The Republican presidential candidate says he will work with the Rudd Government to establish a global framework that would encourage China and India to become part of the solution to man-made climate change. Senator McCain says he is committed to a market-based cap-and-trade system aimed at reducing carbon emissions. And he wants a closer bilateral partnership on other key issues such as nuclear proliferation, trade liberalisation and combating terrorism.

Ross Garnaut warned in his draft report that “intense lobbying” could lead to “serious distortion of policy-making processes”. But this lobbying will extend from smokestack industries and miners, through driving organisations and the pensioner lobby, to millionaire wind-farm financiers, solar panel-makers and insurance companies.

An informal paper circulated by the Department of Resources ahead of a meeting between the Resources Minister and industry peak bodies and chief executives “canvasses alternative approaches” for compensating high-polluting industries that are unable to pass on the cost of emissions permits.

Minerals Council of Australia board member Peter Coates, chairman of base metals and coal miner Xstrata Australia, said the proposed changes to the Rudd Government’s forthcoming emissions trading scheme would still provide a market incentive for companies to reduce their emissions, “but we would not be getting too far ahead of the rest of the world”.

Wisely, former Victorian Premier Steve Bracks has advised the Rudd Government to ignore self-serving pleas from the car industry, trade unions and state governments for continued tariff protection. If adopted, the report’s recommendations would see the tariff cuts foreshadowed by the Howard government proceed, with a reduction from 10 per cent to 5 per cent in 2010.

The car industry has benefited from a long series of generous “adjustment schemes” since tariff barriers began to be dismantled in the mid-1980s, but Mr Bracks insisted this should be the last time it put its hand out for “transitional assistance”.

Although the report recommends that the tariff cuts proceed as planned, the former Victorian premier has also suggested that the Rudd Government help the struggling car industry by setting up a $2.5 billion car industry grants program called the Global Automotive Transition Scheme.

The industry is concerned that the Government’s proposed emissions trading scheme makes no provision for emissions from the more than $60billion of proposed new natural gas projects, putting that investment in doubt, even though gas usually replaces far dirtier fossil fuels in the countries to which it is exported.

As the Rudd Government prepares to release special reviews into car and textile industry assistance, the Productivity Commissioner has criticised plans to delay tariff reductions and increase government subsidies to manufacturers.

Since the late 1960s, the big assaults on protectionism have come from Labor. So it’s a surprise to find that the Rudd Government’s Industry Minister is itching to stall or even stop the removal of the last vestiges of import protection.