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In the midst of the excitement from the Conservative Party conference, and distractions from Italian courtrooms, not enough attention was given to an radical declaration made by George Osborne. In one of the few important pronouncements to have come from the lectern, he declared: “Let’s at the very least resolve that we’re going to cut our carbon emissions no slower but also no faster than our fellow countries in Europe.” There is no mistaking the meaning of his words. And while it might not sound much, it was a piece of open defiance.

Under the Climate Change Act, as it is currently structured, the government is legally bound to cut Britain’s carbon emissions by 34 per cent by the end of this decade. The rest of the EU, on the other hand, has only committed itself to cutting carbon emissions by 20 per cent by this date. So unless the rest of the EU rapidly exceeds its target – unlikely unless their economies move from downturn to collapse – George Osborne has resolved to challenge the status quo. Any business being clobbered by green regulations harsher than those inflicted on their French or German can protest – and cite this new Osborne Doctrine.

The Chancellor’s detractors discard his talk about carbon emissions as a meaningless piece of red meat thrown to hungry Tory activists. Not so. Much of our economic stability rests on Osborne’s personal credibility. Britain’s invaluable AAA credit rating is won precisely because the markets know the Chancellor means what he says. His seven-year deficit reduction plan is moderate enough to be credible, allowing his government to borrow at a rock-bottom rate of 2.5 per cent.

But a recovery built on debt is not a recovery at all. Real growth comes best from tax cuts and deregulation, and if Osborne believes he cannot reduce the taxman’s burden then he can – at the very least – reign in the bureaucrats. The Climate Change act threatens business perhaps more than any other piece of recent legislation. Passed in a spirit of unquestioning cross-party consensus, its targets are utterly unachievable – yet pursuing them will inflict great harm.

The official 2020 target in carbon emissions is just the beginning. The ultimate target is an 80 per cent cut by 2050. Given that this cut is dated from 1990 levels it implies a 94-per cent cut from what carbon is otherwise expected to have been. It is just possible that some new technology – perhaps the eternally-failed promise of nuclear fusion — will make fossil fuel-burning redundant. But at present no such technology exists. Instead we have wind turbines, solar panels and – as are stuffing them with subsidy as if the sheer volume of cash will change them into feasible energy sources. This is a folly that the taxpayer could not afford in boom times. In the bust, it is simple lunacy.

Osborne can also draw up a hierarchy of green schemes that can cost the most but deliver the least. Take, for example, the ‘floor price’ for carbon – in effect, an extra tax which raises basic energy costs. The Institute for Public Policy Research estimates this will push 45,000 households into fuel poverty within two years, a figure that could double by the end of the decade. Worse, as the IPPR says, ‘every ton of carbon that is priced out of the UK will be emitted elsewhere in Europe’. This scheme embodies the futility, almost the sadism, of the green lobby: increasing British fuel bills while exporting the carbon abroad to no discernable benefit to the environment.

One might extend the Chancellor’s analogy, and ask just what Britain achieves by such unilateral policies when not just Europe but the India and China are gladly impose no such structures. Between 1990 and 2006 Britain’s official carbon emissions fell by three per cent. It sounds an achievement, until you consider how our carbon emissions have simply been outsourced to China and elsewhere. Calculate Britain’s carbon emissions on a consumption basis – ie, add up all the emissions created in the name of making goods for British consumers – our carbon emissions rose by 30 per cent over the same period. So our official target, as it stands, is illusory – it succeeds only exporting pollution, and jobs along with it.

Of course, there is an overarching reason why manufacturing is leaving Britain for the Far East: cheaper labour and lower taxes. To accelerate this trend is economic suicide, as the Chancellor will be only too aware. If the Liberal Democrats place green ideology before British jobs or poverty reduction, the let explain themselves to the consumers confronted with eye-watering increases in fuel bills. Such mean-spirited and naïve ideology explains why the party is supported by just a tenth of voters. It can surely be explained to the LibDems that if British businesses are not allowed to buy their energy at affordable prices, then even the solar panels and wind turbines will be manufactured abroad.

Osborne is trying to navigate Britain away from what looks increasing like a second world recession. But as he so rightly said last week, we do not save the planet by running British business into the ground. The LibDems will wish to ignore his conference speech, but its implications are clear. A new era of climate realism is long overdue, and the Osborne doctrine calling an end to unilateral carbon policies is urgently needed. We look forward to its implementation.

The Spectator, 7 October 2011