A ‘borderless world’? Not for carbon!

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Alexandra Marshall

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Alexandra Marshall

28 December 2022

11:15 AM

The European Union has long been known as a collection of bad ideas. On brand, it has decided to become the creator of the world’s largest and most complicated carbon-pricing system. Setting aside the absurdity of going to war with life’s essential building block, the European Union’s Carbon Border Adjustment Mechanism promises to disrupt global supply chains, create significant trade problems, and inspire other nations – such as Australia – to join in.

Complex border taxes on carbon will severely interfere with the importation of aluminium, cement, non ‘organic’ fertilisers, energy, and iron/steel products into the European Union, with only ‘authorised declarants’ able to continue. Making life even harder for those trying to trade with the EU, bloc nations will temporarily receive ‘generous free allowances’, making the EU easily one of the worst trading partners around.

The existence of this carbon tax conversation serves as confirmation that Net Zero products are substandard, undesirable to the public, and unable to compete in a fair and free marketplace. To force these so-called ‘cheap’ and ‘climate friendly’ industries onto society, trillions of dollars have been taken from the public purse, along with the establishment of punitive measures against market competitors (including entire countries). This is never mentioned when politicians wave their arms around and talk vaguely about ‘saving the planet’. If Net Zero technologies were truly all the shiny marketing pamphlets promised, no such coercive legislative behaviour would be necessary.

What you are about to read describes a situation where the State has been invited to break the legs of every competitor that refuses to play the EU’s green game.

The story starts with the European Green Deal – approved in 2020 and predicted to bite by 2026 – which contains a collection of lunatic laws and green taxes. Dubbed Europe’s ‘man on the moon moment’ by President of the European Commission Ursula von der Leyen, the policy is starting to birth some monstrous children. She is right in only one respect, it will cause a ‘Great Leap Forward’ in Europe, though it will be more Chairman Mao than Neil Armstrong.

Keep in mind, the European Green Deal ‘leans heavily’ on the European Union’s Horizon Europe – a near €100 billion project to ‘achieve the United Nations’ Sustainable Development Goals’. Learning nothing, it still contains the same demand for organic farming (targeting fertilisers) that collapsed the Sri Lankan agricultural sector. It also focuses on the construction of extremely non renewable solar panels and wind turbines despite firm evidence that such measures are driving energy insecurity.

In order to construct a green utopia, the EU needs to find €1 trillion in short measure, plus the promised €20 billion (per year in perpetuity) gifted to their Biodiversity Strategy. This is no doubt only the tip of the finance tree… The EU has no intention of earning this money through productivity. Instead, they intend to steal it through fresh taxes.

Enter the Fit for 55 package, which excuses its nightmarish content by promising to ‘reduce greenhouse gas emissions 55 per cent by 2030’. Inside this is the dreaded Carbon Border Adjustment Mechanism (CBAM), which is essentially a tariff applied to imports that the EU wishes to punish.

Those set to be taxed are imports from countries that refuse to sacrifice themselves on the Greta’s death-cult altar – or as the EU puts it – ‘high-carbon imports from countries lacking sufficient greenhouse gas reduction measures of their own’.

This is no longer an EU thought bubble. The CBAM is set to begin reporting in 2023 and be well underway by 2026. The economic suicide policy was passed with 450 votes in favour, 115 against, and 55 who decided to sit on the fence.

Carbon Virtue Signalling maths is all very complicated, with CBAM certificates costed by EU allowances (calculated by existing European Union carbon credits) under the European Union Emissions Trading System.

When the EU insist that this convoluted system of punishing carbon is based on concerns of ‘carbon leakage’, what the lords of the EU really mean is that all countries will have to suffer equally from the collective mental illness taking hold of European bureaucracy. Some of the die hard collectivists in the EU have pointed out that this war against carbon might harm their dictatorial mates in the Global South – never mind the hell those once prosperous European colonies (like Australia) will suffer at the hands of European climate hysteria.

In an article titled, The proposal for a Carbon Border Adjustment Mechanism fails the ambition and equity tests, Tim Gore explains:

‘The proposal aims to address long-held concerns over carbon leakage. It does so, in essence, by requiring EU importers to pay a carbon price at the border – by purchasing CBAM certificates covering the scope one emissions embedded in their imports – equivalent to that faced by EU producers under the EU Emissions Trading Scheme (ETS). If third country producers can demonstrate that they have already paid a carbon price, then the corresponding cost can be deducted by the EU importer.

‘Until now the EU’s response to carbon leakage concerns has been to allocate ETS allowances to energy intensive industries for free. While there has been little to no evidence of carbon leakage actually occurring to date, the strengthened 2030 emission reduction target (and consequent decrease in the total number of ETS allowances) will likely increase the risk in the years ahead. The Commission has presented the CBAM as an alternative approach to free allowances to manage this increased risk.

‘While it is hoped that the CBAM will encourage the use of carbon pricing among international trading partners, it is the removal of free allowances that is critical to strengthening the EU’s domestic climate ambition. As the Commission notes, “free allocation… weakens the price signal that the system provides for the installations receiving it compared to full auctioning.” The CBAM’s key ambition test is therefore the extent to which it enables a rapid phase-out of free allowances and thus the full application of the polluter pays principle across EU industry.’

Aside from severely penalising Russia, other nations including India, South Africa, Brazil, and China have complained about the CBAM, even going so far as to accuse the system of violating the UNFCCC’s pledge of ‘common but differentiated responsibilities’. To grant some countries an exemption would essentially allow them to produce carbon-intensive, highly competitive, low-cost products which ultimately jeopardise EU partners (let alone tarnish global climate goals). The alternative proposition of sharing the revenue was essentially laughed off by the EU, who are only able to garner support for their plan by ripping money out of their trading partners for their pet Net Zero projects.

Astonishingly, Australia’s Mathias Cormann – previously the Minister for Finance within the Morrison government and now Secretary-General of the Organisation for Economic Co-operation and Development, thinks we should embrace a global digital tax on carbon to tackle climate change.

Talking to Politicoin September 2021 under the ‘cover of Covid’, Cormann said:

‘We can harness the experience from international taxation to build an inclusive framework for carbon pricing. Without a sufficiently ambitious multilateral commitment, we will not get to global net zero.’

His call formed part of the conversation surrounding the need for a CBAM, and while Cormann has stated that a CBAM should be a ‘last resort’ to coax the EU’s partners into slashing their economic wrists in sympathy, his pro-carbon tax language is far from reassuring for a former minister of an allegedly conservative government.

‘This should absolutely just be a last resort. It would be much preferable if countries around the world could be persuaded to make a genuine and proportionate effort towards achieving the global mission, to get to global net zero by 2050.’ Adding, ‘If we do have to go down this path, we have to be very careful we make judgments on where to calibrate that price.’

In a position that will be extraordinarily awkward to defend when no apocalypse manifests, Cormann finished:

‘Yes, multilateralism is hard, but what is honestly the alternative? Unless we can get the countries of the world genuinely aligned with all making a proportionate and verifiable contribution to get a global net zero, we won’t succeed. And we have to succeed.’

If only we could get all these holier-than-thou climate zealots to stop air-freighting themselves around champagne-sipping talkfests we might save a few degrees…

As for who will be allowed to keep importing into the EU, according to Engage:

‘EU importers must apply for authorisation to the relevant Member State authorities to become “authorised declarants”. This status would allow them to import CBAM goods into the EU. “Authorised declarants” will then have to purchase and surrender on an annual basis CBAM certificates that reflect the amount of so-called “embedded emissions” in the CBAM goods imported into the EU. Non-authorised declarants will not be able to import CBAM goods.”

Australia is not immune to this crazy behaviour.

Businesses, who would quite like the government to help them destroy their competitors while pretending to be climate virtuosos, have lobbied Jim Chalmers to include Australia in the carbon border tax party.

Albanese’s Labor Party – thrilled by the opportunity to increase taxes on productivity – is said to be considering carbon border taxes with Chris Bowen making out as though businesses were begging him to tax them harder. (We’d like a list of those businesses and their vested interests.)

Bowen is the kind of deep thinker that makes it clear that energy market disruption makes his work on the transition to renewable energy ‘urgent’, but never answers questions about the obvious danger of gifting Australia’s energy infrastructure over to the most dangerous communist dictatorship in the neighbourhood which spends half its time threatening war on Taiwan and Japan. ‘Stability’ and ‘China’ are not items you’d find together in the supermarket.

Worse, Bowen doesn’t have a master plan for the security of Australian business interests – he has a PR plan for getting himself re-elected by one-dimensional greens while appeasing corporate lobbying groups hungrily reaching for billions in public money earmarked for ‘feel good’ green investments.

The Business Council of Australia should be publicly shamed for instigating an idea like this that will cause serious harm to so many Australian companies following on from two years of Covid lockdown hardship. Labor are happy to gut the middle class, but Dutton needs to stop dragging his heels on this. Morrison had many failures as a Prime Minister when it came to fending off eco-fascists, but at least he managed to call the CBAM ‘a new form of protectionism’ and said that it would ‘undermine global free tree trade and impact Australian exporters and jobs’.

To that end, you may notice that all the left-leaning free trade advocates have no problem with a carbon border tax, despite it being the biggest imposition to free trade in living memory.

What we are watching is significant anti-competitive behaviour concealed beneath a ‘moral arms race’ in which the rich win and everybody else drops down another rung on life’s ladder. Tony Abbott was right to kill carbon taxes – who will defend Australia from them this time?

Far from being a ‘borderless’ globalised utopia as promised by progressive European bureaucrats – there have never been more borders to trade, equality, and prosperity than under this ‘Green Dream’.

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Published by Nelle

I am interested in writing short stories for my pleasure and my family's but although I have published four family books I will not go down that path again but still want what I write out there so I will see how this goes

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