Outsmarted and with no hope of coal comfort

The Liberal Party and the Nationals are moving into political deadlock over coal and climate change as Barnaby Joyce, posing as leader-in-waiting of the Nationals, ­exploits his backbench freedom to repudiate Scott Morrison’s climate change evolution.

The stand Joyce has taken this week — demanding government support for a coal-fired power plant in Queensland — is historically crucial because the Prime Minister can­not submit to this demand given the anti-coal mania that has infected some of the Liberal Party’s prized seats in Melbourne and Sydney.

There is a deadlock, almost a zero-sum deadlock, between ­Nat­ional and Liberal political interests. The perpetually fragile Liberal-National accommodation on climate change policy threatens to collapse. The Coalition partners are being pulled apart a few months from the election in another event that will haunt Morrison and further institutionalise the spectre of a government split from within.

The Morrison government’s effort to separate energy and ­climate change policy is now in tatters. This was a political imperative for Morrison after the collapse of the national energy guarantee during Malcolm Turnbull’s final days, but such separation never made policy sense.

The Liberal-National gulf has been stretched to breaking point by two events: the independent-led climate change ­insurg­ency in once safe, leafy suburban Liberal seats (think Wentworth) and the boiling frustration of Queensland Nationals now vowing to take a stand for coal on the basis of their economic interest and cultural honour. Joyce’s breakout this week saw a fusion of sentiments: alarm within the ­Nationals at the ineffectiveness of their leader, ­Michael McCormack, and an equal alarm that the Nationals were succumbing to the Liberals on core tenets of energy policy.

But there is another insidious factor: the sense of electoral doom that drives an “everyone for themselves” desperation. The epic story, however, cannot be concealed: the Coalition has lost the politics of climate change. The irony is supreme.

Just six years ago Tony Abbott brought the Coalition to office with his anti-carbon tax campaign. Yet since its abolition the Coalition has been unconvincing on either power price rises or climate change credentials.

Disunity over energy policy during Turnbull’s leadership ­became fatal. The Nationals can pitch coal to their regional constituency but Australian sentiment has turned against coal. This is yet another massive victory by the progressives while the ­Coalition has been governing.

The anti-coal forces in effect vetoed coal on political grounds, won the battle on financial grounds and their ideological wing now conducts a cultural war against coal that seems to have made immense inroads. In truth, this campaign is a bizarre brew of rational economics and irrational climate change mania that threatens serious harm.

The conservatives have been outsmarted and out-muscled. The upshot is rage and frustration within the Queensland wing of the Nationals over the demonisation of the nation’s major export ­earner and sullen resentment among conservative Liberals typified by Abbott’s recent concession that Australia should honour the Paris accords.

For the government, the most frightening aspect of Joyce’s intervention is his apparent assumption of irreconcilable National-Liberal differences over coal and climate change. Joyce’s assertion of a pro-coal National stance comes with the recognition that this will damage Liberal votes and lose Liberal seats in the far bigger suburban centres of Melbourne and Sydney.

McCormack is trying to be a responsible junior ­Coal­ition partner, keeping the ship afloat, winning praise from Morrison but inviting internal ­retribution. A number of Nationals resent Joyce’s intervention but the populist tide he stirs cannot be under­estimated. Joyce says he will never “throw our people under a bus” to satisfy Liberals in Melbourne.

The purpose of the National Party, he says, is to pursue policies in its own right, not just follow the Liberals. Anything else is “political serfdom”. This is an established Nationals battle cry. It comes when the party has an uninspiring leader, a troubled base and poor product differentiation from the Liberals.

For Joyce, it is familiar territory. It was in 2009 that Joyce, not then leader, spearheaded the populist Nationals revolt against Turnbull’s support for Kevin Rudd’s carbon pricing scheme with his famous declaration that it was time for the party to “burn the boats” — a la Hernan Cortes — and take an irrevocable stand of opposition. This conflict is not just about personalities. It reflects, above all, the deepening cultural split in Australia between its longstanding strength in fossil fuels as a source of national income and its rising tide of middle-class morality over climate change action that, in wealthy suburbs, assumes crusade-like dimensions.

This risks turning into a ­national trauma. The repeated failure to devise a national policy that integrates emissions reductions and competitive energy pricing decisions has had a destructive consequence: it invited a mad culture war where ideology is dominant, gesture politics are supreme, gas reserves are locked up and targets are advocated with cavalier disregard of their pricing and economic impact.

The Greens and emerging ­independents want a timetable on phasing out coal while Joyce, with justification, bemoans a country that brands as “evil” its biggest export industry, which helps to fund the schools and hospitals demanded by the progressive class.

For the Coalition, this throws two of its core constituencies into conflict: the pro-­mining central Queensland dev­elop­mental ethic with its aspir­ation of opening the Galilee Basin to multiple coalmines and exports, and the renewables-loving suburban middle class with its assumption that renewables meet tests of both clean energy and price competitiveness.

This conflict within conservative politics will endure beyond any election loss. Given its internal divisions, the Morrison government’s chances of discrediting Labor over its 45-50 per cent emissions and renewable energy targets seem forlorn.

A house divided against itself is hardly equipped to wage political war on the issue of its own divide. One of Bill Shorten’s achievements has been his tactical success in containing the contradiction within Labor’s constituency ­between its blue-collar, pro-­mining trade union base and its pro-climate-change middle-class progressive backers. But he will find this challenge far more daunting if he wins the election. It would be folly for the Nationals to engage in any pre-election leadership showdown.

But Joyce is after McCormack’s job and McCormack, ­unsurprisingly, is hitting back. Joyce says the Coalition arrangement is not a “marriage” but a “business” transaction. Both labels are wrong. The Coalition, as John Howard knows, is the most successful partnership in our political history. It is indispensable in ­enabling the Liberals and Nat­ionals to govern. No viable ­Coalition means no government for the Liberals and Nationals — this is the sharp end of reality.

The Morrison government must now finesse its management of Energy Minister Angus Taylor’s list of new generation projects to be underwritten by government. Morrison’s recent pivot ­towards renewables suggests coal is unlikely to figure in any final list.

After Turnbull’s removal, Morrison embraced government ­inter­vention as fundamental to his energy policy. The lesson, however, is that state intervention, as opposed to reliance on the market, is a dangerous instrument ­because it turns investment decisions into declarations of government policy, and that is the trigger for today’s brawl.