“Gone by lunchtime”… If only the same could be said of the debate that wouldn’t die: carbon tax vs emissions trading

The post has been updated, to address the Atomic Energy Act. Hat tip: Graeme Edgeler, the Legal Beagle.

The fizzle of Patrick Gower’s yellowcake story was about as surreal as the story itself.

TV3's Gower broke a story last Wednesday about yellowcake shipping via New Zealand ports. It’s been happening once in a while, for a very long while — over twenty years — and weekly, more recently.

Even with both governments implicated, the lack of fallout was astonishing. No one but Gareth Hughes and Russel Norman seemed to care. It’s inconsistent with New Zealand’s anti-nuclear policy, they said, to be even tangentially supporting the uranium industry.

New Zealand Nuclear Free Zone, Disarmament and Arms Control Act 1987
On the matter of this Act, Nick Smith spanked the Greens quite nicely: nuclear-free policy is not a radioactive-free policy, he said [question 9], and by the way, what are the Greens' views on cancer treatment?

He was happy to rely on Australian policy and assurances, that their uranium is used only for non-violent purposes; plus ERMA assurances that the yellowcake poses zero risk to environment or health.

And he’s right: ours is, as it has always been, an anti-nuclear powered or armed warship policy, not all anti-all civilian use of the technology. In that sense, this is a sideshow.

Yet Don Brash, Geoffrey Palmer, and John Key have all mis-stepped, in the not so distant past, over not dissimilar logic. (There are differences between the three: one of them is not like the others, in my view; over to you to figure out which.)

We — or David Lange, on our behalf — stood up against the big guy, on the world stage, and won. When we dust off that iconic memory, bound up with pretty ‘no nukes’ ribbon, I wonder if we sometimes misremember what the policy must have been.

Perhaps, the lack of interest in Gower’s story is a measure of our new maturity, perhaps a newfound clarity about the policy scope. But I’m not sure either is true. Gower’s story was the best, non-politicised chance we’ve had to debate this thing at the core of our national identity, and we’re randomly passing it up.

“Yellowcake undermines no nukes policy”: dumb argument. Unprincipled argument: if environmental champions were defending nuclear power generation as a global green good (and some do), and if they were right, it would just not be good enough for New Zealand to pontificate and wring its hands and refuse to help.

But as a global leader now, on nuclear non-proliferation, is this an opportune time for our policy to be extended? Even in civilian contexts, arguably, the net security, health and safety, and environmental hazards make nuclear not worth the risk, for any country, anywhere.

[Update: The Green Party is seeking a review of the existing legislation, to include a ban on uranium shipping, according to this report in the Nelson Mail:

"The Green Party wants a review of the legislation banning nuclear weapons and nuclear-powered ships from New Zealand waters to include a ban on uranium being shipped through Nelson and other ports.

Green MP and oceans spokesman Gareth Hughes is to draft a member's bill in an effort to have uranium shipment bans covered by the New Zealand Nuclear-Free Zone, Disarmament, and Arms Control Act 1987."]

 

Atomic Energy Act 1945
However, under the Atomic Energy Act -- arguably, part of the fabric of our anti-nuclear protection, although it arrived a lot earlier -- the government, and Ministers from previous governments, may have questions to answer. At least, they ought to be asked them.

Section 7 of that Act provides that " no person shall, without the prior written consent of the Minister, import any prescribed substance" in excess of 5 pounds in weight. Under the Act, "prescribed substance" means uranium. "Uranium" includes all chemical compounds of uranium. Wikipedia classifies yellowcake as a uranium compound. "New Zealand" includes any territory subject to the authority of the government of New Zealand.

So, was the yellowcake "imported"? The Atomic Energy Act doesn't define "imported". But the Customs and Excise Act does.

The Customs and Excise definitions are for the purposes of that Act (" In this Act, [x] means [y] ..." it says in section 2). So there is room for argument about whether "importation", defined for Customs control purposes, can or should be translated to the Atomic Energy context.

However, the definitions are quite clear. "Importation" means " the arrival of goods in New Zealand in any manner, whether lawfully or unlawfully, from a point outside New Zealand". "Arrival", in relation to a craft, which includes ships, " includes the arrival of the craft, whether lawfully or unlawfully, in New Zealand from a point outside New Zealand whether or not the craft ... berths, moors, anchors, or stops at ... any place within New Zealand". "New Zealand" means " the land and the waters enclosed by the outer limits of the territorial sea of New Zealand", which extends, roughly, 12 miles offshore.

Shipping yellowcake through our waters is "importation", in Customs Act terms.

That means it requires the prior written consent of the Minister responsible under the Atomic Energy Act.

The government may be doing this; now that it knows about the practice, in all likelihood, it is. Gerry Brownlee hasn't been asked.

However, if shipments (ie, imports) proceeded from time to time without that Minister's knowledge, under this government or a previous one, they would have been in breach of the Atomic Energy Act.

As such, they would also have been "unlawfully imported", as defined in the Customs Act.

Unlawfully imported goods are forfeited to the Crown: section 225 of the Customs Act. According to this Law Commission report, that means title vests in the Crown. To my understanding, there is no discretion about this. It just happens, by virtue of the imports' unlawful status.

Whether we knew it or not, or benefited from it, chances are, NZ has at one time or another over the last twenty years been party to the yellowcake trade, as the holder of the property right in some shipments ...

I wonder how much Aus owes us? 

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Reports on Carbon News and, apparently, Radio New Zealand [question 3], that Labour is reconsidering a carbon tax, followed hard on the heels of hints from Green sources.

If either party is sticking a pre-election finger in the wind, neither can do so with any credibility.

When the ETS Review Select Committee reported, almost all were persuaded of the merits of a carbon tax; even ACT is now persuaded of the merits of a carbon tax, for heaven’s sake. But we kept the ETS. And Phil Goff’s Federated Farmers’ speech last week talked of replacing National’s legislation, but also a “market based emissions system”; when he laid out his policy choices for the farmers, carbon tax was not among them.

But just in case:

Prior to its rushed ETS, Labour proposed — then cowardly canned — first the ‘fart’ tax (2003), then a so-called comprehensive, except agricultural emissions, carbon tax (2005).

The Greens ummed and ahhed about supporting Labour’s Climate Change (Emissions Trading and Renewable Preference) legislation, which brought in the ETS. In the end, they supported it, making clear their ambivalence — it had the same problems as National’s, on a bit smaller scale. Here’s one among many quotes from Jeanette Fitzsimons:

“Since 1993, the Green Party has been advocating a carbon charge, with corresponding reductions on the bottom band of income tax. So we welcomed the Labour Government’s 2002 policy that among other things promoted a carbon charge. But because the Government did not say what it would do with the money, it lost the political battle and … abandoned the charge in 2005. That was 4 years wasted. We now have a second-best system of an emissions trading scheme, and economists and a number of business people have recently come out in support of the view that it is a second-best system. Too late, those who now regret their opposition to the very much simpler and fairer carbon charge, with lower compliance and administration costs and real revenue to recycle, must accept their role in killing the better scheme and accept the second-best. It is here, and we have to make it work.”

That was in September 2008. A few months later, post-election, the Greens were outraged by the ETS review, and spent a lot of time defending the status quo. Fitzsimons again, on the establishment of the ETS Review Select Committee:

“We are not apologists for the current emissions trading scheme. We are sceptical that emissions trading creates an opportunity for many people to create markets in buying and selling carbon where they do nothing except leverage the market. But it’s the only thing going to put a price on carbon. We need to get on and do it.”

It’s never too late to change one’s mind, perhaps. A carbon tax was always the simplest and best option, and would be an improvement on National’s revised scheme.

But, invoked by the Greens many times in response to others’ delays, is an argument about uncertainty, and its hazard to responsible investment. Starting again from scratch is an impulse even Nick Smith has resisted.

The risk is that the public, business investors, and our export markets lose patience entirely, and politicians all credibility, on this issue.

If Labour and the Greens are seriously considering this, which I really cannot quite believe, they ought to stop, and breathe, and ask themselves — can you see a future in which any National-led government would prefer your carbon tax to an ETS market mechanism? — and be guided by that answer.