"A RECENT survey of Australian economists has revealed around 60 per cent believe the carbon tax package is a good economic policy and 25 per cent disagree.

The poll included 140 economists in response to the weekend’s carbon tax announcement. Nearly 85 per cent said they did not think the Coalition’s Direct Action Plan is a sound economic proposal to reduce carbon emissions."

Source: http://citynews.com.au/2011/news/eco...ree-on-carbon/

The Greens are looking particularly smug. Not surprising really given that they got their way - balance of power is a strong persuader.

So if I follow the logic of the government.

1. They tax the big polluting companies
2. They give that money to compensate Joe Public for the increase in the cost of goods caused by the rise in costs to the big polluting companies.

So far so good.

Fast forward 2 years and lets assume that the big carrot worked and the big polluting companies will have figured out ways to reduce their emissions and therefore the tax they pay.

At that point; do you think that the subsequent in the costs of goods will be passed on to the consumers. I don't think so, they will remein at their new inflated price. And is the government still compensating Joe Public? If so, what with? The pot of money they were using to compensate with has run empty because the big polluting companies aren't filling it anymore.

It's just Labour spending (or promising to spend) what they haven't got all over again.

My guess is that according to the theories of free market economics, if big business increases its margins this way - eventually someone running a medium sized business will recon they'll make a decent living off a smaller margin - and therefore charge less for their goods/services to take market share from the bigger more expensive guys... Eventually that medium sized business becomes popular as word spreads about their cheaper offerings and they grow... into a bigger business - Eventually the older business either die out, or reduce their margins as pressure from competition comes into play.

Of course all of the the above fails miserably if there is no free market, or if theres no competition, or if the population in general [customers] are too stupid to take their business to someone offering a cheaper/better service.

I heard on the radio this morning that most of Australia's economists are employed by the banking sector, who stand to gain hugely from the carbon tax, therefore they support it. An example quoted was Malcolm Turnbull, who supported KRudd's emissions trading scheme, and got ditched as the Opposition Leader because of his stance. I'll look out for a podcast of the report, it's not on the website yet. Here's an article from The Age http://www.theage.com.au/national/ec...713-1hdyo.html.

I like the cut of this guy's jib

http://www.abc.net.au/unleashed/2794652.html

He sure has a way with words

Can I give him karma? I now know who Deadvim really is -


The random grocery quiz had undone the Treasurer yet again. "Wait, wait, wait, got one…uh… large box of Libra Fleur? Nope. Uh, Sara Lee Chocolate Bavarian? Hah, you got nothin', Swanny!"

He bangs on about the price of them as well. Just saying..........

Thumbs up from me, there speaketh sense.

Confused by your turnbull example..could you clarify?

Part of me thinks maybe a lot of people are behaving like fruit cakes over a poorly planned policy, another part thinks of the frogs in boiling water anecdote.

Start the public off gently to get the systems in place before ratcheting up the pressure, akin to the Fuel Price Escalator in the UK during the 90's .

Turnbull was a banker, so like most of the other bankers in the survey (who happened to be economists), they support an ETS/carbon tax. Turnbull's training was as a lawyer, and he was also an entrepreneur. Interestingly, Abbott studied economics and law at uni. Both were Rhodes Scholars at Oxford.

was the theory that they all had something to gain, therefore discrediting their opinion that abbott's proposed scheme was a waste of taxpayers money, proposed by a conservative commentator?

The business I run is indirectly a significant polluter so we get hit, but we also get lots of credits back. Is that going to motivate? Not really as we all know we cannot change laws of chemistry to reduce power consumption. Our product, going into one of the rare value adding export industries will just make the whole chain less competitive globally. Yep that's good for Australia.

I think that's exactly the way that it'll develop.

...Softly softly catchee monkey