Australia's carbon tax--is it a big winner?

What is going on in Australia recently? Well let me start out to explain I am no expert. Comments will then start out with, “You are right ELP; you are no expert”.

So with that ladies and gentlemen of the jury, let me throw this one at you and see how close it is to explaining a few recent events.

The carbon tax plan by the government is all the rage here. This can only be interpreted as a money grab by the government given their confusing message on green energy. We should hand over the money to Guido for the carbon tax yet on the other hand you have the following problem with solar energy.

Although it is a small number; there are people in the state of New South Wales who invested into expensive solar energy kit for their home or business. An NSW government scheme lets them receive money for any excess energy they can pump back into the grid. The recent budget just cut that fee by one-third. So all those that believed in this green initiative—and anyone thinking of getting into this plan—feel betrayed. As well they should. Those fees were to help pay for the expensive kit. Along with that, the phones stopped ringing for businesses that sell the solar equipment.

I doubt the carbon tax is going to be a big winner. With or without the carbon tax, electricity prices are going up. With it; they will go up more.

Part of the government justification is to keep up with world treaties. Well Australia is not a third world nation; has a fairly functional political capability and can mind its own business without outside interference. I don’t think that is nationalism. It is just a strong opinion that may have merit.

Next there is the rising dollar. This is going to put a hit on exports for Australia. The nation gets a big part of its wealth from things it digs up out of the ground and sells to China. If China can find a cheaper mineral resource elsewhere, this may have a negative effect on the economy; plus well...that carbon tax thing.

The Australian economy is healthier than most. It will be interesting to see how the current government avoids its mixed message on the carbon tax; as well as other ideas that drain profits from business large and small. The last prime minister found out what happens when you declare war on one of Australia’s cash cows. Let us see if the current one is smart enough to avoid the same fate.