Kevin Rudd has gone to Tokyo and managed to bring the annoucement of Toyota’s green car production forward a few months, at the cost of $70 million.

But from the government’s perspective, what difference does it make if hybrid cars are built in Australia or in, for instance, China? If the Victorian and Commonwealth government wanted to encourage car manufacturers to build ‘green’ cars, why wouldn’t it just offer the firms their $70 billion and allow them to build the cars anywhere in the world? The resulting cars may eventually be cheaper, encouraging their adoption. And surely the aim is reduce global emissions, not only emissions originating from Australia. So what does it matter where those cars are finally purchased and used? (I might be mistaken - is there a reason that we might have to reduce emissions in certain areas around the globe more than other areas?)

Kevin Rudd and John Brumby’s green car announcement may be wrapped in the rhetoric of climate change and innovation, but it seems to be just traditional industry policy with a green twist.

(Sinclair Davidson and I asked the Labor Party 7 questions about their industry policy in early 2007. And earlier this year I penned a defence of the poor old automobile.)