Climate change is a big problem requiring varied and well planned solutions. One of these will be a carbon tax. It can be a simple market device to affect consumption. If carbon emissions have been over produced or under costed, then adding a tax onto carbon will make it more expensive and that will bring down production. This is how a tax designed to affect behaviour works. In BC, this is going to happen by taxing fuel, first just a little bit, but then gradually ramping up over time. This rising revenue stream will be offset by a reduction in income taxes.
By making carbon more expensive, there will be choices and opportunities created. As a consumer, I can decide to properly insulate my house to reduce fuel costs, for example. Corporations can gain a competitive advantage by reducing their carbon emissions. Old and carbon intensive processes will be either phased out or priced out of the market.
These kinds of changes won’t happen overnight, and they shouldn’t. Rapid and sudden changes can be particularly destructive and if they are not necessary, they should be avoided for the undue suffering they cause . If carbon emissions slowly and steadily become more expensive, the economy will be allowed to adjust at a measured pace and wrenching changes kept to a minimum. This is the plan put out by Premier Campbell and the Liberals of BC. It appears the public is onboard, although we’ll find out for sure at the next provincial election.
On the federal level, Dion is going to be releasing his own carbon tax, no doubt based on and inspired by Campbell’s initiative. Harper and the Conservatives are already bashing it through attack ads. You can read more about this here. I urge Dion to stick to his guns and take the higher ground on this by ignoring the politics around this issue. I believe Canadians are ready and willing to tackle the problem of climate change and carbon emissions. If that awareness is there, then the Conservatives will look rather silly and out of touch with the voters on this issue, forcing them to either get on board or to get out of the way.
Canadians have been known to accept difficult measures in the past in order to deal with big problems. The budgetary deficits and public debt problem of the 90’s is a good and recent example. At the time, there was talk of Canada slipping into third world financial problems. Chretien’s Liberals slashed spending and raised taxes to deal with the deficit. Typically unpopular moves, but they saw re election and the last majority governments in this country because the public was on board and ready to accept tough medicine. Canada is once again faced with a big problem, a problem this time shared by all countries, and we are ready to step up and move forward on carbon emissions. The federal Liberals led by Stephane Dion have an opportunity to do a great thing for this country and the world by honestly addressing this problem.
June 11, 2008 at 1:57 pm |
Here speaks the next Mark Jaccard. Go Matt. Hope you get to take some environmental economics electives next year. Did you know Jaccard started his career as a commercial fisherman?
June 12, 2008 at 6:16 am |
I saw Dion once defending his new tax on TV. At the time he looked like he had just copied another kid’s homework assignment (BC’s carbon tax), and he didn’t actually know what that kid had done. Which as far as my limited economics brain stretches, was a shifting of value. The ‘Tax’ is a tool, and not the thing for people to focus on, and I think this is where Dion is messing up.
You know, it will be great when words like Carbon and The Environment are no longer needed to be used politically for any sort of ‘Green Imaging’ . You can imagine how for the next 100 years, if something isn’t done immediately, everything is going to have organic, friendly, free-range, or green in the title of it..from Economic polcies to cereal boxes. I look forward to whent hings can go back to normal and the ‘Green’ part is already understood and known and is the standard…and we don’t have to have it waived at us like a flag anymore…
It would be better to call the tax: Dion’s Copycat Tax. And everyone can know it is a copy of Campbell’s ‘Finally, Lets At Least Try And Do Something Smart Tax’…and the environmental branding is dropped, because it shouldn’t actually be the focus. The shift in value, the end goal, the vision should be the focus…and not the tax.
It will be nice when intelligent valuation of the environment can be embedded in the economic policies without this need to claim to be an environmental piece of policy.
Everyone is an environmentalist. Lets move on. Lets let go of this ‘need to be seen as green’ box, and actually get down to business and generate more value, and actually come out and say this is what we are doing!
I think this is where Dion is missing the point and inviting lots of criticism. He’s all scared to be looking like he’s doing the right thing, but doesn’t understand how to unwaveringly communicate the meat of the issue through all the opposition, and so is inviting the thing he claims to be opposing.
I think he is ‘IN The Box’ as they say
for readings on ‘being in the box’, please see ‘Leadership and Self-Deception’ by the Arbinger Institute and you will see how ‘In the Box’ I am while writing this…cause for me to see myself as being an ‘out of the box kind of a guy’…I need people like Dion in my life.
June 12, 2008 at 7:26 am |
Mike, I think you’ve described perfectly the problem Dion has in communicating his ideas. Hopefully he can drum up some conviction, because ultimately, what has he got to lose? If things don’t turn out for him and the Liberals at the next election, he’ll be turfed for sure.