"Now the CPI increases. All prices increase due to the tax on emissions embedded in all products". This is the key statement in Geoff Carmody's rather complex analysis, which I'm sure is right. Cutting greenhouse emissions must come at a cost to the total economy because the lower-emission technologies are bound to be more expensive than just burning fossil fuels – otherwise global warming would not present a problem at all. And the price of energy appears in every good and service we consume. All economists know this. So when we hear governments and their advisors spruiking policies that redistribute wealth but fail to mention that carbon pricing will harm overall prosperity, we should respond with just two words: 'smoke' and 'mirrors'. The first step towards successful policies for lowering carbon emissions is to accept that prosperity will suffer. And the next step is to choose the energy technologies that will keep that impact to a minimum.

In other words, Julia’s carbon tax is a dog’s breakfast. Agreed.

Again I will reiterate, this carbon tax will make few people very wealthy, whilst the rest of us subsidize their income.

Prof S.Fred Singer wrote that the ETS is a scheme to transfer cash from the poor of rich countries to the rich of poor countries.
The Latrobe Valley power generators are preparing to pass the extra tax costs on, plus a % profit. Shareholders will not suffer.
Costs will add on and add on and add on ad infinitum until the GST is added on the end.
The we all suffer.

"The first step towards successful policies for lowering carbon emissions is to accept that prosperity will suffer."

Correction: the first step is to provide real world evidence that we face catastrophic man-made global warming that lowering carbon emissions can improve, taking into account the positive consequences of any climate change, and the negative consequences of any governmental action, and that does not consist of appeal to absent authority in vested interests which *assume* what is in issue, and then "prove" it by computer models (guesses).

The whole thing is fully 13 layers deep in bullsh!t.

The worrying part for the Labor government is, as Geoff points out, that companies will do their best to reduce their tax burden perhaps by installing emissions saving technology.

There will still be a cost which consumers will have to pay, but less tax for the government to redistribute. In other words the carbon tax will cost, and may cost consumers big time, to return for almost certainly no effect on emissions world wide.

No-one else will have anything like a carbon tax, or anything apart from the quite limited emissions trading schemes in Europe, the US and New Zealand, and token efforts (as far as anyone knows) by China.

The carbon tax proposal is pointless nonsense, and there are indications that the voters agree. If Gillard seriously wants to be re-elected she has to dump it.