THE BATTLE-LINES ARE DRAWN

Finally, Labor has a carbon policy.

It remains to be seen how effectively the party will be able to sell it, nevertheless, Julia Gillard's announcement on Thursday has established the terrain for the new battle-ground of politics.

THE START OF THE BATTLE

Evelyn Waugh is not a popular writer today. His books, like Brideshead Revisited, are populated with characters we no longer recognise; gay Oxford colleges inhabited by wealthy, champagne-guzzling, wastrels; recusant Catholic aristocrats doddering around enormous, privately-owned country seats; and even a few lingering remnants of an earlier world, people who find meaning in serving transcendental values rather than being occupied by the continual sordid squabble for money.

But on Thursday, in the unlikely surroundings of the Prime Minister's courtyard, one of his themes suddenly leapt into life. At the beginning of his Sword of Honour trilogy, Waugh describes the way his hero feels as the Second World War begins. "Eight years of shame and loneliness were ended. [Guy] had been deprived of the loyalty which should have sustained him. Now, splendidly, everything had become clear. The enemy at last was plain in view, huge and hateful, all disguise cast off." In Australian politics also, the battle lines are finally drawn.

Julia Gillard will be desperately hoping her carbon tax proposal has a similar effect galvanising support for the government. This comparison is not overdrawn. It would be wrong to minimise the significance of the gap that has suddenly opened up in the Australian political debate. Quite suddenly, both parties have come to stand for radically different ways of grappling with the world. This goes to a fundamental issue. Gillard is, effectively (whether she likes it or not) asserting that we need to find a new way of distributing resources to preserve the world. Tony Abbott insists the current model (and its underlying economic theory) is not broken and that there is no need to change anything. The real fight has finally begun.

Gillard's office says the detail is still being worked through -- a clear indication that the government and the Greens haven't yet been able to settle on concrete terms of implementation. Serious sticking points remain and they’re all to do with the detail. Nevertheless, at the moment at any rate, this is not where the devil lurks.

The government's great achievement has been to agree with the Greens and independents and find a mechanism for dealing with carbon emissions. This structure is fundamental to dealing with the issue. Abbott will quite correctly be able to yell that Gillard has reneged on her pre-election promise and sold-out to the environmentalists. She has, in fact, now done exactly what she urged Kevin Rudd not to do back in 2010. However this will damage her far less than ignoring political reality.

Finding a way to deal with climate change has been the single most defining structural issue confronting Australian politicians for the past half-decade. Put aside, for a moment if you will, the science. Let's deal exclusively with the political reality: a growing number of people have come to believe in climate change. It appears increasingly unlikely that either party will manage to win power without harnessing these people's votes, although the issue was particularly harming Labor. Gillard's risible announcement of a "citizens assembly" during the election was treated with the disdain it deserved. The party had to find a serious way of dealing with this issue, otherwise it was at risk of disintegrating. The long coalition between the workers and the well-heeled university-educated socially-concerned party supporters was heading for a bitter divorce.

Now Gillard, relying on the vital negotiating skills of Climate Minister Greg Combet (who is the real hero of Thursday's announcement) has managed something that has eluded both sides of politics for the past five years. She has laid out a clear pathway for an emissions reduction mechanism together with the vital ingredient of political support to make it a reality. For the first time since she became Prime Minister, Gillard represents certainty. At last she can speak with authority on the fundamental question confronting the country.

And this leads to a second element of the equation: one far too often ignored in the coverage of the domestic political squabble. Our method of dealing with the environment has an international dimension. Although the solution promoted by Rudd at the Copenhagen talks ended in a shambles as China and India made their opposition to a global deal clear, both countries have acted independently in attempting to find ways of curbing their emissions. The European Union has led the world in developing its own scheme to slash the production of greenhouse gases. At a time when there are increasing calls for protectionism it was only a matter of time until Australia began to be penalised economically for its lack of action on the issue.

On the day Gillard made her announcement the Australian Strategic Policy Institute was hosting Joergen Moeller, a Danish researcher based in Singapore who's been studying these broader issues confronting the world. He insists the old paradigms of mass consumption and rising economic growth need to be thrown out in order to deal instead with resolving the new challenge of scarcity. The world will soon face critical shortages of vital commodities, in particular food, raw materials, energy (oil) and water. It's not necessary to accept the entirety of Moeller’s argument to acknowledge that humanity now has to find a new way of resolving seemingly exponentially increasing demands for limited resources to understand that our climate is a vital part of any solution.

Gillard has finally acted to put herself on the right side of this battle for the future. Tony Abbott still insists that there is no need to change the paradigm that has worked so well for Australia in the past. His message is one many Australians will find comforting. It is, basically, that there is no need to change; that life will continue much as it has in the past and, most particularly, that there is no need to change our patterns of consumption.

The polling will soon demonstrate how voters feel about Gillard's strategy. It would be a mistake, however, to underestimate the degree to which Australian politics changed last Thursday. After searching aimlessly for a viable narrative ever since Rudd abandoned his attempts to introduce an ETS, Labour can finally again claim to have a vision. By contrast Abbott claims that what has worked well in the past will continue to work well. Definition has re-entered the political debate.

By the end of his trilogy, Waugh's hero is badly disillusioned. The glorious vision of the future that he fought for has been sullied by political reality. Nevertheless, he realises there was no alternative but to take up arms -- surrender was not an option. Gillard hopes voters will feel the same way.