Economic competition spurs innovation, productivity and growth. But now Canada appears to have joined a global pilot project to show how competition can lead us toward the end of civilization as we know it. Hyperbolic? We won’t know until it’s too late. This conversation is about carbon and we open with a dramatic statement to be sure everyone is paying attention. The stakes could not be higher.
Carbon energy created our modern world with all its glories and conflicts. Whatever else you want to say about the world, more people are living better today than at any previous point in history. But we are purchasing this success from the future, filling the skies with carbon effluent that is dangerously warming the planet.
It doesn’t make any difference where the carbon is extracted nor where it is turned to energy and dumped into the air. Within weeks a carbon molecule emitted in China might be over Saskatchewan and so forth. The time to fix the roof is when the sun is shining, the great Christine Lagarde likes to say. What she means is when the economy is strong, as ours is today, is the time to pay the price to repair problems. The challenge for our global roof is that it increasingly resembles a greenhouse trapping that sunshine.
A global problem like this can only be repaired with a global solution. No one country or corporation or organization can impose that solution. Even if they could, that’s not the post-carbon world most Canadians, or anyone else who believes in democracy and freedom, would want to live in. The only democratic solution is global cooperation. Everyone on earth contributes, so our grandchildren in Vancouver and the Maritimes (or Bangladesh and Miami) won't need scuba gear to go to school.
Two and a half years ago in Paris the world agreed to do something. Virtually every country committed to curbing carbon. Even then, some scientists and environmentalists feared the reductions would be too little too late. But at least the world was going in the right direction.
It’s very hard to say that today. Canada, Australia and, of course, the United States are all in retreat. Give President Trump credit. He at least is transparent. His administration’s proposal to undo President Obama’s clean power plan actually acknowledged it would increase deaths. Sadly, that dramatically understates the scale of what’s going wrong.
To see that in full force, turn to Ottawa. Transparent would not be the word to describe the Trudeau government's decision to water down its carbon tax. The changes were posted on a ministry website as a “technical backgrounder.” Oh, come on, the fate of the earth deserves better.
It's hard not to have some sympathy for the Prime Minister and his team. In Australia, Prime Minister Turnbull completely withdrew a carbon plan in the face of opposition on his right stoked by the powerful coal industry (Australia is the world’s largest exporter of coal, by far). In the United States, Trump has declared an end to “the war on beautiful, clean coal.” Electric utilities are to be given more room to run coal plants longer. In other words, neither Australia nor The USA is willing to accept costs in the present to reduce damage to the future.
Economists generally agree that a carbon tax (or fee if you hate taxes) is the most efficient and market friendly way to take those costs we are currently dumping on the future and pay them in the present. Ottawa bravely offered a plan to do just that. But the courage seems to be seeping away. The revised plan says industries at “competitive risk,” such as cement and steel, will be treated more leniently to avoid “carbon leakage.” That’s a phrase worthy of George Orwell. Carbon leakage means packing up your plant and moving to somewhere more carbon friendly, like say America, or, Australia, or China.
“After two years of saying that a carbon tax would not affect Canada’s competitiveness and hurt our economy, the federal government just admitted that it actually will,” the premier of Saskatchewan, Scott Moe, tweeted. “They have announced they will now reduce the amount of tax companies are required to pay on their greenhouse gas emissions.”
That’s just the point. The Prime Minister finds himself trapped between domestic economic concerns and a global race to the economic bottom. This is what is known as a leadership moment.
The fate of the earth deserves better. #cdnpoli
Retreat is the wrong answer politically and substantively.
But how to make others face their responsibility, too? First, don’t be sneaky. Be straightforward. The world can’t afford not to curb carbon. Say so. Then speak to President Trump in the only language he knows. The deal. Make a carbon emission plan part of NAFTA. That will at least curb “carbon leakage” across North America.
Then we need to address the whole world. The General Assembly meets next month.
Canada has been a beacon of economic stability and progressive values for the last few years. Fair play is one of those values. The world respects us for it. We need to demand more than the vague promises of the Paris climate accord. The world needs a level economic playing field in which one country’s willingness to pay the real price to protect the future from carbon isn’t used by predators to steal economic advantage today.