Wednesday, 16 October 2019

Busting more carbon tax myths. A letter-to-the-editor.

by Dan Soprovich.

Conservative politicians lie about the carbon tax.  Jason Kenny, Doug Ford, Andrew Scheer … you know who the rest are.  And Conservative politicians have been lying about the carbon tax for more than a decade.  When the Stephane Dion Liberals proposed a carbon tax in 2008, Prime Minister Stephen Harper lied about it.  At the time, my dear departed Uncle Jack, who made millions of dollars from the oil industry, sent me an Internet article indicating that a poor retired couple in New Brunswick would be terribly impacted by the Liberal’s proposed carbon tax.  However, that was simply not true.  The proposed carbon tax included a rebate so that folks at the lower end of the economic spectrum would not be hurt (very similar to the carbon tax implemented by the Trudeau Liberal government).  The Stephane Dion Liberals also provided an online calculator at the time.  When I applied the circumstances of the retired couple within the calculator, the inconvenient truth was that the couple actually came out ahead under Dion’s proposed carbon tax, just as the great majority of Canadians come out ahead under the Trudeau government carbon tax.  This example demonstrates the critical importance of ‘testing’ information, at all times, to get to the truth of a matter.  This is particularly true for information from the Internet, where anyone can write almost anything.
Lying is a strong word and I do not use it lightly.  However, in the era of US President Trump, it has become evident that the honest and objective observer must call a lie for what it is.  It is more important than ever in today’s environment to speak truth to power, and this is particularly so when politicians lie.

Why do Conservative politicians lie about the carbon tax?  In my view, the reason is simple.  It is because they believe that many or most people will not check the facts, and because their ‘Taxes bad, no taxes good’ mantra is an easy sell for these cynical politicians.  Conservative politicians like Andrew Scheer and Doug Ford never tell Canadians about the carbon tax rebate that is received by the great majority of Canadians, and therefore effectively lie by consciously omitting a fundamental piece of critical information.  A serious discussion requires serious people applying information and facts.  By distorting the truth and not engaging in an evidence-based discussion, these Conservative politicians, who know that they are spreading misinformation, can pick up votes in an attempt to get themselves elected.  As one example of the vulnerability of people to misinformation, some months ago I had a good and lengthy discussion with a local businessman and farmer who, at that time, opposed the impending carbon tax.  By the end of the discussion, it was clear that the individual had absolutely no understanding of the mechanics of the carbon tax, or its demonstrated effectiveness in reducing emissions.

So, what are some of the inconvenient truths?  

First and foremost, economists almost universally support the view that a carbon tax/price on carbon is the most efficient and cost-effective means to address emissions.  The economic basis is simple.  Pricing carbon drives businesses and individuals to reduce emissions and innovate, because by doing so they can reduce costs.  It is for this reason that fiscal conservatives support carbon pricing, like Reform founder and former leader Preston Manning who strongly supports putting a price on carbon.  Similarly, the Canadian Chamber of Commerce supports carbon pricing, having stated in December of 2018 that “when done right, carbon pricing can equip businesses for the transition to a lower-carbon economy, and reduce the overall regulatory burden.” 

Despite assertions to the contrary by Conservative politicians, a carbon tax/price on carbon has been demonstrated to be an effective means to reduce emissions. The Ecofiscal Commission was “formed by a group of experienced, policy-minded economists from across the country”, and conducts objective analyses on carbon pricing.  In a recent article (SIXPLACES Where Carbon Pricing is Working), Don Drummond and his co-authors stated that the carbon tax in British Columbia led to “Reduced gasoline use by at least 7% per capita over the first four years.” Don Drummond is hardly a left-wing radical, having earlier in his career served as Chief Economist and Senior Vice President of the Toronto-Dominion Bank.

Conservative politicians lie about the impact of a carbon tax/carbon pricing on jobs and the economy, when they tell us that the “economy will tank”.  Our common sense can be applied to refute this lie.  The Trudeau government carbon tax returns the great majority of the revenue to individuals via the rebate.  When money is returned to people, particularly those on the lower end of the economic spectrum, they will generally spend it.  And how does that spending of money impact the economy?  Of course, it creates jobs.  Subject to how a carbon tax is designed, there will be a variable number of lost jobs. But because jobs will also be gained, one must determine the net impact.  When one looks at British Columbia, which has had a carbon tax since July of 2008, one finds that BC’s Gross Domestic Product between 2009 and 2018 increased by 29.26%, second only to Alberta’s increase of 29.41%.  In the Ecofiscal Commission article “10 MYTHS About Carbon Pricingin Canada”, the authors stated “Analysis of British Columbia’s carbon tax suggests it led to a 2% increase in the total number of jobs in the province between 2007 and 2013—an average of 5,000 jobs per year (Yamazaki, 2017)” 

The carbon tax is effective because it rewards good behaviour (reductions in emissions) and penalizes bad behaviour (increases in emissions or a disregard for emissions).  In the fall of 2018, while discussing the harvest, a local farmer/professional man told me that a lot of farmers were out on the land practising “recreational tillage." In other words, there was no need to till but they were still out there tilling, perhaps out of habit.  This is the kind of bad behaviour that a carbon tax/carbon pricing should attempt to penalize.

I could go on relative to the lies perpetuated by Conservative politicians, but you get the picture. 
While Conservative politicians lie about climate change, it is also clear that those who support the Conservative Party of Canada generally do not believe that global warming is real, or believe that it is not caused by humans.  This provides further evidence as to why Conservative politicians lie, as they align with the views of their base.  A 2018 Angus Reid survey found that only 35% of past Conservative voters believed that climate change was real and caused by humans.  35% of these Conservative voters believed that climate change was happening but was mostly caused by natural changes, and 21% believed that climate change was a still unproven theory. 

There are a number of moral aspects to the global warming issue.  By any independent analysis, Canada is an extremely rich country and Canadians are generally very well off when compared to people from other countries.  We are lucky and blessed in many ways, simply by having had the good fortune to be born in Canada or to have immigrated to Canada.  And within Canada, people in some provinces are extremely well off (e.g., in Alberta, where wages continue to be high and taxes low, despite the downturn in the oil and gas industry).  Why is it, when we are generally so well off, and particularly so among old ‘white’ men like me, that we are often so greedy?  We certainly can’t take it with us.  At the same time, many Canadians who are among the wealthiest people in the world ignore the effects of climate change on the young and the Indigenous.  

It is immoral for well off Canadians to ignore how climate change will impact on our Nation’s children and grandchildren.  No wonder we observe a disconnect between older generations and the young on this matter.  It is immoral for well off Canadians to ignore the effects of climate change on the culture, health, and welfare of the Indigenous.  While the wealth of Canada and other rich Nations is due in very large part to the extraction and use of fossil fuels, it is often the poorest of Nations that will suffer the consequences of our contribution to climate change, despite their often insignificant contributions to the problem.  For example, Island Nations like Kiribati and Tuvalu are expected to be severely damaged by the rising ocean levels and altered storms that result from climate change.  Indeed, islands have already been lost, including one in Kiribati where a village once thrived. Canadians can just say ‘bad luck' as Conservative politicians demonstrate by their words and actions (e.g., some of the cutbacks in Scheer’s election platform), or we can take responsibility for our actions.  As it is rich Nations like Canada that are primarily responsible for the problem, it is immoral for Canadians to not address climate change so as to minimize its effects on these Nations, and to not support the adaptation measures that can help them continue to exist. 

There is a fundamental religious element to the response of Canadians to global warming.  Religions across the spectrum, including those of Christians, incorporate a responsibility for stewardship of the earth. This stewardship focus and the social justice aspects are why many religions and religious leaders strongly endorse the need to combat global warming. For example, see Interfaith Power & Light.

Climate has changed in the past.  But it has never changed at the extremely fast rate that we are observing today.  Biological scientists are so concerned respecting the impact of climate change on the extinction rate of species because, among other reasons, mammals, birds, and other species will have relatively little time to adapt.  The extinction rate will increase and species distribution will change.  For example, a recent study predicted that blueberries, sweetgrass, and Labrador tea will be almost eliminated from southern Manitoba by 2071-2100, and that the core distribution of white birch will be considerably changed.  

A recent issue of the scientific journal Nature noted that, while Canada contributes some 2% of the global greenhouse gases, most importantly Canada is the tenth largest contributor among countries. And Canadians, at an average of 15.3 tonnes CO2 per capita, are the third highest contributors of greenhouse gases in the world, after Saudi Arabia and the United States. It is not debatable that our great wealth and very high standard of living are due to the very high per capita past and current levels of greenhouse gas emissions by Canadian families and businesses. If Canadians, who are among the very wealthiest in the world, cannot do their share to address their contribution to climate change, who can?  Should we make the poor pay for a problem largely created by wealthy countries like Canada?    

How do the federal parties stack up in terms of their platforms on addressing climate change?  The Conservative Party of Canada Climate Plan was evasive in that it did not provide how much less CO2 would result from the Plan, or what the cost would be. Consequently, in their examination of the Conservative Plan,EnviroEconomics and Clean Prosperity had to make a number of assumptions.  The assessment found that the Conservative Plan “would increase emissions by 9.1 Mt in 2022, relative to the current and announced measures being planned by the federal and provincial governments, as described in the most recent “additional measures” scenario from Environment and Climate Change Canada.  The Plan would have a net cost of $3.8 billion by 2022 accounting for savings from removing existing measures including the carbon tax in benchmark provinces (regulatory charge) and the Clean Fuel Standard.  This translates into a cost of $295 per household in Canadian provinces and territories that currently have the federal carbon tax.”.  The main carbon-reducing component of the Plan, by far, is to use tax credits to fund energy conservation measures like energy efficient windows and more insulation.  The assessment estimated that this would cost $439 per tonne of CO2 Compare this to the $46 per tonne of CO2 for the Liberal carbon tax.  So we observe, for this measure, that the Conservative Plan would cost about 10 times as much per tonne of CO2 as the carbon tax that Scheer and other Conservative politicians rail against.  And where will the money for this inefficient Conservative measure come from? … you guessed it … your tax dollars.  Again, this is part of the Scheer/Conservative Party of Canada lie on carbon pricing, in that the Conservative Plan did not include carbon emission effects and costing, because doing so would have demonstrated that the Plan was not cost-effective.  Under the Conservative Plan, industry would be allowed to emit more CO2, with emissions increasing by 0.83 Mt (megatonnes) for industries that emit 10 kt (kilotonnes) or more per year.  

It is also important to consider whether we can trust Scheer and the Conservative’s on this.  I suggest that we cannot, because I remember that Prime Minister Harper promised to regulate the oil and gas sector in 2007 (under a minority government) and then went back on his commitment in 2014 (when he had a majority).  The Conservative Plan also proposes to decrease emissions by funding the development of new technology, where the private sector would be expected to provide more than double the contribution by Canada.  While certainly of value, there is nothing new here, as this is the type of policy that climate change ditherers always trot out … to some extent, it is the “no worries, be happy” approach that assumes we will invent our way out of the problem.  The technological solution has been proposed for decades, and we find ourselves in a much worse condition today.  Although today’s technology can be applied to address climate change, the assessment attributed a decrease of 2.48 Mt to the measure, while stating “we give the Plan the benefit of the doubt”.  The assessment noted that this type of measure has been demonstrated to be a poor means to reduce emissions, in terms of cost-effectiveness.  The report stated “This abatement cost is high relative to other policies; a recent comparison of the cost-effectiveness of various policy levers designed to incent innovation and technology diffusion ranks R&D subsidies low”.  The assessment estimated the cost of this measure at $272 per tonne CO2 The final component of the Conservative Plan that might measurably reduce greenhouse gases is its Green Construction Options component.  The assessment estimated that this measure would reduce emissions by 1 Mt of CO2 via an increase in the use of low-carbon cement; however, the authors also stated “the Plan is not clear on the policy approach to incent usage of low emitting cement”.  In other words, the Conservative Plan indicates that it will reduce emissions without demonstrating how it will do so.  That is not a plan, rather it is simply a goal and just more Conservative ‘smoke and mirrors’.   Other elements of the Conservative Plan are very questionable, and are addressed within the assessment.  The Conservative Plan is very costly (e.g., $439 and $272 per tonne of CO2 for the two measures that would result in 11.50 Mt, or 92%, of the reduction in emissions).  Compare this to two already existing and in the works measures of the Liberal government that the Conservatives would eliminate (i.e., $46 per tonne of CO2 for the carbon tax and $142 per tonne of CO2 for the Clean Fuel Standard, which collectively would reduce emissions by 20.81 Mt).  The Conservative Plan would eliminate cost-effective measures and replace them with high cost measures.  The bottom line is that the Conservative’s Plan will cost the average Canadian household far more to achieve far less (e.g., for 2022, a cost of an extra $295 per household excepting for Quebec, BC, and Newfoundland where it would be an extra $187 per household).

Climate atmospheric scientist Katherine Hayhoe (Texas Tech University) and energy and environmental economist Andrew Leach (University of Alberta) recently evaluated the plans of four federal parties.The Conservative Plan was assessed as “What’s missing: Policies likely to lead to actual emission reductions” and “Grade: D for ambition, F for feasibility.”  These two experts wrote “its actual substance is vague.  Very vague.  There are some bold promises about how this plan gives Canada the “best chance” at meeting the Paris targets, but there’s not much evidence to back that up.  In fact, they’ve been so shy to make commitments that they’re not included on the graph above.”, “You might think you know what Scheer’s plan is: cut the carbon tax. But that’s not quite true.  His plan has one, it’s just hidden.  For large emitters, the plan sets emissions limits and forces them to invest a certain amount (How much? No one knows!) for any emissions above that (also unknown) limit.  Other aspects of the plan come directly from the Harper government, such as credits for transit passes and home renovations.  But both of these policies are relatively expensive per tonne of carbon reduced“, and “Economist Marc Jaccard concluded that, by getting rid of the current carbon pricing system and replacing it with largely optional incentives, the CPC plan is more likely to increase Canada’s carbon emissions than decrease them.”  By any objective evaluation, it is clear that the Conservative Plan and rhetoric on the Plan continues the Conservative politician’s practice of misinformation, deception, and lies.  For their evaluation of the plans of the other parties, Hayhoe and Leach graded ambition at B to A+, and feasibility at D to A.   

Our choice on the environment and climate change is a critical consideration in our federal election.  For those who care about the environment that we leave to our children and grandchildren, it is clearly anyone but Conservative.

Dan Soprovich, Swan River

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