Well written. What really concerns me is I have little to none affordable choices for heating and transportation in my small rural B.C. town where winter is real and summer is hot. I would happily switch to better affordable choices if they were within my reach. I would happily take the bus if it would take us to cancer treatments only available one town over if it had a schedule that would get us there on time and back. We are being punished for having no choice. It has become completely unacceptable
Except they actually dont want you to live in your small rural BC town.
They want you to have no choice but to move to Vancouver.
More efficient you see, because then you can take the EV bus to your cancer treatments instead of your evil gas guzzling ICE vehicle, plus it's generally warmer in Vancouver except when its not.
I'm sure it's more affordable for you there, assuming you choose to live on the street..
Not trying to be cruel - I sympathize with your plight - particularly the cancer.
Just trying to make a point of how our Ottawa-Montreal-Toronto big brains see you.
I'm a rural resident outside a small town in 'Berta. I get it.
We got a foot of wet heavy snow overnight, and it's still coming down until Sunday.
I'm happy about the snow, because we really need the moisture, however I understand it necessitates diesel powered snow removal that my taxes pay for, and a large 4x4 truck so I can realistically get to work on spring snow events like this one.
Reality in rural areas does not concern our elites.
Like our federal Environment Czar, they really do think we should all live in shoebox apartments in the city and take our bikes and public transit to work.
Oh, except for our Environment Czar and his colleagues.
They're exempt, you see, because leadership requires compromises.
CP, don't forget that they are exempt because the MUST use government supplied limousines. And they MUST use government supplied airplanes when going on vacation. And, and, and ....
Indeed. But consider this other example of "no choice".
I have several co-workers who used to bike to work because it let them avoid a second car payment, second insurance, gas etc. The road used to be quiet, so it was a good time after work AND they saved a lot of money for their family. (The money saving was the big reason)
Now the road is busier, drivers use cell phones and the city refuses to put up concrete barriers. My co-workers now have to pay for a second car because trusting their lives to paint with drivers checking their phones is stupid.
They have to DOUBLE their car costs because the city takes the attitude "trust your life to paint or buy a second car, you peasant".
Another example. When I was a kid I lived about 20 or 25 km from the French immersion school. It was a long bus ride, but the school provided it. Now my kids live less than 10km in the same area from a new French immersion school, but there's no school bus. The only route to the school involves a route so dangerous to bike or walk on, you'd wonder about my sanity if I did anything except act as my childrens' taxi driver.
Letting people have gasoline without a carbon tax is still going to see them punished for having no choice.
Letting people save money and reduce the cost of living has to involve more than just cutting the carbon tax.
Andrew, perhaps you live in a smaller community? Every large city in the country, where 80% of Canadians live, have invested in bike friendly infrastructure.
Smaller than Surrey for sure, but not exactly Fernie either.
The thing is... paint isn't infrastructure. Yes, there are good bike paths, but far too much "bike infrastructure" is just paint on the ground.
A "bike path" that involves being right up close to a pickup truck or an SUV travelling at 60kmph (or 80 or more) with a white line on the ground to keep you safe isn't a bike path. It's an invitation to suicide. (Or worse than suicide if it's your kids riding their bikes to school with trucks going by at 60kph)
Vehicles are a LOT bigger and heavier than they were when we were kids. There is more traffic. And drivers are a LOT more distracted. Everyone talks a big game about not checking their phones while driving, but we know that it's done. How many people think nothing of driving 60kmph through a residential zone because the limit is a rather crazy 50kmph which they read as +10, so it's really 60?
So given all that... how much "choice" do people really have? They're effectively forced to take on a second car payment, more gasoline costs, double the insurance.
Especially when it comes to their kids, they don't have a real choice.
But it's not just that. Sometimes it's just a lack of care. Sometimes a few jersey barriers would do the trick but I can't get city council to take it seriously. I wonder if they're making the perfect the enemy of the good and insisting that unless they have the money to put a $10 million bike separated bike path on every side street, they'll only have painted lines keeping that Ford F350 with the texting driver from crushing that 9-year old.
What I do know is that right now I know several streets where a few jersey barriers would make a huge difference and city council says it's a "great idea" (that's a direct quote) and does nothing as though they think it's someone else's job.
80% of Canadians live in metropolitan areas, but that’s very different from living in city cores where things are bikable. Toronto has invested a lot in bike lanes over the past ten years but most people don’t (can’t afford to) live near them. Most live in the “905” which is considered part of the Toronto urban agglomeration but is a very different story when it comes to transit and alternatives to driving.
It’s very clear to me that all of this obfuscation, messaging around how it’s actually a benefit, multiple economically-inefficient policies layered on top of the efficient tax, etc. — all of it — is because the simple strategy of asking people to sacrifice for a cause (like governments do during major wars, and the vast majority of people tighten their belts and do it) doesn’t work because the voting populace _doesn’t actually believe climate change is that urgent of an issue_. The supposed green momentum and consensus on action crumbled as soon as the tax had any real teeth that people could feel.
You can see it in revealed preference on how little people will make even minor lifestyle changes, and you can see it in the collapse of the global cooperation (UNFCCC process) as it becomes clear that China and India and the US will not be constraining energy use. People want a path of abundant clean energy to be able to consume like we do today, and they will punish political parties that try to constrain energy use prior to the availability of this abundant zero-carbon energy. This is not how voters treat issues that they genuinely care about (think of the leeway given to governments in March 2020! Not to mention real total wars, the last of which for Canada was maybe WW2.)
What scares me is that climate change is the ultimate coordination problem. It’s huge in time scale: sacrifice today mostly has benefits 50 years from now. No immediate payoff. And it’s huge in length scale: unlike cleaning up litter, the whole WORLD has to act in unison here. What if this problem is simply beyond the human capacity to coordinate over such length and time scales? Physics don’t care about our human operating system not being able to handle it. The world could get real bad before the nature of the threat is clear enough to make voters demand real action (and be willing to sacrifice).
Kill the tax for good. So long as the BRICs countries are pumping out their GHG in quantity we in Canada can do nothing to offset it. Why destroy our economy for the sake of virtue signally? Seriously!
Great article Jen. I actually preferred Rachel's Carbon Tax because she invested the proceeds in projects that reduced emissions. I'm not a fan of the "revenue neutral" approach, especially when it's subjected to political manipulation like the current federal tax.
Yes, it did become that. I support the original concept, not its final resting place. Carbon taxes seem to suffer in any government's hands to be poorly implemented.
There is a further disconnect between the CO2 Rebate not mentioned in the article. Most people get the rebate auto deposited to their accounts, they do not open cheque and see it at all, people who are already living hand to mouth do not even notice the extra money in they bank accounts, they only notice the money they are spending is more than it was.
Yes, this is apparently a huge problem! I've spoken to many people who say " I don't get the rebate" Many people think it's tied to income, which it isn't. As long as you filed your income tax return, your household will receive it.
The thing that is difficult for the pro-carbon tax crowd to understand is that nobody trusts what they are saying. All the fancy economic analysis falls on deaf ears because normal people smell a rat. And the normal people are right.
The stated goal of the economists is NOT to get us efficiently net zero, but to an "economically efficient" level of emissions. Stephen Gordon put it succinctly: "You don't have to completely abandon fossil fuels, just reduce your consumption of them."
You can dig into the government's calculations of the "social cost of carbon" (which informs the carbon price level) and discover a whole lot of complicated models that rest on faulty assumptions that aren't informed by climate science. Like, 2° isn't such a big deal, or indoor GDP is unaffected by climate, or agricultural production will probably increase because of more CO2 (assume no droughts).
But of course all of this goalpost shifting is glossed over with the insistence that the carbon tax is the "most efficient and effective" way to reduce emissions. They never define "efficient" or the level of emissions reduction. Just trust us, we've done all this complicated math. The model is too complex for the hoi polloi to comprehend. 200 experts.
A normal dummy can look at the policy and say "how is this supposed to get me to stop buying gas?" And they are correct. The policy is not supposed to do that. The politicians insist that this policy is going to save the climate, but it's actually not designed to do that. There's no actual empirical evidence that the policy works, it's all just theoretical models. Regular people aren't stupid, they can sense that none of this makes sense. And they don't trust anything that 200 experts say about it.
"There's no actual empirical evidence that the policy works, it's all just theoretical models."
Sweden has had a carbon tax for three decades, and during that same time period its emissions have steadily declined over most years. You cannot argue with proven results.
Sweden's carbon tax goes into general government revenues and helps fund clean electricity generation and industrial decarbonization projects.. The tax itself doesn't reduce emissions by any measurable amount through behaviour modification.
I was surprised to read when checking online that Swedes do consume a high quantity of electricity. So obviously their energy shift has been a major factor in emissions reductions, as you imply.
Yeah, they're talking about the business carbon tax. And there are a bunch of subsidies available to help the transition and deploy clean tech. There's a difference between influencing business investment decisions and changing household behaviour. For one thing, businesses don't vote. And businesses are used to investment: hey if the government is going to help finance this new efficient boiler and the cash flow is positive, I'll invest.
The Canada Greener Homes Grant was so popular that it ran out of money two years early. People want to do the green thing, but it has to make financial sense.
That's where the politics comes in. Who chooses who gets to be better off and who gets to be worse off? Who decides if efficiency should even be the goal? Who decides what "better off" means? Better off for whom and on what timeframe?
If one is making those sorts of decisions, that's not neutral science, that's politics. If one thinks that government spending on green stuff is icky, and sacrificing Prince Edward Island to the rising seas is a small price to pay, just make that argument without dressing it up in a bunch of complicated math.
It's articles like this that explain why I think women should be in charge of the planet. It's bloody brilliant. The 5000 year history of men being in charge just confirms it.
When you run, Jen, I'm moving to Calgary to vote for you. This is what leadership sounds like.
Regardless of the "worth" of the tax the fundamental difference between the CCTB (Canadian Child Tax Benefit) and the rest is that they are paid monthly. So they are a part of the daily life of those who need the money.
Rebates are just economic speak. For those that receive them they are just bonuses to look forward to spend a few more dollars on something. When you are living day to day quarterly payments are not usually saved to be doled out during each month they are used on things you might not be able to enjoy or afford. Monthly payments are more likely to be used to live.
The entire premise of the carbon tax misses the point. Changing peoples mindset through punishing taxes that echo across the chain whether you have hydro power and an electric car or natural gas furnace and a Chevy Corvette from 62. There is no distinction, and we all pay the price.
The other side to this so-called revenue neutral tax (like they used to describe the GST at one time) is that provides no evidence that in a country like ours with its size and difficulty to match promise to results that there is any ability by this government to do more than just use it as another revenue stream to dole out largesse's all the while patting themselves on the back for how good they are.
That is also why people are mad when they go to the pump and are seeing their costs skyrocket. But the economy was always going to be the issue. Inflation was always going to be a problem for this tax.
can I also add that we liked the CCTB because it went in the head-of-household's bank account?
I have 2 sons that get their 'rebate' when it is ME who pays for the car, the gas, the food, the home heating.... oh yes, the tax is an income redistribution - mine!
(before you ask, these sons are in university - I will not charge them rent, or tell them they have to give me their rebate checks)
I have a daughter who also gets this, also in university, also rent free. Though she does pay for the gas she uses in our vehicles because I think it's an important budget skill to learn. So I guess she technically is feeling a SMALL amount of the price of the tax, but not as much as she gets back in the rebate since we pay for her food, clothes, and shelter still.
The year the carbon tax/rebate scheme was introduced, there was a survey done (can''t recall by who) which basically asked Canadians if they thought "fighting climate change" was something the government should be prioritising - and virtually every respondent said YES!!
But then the followup question was asked: how much would you want to personally contribute in the way of taxes to make that happen, and the average response was something in the order of $100/year.
The Liberals were clearly not listening then, and they have continued to not listen ever since.
Exactly. Revealed preference shows how little people actually care about the threat. When voters genuinely care — like they did in March 2020 or they do when their country is invaded — they give governments wide latitude to enact whatever policies are required, they tighten their belts and sacrifice, and social cohesion goes up. Does it seem like any of this is true for the energy transition right now?
(Just to be clear: climate change IS a threat on the same scale as war or pandemic, it’s just a slow-motion catastrophe so it’s easier to hide our heads in the sand for a long time.)
Arguably the lesson of the pandemic is that cohesion is pretty short-lived, and there's only a short window where people ignore how costs and benefits are distributed. Support for restrictions dropped relatively quickly among the age groups least at risk and especially harmed in terms of education and employment. In a short-term crisis there is the luxury of ignoring the perception of fairness, but in a long-term one there isn't.
“Climate change is a threat comparable to war or pandemic“. Well maybe, but it really is not clear how big a threat it is. Not much that has happened so far seems to me to be very threatening and as for the distant future who knows. All we have are unvalidated computer models that seem to have trouble getting what has already happened right never mind what might happen in a hundred years. A poor basis for draconian policies in my opinion.
Perfect encapsulation of why climate action, and the carbon tax, is politically really hard right now. People think the threat is too far off. (They are wrong, and future generations will curse us for not taking action now, but you can see why drastic action now is politically impossible.)
As I said in another comment on this thread: What scares me is that climate change is the ultimate coordination problem. It’s huge in time scale: sacrifices made today have most of their benefit 50 years from now, for our grandkids. No immediate payoff. And it’s huge in geographic scale: unlike cleaning up litter that benefits your local community or smog that hurts your own city, the whole WORLD has to act in unison here. What if this problem is simply beyond the human capacity to coordinate over such length and time scales? That by the time we see how bad it is and finally make the required changes, it’s very late in the game?
If you believe that you can change the climate by paying a tax to a government in a country responsible for 1.5% of global emissions while India, China, and others are growing their emissions, you have a problem. If you believe further that the government will make you richer by returning the tax you paid, and then some, back to you, then you have a very big and perhaps insoluble problem.
A wonderful essay Jen, the one I have liked and agreed the most since joining The Line. Just the title says it all. Really sad that it is necessary to write it to point out all this nonsense of paying to get bribed with my own money, without any connection whatsoever to the behavior I am supposed to change. I totally agree with you that the double whammy of having to pay a carbon tax and also having all these regulations and subsidies at a terrible cost for the economy (what would make sense is to use the tax revenue to pay for those subsidies, instead of adding to the unsustainable government debt and causing inflation) is intuitively stupid, and I also totally agree on your perfect description of the anger I feel every time I get the rebate (and hell yes, my household gets back in rebates far more of what we pay in carbon tax)... It would be fantastic if Trudeau, Guilbeault and company read this article and change their ways, but that will never happen. Much better to get a new government, axe this tax, and start putting something together that really makes sense.
Well said. I always felt the idea of the rebate is counterintuitive if the goal is to change behaviour. The smart play would have been for the gov't to put a hold on the increase a YEAR AGO – to acknowledge inflationary pressure. Now, it's too late... and is going to lead to the death of the whole policy.
There's also the politics of expecting major sacrifice while (effectively) diluting it through population growth. This is another case where governments are not clear about goals. Emissions targets are not per capita, but it would be a hard sell to say out loud that the goal is to reduce emissions faster than a bigger population increases them.
Efficiency and honesty is one thing, but governments also need to more be serious about how many costs they are piling on simultaneously, even if theoretically those costs have long-term benefits. The benefits of population growth, at best, are quite long-term. (There's even the same spin of trying to insist right-thinking people would think it's costless.) A large population may be beneficial, but growth itself is expensive. How many big, expensive, effectively generational priorities can we afford?
When someone (the Liberals) is drowning, they don't stop to consider whether or not they should have bought a better boat so as not to sink against the rocks. They grab the life jacket, swim ashore and keep buying the same boat.
Jen, the last several paragraphs hit the issue bang on. If the government wanted to put in a highly visible, inflationary new tax like a carbon tax, then they should have tied it to reductions to GST, also a highly visible, inflationary tax.
And said new carbon tax should be tied to American tax policies. Mainly because if Canada goes alone we punish people without the market providing solutions. The very thing the carbon tax says it will do. But it doesn't, not if you have an open, trade dependent economy like Canada s. Tax carbon so people will switch cars. Right, except electric cars are more expensive and have poor range performance, and the market will not solve that for Canada. It will solve it when the US demands it. Force people to cut their home heating with fossil fuels. Right, my home has a natural gas furnace and a heat pump/AC. The furnace failed last January during our cold snap. Forced to rely on our heat pump. As the nighttime temps dropped below -20, the heat pump could barely keep the house above 14 degrees.
Finally, while industrial carbon taxes are good, all that money should be going back into R&D so we can figure out solutions. High level government R&D, the stuff that companies are not good at doing themselves. Most people and companies are not dumping carbon into the air because they are bad or just need a little nudge. They are doing it because there are no cost effective solutions to getting cheap, dense energy. If our carbon tax policy is not driving at this difficulty root cause, we are just generating frustration with voters and driving our businesses out of business.
Great analysis thanks! It is wealth redistribution. Loved your statement "And, the question we have totally forgotten to ask ourselves at every level of Canadian government: what concrete and measurable objectives are you hoping to accomplish by it?" In fact this government doesn't define measurable objectives (for any of their policies) so of course they can't measure objectives. It's insane that anyone buys into the carbon tax when their are NO MEASURABLE OBJECTIVES? The Liberals love to lecture and imply that only they know best by holding many media events with Trudeau way out front and multiple people including MPs head bobbing agreement much further away in the background who apparently have no spines. I'm amused that this government thinks one of their main problems in communication. No it's your lameless leader Trudeau, it's your musical chairs of cabinet ministers, it's your failed policies and never being able to say you made a mistake to course correct, it's the constant lecturing, it's the over spending baby etc etc! It's turning Canada into a failing country where even youth born and educated in Canada are leaving or eager to leave this country. This country is on a very disturbing path.
One of the problems is that the measurable objective of the carbon tax side (as opposed to the rebate side) is reducing Canadian emissions. That’s fairly measurable, although the real objective is to reduce them compared to what they would otherwise have been, which is not quite as visible as reducing them compared to historical numbers.
But anyway, WHY are we reducing emissions? Because reducing global emissions is beneficial (or desperately vital, depending on one’s temperament) in limiting bad climate outcomes that would otherwise get even worse. The Liberals love to say their policies are stopping all of these bad enviro outcomes. But there is a highly uncertain missing step in the logic: what is the relationship between Canada reducing emissions, and reducing global emissions?
Trudeau wants us to take a Boy Scout view — we must do our share (or a little more than our share) just `cuz. Or he wants to skip that step, as if reducing Canada’s emissions ipso facto causes big reductions in global emissions, leading directly to better climate outcomes. But it’s not that simple. The world does not await Canada’s bold moral leadership, and adjust global policy in response. The arguments against being a free rider on climate are complicated and indirect, like the arguments against being a free rider on defense (which Trudeau finds singularly unpersuasive in the case of defense FWIW).
Maybe we should do a little now, but not altruistically over achieve, because China will take our voluntary steps as the baseline when it comes time for the really hard bargaining to get Chinese and Indian emissions down. Maybe there’s some reason we’re better off to be super aggressive up front. But this is the real debate, and the Libs are deeply committed to not having it.
Well written. What really concerns me is I have little to none affordable choices for heating and transportation in my small rural B.C. town where winter is real and summer is hot. I would happily switch to better affordable choices if they were within my reach. I would happily take the bus if it would take us to cancer treatments only available one town over if it had a schedule that would get us there on time and back. We are being punished for having no choice. It has become completely unacceptable
Except they actually dont want you to live in your small rural BC town.
They want you to have no choice but to move to Vancouver.
More efficient you see, because then you can take the EV bus to your cancer treatments instead of your evil gas guzzling ICE vehicle, plus it's generally warmer in Vancouver except when its not.
I'm sure it's more affordable for you there, assuming you choose to live on the street..
Not trying to be cruel - I sympathize with your plight - particularly the cancer.
Just trying to make a point of how our Ottawa-Montreal-Toronto big brains see you.
I'm a rural resident outside a small town in 'Berta. I get it.
We got a foot of wet heavy snow overnight, and it's still coming down until Sunday.
I'm happy about the snow, because we really need the moisture, however I understand it necessitates diesel powered snow removal that my taxes pay for, and a large 4x4 truck so I can realistically get to work on spring snow events like this one.
Reality in rural areas does not concern our elites.
Like our federal Environment Czar, they really do think we should all live in shoebox apartments in the city and take our bikes and public transit to work.
Oh, except for our Environment Czar and his colleagues.
They're exempt, you see, because leadership requires compromises.
CP, don't forget that they are exempt because the MUST use government supplied limousines. And they MUST use government supplied airplanes when going on vacation. And, and, and ....
> We are being punished for having no choice.
Indeed. But consider this other example of "no choice".
I have several co-workers who used to bike to work because it let them avoid a second car payment, second insurance, gas etc. The road used to be quiet, so it was a good time after work AND they saved a lot of money for their family. (The money saving was the big reason)
Now the road is busier, drivers use cell phones and the city refuses to put up concrete barriers. My co-workers now have to pay for a second car because trusting their lives to paint with drivers checking their phones is stupid.
They have to DOUBLE their car costs because the city takes the attitude "trust your life to paint or buy a second car, you peasant".
Another example. When I was a kid I lived about 20 or 25 km from the French immersion school. It was a long bus ride, but the school provided it. Now my kids live less than 10km in the same area from a new French immersion school, but there's no school bus. The only route to the school involves a route so dangerous to bike or walk on, you'd wonder about my sanity if I did anything except act as my childrens' taxi driver.
Letting people have gasoline without a carbon tax is still going to see them punished for having no choice.
Letting people save money and reduce the cost of living has to involve more than just cutting the carbon tax.
Andrew, perhaps you live in a smaller community? Every large city in the country, where 80% of Canadians live, have invested in bike friendly infrastructure.
Smaller than Surrey for sure, but not exactly Fernie either.
The thing is... paint isn't infrastructure. Yes, there are good bike paths, but far too much "bike infrastructure" is just paint on the ground.
A "bike path" that involves being right up close to a pickup truck or an SUV travelling at 60kmph (or 80 or more) with a white line on the ground to keep you safe isn't a bike path. It's an invitation to suicide. (Or worse than suicide if it's your kids riding their bikes to school with trucks going by at 60kph)
Vehicles are a LOT bigger and heavier than they were when we were kids. There is more traffic. And drivers are a LOT more distracted. Everyone talks a big game about not checking their phones while driving, but we know that it's done. How many people think nothing of driving 60kmph through a residential zone because the limit is a rather crazy 50kmph which they read as +10, so it's really 60?
So given all that... how much "choice" do people really have? They're effectively forced to take on a second car payment, more gasoline costs, double the insurance.
Especially when it comes to their kids, they don't have a real choice.
One more thing I'd like to add.
Yes, money is an issue.
But it's not just that. Sometimes it's just a lack of care. Sometimes a few jersey barriers would do the trick but I can't get city council to take it seriously. I wonder if they're making the perfect the enemy of the good and insisting that unless they have the money to put a $10 million bike separated bike path on every side street, they'll only have painted lines keeping that Ford F350 with the texting driver from crushing that 9-year old.
What I do know is that right now I know several streets where a few jersey barriers would make a huge difference and city council says it's a "great idea" (that's a direct quote) and does nothing as though they think it's someone else's job.
80% of Canadians live in metropolitan areas, but that’s very different from living in city cores where things are bikable. Toronto has invested a lot in bike lanes over the past ten years but most people don’t (can’t afford to) live near them. Most live in the “905” which is considered part of the Toronto urban agglomeration but is a very different story when it comes to transit and alternatives to driving.
It’s very clear to me that all of this obfuscation, messaging around how it’s actually a benefit, multiple economically-inefficient policies layered on top of the efficient tax, etc. — all of it — is because the simple strategy of asking people to sacrifice for a cause (like governments do during major wars, and the vast majority of people tighten their belts and do it) doesn’t work because the voting populace _doesn’t actually believe climate change is that urgent of an issue_. The supposed green momentum and consensus on action crumbled as soon as the tax had any real teeth that people could feel.
You can see it in revealed preference on how little people will make even minor lifestyle changes, and you can see it in the collapse of the global cooperation (UNFCCC process) as it becomes clear that China and India and the US will not be constraining energy use. People want a path of abundant clean energy to be able to consume like we do today, and they will punish political parties that try to constrain energy use prior to the availability of this abundant zero-carbon energy. This is not how voters treat issues that they genuinely care about (think of the leeway given to governments in March 2020! Not to mention real total wars, the last of which for Canada was maybe WW2.)
What scares me is that climate change is the ultimate coordination problem. It’s huge in time scale: sacrifice today mostly has benefits 50 years from now. No immediate payoff. And it’s huge in length scale: unlike cleaning up litter, the whole WORLD has to act in unison here. What if this problem is simply beyond the human capacity to coordinate over such length and time scales? Physics don’t care about our human operating system not being able to handle it. The world could get real bad before the nature of the threat is clear enough to make voters demand real action (and be willing to sacrifice).
In other words, they have No Idea What They Are Doing. The Liberals used to have good grownups. They need to step up and restore adult supervision.
Peter, please allow me to rephrase your last sentence to, "They need to STEP DOWN and restore adult supervision."
Kill the tax for good. So long as the BRICs countries are pumping out their GHG in quantity we in Canada can do nothing to offset it. Why destroy our economy for the sake of virtue signally? Seriously!
Why? Because we are bad people and we deserve to suffer.
Is that a cheeky comment or a statement of fact?
It is an admission by Bill of his complicity in "badness." Not business but "badness."
Great article Jen. I actually preferred Rachel's Carbon Tax because she invested the proceeds in projects that reduced emissions. I'm not a fan of the "revenue neutral" approach, especially when it's subjected to political manipulation like the current federal tax.
HANG ON A SECOND!!!!
https://calgaryherald.com/business/energy/alberta-budget-2018-alberta-to-use-carbon-tax-money-to-balance-its-books-expects-surplus-by-2023
"Rachel's Carbon Tax" became nothing but a failing attempt to rein in a terrifying accumulation of debt.
Yes, it did become that. I support the original concept, not its final resting place. Carbon taxes seem to suffer in any government's hands to be poorly implemented.
Perhaps because the anticipated increase in revenues from "good green jobs" and the "clean energy economy" never materialize?
There is a further disconnect between the CO2 Rebate not mentioned in the article. Most people get the rebate auto deposited to their accounts, they do not open cheque and see it at all, people who are already living hand to mouth do not even notice the extra money in they bank accounts, they only notice the money they are spending is more than it was.
Yes, this is apparently a huge problem! I've spoken to many people who say " I don't get the rebate" Many people think it's tied to income, which it isn't. As long as you filed your income tax return, your household will receive it.
I still get cheques from them, I don’t like the auto deposit, I prefer the cheque.
But the only time I noticed that in small type it said CLIMATE ACTION or something that pointed to the Carbon Rebate.
The thing that is difficult for the pro-carbon tax crowd to understand is that nobody trusts what they are saying. All the fancy economic analysis falls on deaf ears because normal people smell a rat. And the normal people are right.
The stated goal of the economists is NOT to get us efficiently net zero, but to an "economically efficient" level of emissions. Stephen Gordon put it succinctly: "You don't have to completely abandon fossil fuels, just reduce your consumption of them."
https://worthwhile.typepad.com/worthwhile_canadian_initi/2019/01/marginalists.html
You can dig into the government's calculations of the "social cost of carbon" (which informs the carbon price level) and discover a whole lot of complicated models that rest on faulty assumptions that aren't informed by climate science. Like, 2° isn't such a big deal, or indoor GDP is unaffected by climate, or agricultural production will probably increase because of more CO2 (assume no droughts).
But of course all of this goalpost shifting is glossed over with the insistence that the carbon tax is the "most efficient and effective" way to reduce emissions. They never define "efficient" or the level of emissions reduction. Just trust us, we've done all this complicated math. The model is too complex for the hoi polloi to comprehend. 200 experts.
A normal dummy can look at the policy and say "how is this supposed to get me to stop buying gas?" And they are correct. The policy is not supposed to do that. The politicians insist that this policy is going to save the climate, but it's actually not designed to do that. There's no actual empirical evidence that the policy works, it's all just theoretical models. Regular people aren't stupid, they can sense that none of this makes sense. And they don't trust anything that 200 experts say about it.
"There's no actual empirical evidence that the policy works, it's all just theoretical models."
Sweden has had a carbon tax for three decades, and during that same time period its emissions have steadily declined over most years. You cannot argue with proven results.
Sweden's carbon tax goes into general government revenues and helps fund clean electricity generation and industrial decarbonization projects.. The tax itself doesn't reduce emissions by any measurable amount through behaviour modification.
I was surprised to read when checking online that Swedes do consume a high quantity of electricity. So obviously their energy shift has been a major factor in emissions reductions, as you imply.
However, a third of the Swedish emissions reductions are attributed to the tax: https://www.hhs.se/en/houseoffinance/research/featured-topics/2024/carbon-pricing-significantly-reduces-carbon-emissions/ Transportation emissions specifically declined as a result.
Yeah, they're talking about the business carbon tax. And there are a bunch of subsidies available to help the transition and deploy clean tech. There's a difference between influencing business investment decisions and changing household behaviour. For one thing, businesses don't vote. And businesses are used to investment: hey if the government is going to help finance this new efficient boiler and the cash flow is positive, I'll invest.
The Canada Greener Homes Grant was so popular that it ran out of money two years early. People want to do the green thing, but it has to make financial sense.
S
Exactly.
Basically, an allocation is efficient if it's not possible to make one person better off without making another person worse off.
Another way of putting it is that if an allocation is inefficient, it's possible to rearrange things to make everyone better off.
Inefficient outcomes are wasteful. Economists don't like waste.
https://en.wikipedia.org/wiki/Pareto_efficiency
Hope this helps
How do you square "inefficient outcomes are wasteful and economists don't like waste" with the carbon tax's special subsidy for rural Canadians?
That's where the politics comes in. Who chooses who gets to be better off and who gets to be worse off? Who decides if efficiency should even be the goal? Who decides what "better off" means? Better off for whom and on what timeframe?
If one is making those sorts of decisions, that's not neutral science, that's politics. If one thinks that government spending on green stuff is icky, and sacrificing Prince Edward Island to the rising seas is a small price to pay, just make that argument without dressing it up in a bunch of complicated math.
It's articles like this that explain why I think women should be in charge of the planet. It's bloody brilliant. The 5000 year history of men being in charge just confirms it.
When you run, Jen, I'm moving to Calgary to vote for you. This is what leadership sounds like.
I understand my role in the political marketplace. It's this, not that. JG
I wouldn't want their job either. But you have a gift.
But Jennifer, you would be so GOOD at that. You know, the old, not suffering fools gladly, and so forth. And there are a lot of fools about.
Regardless of the "worth" of the tax the fundamental difference between the CCTB (Canadian Child Tax Benefit) and the rest is that they are paid monthly. So they are a part of the daily life of those who need the money.
Rebates are just economic speak. For those that receive them they are just bonuses to look forward to spend a few more dollars on something. When you are living day to day quarterly payments are not usually saved to be doled out during each month they are used on things you might not be able to enjoy or afford. Monthly payments are more likely to be used to live.
The entire premise of the carbon tax misses the point. Changing peoples mindset through punishing taxes that echo across the chain whether you have hydro power and an electric car or natural gas furnace and a Chevy Corvette from 62. There is no distinction, and we all pay the price.
The other side to this so-called revenue neutral tax (like they used to describe the GST at one time) is that provides no evidence that in a country like ours with its size and difficulty to match promise to results that there is any ability by this government to do more than just use it as another revenue stream to dole out largesse's all the while patting themselves on the back for how good they are.
That is also why people are mad when they go to the pump and are seeing their costs skyrocket. But the economy was always going to be the issue. Inflation was always going to be a problem for this tax.
can I also add that we liked the CCTB because it went in the head-of-household's bank account?
I have 2 sons that get their 'rebate' when it is ME who pays for the car, the gas, the food, the home heating.... oh yes, the tax is an income redistribution - mine!
(before you ask, these sons are in university - I will not charge them rent, or tell them they have to give me their rebate checks)
I have a daughter who also gets this, also in university, also rent free. Though she does pay for the gas she uses in our vehicles because I think it's an important budget skill to learn. So I guess she technically is feeling a SMALL amount of the price of the tax, but not as much as she gets back in the rebate since we pay for her food, clothes, and shelter still.
The year the carbon tax/rebate scheme was introduced, there was a survey done (can''t recall by who) which basically asked Canadians if they thought "fighting climate change" was something the government should be prioritising - and virtually every respondent said YES!!
But then the followup question was asked: how much would you want to personally contribute in the way of taxes to make that happen, and the average response was something in the order of $100/year.
The Liberals were clearly not listening then, and they have continued to not listen ever since.
Bang on article, Jen!
Exactly. Revealed preference shows how little people actually care about the threat. When voters genuinely care — like they did in March 2020 or they do when their country is invaded — they give governments wide latitude to enact whatever policies are required, they tighten their belts and sacrifice, and social cohesion goes up. Does it seem like any of this is true for the energy transition right now?
(Just to be clear: climate change IS a threat on the same scale as war or pandemic, it’s just a slow-motion catastrophe so it’s easier to hide our heads in the sand for a long time.)
Arguably the lesson of the pandemic is that cohesion is pretty short-lived, and there's only a short window where people ignore how costs and benefits are distributed. Support for restrictions dropped relatively quickly among the age groups least at risk and especially harmed in terms of education and employment. In a short-term crisis there is the luxury of ignoring the perception of fairness, but in a long-term one there isn't.
“Climate change is a threat comparable to war or pandemic“. Well maybe, but it really is not clear how big a threat it is. Not much that has happened so far seems to me to be very threatening and as for the distant future who knows. All we have are unvalidated computer models that seem to have trouble getting what has already happened right never mind what might happen in a hundred years. A poor basis for draconian policies in my opinion.
Perfect encapsulation of why climate action, and the carbon tax, is politically really hard right now. People think the threat is too far off. (They are wrong, and future generations will curse us for not taking action now, but you can see why drastic action now is politically impossible.)
As I said in another comment on this thread: What scares me is that climate change is the ultimate coordination problem. It’s huge in time scale: sacrifices made today have most of their benefit 50 years from now, for our grandkids. No immediate payoff. And it’s huge in geographic scale: unlike cleaning up litter that benefits your local community or smog that hurts your own city, the whole WORLD has to act in unison here. What if this problem is simply beyond the human capacity to coordinate over such length and time scales? That by the time we see how bad it is and finally make the required changes, it’s very late in the game?
If you believe that you can change the climate by paying a tax to a government in a country responsible for 1.5% of global emissions while India, China, and others are growing their emissions, you have a problem. If you believe further that the government will make you richer by returning the tax you paid, and then some, back to you, then you have a very big and perhaps insoluble problem.
A wonderful essay Jen, the one I have liked and agreed the most since joining The Line. Just the title says it all. Really sad that it is necessary to write it to point out all this nonsense of paying to get bribed with my own money, without any connection whatsoever to the behavior I am supposed to change. I totally agree with you that the double whammy of having to pay a carbon tax and also having all these regulations and subsidies at a terrible cost for the economy (what would make sense is to use the tax revenue to pay for those subsidies, instead of adding to the unsustainable government debt and causing inflation) is intuitively stupid, and I also totally agree on your perfect description of the anger I feel every time I get the rebate (and hell yes, my household gets back in rebates far more of what we pay in carbon tax)... It would be fantastic if Trudeau, Guilbeault and company read this article and change their ways, but that will never happen. Much better to get a new government, axe this tax, and start putting something together that really makes sense.
Well said. I always felt the idea of the rebate is counterintuitive if the goal is to change behaviour. The smart play would have been for the gov't to put a hold on the increase a YEAR AGO – to acknowledge inflationary pressure. Now, it's too late... and is going to lead to the death of the whole policy.
There's also the politics of expecting major sacrifice while (effectively) diluting it through population growth. This is another case where governments are not clear about goals. Emissions targets are not per capita, but it would be a hard sell to say out loud that the goal is to reduce emissions faster than a bigger population increases them.
Efficiency and honesty is one thing, but governments also need to more be serious about how many costs they are piling on simultaneously, even if theoretically those costs have long-term benefits. The benefits of population growth, at best, are quite long-term. (There's even the same spin of trying to insist right-thinking people would think it's costless.) A large population may be beneficial, but growth itself is expensive. How many big, expensive, effectively generational priorities can we afford?
Ah, honesty ....
There ain't no honesty with this group of government thinkers / dunces.
When someone (the Liberals) is drowning, they don't stop to consider whether or not they should have bought a better boat so as not to sink against the rocks. They grab the life jacket, swim ashore and keep buying the same boat.
Jen, the last several paragraphs hit the issue bang on. If the government wanted to put in a highly visible, inflationary new tax like a carbon tax, then they should have tied it to reductions to GST, also a highly visible, inflationary tax.
And said new carbon tax should be tied to American tax policies. Mainly because if Canada goes alone we punish people without the market providing solutions. The very thing the carbon tax says it will do. But it doesn't, not if you have an open, trade dependent economy like Canada s. Tax carbon so people will switch cars. Right, except electric cars are more expensive and have poor range performance, and the market will not solve that for Canada. It will solve it when the US demands it. Force people to cut their home heating with fossil fuels. Right, my home has a natural gas furnace and a heat pump/AC. The furnace failed last January during our cold snap. Forced to rely on our heat pump. As the nighttime temps dropped below -20, the heat pump could barely keep the house above 14 degrees.
Finally, while industrial carbon taxes are good, all that money should be going back into R&D so we can figure out solutions. High level government R&D, the stuff that companies are not good at doing themselves. Most people and companies are not dumping carbon into the air because they are bad or just need a little nudge. They are doing it because there are no cost effective solutions to getting cheap, dense energy. If our carbon tax policy is not driving at this difficulty root cause, we are just generating frustration with voters and driving our businesses out of business.
I come here for common sense. Thanks for that small dose. I see none whatsoever from our government.
Great analysis thanks! It is wealth redistribution. Loved your statement "And, the question we have totally forgotten to ask ourselves at every level of Canadian government: what concrete and measurable objectives are you hoping to accomplish by it?" In fact this government doesn't define measurable objectives (for any of their policies) so of course they can't measure objectives. It's insane that anyone buys into the carbon tax when their are NO MEASURABLE OBJECTIVES? The Liberals love to lecture and imply that only they know best by holding many media events with Trudeau way out front and multiple people including MPs head bobbing agreement much further away in the background who apparently have no spines. I'm amused that this government thinks one of their main problems in communication. No it's your lameless leader Trudeau, it's your musical chairs of cabinet ministers, it's your failed policies and never being able to say you made a mistake to course correct, it's the constant lecturing, it's the over spending baby etc etc! It's turning Canada into a failing country where even youth born and educated in Canada are leaving or eager to leave this country. This country is on a very disturbing path.
One of the problems is that the measurable objective of the carbon tax side (as opposed to the rebate side) is reducing Canadian emissions. That’s fairly measurable, although the real objective is to reduce them compared to what they would otherwise have been, which is not quite as visible as reducing them compared to historical numbers.
But anyway, WHY are we reducing emissions? Because reducing global emissions is beneficial (or desperately vital, depending on one’s temperament) in limiting bad climate outcomes that would otherwise get even worse. The Liberals love to say their policies are stopping all of these bad enviro outcomes. But there is a highly uncertain missing step in the logic: what is the relationship between Canada reducing emissions, and reducing global emissions?
Trudeau wants us to take a Boy Scout view — we must do our share (or a little more than our share) just `cuz. Or he wants to skip that step, as if reducing Canada’s emissions ipso facto causes big reductions in global emissions, leading directly to better climate outcomes. But it’s not that simple. The world does not await Canada’s bold moral leadership, and adjust global policy in response. The arguments against being a free rider on climate are complicated and indirect, like the arguments against being a free rider on defense (which Trudeau finds singularly unpersuasive in the case of defense FWIW).
Maybe we should do a little now, but not altruistically over achieve, because China will take our voluntary steps as the baseline when it comes time for the really hard bargaining to get Chinese and Indian emissions down. Maybe there’s some reason we’re better off to be super aggressive up front. But this is the real debate, and the Libs are deeply committed to not having it.