged) but forwarded to Nick Smith I was informed that he was an expert on risk analysis, the science settled and the best interests of NZ taken care of. Whilst I understand that dealing with the labour/green opposition and a hostile press as well as MMP is difficult the ETS problem is letting National paint itself into a corner.

  3. Andy on May 21, 2012 at 9:20 am said:

    Given the estimated cost of $1500 per year for a family of four, wouldn’t the government be better just buying everyone a one-way ticket to Sydney?

    It would kill two birds with one stone – reduce emissions and expedite the rapid depopulation of NZ to Australia

  4. Thanks, Peter, that’s a great article by Barry; I hadn’t seen it. It sounds as though National has obtained what it wished for from the ETS and will now convert it to a plain tax, as people are used to it and any tax is lucrative.

  5. You make me laugh, Andy! Logical, perhaps, but oh, the cynicism!

  6. Andy on May 21, 2012 at 10:40 am said:

    Remember that in Australia, the public are being “compensated” for their carbon tax. In NZ, all the costs are being passed to the consumer.

    With emigration to Australia at record levels, my solution makes perfect sense. Before long, the only people able to afford to live in NZ will be the bureaucrats, who of course always manage to “negotiate” a fair pay.

  7. “Before long, the only people able to afford to live in NZ will be the bureaucrats, who of course always manage to “negotiate” a fair pay”

    and the likes of Rob Fenwick, determined to beat the drum of melting ice sheets (no word of Eastern Antarctica or rebounding Arctic ice) to keep funds rolling:
    http://www.stuff.co.nz/the-press/opinion/perspective/6956239/Accelerating-melt-reason-to-worry

    “In New Zealand, a new research institute for Antarctic science backed by global private funders is expected to be announced soon.

    The civilised world has never been confronted with as great a challenge as climate change. It threatens many of the norms we have come to expect as essential to our living standards and to which developing countries understandably aspire.

    New Zealand and its science community will need all the collaborators and supporters it can muster if it is going to find the answers that will help future generations of those who share the Pacific to thrive in a warmer and significantly different world. “

  8. Thanks for the article by Fenwick, Ron. It begs for a reply.

    It’s amazing what he says, even hints at runaway warming, which I thought no climate scientist still backs: “No-one can argue with the facts. The surprise is that it’s happening more quickly than predicted. The runaway effect caused by the lack of snow cover on land and ice cover over the sea is accelerating heat absorption and compounding the rate of melt.”

    He heads up Antarctica New Zealand — anyone know much about it?

  9. Andy on May 21, 2012 at 1:59 pm said:

    Rob Fenwick is an experienced businessman and company director with interests closely aligned to promoting sustainable development. He has had a long association with Antarctica: for nine years until 2007 he was a director and later chairman of Landcare Research, one of several CRIs involved in Antarctic research, and is a former chairman of the Antarctic Heritage Trust. In 2005 the New Zealand Geographic Society named the Fenwick Ice Piedmont in the Ross Sea for his work in Antarctica.

    He is a co-founder and director of Living Earth Ltd, New Zealand’s principal organic waste management business and is active in policy development around waste minimisation and climate change, and has been a member of several Government working groups in these areas. He is a special advisor to the Department of Conservation and was conferred with the degree of Doctor of Natural Resources, honoris causa, by Lincoln University this year.

    http://www.antarcticanz.govt.nz/rob-fenwick

    Seems to tick all the boxes. That’ll do nicely sir, step this way your limousine awaits..

  10. Wow. Ah well, what’s the point in picking fights with small fry? Thanks for your help, Andy. (I could have found that myself, but I had to have some lunch.)

  11. Alexander K on May 21, 2012 at 3:36 pm said:

    Nonsense, whoever writes or enunciates it, is nonsense and lies, whoever tells them, are still lies. Charles Dickens saw the Smiths and Fenwicks of his day very clearly. I suggest reading (or re-reading) Dickens’ essay, ‘The Circumlocution Office’ – still wryly funny and still true.
    Human nature never changes.
    I never found Smith coherent, but he has set new standards for incoherence in the quoted passage. In my view, the other gentleman is a chancer and glory-hound of the first water.

  12. Gary on May 22, 2012 at 4:37 pm said:

    Rob Fenwick is a spin doctor from way back.
    If there is a public Trough to feed from he and the Al Gores of the world are attracted like magnets.
    I can garantee his carbon foot print will not be light.

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