Rio Tinto and the carbon tax PR riddle

A new US report shows many large corporates saying one thing about climate change to the public and then saying another thing to government, often indirectly via industry associations and think tanks. The trend is strong in Australia too, and Rio Tinto seems to be the biggest offender.

The Union of Concerned Scientists released an excellent publication recently entitled, A Climate of Corporate Control. This report quite methodically analyses what a number of large US corporates might say on climate change when talking to the general public, versus what they say to government and policy leaders via their government submissions, the lobbyists they hire, the political donations they provide and the funding given to think tanks and industry associations. 

Much of what is documented will probably not come as much of a surprise to Climate Spectator readers – those companies that sell oil and coal, while they might feign concern for global warming, tend to spend most of their money lobbying government not to do anything about it.

Unfortunately the focus of the report is on a small handful of very large corporations based in the US, and doesn’t extend its analysis to many companies that are active in Australia. This would actually help a number of people to realise that AGL has been, for the most part, remarkably consistent in supporting policies that reduce greenhouse gas emissions in spite of their criticism of solar feed-in tariffs. While a number of other companies, in particular Rio Tinto, have been incredibly inconsistent.

Out of all the companies in Australia I would suggest Rio Tinto has been the most influential in hindering the carbon price and the renewable energy target in this country. Meanwhile, in North America (where their aluminium smelters are powered by Hydro under fifty year contracts), Rio signs-up to statements like the one below calling for the US to exercise leadership in addressing climate change and putting a price on carbon. 

Imagine if Rio Tinto stood up at a parliamentary inquiry and instead of claiming that a carbon tax would be "disastrous" for jobs and industry if Australia were to introduce it ahead of other countries or at a level above that in other countries; instead said, ‘it’s time Australia showed some leadership with bi-partisan legislation to limit emissions’.

A public letter signed by Rio Tinto published in late 2009 in the New York Times and Washington Post

Source: Union of Concerned Scientists (2012)

A recent Business Council of Australia report has come out that really puts a lie to many Australian corporates’ claims that the carbon price will cause huge economic damage.

The report, entitled Pipeline or pipe-dream – securing Australia’s investment future, actually makes some very valid points that governments should pay heed to about how construction of major infrastructure and capital plant is noticeably more expensive here than countries overseas.

Yet the report also illustrates, based on Access Economics data below, that rather than Australia suffering some kind of investment strike as a result of the carbon tax, it is in fact going through an investment and exports boom. Precisely as was illustrated in the buoyant GDP growth figures which were discussed in Climate Spectator yesterday.

Business Investment and Exports as a proportion of Australian GDP

Australia faces some serious challenges and opportunities for improving our standard of living, these include the current European debt crisis, the growth of China and India, and the need to address constraints and restrictive work practices in the construction sector. The carbon tax by comparison is a rounding error issue, predominantly confining its significant impacts to power generation, which represents 1 per cent of GDP.

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