Joe Oliver tries to explain the farce

by Aaron Wherry

On Monday, Vancouver Sun columnist Craig McInnes criticized that the the Harper government’s “carbon tax” attacks on the NDP. Natural Resources Minister Joe Oliver has now responded in a letter to the editor.

I am disappointed your columnist Craig McInnes has fallen for NDP leader Thomas Mulcair’s carbon tax boondoggle.

Novel opening gambit.

His plan would raise more than $20 billion in tax revenues from carbon – so it is not inaccurate to label it a carbon tax.

“Not inaccurate” is an interesting turn of phrase. But as we have explained at various points, the reference to revenue is, by the government’s own logic, a red herring. The Conservatives have said that, in their current view, anything that establishes a price on carbon is equivalent to a carbon tax. Therefore, it simply doesn’t matter whether that price results in public revenue or private revenue.

That said, if you want to play along with the idea of government revenue as an important distinction, consider that when John Baird was championing his government intention’s to establish a price on carbon in 2008, he said that industries would pay into a “technology fund.” Here are the details of that proposed fund. Does that count as government revenue?

President Obama recently joined Prime Minister Harper in opposition to a cap and trade system, which Mr. Mulcair supports.

Not quite. President Obama’s press secretary ruled out the possibility of the White House proposing a “carbon tax.” But the President previously proposed a cap-and-trade system. His press secretary’s phrasing—”would”—leaves open the question of whether the President sees a distinction between a carbon tax and cap-and-trade or if, as the Harper government is now trying to argue, Mr. Obama believes the two options are equivalent.

Eminent economists like Jack Mintz say the NDP plan could raise gas prices by 10 cents a litre.

There was some debate during the last election campaign over the precise impact on gas prices, but it’s interesting to see Mr. Oliver defer to the expertise of Mr. Mintz. The eminent economist thinks a carbon tax is the best approach to reducing GHG emissions.

Canada’s trucking industry also came out against a carbon tax because it would raise prices on the goods they transport. Mulcair’s NDP’s carbon tax will raise the price of everything, including gas at the pump, groceries at the checkout counter and electricity in your home. We simply can’t afford Mulcair’s NDP.

The regulations Peter Kent announced earlier this week will raise the price of cars. The government’s regulations for the coal-fired electricity sector will raise the price of electricity. And the Conservatives still have to announce their regulations for the oil and gas sector.

By the way, I remain happy—eager, even—to sit down with Mr. Oliver or Mr. Kent to discuss all this at the earliest opportunity.

(For whatever it matters: Craig’s column referred to my writing on the subject, but I don’t believe Craig and I have ever met, spoken or otherwise interacted. If we have crossed paths at some point in the past—and I’m simply forgetting that—I can categorically say that we didn’t speak or interact in regards to his column before it was published.)

See previously: Peter Kent tries to explain the farce




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Joe Oliver tries to explain the farce

  1. Let’s not forget the federal excise tax on gas. It already has raised gasoline prices by 10 cents per litre. It is the Conservatives $20 BILLION Tax On Everything. It will hurt Canadians’ pocketbooks, raise prices on everything and bring our economy to ruin.
    Bill, still waiting for you to comment on the $20 BILLION carbon tax already implemented by the Conservatives.
    (other commenters: I post this only as everytime I’ve posted it, Bill keeps quiet. Enjoy your Bill-free thread, folks.)

    • Please show me where Harper introduced the Federal excise tax? You also forget that aside from excise tax there is also GST on fuel sales as well – any by the way when the Harper Government lowered the GST rate (this was an actual policy of the Harper
      Government unlike the excise tax) this had the effect of lowering a tax revenue
      on carbon – and yes, your pal Mulcair voted against that, however in fairness
      to Mulcair the NDP has at least been consistent in wanting to try and increase government tax revenues on Carbon, even if Wherry does try and hide that fact from
      Canadians.

      • Your pal Harper has been in power almost 7 years now. In 7 years he hasn’t rescinded the gas tax. If he opposed it, he’d rescind it. He hasn’t rescinded it, therefore he supports it. He’s taxing hard-working middle class Canadians $5 billion per year to pad government coffers. Look it up, federal gas tax is right in the budget. The very budget your pal Harper, Flaherty, and every single Conservative MP voted for. Mulcair voted against this $5 billion per year Conservative Tax On Everything that will surely bring our economy to ruin.
        Shame!
        P.S. you know I don’t support Mulcair, I’ve told you that explicitly before. The real question is why do you go to the lengths you do to support Harper and his Tax On Everything?

        • So by your logic, the HST, introduced by the Mulroney Conservative Government we can now suggest should be attributed to the Chrétien Liberals because they did NOT eliminate it (even though they of coursed
          promised to eliminate in the little red Liberal book of lies)

          Should we also attribute Free Trade to the Liberals because they didn’t cancel it ? Sorry, Matlock but clearly you and I have different views on Government policy creation.

          • Note…I meant GST and not HST….you can correctly argue that the Liberals created HST although according to your logic they apparently can be credited with GST as well by virtue of not eliminating it.

          • By my logic, the GST can be attributd to Mulroney, Chretien, Martin, AND Harper. None of them rescinded it. We should also attribute free trade to every prime minister that didn’t rescind it also.
            The simple truth is the $ 5 BILLION per year Conservative Tax On Everything is right there in the 2012 budget. I actually looked it up and viewed it first hand. Your buddy Harper, Flaherty and the entire Conservative caucus voted for this $5 BILLION tax grab that will pad government coffers and surely ruin our economy.
            Now Bill, if you want to drop the charade and have an honest discussion on carbon taxes vs cap-and-trade vs regulatory approach, I’d love to. In fact, weeks ago we started such a discussion. But if you plan on mindlessly bleating NDP “$21.5 BILLION carbon tax”, “it’s right there in their platform” umpteen million times on this blog, I’m going to mindlessly bleat “$20 BILLION Conservative Tax On Everything”, “it’s right there in the budget that Harper voted on”. The same crowd that is convinced by your mindless bleating will surely be convinced by mine also.
            Your move.

          • The difference of course is that there actually IS $ 21.5BILLION in proposed increased revenues on Carbon in the 2011 NDP Campaign platform. My point is that is a factually verifiable statement. Yes, absolutely one can debate the merits of it but trying to pretend it is a “lie” to reference what is factually accurate does not begin much of a discussion.

          • And you know what, it is a fact that there is $5 BILLION per year in the Conservative budget for carbon taxes, which amounts to a $20 BILLION Conservative Tax On Everything between now and the next election. My point is that is a factually verifiable statement. It’s in the budget. Forget proposed carbon taxes. I’m talking about already implemented carbon taxes. Trying to shift the discussion from the party in power today to the party not likely to gain power in 2015 does not change the fact that what I tell you is factually accurate.
            P.S. “lie” in quotes – who here used the word lie? Not I.

      • So…Harper could lower the GST [ which wasn't his tax either] but he can’t lower fuel taxes because he didn’t introduce them…IOWs, not his tax either…fascinating.

  2. What this post should really be titled is “Aaron Wherry defends Thomas Mulcair and proposed NDP Carbon revenue increases to Government ”

    I had to laugh at Wherry’s last paragraph…

    “For whatever it matters: Craig’s column referred to my writing on the subject, but I don’t
    believe Craig and I have ever met, spoken or otherwise interacted. If we have crossed paths at some point in the past—and I’m simply forgetting that—I can categorically say that we didn’t speak or interact in regards to his column before it was published.” – Aaron Wherry.

    Is Wherry so dense that he cannot figure out the reason why he was quoted ? There is no
    media member of the Parliamentary press gallery who has been more obsessed with
    defending the NDP proposed Carbon revenues then Wherry has. In fact I would submit there is no member of the Parliamentary Pres Gallery who has been more obsessed with promoting the NDP then Wheery has. Just like a good little union boy should.

    • Wherry is “defending the NDP proposed Carbon revenues”? How do you draw that conclusion? Please show me where Wherry introduced his support for the NDP carbon revenues.

      What Wherry is defending is truth in advertising. Since you’re already buying what CPC is selling, pride is possibly standing in the way of your capacity to process logic.

      • The simple truth is the $ 21.5 BILLION proposed by the NDP in new revenues on Carbon actually DID appear in the 2011 NDP campaign platform. I actually looked it up and viewed it firsthand. NDP media shills like Wherry try to spin,
        deflect and hide that fact from Canadians.

        • Still pretending that you don’t understand what the “carbon tax farce” refers to?

          That’s a sad way to live.

        • Odd. I never knew “Hey look, they’re doing this too” actually meant “We’re not doing this.”

        • Actually all he has done is point out the CPC once, and until quite recently, proposed the very same tax…price on carbon, whatever. One day you’ll get it…if you live long enough.

  3. If Mintz is correct, and the NDP plan raises gasoline prices by 10 cents per litre (disputed by others as being closer to 4 cents per litre) does anyone seriously think this will cause a significant shift in driving behaviour and hence lowering GHG emissions?

    • No, I seriously don’t believe an increase of gasoline prices will change driving behaviour. It may do so for a few days, but after that it would be business as usual.

      • I believe a price increase would, but somewhere in the neighbourhood of say 50 cents/l would be required to really get people’s attention (depending at where we are starting from).

      • Well, if you “believe” something that’s all the evidence I need that people will cut back their spending on groceries, clothing, housing, entertainment, vacations and/or retirement savings etc., in order to maintain their non-negotiable driving behaviour.

    • I said this to Francien yesterday and I’ll say it to you, my gut feel is I agree I don’t know if it will change driving behaviour, but it will change vehicle purchasing behaviour. It makes the cost benefit analysis of swtiching from SUV to hybrid SUV, or SUV to smaller crossover, midsize to compact, etc. that much more attractive.

      • Even at 4 – 10 cents/l?

        • It might enduce more people to switch to an alternative smaller vehicle in town at least. Of course that would be helped if insurance companies were more cooperative on second vehicles.[ not the case with ICBC]
          And for more remote areas, it has an effect on how often people take needless longer journeys.[ it's 12 hours in good conditions from my town to Edmonton...that's at least $25 to $ 50 more per round trip...not to mention one of the biggest costs drivers fuel wise around here is the amount of idling time in cold weather]
          Having said that i think rural Canada should if possible be except[ or rebated] any surcharge/tax on gas costs. It is in the cities that this battle will be won or lost surely?

          • Here’s one individual’s effort (found through google for gas price history) who has logged the price he paid for gasoline from 2000 – 2012 (includes a BC carbon tax in 2008 phased in which gradually increased to 7 cents per litre) http://climate.uvic.ca/people/ewiebe/gasoline_prices.php

            The price went from about 60 cents per litre to $1.30 (2012). I expect you experienced something similar wherever you are in Western Canada.

            So, anecdotally, have your driving habits changed significantly over this period? Bought a new vehicle for better fuel economy?

          • Yep. Bought a camper van that gets 10-12L per 100. Don’t know if i would have done it anyway, but it was a factor.
            I can’t honestly say it has reduced trips my family makes overall, but rising gas prices alone has meant economizing all around.[ less $ on food an accommodation along the way for instance.]
            We don’t burn less gas since our other van is a little better on gas, but you get the point. I see it isn’t hampering lots of ABs. 5th wheels galore down there come camping season.

  4. A question I am posing to the rest of the “peanut gallery” here (I’m not a made member of the Blocking/Ignoring twittering Economists).

    Coyne claims the “$36 Billion Car Tax” is in fact a tax. Tweet here and my questions below on the same thread https://twitter.com/acoyne/status/274188583177445376

    McInnes wrote in his piece:

    [The Conservative claim that a cap and trade is a carbon tax] is both nonsensical and destructive. It dumbs down a crucial environmental and economic debate that to be worthwhile requires a high level of understanding of complex issues.

    Back to vehicles. Having read some of the EPA report on CAFE standards, they are forecasting an average cost of improvements to vehicles (some are using $1800 by 2025) and a savings in fuel (say $900/yr). This indicates a +ve payback beyond 2 years ($1800/$900)

    So, is this in fact a tax? Maybe in the strictest sense using a narrow definition. If so, it is a negative one.

    Change the topic. Say I am off to get a free flu shot.

    1) Is this a benefit, a publicly funded insurance, or a tax?

    2) How about if it was made mandatory, but publicly funded? Tax now?

    3) How about mandatory, but required to be funded by the individual? Now, surely it is a tax. No?

    • It is really all about how one chooses to define what is or what is not a “carbon” tax.

      For example will Aaron Wheery as vigorously campaig that the new 2025 fuel efficiency regulations are just that – regulations and not a tax? After all, Wherry has demonstrated his own personal belief that stating something as a “carbon tax” is a farce (as long as it is from the NDP at least) Naturally we can assume Wherry will go to similar lengths to set the record straight on new fuel efficiency regulations as well. Or will Wherry do the same thing that he has criticized the Conservative’s for and label it as a tax ?

      Will Wherry be as keen to “set the record straight” when it comes to taxes on Carbon as he has been when the NDP proposes them ?

      • AW has linked to SGs blog and referenced Prof Leach’s blog numerous times. Both these economists have gone into the cost/benefits of regulating carbon vs market pricing at length. Why don’t you grow up and go read some of them, then come back[ if you must] and defend regulation via reasoned argument, rather then tediously,mindlessly dissing AW?

  5. From the Regulatory Impact Analysis Statement of the ARCHIVED — Passenger Automobile and Light Truck Greenhouse Gas Emission Regulations ,P.C. 2010-1162 September 23, 2010. The proposed new standards go further, but similar economics

    Business and consumer impacts: The Regulations are anticipated to increase the cost of manufacturing passenger automobiles and light trucks. These costs are expected to be passed on directly to consumers purchasing these vehicles, and will add an additional $89 to the average purchase price of a 2011 model year vehicle, and an additional $1,195 to the average purchase price of a 2016 model year vehicle (less than 5% of the average purchase price). The benefits resulting directly from the Regulations include fuel savings of approximately 28 billion litres over the lifetime of the vehicles of 2011 to 2016 model years. It is estimated that the added costs to these vehicles will be more than offset by pre-tax fuel savings with a payback period averaging less than 1.5 years.
    http://www.gazette.gc.ca/rp-pr/p2/2010/2010-10-13/html/sor-dors201-eng.html

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