IS A CARBON TAX A GOOD IDEA?

There must be a federal election by October 2009, sooner if the Harper government were to fall on a confidence motion in the Commons.

In most federal elections there is no big issue. In fact the major parties dive for the centre ground so that, in fact, there is not that much difference in the party platforms. Most Canadian voters, I venture to guess, make their decision on the basis of their view of the leaders. Are they trustworthy, honest, competent, comfortable in their skins? Charisma is not a factor in contemporary elections in Canada since no leader has much of it.

There hasn’t been a big issue in a federal contest since the free trade election of 1988. Could the next federal election be decided on a big issue? Could be. The issue is called a carbon tax.

The rationale behind a carbon tax is fairly simple: that we should tax less the things we want more of – work, savings, investments – and tax more the things we want less of, like greenhouse gases. The intention of a carbon tax is environmental, to reduce emissions of carbon dioxide and so slow global warming. Such a tax can be implemented by taxing the burning of fossil fuels – coal, petroleum products such as gasoline, aviation fuel and natural gas – in proportion to their carbon content.

This direct taxation is transparent. It can be popular with the public if it is revenue neutral i.e. if the revenue from the tax is returned by reducing other taxes.

Could a carbon tax become the big issue in the next federal election? Indeed it could. And the man who could make it one is Liberal leader Stephane Dion. He is thinking of putting a carbon tax at the centre of the next Liberal platform.

Dion has been encouraged by British Columbia Premier Gordon Campbell’s groundbreaking introduction of a carbon tax earlier this year, a tax that has been well received by B.C. voters.

Mr. Dion has promised that his carbon tax would be revenue-neutral, raising about $16-billion which would be returned to middle-class and working Canadians through tax cuts.

A former Dion advisor says the Liberal leader should be bold: “Make it a Canadian version of Roosevelt’s New Deal.”

A poll just out today indicates that 72 per cent of Canadians think a carbon tax is a positive step.

Do you agree that a carbon tax is a positive step?

Or do you believe a carbon tax would hurt the economy and lead to loss of jobs?

Do you think the Liberals could win a general election promoting a carbon tax?

17 Comments »

  1. 1
    jim Says:

    Look, the only item I’d trust with a politician is my mother-in-law. Did you ever read that the federal income tax, early in the 20th century, was only temporary? What should be done right now is to eliminate the taxes on fuel oil deliveries to homes.

  2. 2
    Tony Kondaks Says:

    I think there should be an anti-carbon tax to discourage the move away from carbon-dioxide producing fuels.

    Since carbon dioxide is GOOD for making plants grow, this should be encouraged because to reduce its presense in the atmosphere at this juncture in history when the price of crops is going up would be criminal to the poor people of the world who are really being hurt by demand pressure on supplies.

    Speaking of the poor of the world, I am wondering how Al Gore sleeps at night these days knowing that his completely fatuous and fantastical notion of catastrophic man-made global warming is causing and will cause the deaths of thousands and probably millions of the world’s poor. I’m speaking of course of policies such as the misplaced corn-into-ethanol programs which are in part responsible for shortages in basic food staples which, in turn, drive the price of this and other food commodities up. Such programs find their inspiration in and are justified by policy-makers by the catastrophic man-made global warming cult.

    And let’s call it a cult because that is precisely what this “the debate is over” movement has become. And it is time to hold ALL those responsible for perpetuating this sham and the horrors it is already reaping and will continue to reap onto the carpet.

    It’s high time for a reworking of that ditty from the anti-war movement of the ’60s…you know, the one about LBJ:

    “Al Gore Junior, Al Gore Junior. How many babies have you killed today?”

  3. 3
    Chimera Says:

    No more taxes, dammit!

    The best way to encourage people to change their habits and behavior is to provide incentives toward that change, not penalties for refusing to change.

    In other words, more carrot, less stick. And much better education about the entire process.

    “Since carbon dioxide is GOOD for making plants grow, this should be encouraged…”

    Tony, you’re tipping the balance. There is a concept known as “too much of a good thing.” Too much carbon dioxide makes the oceans acidic, which kills that which lives in the oceans. Including plankton, which has more to do with oxygen production for the world than all the plants growing on land. Kill the plankton, reduce the oxygen, bye-bye life on earth.

    The debate is not over, obviously. Not until people pay better attention to the chain reaction effects of every little thing they do that adversely effects the living conditions of plants and animals all over the world.

  4. 4
    Joe Agnost Says:

    “Do you think the Liberals could win a general election promoting a carbon tax?”

    No, I think they’d get blown out of the water! It wouldn’t even be close!

    I don’t care how many polls suggest that canadians support the idea – nobody is going to vote for a party running on the playform “I will raise your taxes!”. I know he ~claims~ it would be “revenue-neutral” but who believes a politician!! Didn’t cretin promise the GST would be temporary!?

    Another bad idea from the Dion camp… why is he still “leading” the liberals? It’s a car wreck!

  5. 5
    Paul Costopoulos Says:

    More than any other factors the real causes of food and fuel price rises are the shameless speculators who buy the basiscs, old back the supply until the price is right and release the goods when they can make a bundle regardless of consequences. They make big money and their backers cash in also. When are we going to have the guts to forbid speculation and jail the speculators for crimes against humanity?

  6. 6
    Jay Says:

    I don’t believe a carbon tax is the best option for Canada right now. We absolutely have to reduce emissions but I believe that the NDP plan for a cap and trade system that would regulate industrial emissions is where we need to start.

    Cap and trade is a combination of government regulation and market forces. First and foremost, unlike the Liberal plan, cap and trade has a hard cap on carbon emissions for industry. BTW – industrial carbon emission makes up over 50% of overall Canadian emissions. The trade part of the plan gives industries the ability to trade a certain number of emissions credits to help them stay below their caps. This will allow industries a certain amount of flexibility while they are re-tooling to more greener practices. Finally, if a corporation exceeds the cap, they will have to pay a penalty to the government. This is money which can then be used to offset some of the costs for increased transit, or rebate programs for green retrofitting for homes and businesses or for green cars.

    There are simply too many people (rural or seniors on fixed incomes or working class people) who will not be able to afford a carbon tax. I know that the Liberal Party has made some noise about revenue neutrality but how is a single mom who lives in the suburbs and works downtown supposed to deal with increased costs for gas, heating, lighting, food while trying to pay for daycare and everything else.

    Personal responsibility for our carbon footprint is necessary but can’t be made so difficult for the majority of Canadians that they simply cannot do it. From a political perspective it will force people to vote against environmental choices over economic necessity.

  7. 7
    Tony Kondaks Says:

    Paul: Commodity futures markets enable speculators to transfer risk away from producers and consumers of commodities — such as oil, corn, financial instruments, and precious medals — to themselves. This process provides a stability to our everyday economic life that otherwise wouldn’t be there. Without commodity markets, there would be chaos everytime you and I went to the market; one day a dozen oranges would cost $25.00 and the next 3 cents.

    Up until I applied for a commodities trading license in 1986 (I tried it as a job and did horribly at it, so I went on to other things), I simply could not understand how some speculator trading in Chicago could make millions trading something like soybeans when he had probably never even seen a soybean in his life, let along grow one. It all seemed like a scam in which greedy traders were profiting off the hard labour of the poor farmers who were the ones doing the real work.

    And then I actually had to take a course in the history of and purpose of futures trading and learned that, yes, although it is the greed of the speculator that lies behind his motivation to trade, it is this willingness on the part of the speculator to, say, risk buying a future contract for a barrel of oil at $24, that enables you and I to travel so cheaply by air.

    The above, in fact, is an actual example of a futures trade. Southwest Airlines was one of the only airlines to make money in the past decade: when oil was around $24 a barrel, they went to the futures market and bought their next 3 years worth of projected fuel supplies at that price. Then when the price of a barrel went throught the roof, they were still able to offer their low fares to their clients…and make money to boot…because they were paying the lowly cost of $24!

    It could only happen because someone was willing to sell them that futures contract at $24. That’s what speculators do — they take risk and uncertainly about unknown happenings in the future away from the producers and consumers of commodities. And that’s why their greed is so important for the smooth functioning of our economy.

    And it works even BETTER for farmers!

  8. 8

    Tony, bingo.

    It was to add liquidity to dying markets – I think back in the early 70s. Derivatives, though incomprehensible to many, is one of the great inventions of high finance. We always only want to look at the bad side of things (e.g. religion) but not the good. Farmers and speculators have both benefitted. Just don’t go into it blindly. How many times I’ve seen people get obliterated in the options markets thinking they had it “figured” out.

    I know people who just trade in commodities. It’s an art form I could never get.

    Chimera: you had me at no more taxes.

    Tax all you want to save the environment. It won’t do a darn thing. Not with the sun up there manipulating the clouds to hypnotize nature.

    Man has nothing on the sun, friends.

    I’ll tell you one thing, in my lifteime the Liberals never gave anything back to the people. By contrast, Harper sends me a cheque every month to which I gleefully deposit into an RESP for my daughter.

  9. 9
    Paul Costopoulos Says:

    Harper did not create baby bonuses nor family allowances.

  10. 10

    Jay:-

    Thank you for your clear explanation of cap and trade.

  11. 11

    Paul, what do you mean?

  12. 12
    Tony Kondaks Says:

    I just came across this website on an ad on the DrudgeReport and it is very apropos to our discussion today:

    CarbonBelchDay dot com …I am not putting the link in directly because Neil’s blog doesn’t post comments that have links in it, so you have to type it out in the address bar

    But it will be well worth it!

  13. 13
    Paul Costopoulos Says:

    Commentator, you seemed to attribute the paternity of the allowance that you get for your daughter to the Harper government. I just wished to point out that such allowances have been paid out for a long time before Harper re-announced them as though he had tought of them. When my own, now well grown up, children were young we had both federal and provincial allowances in Québec. They have since been made better, at least in Québec, to get people to have children again…and the statistics seem to indicate it works. If I remember well, at both levels of governmemnts, the first initiatives in this field were made under Liberal governments.

  14. 14

    Oh yeah. Historically, that’s true – just like the point you made about greed in the derivatives market. What I said was “during my lifetime.” I haven’t been around long for the record. I’m in my 30s.

    The Liberals did not give back to me – suprlus after famous suplus still nothing. A government my family has been loyal to (I tend to flip-flop for the record.)

    But Harper did.

  15. 15
    Paul Costopoulos Says:

    Well, Commentator, you my children’s age.

  16. 16

    Ah.

    Is that a good thing?

    I’m not sure anymore.

  17. 17

    The Carbon Tax is not the answer to reducing CO2 emissions on a national scale, and definitely on a global scale!! We at The Carbon Tax Myth believe that much hype and hysteria generated by politics and the media surround this debate, thus neglecting to acknowledge scientific proof and validity in the implementation of the tax!


RSS Feed for this entry

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: