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1. Putting a price on carbon is not only about the climate.Yes, humans are affecting the climate and reducing carbon dioxide emissions is a key commitment of this government, and indeed the stated views of the opposition. But there are other reasons to price carbon, primarily to put Australia at the forefront of a global energy technology revolution that is already underway.In future years and decades the world is going to need vastly more energy that is secure, reliable, clean and affordable. Achieving these outcomes will require an energy technology revolution. The purpose of pricing carbon is to raise the revenues needed to invest in this future, just as we invest in health, agriculture and defence.

2. A price on carbon raises revenues to invest in stimulating that energy technology revolution.Australia emits almost 400 million tonnes of carbon dioxide into the atmosphere every year. In round numbers, every dollar carbon tax per tonne on those emissions would raise about A$100 million. A significant portion of the proceeds from a carbon tax should be used to invest in energy technology innovation, using today’s energy economy to build a bridge to tomorrow’s economy. This is exactly the strategy that India has adopted with a small levy on coal and Germany has adopted with a tax on nuclear fuel rods, with proceeds in both instances invested into energy innovation.

3. The purpose of a carbon tax is not to make energy, food, petrol or consumer goods appreciably more expensive.Just as scientists are in broad agreement that humans are affecting the global climate, economists and other experts are in broad agreement that we cannot revolutionise our energy economy through pricing mechanisms alone. Thus, we propose starting with a low carbon tax - one that has broad political support - and then committing to increasing it in a predictable manner over time.The Coalition has proposed a “direct action plan” on carbon policy that would cost A$30 billion over the next 8 years, which is the equivalent of about a $2.50 per tonne carbon tax. The question to be put to the Coalition is not whether we should be investing in a carbon policy, as we agree on that point, but how much and how it should be paid for. The Coalition’s plans leave unanswered how they would pay for their plan.A carbon tax offers a responsible and effective manner to raise funds without harming the economy or jobs. In fact, to the extent that investments in energy innovation bear fruit, new markets will be opened and new jobs will be created. The Coalition’s plan is not focused on energy technology innovation.The question for the Coalition should thus be, at what level would you set a carbon tax (or what other taxes would you raise?), and how would you invest the proceeds in a manner that accelerates energy technology innovation?

It is here where I think that Gillard has made a bad bet. Carbon pricing is supposed to create jobs by making fossil fuels appreciably more expensive, thereby creating a market signal that disfavors carbon-intensive industry and stimulates less carbon-intensive economic activity. The economic parts of theory seem sound enough.

However, it is the political realities that the theory does not account for.  Australia's economy is very carbon intensive (PDF). Thus, if carbon pricing were to work exactly as the Prime Minister describes, it will necessary lead to a great deal of economic dislocation and change -- Consider that to meet the 5% emissions reduction target (from 2000 levels), without relying on offsets or other tricks, implies that Australia's economy would need to become as carbon efficient as Japan's by the end of this decade. How such a profoundly disruptive transitional period would be managed is the one issue that advocates of a high carbon price have never really dealt with -- the market's invisible hand will take care of it I guess.

How does one become "reskilled"?  Without an explanation, many people will translate "reskilled" to mean "unemployed".  The oft-stated idea that the proceeds of a carbon tax will be used to compensate those who fact higher costs does not address the issue of dislocation in the economy. There is a element of "magical thinking" in the idea that transforming a national economy starts with a simple decision: . . . clean energy will open up opportunities we are only just beginning to imagine. Those opportunities begin with that simple but momentous decision: Putting a price on carbon. Friends, a price on carbon is the cheapest way to drive investment and jobs.

the vast majority of the world's scientists back urgent action on carbon emissions: energy must be made much more expensive. Oh, wait, we didn't mean for us!World-class research into future sources of green energy is under threat in Britain from an environmental tax designed to boost energy efficiency and drive down carbon emissions, scientists claim.Some facilities must find hundreds of thousands of pounds to settle green tax bills, putting jobs and research at risk.

Among the worst hit is the Culham Centre for Fusion Energy in Oxfordshire, a facility for research into almost limitless carbon-free energy. The lab faces an estimated £400,000 payment next year, raising the spectre of job losses and operational cuts. "Considering our research is aimed at producing zero-carbon energy, it seems ironic and perverse to clobber us with an extra bill," a senior scientist at the lab said. "We have to use electricity to run the machine and there is no way of getting around that."

, the rejection of proposals that suggest starting with a low carbon price is thus a pretty good guarantee against any carbon pricing at all.  It is rather remarkable to see advocates for climate action arguing against a policy that recommends implementing a carbon price, simply because it does not start high enough for their tastes.  For some, idealism trumps pragmatism, even if it means no action at all.

Ward writes: . . . climate change is the result of a number of market failures, the largest of which arises from the fact that the prices of products and services involving emissions of greenhouse gases do not reflect the true costs of the damage caused through impacts on the climate. . . All serious economic analyses of how to tackle climate change identify the need to correct this market failure through a carbon price, which can be implemented, for instance, through cap and trade schemes or carbon taxes. . . A carbon price can be usefully supplemented by improvements in innovation policies, but it needs to be at the core of action on climate change, as this paper by Carolyn Fischer and Richard Newell points out.

First, the criticism is off target. A low and rising carbon price is in fact a central element to the policy recommendations advanced by the Hartwell Group in Climate Pragmatism, the Hartwell Paper, and as well, in my book The Climate Fix.  In Climate Pragmatism, we approvingly cite Japan's low-but-rising fossil fuels tax and discuss a range of possible fees or taxes on fossil fuels, implemented, not to penalize energy use or price fossil fuels out of the market, but rather to ensure that as we benefit from today’s energy resources we are setting aside the funds necessary to accelerate energy innovation and secure the nation’s energy future.

what is climate change? From a scientific point of view, it is simply a statistical change in atmospheric variables (temperature, precipitation, humidity etc). It has been occurring ever since the Earth came into existence, far before humans even set foot on the planet: our climate has been fluctuating between warm periods and ice ages, with further variations within. In fact, we are living in a warm interglacial period in the middle of an ice age.

Global warming has often been portrayed in apocalyptic tones, whether from the mouth of the media or environmental groups: the daily news tell of natural disasters happening at a frightening pace, of crop failures due to strange weather, of mass extinctions and coral die-outs. When the devastating tsunami struck Southeast Asia years ago, some said it was the wrath of God against human mistreatment of the environment; when hurricane Katrina dealt out a catastrophe, others said it was because of (America’s) failure to deal with climate change. Science gives the figures and trends, and people take these to extremes.

One immediate problem with blaming climate change for every weather-related disaster or phenomenon is that it reduces humans’ responsibility of mitigating or preventing it. If natural disasters are already, as their name suggests, natural, adding the tag ‘global warming’ or ‘climate change’ emphasizes the dominance of natural forces, and our inability to do anything about it. Surely, humans cannot undo climate change? Even at Cancun, amid the carbon cuts that have been promised, questions are being brought up on whether they are sufficient to reverse our actions and ‘save’ the planet.  Yet the talk about this remote, omnipotent force known as climate change obscures the fact that, we can, and have always been, thinking of ways to reduce the impact of natural hazards. Forecasting, building better infrastructure and coordinating more efficient responses – all these are far more desirable to wading in woe. For example, we will do better at preventing floods in Singapore at tackling the problems rather than singing in praise of God.

It is just logical that one cannot make the claim that action on climate change will influence future extreme events without first being able to claim that greenhouse gas emissions have a discernible influence on those extremes. This probably helps to explain why there is such a push to classify the attribution issue as settled. But this is just piling on one bad argument on top of another.

Even if you believe that attribution has been achieved, these are bad arguments for the simple fact that detecting the effects on the global climate system of emissions reductions would take many, many (many!) decades.  For instance, for an aggressive climate policy that would stabilize carbon dioxide at 450 ppm, detecting a change in average global temperatures would necessarily occur in the second half of this century.  Detection of changes in extreme events would take even longer.

To suggest that action on greenhouse gas emissions is a mechanism for modulating the impacts of extreme events remains a highly misleading argument.  There are better justifications for action on carbon dioxide that do not depend on contorting the state of the science.

The past few years have seen a marked decline in the percentage of Americans who believe what scientists say about climate, with belief among conservatives falling especially fast. It's true that the science community has hit some bumps — the IPCC was revealed to have made a few dumb errors in its recent assessment, and the "Climategate" hacked emails showed scientists behaving badly. But nothing changed the essential truth that more man-made CO2 means more warming; in fact, the basic scientific case has only gotten stronger. Yet still, much of the American public remains unconvinced — and importantly, last November that public returned control of the House of Representatives to a Republican party that is absolutely hostile to the basic truths of climate science.

facts and authority alone may not shift people's opinions on climate science or many other topics. That was the conclusion I took from the Climate, Mind and Behavior conference, a meeting of environmentalists, neuroscientists, psychologists and sociologists that I attended last week at the Garrison Institute in New York's Hudson Valley. We like to think of ourselves as rational creatures who select from the choices presented to us for maximum individual utility — indeed, that's the essential principle behind most modern economics. But when you do assume rationality, the politics of climate change get confusing. Why would so many supposedly rational human beings choose to ignore overwhelming scientific authority?

Maybe because we're not actually so rational after all, as research is increasingly showing. Emotions and values — not always fully conscious — play an enormous role in how we process information and make choices. We are beset by cognitive biases that throw what would be sound decision-making off-balance. Take loss aversion: psychologists have found that human beings tend to be more concerned about avoiding losses than achieving gains, holding onto what they have even when this is not in their best interests. That has a simple parallel to climate politics: environmentalists argue that the shift to a low-carbon economy will create abundant new green jobs, but for many people, that prospect of future gain — even if it comes with a safer planet — may not be worth the risk of losing the jobs and economy they have.

Peer to peer file sharing (P2P) has made media distribution free and has become the bane of media monopolies. P2P file sharing means digital files can be copied and distributed at no cost. CD's, DVD's, and other older forms of holding media are no longer necessary, nor is the cost involved in making them or distributing them along a traditional logistical supply chain. Disc burners, however, allow users the ability to create their own physical copies at a fraction of the cost of buying the media from the stores. Supply and demand is turned on its head as the more popular a certain file becomes via demand, the more of it that is available for sharing, and the easier it is to obtain. Supply and demand increase in tandem towards a lower "price" of obtaining the said file.Consumers demand more as price decreases. Producersnaturally want to produce more of something as priceincreases. Somewhere in between consumers and producers meet at the market price or "marketequilibrium."P2P technology eliminates material scarcity, thus the more afile is in demand, the more people end up downloading it, andthe easier it is for others to find it and download it. Considerthe implications this would have if technology made physicalobjects as easy to "share" as information is now.

In the end, it is not government regulations, legal contrivances, or licenses that govern information, but rather the free market mechanism commonly referred to as Adam Smith's self regulating "Invisible Hand of the Market." In other words, people selfishly seeking accurate information for their own benefit encourage producers to provide the best possible information to meet their demand. While this is not possible in a monopoly, particularly the corporate media monopoly of the "left/right paradigm" of false choice, it is inevitable in the field of real competition that now exists online due to information technology.

Compounding the establishment's troubles are cheaper cameras and cheaper, more capable software for 3D graphics, editing, mixing, and other post production tasks, allowing for the creation of an alternative publishing, audio and video industry. "Underground" counter-corporate music and film has been around for a long time but through the combination of technology and the zealous corporate lawyers disenfranchising a whole new generation that now seeks an alternative, it is truly coming of age.