Caught in a carbon tax loop
I suppose we have to talk about the carbon tax … again. Again and again.
The one mercy screenwriters typically extend their groundhog victims is amnesia. The audience suffers but the character wakes innocently again and again. No such mercy for us. We reawaken to Act 1, Scene 1 each time to a set a bit more scorched, the need for action ever more urgent. And yet we know we’re acting out the same script for the umpteenth time.
Our embattled prime minister says it amazes him that after “three failed elections in row by the Conservatives,” they still want to fight another one over carbon taxes. The PM’s surf buddies in Tofino could tell him the vortex has been spinning much longer.
Out on the West Coast, B.C. has had a carbon tax since 2008, brought in by the right-wingers back in the days when Schwarzeneggerian conservatism was a thing. The lefties fought it, campaigning in 2009 under the banner — you can only thump your forehead — “Axe the Tax.” The provincial NDP promised not only to terminate the carbon tax but to put a freeze on renewable energy projects as well. And the lefties lost. But the next leader of the right-wing party froze the carbon tax anyway. But then it was reanimated by the NDP (c’mon, please keep up).
It was exhausting. Eventually, the main parties agreed to depoliticize the whole thing and let the carbon price putter along. Until this week. Thanks to an impulsive Thursday afternoon in Ottawa, the right-wing party in Victoria is now attacking its own policy legacy. Again.
The history has been only slightly less convoluted in other provinces. Alberta agreed to have one in return for a pipeline. Then killed it (but notably not the pipeline). Now it has one again because of the feds. Ontario had cap-and-trade. That got cut and tossed (at great expense). Now it has the federal backstop, too.
Conservative premiers fought the feds with stickers on gas pumps. They fought in the court of public opinion. They fought to the Supreme Court of Canada. Carbon tax appeasement doomed the last federal Conservative leader. The number of federal elections is tough to gauge — do we count Stephan Dion’s Green Shift in 2008?
But there is one thing truly new this time round. Never before has the proponent simply handed the knife to their opponent. In a reckless, impetuous reversal, Justin Trudeau conceded the ground of affordability when cost of living is voters’ top concern.
Just days before, ministers were vowing there would be no carveouts from the carbon price. Then, suddenly, a hastily assembled late afternoon press conference. The Atlantic Liberal MPs — very notably only the Atlantic MPs — arrayed behind the prime minister. The ministers in charge were glaringly absent while the prime minister proceeded to peel the carbon tax off heating oil in order to “lower energy bills for Canadians.”
That’s the sound a furnace makes when vapourizing seven years of arguing about rebates (“climate action incentives”) that were said to combat climate change while leaving all but the richest better off.
Others heard something louder. “This is the sound a dying government makes,” according to David Moscrop.
Trudeau could have simply offered financial assistance to households using heating oil. He might even have tapped the fossil industry’s absurd profits to pay for it. Instead, he capitulated to Pierre Poilievre’s “Axe the Tax” demagoguery. Ken McDonald is the Liberal MP from Newfoundland and Labrador who has been breaking ranks to vote with the Conservatives against the carbon tax on home heating. He credits Trudeau and Chrystia Freeland for making the carveout happen over the objections from MPs from other parts of the country and ministers like Steven Guilbeault.
The government acted so rashly, it seems not to have anticipated the blowback from across the country. Why don’t other forms of heating get the same consideration? Aren’t other citizens suffering the same affordability crisis? Why don’t other provinces get programs for free heat pumps?
With one impulsive move, Trudeau catalyzed the extraordinary — Alberta’s Danielle Smith and Rachel Notley suddenly have common ground, as do Jagmeet Singh and Poilievre. The federal NDP says it will vote with the Conservatives on a motion to exempt “all forms of home heating." The House of Commons will vote on Monday. It’s a non-binding motion but will very likely express the hallowed will of Parliament.
Almost every politician west of the Atlantic provinces is fuming, and understandably so. The BC NDP is visibly angry about the lack of inclusion. Doug Ford wants a carveout for Ontarians. Saskatchewan’s Scott Moe says his province will stop collecting the carbon tax unless there are similar carveouts for natural gas customers. He’s got the support of the provincial NDP.
“The carbon tax is dead,” laments Trevor Tombe, a professor of economics and a carbon tax supporter. “It all unravels from here” is the widespread view among economists who have been championing carbon pricing as the most “efficient” way to cut greenhouse gas emissions.
You don’t have to be so confident about your own crystal ball to make one prediction — winter is coming. People will be pissed about heating bills.
Trudeau says there will “absolutely not” be any more carveouts. The purity of carbon pricing will not be compromised any further.
In fact, there are a number of carveouts already. Farm fuel has an exemption. Fishers have an exemption. Quebec’s pricing system magically carves in many millions of credits from California. About 80 per cent of oil and gas production is carved out.