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Carbon tax: what does it mean for Australia?

The Big Question: Melissa Fyfe, Adam Morton and Tony Wright discuss the topic "Carbon tax: what does it mean for Australia?"

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LABOR carefully avoided triumphalism, after the backlash against that earlier kissing and hugging, but the Senate's tick for the carbon price is a defining and especially well-timed victory for Julia Gillard.

She has secured a major economic reform that eluded her predecessor, and it comes when Newspoll shows the ALP primary vote rising into the 30s.

The months ahead, selling the tax, will be tough for the PM - voters have swung from supporting to opposing a carbon price - but increasingly they will be hard for Tony Abbott too, as he is quizzed about how he'd really be able to roll back a scheme that could be well entrenched if the election is late 2013 and by then accepted by a large section of business.

 A Labor leadership challenge this year was never likely, but Gillard is now certainly safe into 2012. She has the breathing space for some recovery, if she is up to it. And although a 32 per cent primary vote is still terrible for the ALP, Abbott must feel just the slightest tremor in the electoral ground on which he stands. The Coalition is solidly ahead, but 57 per cent are dissatisfied with Abbott's performance, only marginally fewer than the 60 per cent unhappy with Gillard.

Abbott may be already realising he is entering rougher political terrain, as he comes under increasing media scrutiny and criticism for naysaying. We have seen him reluctantly accept that in power he would keep the government's increase in the super guarantee levy from 9 per cent to 12 per cent, despite the budgetary pressure this imposes. The cost of that backflip has been internal disunity.

It was not a good look for Abbott to be absent yesterday. He's gone to London for a meeting of conservative leaders - he says it was a long planned trip - but a press statement and a radio interview from Dubai are not the same as being on the spot. He was not needed in the Parliament, of course, but his absence looked odd after all that banging on about how everyone should be around for the votes.

Gillard's challenge on carbon pricing is now twofold. She must convince people they will not be worse off, and that many will be better off, when the scheme comes in with its accompanying package of welfare rises and tax cuts. Second, she is seeking to persuade voters that even if they elect Abbott, they will still have the carbon price. Implicitly she is saying ''so why bother?'' Climate Minister Greg Combet has to make sure July 1 won't bring too many glitches for business.

The Greens are the ones for whom the carbon price is mostly all positive. They can boast that it was their muscle-flexing in the minority government that ensured the government did something. The ''credit game'' on carbon highlights the ambivalent relationship Labor and the Greens have. The government needs the Greens, and the two parties share some ideas. But they are also electoral rivals. Labor's rise in yesterday's Newspoll saw a corresponding fall in the Greens vote.

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