Carbon

There has been plenty of fear mongering that Canada must follow U.S. President Trump’s corporate tax cut agenda or face economic devastation. Yet many of the experts, often those not working for corporate interests, agree on two things: there is no assurance and much skepticism that the broad cuts will lead to significantly greater economic competitiveness for the U.S in the long-term^1,2; and, there are much more effective levers to generate a competitive advantage for the Canadian economy than tax cuts³.

Now that Manitoba has joined Ontario and Saskatchewan in opposition to a carbon tax, what are the realistic political options for the federal government?  Economists overwhelmingly support carbon pricing as the most economically efficient way to reduce greenhouse gas emission and combat climate change. But should the federal government now just accept that Canadian conservatives have successfully framed it as a “job-killing tax” whose implementation will “hurt the economy”? Have Doug Ford, Andrew Scheer and other Conservatives been successful in nurturing the suspicion that carbon pricing is just another tax grab by government that will make “ordinary Canadians” worse off? Is the idea now politically dead?

TORONTO — Canada must ensure there are broader changes to our economy beyond carbon pricing alone if the country is to move toward a low-carbon economy, says a new report released today by the Mowat Centre and the Broadbent Institute.

The two think tanks say that in the lead-up to next month’s UN Conference on Climate Change in Paris, Canada’s new federal government must articulate a broad and clear agenda that recognizes climate change is a fundamental global threat demanding Canadian leadership.

Last week, Liberal leader Justin Trudeau appeared to back away from a national carbon price. He said some of the provinces have already implemented carbon pricing, so the federal government will be left to "oversee."

What Trudeau is actually saying isn’t quite clear, but it certainly seems like he is giving up on creating a national carbon price and leaving it to the provinces.

Premiers have been working on collaborative energy strategies in one form or another since 2007, and their energy conversation now looks like it’s poised to continue for another year. But despite its frequent appearance on the Council of the Federation’s agenda, it’s fair to ask why Canada needs a national strategy for energy at all.

Any kind of Canada-wide “strategy” risks sounding like more talk than action. And with Canada often described as an energy powerhouse — boasting not just the world’s third largest oil reserves but the world’s third largest hydropower generation capacity — what would a strategy add that we’re not already doing?