How to sell a carbon tax in Australia?

Comments on Peter van Onselen “Gillard running out of options on carbon tax as attempts to sell it fail”, 16/03/2011, http://www.theaustralian.com.au/business/opinion/gillard-running-out-of-options-on-carbon-tax-as-attempts-to-sell-it-fail/story-e6frg9if-1226022081600

Gillard and her government is making decisions and policies on the run, sometimes out of their silliness, sometimes forced by minor parties.

While it is uncertain whether voters will forgive Gillard's broken promise of no carbon tax, it is still possible for Gillard to get a carbon tax and have the public accept the need for it.

The main issue is whether she, under the pressure of the minor parties particularly the Greens but assisted by Minister Combet, can really rationalise it and design the most acceptable compensation package and ensure both revenue neutrality with no perceived revenue grab and using it for redistribution purposes and trade neutrality.

It is completely possible for a mild carbon tax to start with, and with all the most revenue used to compensate consumers, and with a simple but effective trade measures to make the international competitiveness largely unaffected by such a tax.

But the key is to abandon any ideologies that the ALP and Gillard have to use the carbon tax for income redistribution, and to resist the Greens push for unrealistic actions at this stage.

However, a carbon tax should be flexible enough to cope with any international development on climate change.

PS: There is no need to over compensation, but it is important not to create winners and losers out of carbon tax compensation, that is why redistribution is harmful and unacceptable.