You voted against a carbon tax, so Turnbull gives you something even worse!

We voted (clearly!) against a carbon tax when we elected Tony Abbott as our PM is 2013. But now our plain-speaking, introvert, somewhat politically clumsy, but honest, devoted to the welfare of his country, courageous protector is now an ex-PM. In his place we have a populist waffler who knows how to say all the right things (meaning the things that will get him fine sound-bites on the ABC) and who says nothing of importance until he works out the "popular" thing to say - and who, under no circumstances, ever takes a decision on principle.

Apparently "The Turnbull government will “probably” allow emission reduction permits to be bought from overseas, giving Australia flexibility to increase the targets it pledged at the Paris climate conference..."

The more I see of this man, the more I am convinced he is a willing member of the kleptocracy that seems to be in universal rule throughout the western "democracies". Let me explain why an ETS is infinitely worse than a merely impoverishing carbon tax...

A carbon tax is simple: you get fined by the government for every tonne of plant food (i.e. CO₂) that you contribute to the Earth's atmosphere, where it enriches plant life (11% in 28 years, according to our own CSIRO), helps the poor grow more crops, and feeds wildlife. The fine is a fixed number, so you can adjust the level of impoverishment you are willing to accept by reducing, or not, your contributions to the planet's welfare.

An emissions trading scheme (ETS) is another beast (I use the word advisedly) entirely.

An ETS fixes the maximum amount of plant food that everyone collectively may contribute. Let's see how that works out.

Say there are just four people in Australia, there is no plant food tax or ETS, and they each contribute these amounts of plant food:

Person A: 80 tonnes
Person B: 70 tonnes
Person C: 60 tonnes
Person D: 50 tonnes

Emission of plant food is a close measure of wealth, so just by looking at these figures, we can probably guess that A is richer than B, B than C, and C than D. But just to spice things up, let's say D is devoted greenie, zealously trying already to starve the planet's ecosystem. Let's say D is in fact wealthier than B, so their relative wealth is A > D > B > C.

With a carbon tax:

Now let's introduce a carbon tax. D is already trying his hardest to wreck the planet, so D cannot reduce his contributions. A, whatever his devotion to the green cause (or not) is too wealthy to be bothered by the tax, so the new emissions are:

Person A: 80 tonnes
Person B: 70 60 tonnes
Person C: 60 50 tonnes
Person D: 50 tonnes

Let's "up" the tax. Now it starts to bite:

Person A: 80 tonnes
Person B: 70 60 50 tonnes
Person C: 60 50 40 tonnes
Person D: 50 tonnes

Now C is using less than the rock bottom usage of the devoted greenie. But let's hike up the tax a bit more:

Person A: 80 tonnes
Person B: 70 60 50 40 tonnes
Person C: 60 50 40 30 tonnes
Person D: 50 45 tonnes

Now C is definitely living in poverty, B is in hardship, and even the relatively wealthy D is having to find new ways to cut energy usage. A, of course, is unaffected, being wealthy. Whatever it costs to help the poor with more plant food, A will just pay the bill and move on. That's why Gore's house uses more power than some African countries.

Finally, let's assume that a truly draconian green dictatorship takes charge and pushes the price of plant food through the roof. An appallingly high carbon tax is introduced. The figures become:

Person A: 80 tonnes
Person B: 70 60 50 40 20 tonnes
Person C: 60 50 40 30 5 tonnes
Person D: 50 45 30 tonnes

Now all of B, C and D are living in poverty: C, especially, in abject, life-threatening poverty. But even C can, when she absolutely must, find a few pennies for some small luxuriy like a light at night, or to boil a jug for a cup of tea.

Replace the carbon tax with an ETS:

Bad? Well you ain't seen nothing yet. Let's do it again, but with an ETS. Remember our starting position, no ETS, no carbon tax:

Person A: 80 tonnes
Person B: 70 tonnes
Person C: 60 tonnes
Person D: 50 tonnes

And D is wealthier than B, but is doing it hard by choice. Now for the ETS. The idea here is that there is a fixed amount of plant food that may be emitted, and individuals have to trade on a market to buy permits for whatever they use. The total usage of our four is 260 tonnes. If there are more than that number of permits, all four continue as before. But let's set the limit at 240: Now the price will adjust itself to about the figure of our first carbon tax, with the same result:

Person A: 80 tonnes
Person B: 70 60 tonnes
Person C: 60 50 tonnes
Person D: 50 tonnes

Let's skip the middle steps and go to our draconian green dictatorship. They set the limit at 135 tonnes. The price adjusts itself to what it would have been with a straight tax, with the same result:

Person A: 80 tonnes
Person B: 70 60 50 40 20 tonnes
Person C: 60 50 40 30 5 tonnes
Person D: 50 45 30 tonnes

Once again, C is in desperate straights and even comparatively wealthy D is in poverty.

But there is a complicating factor here: this is now a market, not a tax. So wealthy A actually buys 20 extra permits. B, C and D collectively find a shortfall of 20 to be split amongst them. A ups the price on his surplus 20 permits. Let's say the others got these amounts at the old price:

Person B: 70 60 50 40 20 12 tonnes (short by 8)
Person C: 60 50 40 30 5 3 tonnes (short by 2)
Person D: 50 45 30 20 tonnes (short by 10)

Person C simply cannot afford the cost of the missing 2 permits. C dies, as so many pensioners already have done in the UK due to inability to finance heating their homes. Now D simply "must have" 30 permits; he pays whatever A is asking and gets them. B can only afford 4 at A's higher price. A keeps the unsold permits speculatively. So we have:

Person B: 70 60 50 40 20 12 + 4 costly tonnes (short by 4)
Person C: 60 50 40 30 5 3 tonnes (short by 2) deceased
Person D: 50 45 30 20 tonnes + 10 costly tonnes

Some years later, after A has offloaded his surplus permits, the greens lower the boom without mercy. The new limit is 110 tonnes:

Person A: 80 tonnes
Person B: ?
Person C: deceased
Person D: ?

A, again, has speculatively bought in to some extra tonnage. D, though comparatively wealthy, is living like a pauper, so we can expect he will outbid B, whatever the price, for all the remaining 30 permits:

Person A: 80 tonnes
Person B: 0 - soon to be deceased
Person C: deceased
Person D: 30 tonnes

And at the next lowering of the limit, D is on the way out too. And the cost, instead of going into general revenue, went into the pockets of market traders like Person A, who themselves make only an apparent contribution to solving the (non)problem.

The limit will never be less than A's 80, of course, because A is the kleptocrat who decides the limits!

Too alarmist? Well the deaths of real pensioners in supposedly first-world Britain are all too real. So I hope you're not one of those who said New York would be under water by now, or it's pot-kettle-black. Don't miss the serious point here: in a trading scheme with fixed limits, the wealthy will outbid the poor and the cuts will come from those who can least afford it. Whilst the wealthy, like Mr Waffles, will keep right on using energy and trading themselves to even bigger riches - all the while congratulating themselves for their green moral superiority.