cap and tax? maybe just tax?

I was at breakfast yesterday and the rumour running around was that the Europeans were going to Bali for the post-Kyoto meeting to suggest than an emissions trading scheme was not the best way to deal with the climate change problem.

Interesting... especially after I saw a basic stat saying that carbon abatement in Australia might cost $1.5-2b, but an emissions trading scheme is more likely to cost closer to $12b!

I wrote a post at work talking about why and emissions trading scheme is a good idea, and while in theory, it could work, I actually don't think I 100% support my own argument. In all honesty, I think I was writing it to defend the position we had taken and help some other people understand why there was all this talk over trading. But thinking about it now, and after hearing about the European example, I think a tax (as advocated by the economist over 12 months ago!), is much smarter.

The questions are, however, will business accept it? Have we gone too far down the path of trading? What will the public think given that they are going to an election on the promise of a trading scheme?

At the end of the day I don't think questions 2 or 3 really matter... I just hope that number 1 doesn't prove to be a stumbling block.