Doing nothing is preferable to this

Even if a global deal is likely, realistically, developed countries probably have to cut emissions before emerging countries. That pits Australia, acting early, against its main trade competitors, acting later.

Henry Ergas is right. We'll incur significant costs even reducing our emissions consumption. We're a rich country (with emissions consumption to match) owning large emissions-intensive resources. If countries buying our exports apply border tax adjustments to them (and competitors' exports), so be it. If not, why should we do so unilaterally? If we won't apply similar adjustments for emissions embedded in our imports, why should those selling them to us?

Targeting national consumption of emissions helps promote a global deal. Targeting emissions production does not.

Doing nothing is preferable to another CPRS, whatever the odds of a global deal.