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Carbon scheme’s cost: “brownouts, high fuel taxes and lost jobs”


 

I refer, of course, to the Conservative carbon scheme. My source is Jack Mintz, the noted Communist leftard economist, writing in that biased MSM rag, the National Post.

To be fair, Mintz (whose piece a month ago has probably not received enough attention; at least, until this morning, it hadn’t received any from me) says the brownouts, layoffs and massive terrifying Gotham-style chaos “could” be a result of the Conservatives’ carbon policy, Turning the Corner. “Could” because it depends on (a) the Conservatives actually following their plan (b) large emitting corporations reaching into their own backsides and failing to fish out the large quantities of horseshoes that would give them the luck they need to avoid nasty side effects.

If the Conservatives follow their policy and the oil patch’s luck is only fair, then things get really nasty really fast.

Saith the Mintz: “both the Liberal and Conservative plans” are “complex and highly interventionist in the economy.” The Tory plan’s emissions intensity targets kick in fast, by 2010; companies — for the plan applies only to companies, increasing their burden by giving you and me a break — can buy their way out by “contributing,” under criminal penalty, to a technology fund, which Mintz calls “essentially an earmarked tax.”

Oops, did I say the Conservative plan gives you and me a break? I forgot my Andrew Coyne: There are no corporations, only individuals. “The effect of the plan will largely fall on consumers and businesses purchasing energy-intensive products,” Mintz writes. “The Conservatives have not been straightforward” — I know this will surprise and sadden many of you — because the costs incurred “must result in higher consumer prices or lost jobs.”

Which is where we get to brownouts, job losses, dogs and cats living together, and so on. Onerous early targets and insufficient offsets would lead to the above-delineated unpleasantness.

“Given these uncertainties,” Mintz writes, “many U.S. and Canadian businesses prefer a carbon tax.” Like Dion’s? It has much to recommend it in his view — but it’s not regionally neutral enough, because cost is incurred in one part of the country and benefits enjoyed elsewhere. That’s because Dion chose to pay for child tax benefits and anti-poverty programs with the carbon tax’s windfall, instead of putting revenues back into green effort through clean-energy tax credits.

Indeed, that’s what makes Mintz conclude that the Liberal plan is, in some ways, “weaker than the Conservative plan” because the Conservatives’ is “more directed at reducing carbon.”

But but but. The Conservatives can’t have it both ways: their plan is only stronger than the Liberals’ if it is applied in such a way as to impose onerous deadlines and real costs on emitters. So they can’t claim their plan is tougher at the same time as they complain about the costs of Dion’s.

Of course, when I use phrases like “can’t have it both ways” and “they can’t claim,” I mean they certainly will claim and they probably can have it both ways. This is the evolving John Baird Two-Step, which the minister has rehearsed in a few interviews this summer: Why put up with the nasty cost of the Liberal tax scheme, when you can have the much tougher, more responsible Conservative plan instead?

It’s a profoundly disingenuous argument. I sure wouldn’t want to have to campaign against it.


 

Carbon scheme’s cost: “brownouts, high fuel taxes and lost jobs”

  1. Fascinating. Especially since it hasn’t been all that hard to buy into the Liberal argument that the Conservative plan is entirely toothless… Disingenousness abound, no?

  2. Well, that’s the thing, no? It’s either toothless or really rough. But since the Conservatives can argue, with a straight face, that it’s full of teeth but not rough at all, surely there’s a Liberal somewhere who can argue that it’s toothless AND painful — that the Conservatives are plotting (secretly, natch) to gum the Canadian economy to death. How hard can that be?

  3. I think the Conservatives have learned the lesson of the GST. A hidden tax is much easier to sell than a plainly visible one. It probably makes way more sense politically to go with regulation followed by a cap-and-trade (once the US gets organized) just because individual consumers don’t really know what the price increase would be beforehand and you can claim your political opponents are fear-mongering when they attack you over it.

  4. So, you’re saying there is no Santa Claus?

    Given all the “If X then A, and if Y then B” in so many proposed programs from the major parties, I suddenly feel like come election time I should just flip a coin. Either that, or just vote for the party whose platform I generally like least, on the presumption that the spin and the reality are likely to be pretty much polar opposites.

    I don’t suppose the argument that if the Tories actually do what they say they’re going to do it’ll be much worse for the economy than the Liberal plan is going to hurt them much though. As you say, the Tory plan will only actually be this bad if they actually implement their plan. Raise your hand anyone who thinks ANY of the parties are going to actually do after the election what they say they’re going to do before it.

    Yeah. That’s what I figured.

  5. Bravo! It’s about time somebody decided to compare the two scheme’s. I’ve been suffering in silence as I listen to the Conservatives say they’re going after polluters whereas the Liberals will put a permanent tax everything and hurt joe-citizen.

    Who do think will pay for all the technology-hedging that’s been done in those emission reduction targets… billions of dollars for carbon capture and storage and some yet-to-be created pollution abatement technology? Private money won’t want to pay for that. What shareholder will allow those costs sit on a balance sheet eating into their dividends? No one will.

    Those costs will definitely be passed on to the consumer.

  6. Since the Mintz article of June 27th, the Alberta Gov’t has announced an investment fund of some $2 billion over a number of years for carbon capture and storage, and simultaneously at least one O&G company, Shell has announced a major project to capture carbon. So it is a bit dated.

    If one accepts CIBC’s Chief Economist Jeff Rubin’s often stated claim that the “world price for oil is floored at the marginal cost of production of the most expensive oil (that probably being Alberta oilsands)” then the carbon tax will be ultimately passed on to all world consumers of oil.

    In any event, with the price of oil at $125/barrel and Alberta Gov’t coffers overflowing, there is plenty of spare room before in this sector of the economy at least before we see brownouts or loss of employment as Mintz suggests.

  7. -It’s based on tentative and contradictory scientific evidence about climate trends.

    -It focuses on carbon dioxide, which is essential to life, rather than upon pollutants.

    -Implementing Kyoto will cripple the oil and gas industry, which is essential to the economies of Newfoundland, Nova Scotia, Saskatchewan, Alberta and British Columbia.

    -As the effects trickle through other industries, workers and consumers everywhere in Canada will lose.

    -Kyoto is essentially a socialist scheme to suck money out of wealth-producing nations

    Stephen Harper, 2002, on Kyoto Accord
    —————

    Economists rarely agree on anything, it seems to me, so I would want to see more analysis than this.

    However, if Harper/Cons are about to be hoisted on their own petard, I say good. What happened to the Harper of 2002? I wish he would return.

  8. Isn’t Mintz the architect (albeit indirectly) of Dion’s carbon tax and not the architect (albeit indirectly) of “turning the corner”?

  9. Good Catch.

    But how can the media have it both ways?

    Everyday we are told by the press that the CPC does not have a plan, that it will do nothing for the enviroment. I think the PPG jump the shark on Dion’s plan.

    It’s going to be interesting watching the liberals and Tories spin this issue.

    Anyway I hope non of these politicans try implment any of these crazy plans.

  10. Paul

    That Mintz article was referenced by Minister Baird during an appearance on QP. Baird used it too show that the Conservative plan was credible, not to mention it came from the same guy the Liberals were citing, in support of a carbon tax. The real kicker, and you used a partial quote:

    “The Conservatives have not been straightforward with John Baird, Minister of the Environment, indicating that only dirty big companies will bear the costs.”

    Am I the only one that finds it curious, John Baird reduced to pointing to an opinion piece which claims he has been dishonest with Canadians. If that doesn’t reek of desperation, I’m not sure what does.

  11. Admit that man made CO2 plays no role in climate change. Drop all plans for carbon tax or cap and trade. Lower trade barriers to the worlds 50 poorest economies. win my vote

  12. If we really were choosing between cap-and-trade and a carbon tax, I’d have to vote Liberal.

    I’m counting on the Tories lying through their teeth on the issue and not doing anything substantial, which is my preference.

  13. I’ve voted using similar calculations in the past, Ben…It’d be interesting to try to measure how often people vote for a party in the hope that it’s being disingenuous.

  14. My concern with the conservative plan is the regional investment plans that would be created. Why regional/provincial? How is this money going to be invested? Sounds like 10-12 slush funds for handing out money to friends.

  15. A quick observation: it’s not so much the Liberals plan that I’m against. It’s that the plan intended to help us all in our never ending quest of “being green” actually creates revenue for a yet to be revealed Liberal plan to bankroll social spending. Now I am a kind hearted grumpy voter: I’m all for social spending where necessary, but to create a plan that’s supposed to be about cleaning the environment and using significant chunks of the revenue generated to bankroll social programs, well, that’s just disingenuous. If the Liberals want to increase social spending, then at least be honest about it, that’s all. Don’t hide behind the almighty “green” and call it an enviro-tax when it really isn’t.

    As well, let’s assume there is no social spending component in this plan. Let’s assume the Liberals are being forthright and it’s all about being green. Given that Canada contributes less than 2% to global GHG’s, how can anyone honestly believe that reducing that 2% is going to do anything in the grand scheme of things? You have to be utterly deluded to believe that.

    I am a skeptic of anything that becomes so highly politicized because people tend to bunch themselves into “groupthink” enclaves where it’s no longer about the issue at hand and it’s all about controlling the definition of the issue. In this case, groupthink manifests in the form of climate change and anyone who questions conventional wisdom is branded a heretic.

    It’s no longer about the environment, folks. Big Suzuki is all about controlling the message and that’s why I am a skeptic.

    (I should add that the last time I looked, Canadians are still driving through gridlock on the Gardiner Expressway in their gas guzzling vehicles enroute to work and home each day – this after idling in line at the local Tim’s for ten minutes to get their double-double, along with jillions of other Canadians. Voters are a curious lot: we want to clean up the environment, yet our behaviors suggest that we too are disingenuous on that front.)

  16. Everyone is always talking about secret Liberal plans to grow government. I just want to know if there’s been a recent Conservative government that actually shrunk anything other than the G.S.T. (what a joke!)? I would love to vote for a real conservative, in the Burkeian sense… Find me one, and I’m there. Until then, I think I’ll stick to the other parties.

  17. Now why did Mintz have to go and muddy the situation? Why can’t we all just keep blindly assuming Harper hates the environment and Dion’s plan will kill the economy?

  18. A quick observation, Grumpy Voter hasn’t read the plan if he thinks that the social spending hasn’t been revealed. It’s all in there.

    What’s interesting about the plan is that it provides for both. We become more green because consumers will trend toward avoiding non-green products as their price rises. The money from that plan then goes to help those who are unable to avoid non-green products because their situation puts them at an economic disadvantage to begin with.

    Will reducing our 2% make a practical difference? Probably not of any significance, no. What it will do though, is give us the moral standing for when we speak with other countries to say “Hey, we’ve done this, we can help you.” It’ll also give us the financial incentive and therefore opportunity to develop our own “green” economies and thus be more prepared when a CO2 intensive lifestyle simply isn’t possible due to the price of fuel or because of the western nations becoming small players on the much bigger stage that is a developed South America, India, and China.

  19. Actually I’ve read the plan backward, forward and sideways. My point is that if Dion wanted to increase social spending, develop a SOCIAL SPENDING TAX and run on that – don’t try to piggy back a social spending tax grab under the guise of environmentalism. It’s insulting to anyone who doesn’t have to wear a helmet to pee.

    >>Will reducing our 2% make a practical difference? Probably not of any significance, no. What it will do though, is give us the moral standing for when we speak with other countries”<<

    Wow, you really believe that ANYONE gives a rat’s ass about what Canada thinks? When did anyone give a rat’s ass?

  20. This whole discussion on Carbon tax is like drunken sailors talking about derivatives. It’s a reflection of the calibre and intellence of the media at large. What we need is a good discussion based on the mechanics of each party’s carbon plan, the costs to the implicated parties (industry, individual tax payers), relative merits of each to the treasury, tax payer and the economy as a whole. Why doesn’t the Parliamentary Budget Officer weigh in on this.

  21. The Parliamentary Budget Officer should be telling the Canadians the relative costs of the Tory and Liberal carbon plans as well as the true cost of the war in Afghanistan. The cost of the war alone should put the budgetary balance in the red. Don’t expect Finance or Treasury Board bureaucrats to undertake financial analysis.

  22. No pain. No gain.
    Let’s bite the bullet and clean up this little
    gem of a planet!

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