be able to borrow permits from the future, and that such borrowing helps the world meet global abatement targets. Even with all those assumptions -- and especially assuming the industrial countries all abate at a uniform price by 2016 -- the costs Treasury estimates for the government's proposal are anything but trivial. Rather, discounted at the Garnaut discount rate, they have a present value of $1 trillion -- about one year of Australia's GDP. And that relies on the assumption of global action. In saying this, let me emphasise that it is absolutely fair for Treasury to have made those and other assumptions -- that is in the nature of modelling. But it is also fair for there to be an opportunity to assess the implications of varying those assumptions. Indeed, the ability to undertake such sensitivity testing is one of the greatest strengths of economic modelling and is obviously vitally important where decisions of huge significance are at stake. So there is more work to be done before any decision can be taken. That work needs to be done transparently and independently: ideally, by the Productivity Commission. Until then, proceeding with the government's scheme is little more than reckless. Want to follow The Conversation? Sign up to our free newsletter to get the day's top stories in your inbox each morning, with a special wrap on Saturday. Email address ? Republish You are free to republish this article both online and in print, as long as you follow some