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ZNR UUUUU ZZH
R 270629Z NOV 09
FM AMEMBASSY CANBERRA
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INFO RHEHAAA/WHITE HOUSE WASHINGTON DC
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RUEHJA/AMEMBASSY JAKARTA 5563
RUEHKO/AMEMBASSY TOKYO 3743
RUEHLO/AMEMBASSY LONDON 2148
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RUEHBN/AMCONSUL MELBOURNE 6802
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RUEHDN/AMCONSUL SYDNEY 5071

UNCLAS SECTION 01 OF 02 CANBERRA 001053 
 
SENSITIVE 
SIPDIS 
 
DEPARTMENT FOR S/SECC STERN 
 
E.O. 12958: N/A 
TAGS: SENV PGOV AS
SUBJECT: OPPOSITION MELTS DOWN OVER CLIMATE CHANGE 
 
REF: CANBERRA 920, CANBERRA 893 and previous 
 
¶1. (SBU) SUMMARY: The Opposition Liberal Party is in turmoil after 
an unprecedented revolt against leader Malcolm Turnbull and his 
decision to support the Government's climate change legislation.  A 
Liberal party leadership ballot will be held on Monday.  Malcolm 
Turnbull's decision to back the government's emissions trading 
scheme has deeply divided the Liberal party, causing Tony Abbott - 
from the party's right - to put his hand up. Some of Turnbull's 
supporters are pressuring him to resign so that fellow moderate Joe 
Hockey - who insists he won't challenge Turnbull - can take over. 
The Right is amenable to Hockey provided he makes concessions on the 
ETS.  The majority view is that Hockey will succeed Turnbull however 
Turnbull insists he's not resigning.  This public meltdown is likely 
to leave deep scars within the Liberals and further reinforces the 
consensus that Prime Minister Kevin Rudd is primed for victory in 
the next election, which is likely to be sometime in 2010. END 
SUMMARY. 
 
LIBS PLOT TURNBULL'S DOWNFALL 
----------------------------- 
 
¶2. (SBU) A significant proportion of Liberal MPs were livid at 
Turnbull for announcing Opposition support for a revised version of 
the government's emissions trading scheme (ETS) earlier in the week. 
 This followed the Government accepting a series of Opposition 
amendments to the legislation that provided additional compensation 
to industry.  Angry Liberals first called for a leadership vote, 
which was defeated November 25 by a margin of 48-35, allowing 
Turnbull to argue he had party support for voting in favor of the 
ETS.  However, on November 26, around 10 Liberals - including Abbott 
and Senate Leader Nick Minchin - announced their resignations from 
the frontbench.  Liberal Senator Gary Humphries told us this was 
part of a "coordinated campaign." 
 
¶3. (SBU) Turnbull hit the airwaves, declaring he would not back down 
or resign, and that the Liberal party would be annihilated if it 
took a "do nothing" position on climate change. Echoing Prime 
Minister Rudd, he warned that taking no action on climate change 
risked "the future of our planet and the future of our children and 
their children".  On November 27, Abbott announced he would 
challenge Turnbull for the leadership if Turnbull didn't change his 
position on the ETS.  Subsequently, a meeting will be held on Monday 
30 November to determine 1) whether there should be a ballot for the 
leadership - a "spill motion;" and 2) if the answer is yes, a 
leadership ballot. 
 
LIBERAL INSIDER'S PREDICTION 
---------------------------- 
 
¶4. (SBU) Liberal Party Deputy Federal Director James McGrath 
(PROTECT) confided that Turnbull's key supporters are pressuring 
Turnbull to resign so that Shadow Treasurer Joe Hockey - who doesn't 
want to challenge Turnbull - becomes leader.  They fear Abbott would 
win a showdown with Turnbull, delivering the leadership to someone 
viewed as far more conservative on social issues than mainstream 
Australians.  According to McGrath, Abbott and Minchin assured 
Hockey he will be elected unopposed if he agrees to make concessions 
on the ETS.  McGrath predicted Hockey would be leader by Monday 
Qon the ETS.  McGrath predicted Hockey would be leader by Monday 
afternoon but that removing Turnbull could be messy due to his 
stubbornness. 
 
¶5. (SBU) COMMENT:  The consensus among our political contacts is 
that Turnbull will resign - perhaps if he loses the spill motion - 
and that Hockey will become leader.  However, if a spill motion 
succeeds, it is conceivable the belligerent Turnbull doesn't resign, 
thus bringing on a leadership showdown with Abbott.  If this occurs, 
enormous pressure will be brought on Hockey to run.  While Abbott 
may connect with the Liberal base, some Liberals are fearful his 
very conservative views will alienate critical swing voters, 
particularly women.  Anti-ETS Liberals believe public opinion is 
turning against an emissions trading scheme as the associated costs 
become apparent, and have no fear of Rudd calling an early election 
on the issue.  Interestingly, some Labor strategists have told us 
such an election would be risky given the location of several Labor 
marginal seats.  However, Labor Party politicians are confident that 
the disarray within the Opposition will pay dividends for a long a 
time to come. END COMMENT. 
 
CANBERRA 00001053  002 OF 002 
 
 
 
BLEICH