Wayne Swan (Lilley, Australian Labor Party, Treasurer) Share this | Hansard source

A market mechanism is the best mechanism because it produces the least cost, most efficient reduction in carbon pollution. So we on this side of the House think markets have an essential role in dealing with market failure when it comes to carbon pollution. Now, Mr Stern, the most pre-eminent economist in this area, has made the observation that this is the greatest market failure in history—the failure to price carbon pollution. The failure to price carbon pollution means that carbon pollution continues to be emitted, with devastating consequences for the planet, for the global economy and of course for this country. Those opposite do not believe in climate change anymore, so perhaps they are not concerned with that market failure, but we do know that a number of those opposite do believe there has been a market failure, that it does require a price mechanism. The member for Wentworth believes that. The shadow Treasurer used to believe that, once upon a time. But we on this side of the House understand how important market mechanisms are in dealing with substantial economic problems.

Of course, the Prime Minister spoke before about tariff reform—utilising changes in the price of goods, changes in the market—to bring about greater prosperity. But, of course, those opposite do not favour market mechanisms anymore. They want central government direction. They want regulation. This would not be odd if they were not the Liberal Party of Australia, on whose basis it was form to say that they believed in the market. But they no longer believe in the market. This is a very big challenge for their economic credibility. It was not that long ago that the former Prime Minister Mr Howard believed in the market. This is what he had to say:

It is fundamental to any response both here and elsewhere that a price is set for carbon emissions. This is best done through the market mechanism of an emissions trading system.

It was a belief held by all of those towards the end of their period in government but now repudiated by those opposite. It is a belief which is held by many other countries in the world that are moving to put in place emissions trading systems. But, of course, now we have this incredible spectacle where those on the other side of the House, who professed to believe in markets, now believe in the heavy hand of regulation against free markets. Is that where the Liberal Party of Australia now believes they are—regulation over markets? We on this side of the House believe in markets. They believe in having a bureaucrat—

See this speech in context