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Dr Muriel Newman

Time to scrap the ETS

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Lord Christopher Monckton, a former policy adviser to British Prime Minister Margaret Thatcher and one of the world’s leading climate change realists, has been visiting New Zealand reminding audiences that the world’s climate is not in the grip of catastrophic man-made global warming – as alarmists would like us to believe – but is instead continuing to change within the bounds of natural variability as it has always done. He warned that attempts by politicians and bureaucrats to control the climate through complex and expensive emissions trading schemes are a futile waste of time and money. He reiterated that because climate science is not settled – with new discoveries on the impact of oceans, volcanoes, sunspots and other natural phenomena on the climate emerging almost daily – the public should strongly reject all attempts by politicians and bureaucrats to impose controls aimed at saving us from ourselves.

Having met Lord Monckton a few years ago, I was asked to help to arrange some media opportunities. While TV3’s political affairs programme ‘The Nation’ conducted a balanced and fair interview, TVNZ, in spite of initially expressing interest, eventually declined – ostensibly on the basis that they couldn’t find anyone to debate against him. So while our state broadcaster has in the past been prepared to interview pro-global warming experts on their own, in this case the public were denied the right to hear the other side of the argument – that scientific evidence shows categorically that there is no justification for politicians to cripple our economy in the name of saving the planet.

Once news of Lord Monckton’s visit filtered out, environmental extremists went into overdrive flooding not only the media with threatening letters to dissuade them from giving him a public platform, but even targeting those involved in organising his meetings. One activist who holds a position of responsibility in a local authority even went so far as to write to the owners of one of the venues insisting that they cancel the function. These actions demonstrate the extreme lengths that global warming alarmists will go to in order to discredit opponents and protect what has become a taxpayer-funded gravy train, with lucrative jobs, generous research grants, and heavily subsidised businesses.

As the architect of National’s emissions trading scheme, Nick Smith is the government’s main driver of climate alarmism in New Zealand. He presents as an ideological environmentalist, peddling the myth that crippling taxes can save the world from a climate Armageddon. He is closely aligned to extreme groups like the Environmental Defence Society, and appears to have been given a free hand by the Key administration to impose his radical agenda on the country, boasting in Parliament last year: “On 1 July 2010 New Zealand will have the first emissions trading scheme up and running outside Europe, and it will cover more sectors than the European scheme does. We were also the first country in the world to include forestry, in 2008, and we were the very first country in the world to have a plan for introducing agriculture, in 2015. If we can settle our emissions trading scheme by December, we will be at the front end of international action on climate change, and will actually have the most comprehensive emissions trading scheme of any country in the world.”1

The most basic question about Nick Smith’s emissions trading scheme is why? Why is the economy being handicapped by the most expensive all gases and all sectors scheme in the world, which will not only cost the economy billions of dollars in lost jobs and growth, but will have absolutely no impact on the climate?

This year’s budget appropriation for the ETS is almost $1 billion. The scheme is so complex and bureaucratic that $23 million will be spent on a carbon accounting system, $11 million on policy advice, and $654,000 on administering the scheme. Due to its complexity, few understand the ETS – including it seems the Minister, who claims that the scheme is responsible for New Zealand meeting its Kyoto emissions target. However, notes to the Kyoto Protocol financial position statement tell a different story. They explain that the dramatic reductions in New Zealand’s emissions were the result of the drought and the recession, combined with new forestry ‘assessment’ techniques.2

In other words, with the help of some creative accounting, New Zealand achieved a near-miraculous three quarters of a billion dollar turnaround in our Kyoto position over a one month period in 2009 when we moved from a sizable $546 million deficit in February, to a $225 million credit in March! With New Zealand now being in a strong credit position of $417 million at the end of May 2011, the political rhetoric that the ETS will enable us to fulfil our Kyoto Protocol obligation, no longer holds water. The ETS could be suspended tomorrow and it would make no difference to emissions or to Kyoto.

This week’s NZCPR Guest Commentator, Robin Grieve, an agricultural consultant and climate researcher, explains why the Labour Party’s election pledge to raise $800 million for R D tax credits by bringing agriculture into the ETS two years early is just hot air. In his article ETS – hot air and cold cash, he puts it this way: “The only reason New Zealand’s Kyoto balance is in credit is because of carbon accounting that is fraudulent at worst and smoke and mirror trickery at best.”

Robin explains, “The first commitment period of The Kyoto Protocol expires at the end of 2012 and there will be no second period. This means New Zealand has no international liability for any emissions, agricultural or otherwise after 2012. Any liability the New Zealand Government faces after this will be purely voluntary, and limited to within our shores. In the current economic climate it would be a foolish Government that imposed any costs on its people that are not justified.”

In a new report on the ETS, Nick Smith boasts about how successful the scheme has been in transferring costs onto consumers: “Early signs are that a price on carbon has successfully entered the New Zealand economy; businesses and foresters are factoring in this price into their long-term decisions and passing the price of carbon down to consumers”. In particular the report confirms that the Transport and Energy sectors have been able to successfully “pass the full cost on to customers”.3

These increases in the price of power and fuel have not only pushed up the cost of filling the car and heating the home, but they have increased prices across the whole economy, as any supermarket shopper can testify. And no matter how much politicians try to claim that they are ‘compensating’ vulnerable families against such price hikes through increases in government transfers, the fact remains that the ETS is achieving nothing positive, but is having an extremely damaging impact on the economic wellbeing of families and the economy as a whole.

That’s why informed New Zealanders who understand the controversy and fraud surrounding the United Nations Intergovernmental Panel on Climate Change climate crisis reports – reports that Nick Smith claims justified the imposition of the ETS – agree with experts like Lord Monckton, that scrapping the ETS is the only sensible thing to do.

In the US State of Virginia, the Attorney General has taken these matters a step further by using their “Fraud Against Taxpayers Act” to fight the use of falsified data in climate change research, and legal challenges to oppose federal regulators on the basis that We cannot allow unelected bureaucrats with political agendas to use falsified data to regulate American industry and drive our economy into the ground”.

Isn’t it time that New Zealanders demanded a mechanism such as binding referenda to protect ourselves from the damage caused by misguided politicians driving ideological agendas? If National was to suspend the ETS tomorrow – on the basis that the country cannot afford this growth destroying policy during this time of grave economic uncertainty, the sky would not fall in and the earth would not become a sauna. Apart from some bureaucrats and advisors having to find more productive employment, the only impact would be to lower the cost of living as fuel and power prices fell and carbon pricing was removed from all goods and services.

Beyond ideology, the only other reason given for having an ETS, is that it is needed to avoid adverse impacts on our international reputation and trade. If we accept the doubtful proposition that trade is the real reason for the ETS, then the question becomes what is the best way for New Zealand to enhance our international green image?

There are many initiatives that could have been undertaken that would have not only fulfilled environmental objectives, but could have also addressed social imperatives as well. One that has merit involves utilising Department of Conservation land. Around a third of the country’s land is held by the Department in a public domain owned by the people of New Zealand, but a significant amount of that land is poorly managed and under-utilised. Such land could be central to a conservation programme that would use another significant and under-utilised resource – the 39,300 15-19 year olds who are currently without a job. With the help of the Mayor’s Taskforce, which is already involved in youth unemployment initiatives, these young people could be mobilised to embark on an indigenous forest planting programme of international significance. By using under-utilised council land as well, the country could look with pride at the development of a nation-wide initiative of indigenous forest plantings – with predator proofed areas for the protection of endangered wildlife – to showcase to the world that New Zealand does indeed care about the environment. Unlike the ETS such an initiative would strengthen our communities and make a real contribution to the country.

Christopher Monckton reminded us that there is no scientific or economic case for an ETS, and if at some time in the future there are climatic concerns that need to be addressed then adapting to them is the only sensible option.