Greg Hunt's magnificent bluff

Greg Hunt has managed an extraordinary 4 year game of bluff that has meant the Coalition has fooled the electorate they can axe the tax without undermining action on carbon pollution.

I remember meeting with Greg Hunt not long after Turnbull had been toppled from the Liberal leadership to discuss research we were planning at the Grattan Institute. At the time of the meeting I genuinely felt sorry for Hunt. He had been asked to eat and enjoy what looked like a truly horrible shit sandwich, to borrow from Abbott's turn of phrase.   

Just about every informed Australian policy analyst had converged on the view that pricing carbon was the best way to reduce emissions. Sure there was some argument around the periphery about how to handle internationally traded goods, compensation for loss of asset-value, and the use of complementary mechanisms. But overall there was a remarkable consensus, even amongst key industry lobby groups like the Business Council of Australia, the Australian Industry Group and the Energy Supply Association of Australia.

I was pretty sure Hunt concurred with this view given his advocacy in the past for a water market and his role as Turnbull’s shadow environment minister.  

But with almost no resources, and down in the polls Hunt would have to swim against the tide of expert opinion and against what I thought was his own philosophical outlook.

Now he is on the verge of taking a position in an Abbott Government cabinet, having played a vital role in supporting Abbott’s rise on the back of his 'Axe the Carbon Tax' campaign.

It is an extraordinary lesson in the magnificent use of bluffing.

Last week the Climate Institute called Hunt’s bluff, releasing a study examining the economics of Hunt’s Direct Action fund. In spite of its generous assumptions in Hunt’s favour, the study concluded Direct Action was underfunded by at least $4 billion to achieve the minimum Coalition emission reduction target.

Furthermore it appears that in the past few years other countries have stepped-up their efforts to reduce emissions. This suggests Australia needs to increase the ambition of its emission reduction target to match the effort taking place in many other major emitters, so the budget blow-out would be even greater.

Hunt’s immediate response was not to release his own detailed costings and supporting evidence but further bluff and bluster.  

He told ABC radio, "The Climate Institute is clearly a partisan organisation. We'll achieve our targets, we'll do it within budget, and I think the Climate Institute has some serious explanation to do.”

Yet in the lead up to the 2010 election Abbott was more than happy to cite the Climate Institute, stating, "The other thing I say is that the Climate Institute actually said the Coalition had a better policy on this because we actually have a policy to reduce emissions by five per cent of 2020 but we can do it without imposing higher costs on consumers."

The extraordinary thing about this is Hunt had the pluck to accuse the Climate Institute of needing to do some serious explaining when they had released quantitative modelling analysis with transparent detailed assumptions.  Hunt, on the other hand, is actually running for office, but all he’s released is a flimsy brochure back in 2010 with costings based on two handfuls of letters from lobby groups, companies with limited project delivery experience, and companies with an axe to grind against the proposed ETS.

The Coalition has managed to get away with these kinds of bluffing manoeuvres for nearly four years.  For example Hunt has claimed Ross Garnaut’s soil carbon estimates support the Coalition’s costings, Garnaut then belatedly refuted this.  Hunt claims several Nobel Laureates (the Copenhagen Consensus) support his policy – but their work doesn’t examine his emissions abatement auction model at all. The examples of his bluffing could fill page after page.

The success of this strategy was beautifully illustrated in Abbott’s press conference on the day the Climate Institute released their study. One journalist asked about the $4billion shortfall identified by the Climate Institute. Abbott said he didn't accept it but his only evidence in support was that his own minister, Hunt, was confident the budget was sufficient.  You’d think this would then have been followed by further questions to get Abbott to at least somewhat explain why the Climate Institute costings weren’t accurate.

But guess what came next – questions about Abbott’s interactions with pop singer Katy Perry and his like for her song played ad nauseam on the TV show Master Chef.

In the world of the two minute media attention span, bluff and bluster can take you very far indeed.