The political economy of carbon pricing in Australia: Contestation, the state and governance failure

Abstract

This thesis examines the rise and fall of an emissions trading scheme in Australia between 2007 and 2014. It offers a novel analysis of the Australian climate policy debate. The thesis develops a heterodox political economy of carbon pricing that draws out the links between polyvalent social struggle over climate change and the process of instituting marketised climate policy.

In contrast to existing depictions of the struggle over carbon pricing as a neat division between forces for and against carbon commodification, the thesis argues that there is a more complex dynamic at play and explores the contradictions of carbon pricing in theoretical and empirical detail. The prospects of legitimate and effective carbon pricing cannot be asserted in principle; rather they must be examined empirically. The thesis provides evidence of the interconnections between political contestation and the brief institution of a carbon market. It details carbon pricing policy and legislation, parliamentary debates, and contests in the media and civil society.

The case of carbon pricing in Australia illustrates that the approach to marketised climate policy adopted does not deal with, and in fact has exacerbated some pre-existing issues of governance failure in energy and land sectors. The thesis demonstrates that governance failure provides a more compelling explanation for the outcomes observed than approaches that conceptualise the political economy of carbon pricing in terms of state failure or market failure.

The normative implications of the political struggles in Australia are explored. Contestation over carbon pricing reforms has posed a political challenge to marketised climate governance in Australia. Conservative and industry opposition is a key part to the political failures of carbon pricing, but so is the broader lack of authority of social democratic political parties, experts and environmental organisations on this issue. A popular agenda for carbon pricing is now very far off, if not impossible. However, new strategic directions within environmentalism indicate that ‘energy politics’ is emerging as a more fruitful political arena than carbon pricing politics.