The conservative defeat of carbon pricing is the defeat of economics – and of conservatism

Source: kludgeocracy

25 Comments

  1. If anything, it’s a defeat of the people’s willingness to be taxed and lied to. That’s what it’s really about.

  2. I have been saying this here for a while; it drives me up the wall that we are living in opposite-politics universe. The CPC today is not a conservative party – sure they call themselves conservatives but their ideology, practice, and approach are not.

    The CPC today has become an anti-Liberal party. Whatever the Liberals are for, they are against. As Coyne writes:

    > Prices, by contrast, are a permanent, omnipresent incentive for businesses and households to reduce their emissions, by whatever means they find least costly – and to go on reducing their emissions for as long as the cost of doing so is less than the price. How much more efficient is pricing carbon to the alternatives? Some years ago the Ecofiscal Commission, a group of environmental economists, estimated the economic costs of a carbon tax, sufficient to meet Canada’s internationally agreed emissions-reductions targets, at 0.05 per cent of GDP annually.

    Whereas on regulations, he writes:

    > Regulation only encourages people to do the minimum required to conform with the regulations. Subsidy often rewards them for doing things they were going to do anyway. Both only apply to the things that occur to the planners to regulate or subsidize. The costs of the regulation-first approach, by contrast, it put at up to 0.80 per cent of GDP: 16 times as much. At a time when growth is expected to average just 1.6 per cent, it’s huge.

    And yet, somehow, the Liberals are the party taking the side of *’won’t someone please think about the economy!’* and the CPC are arguing for the less economically efficient, more government approach, and the approach that will intrude more profoundly in people’s lives. This isn’t conservativism, this is anti-Liberal. The Liberals want to address climate change, the CPC don’t.

    This knee jerk reactionary politic has devastated conservative ideology in the CPC, not just on climate change. This knee-jerk reactionary approach is also in housing, mass transit, and the mental health and addiction crisis. The Liberals have a few really bad ideas – I won’t cast my ballot for them – and the CPC is right to reject some of them, but rejecting everything the Liberals touch has pushed the party to an absurd position.

    Coyne again:

    > But instead the right abandoned it, for no reason other than because the left had taken it up. For a time, this seemed like no more than a missed opportunity. But the conservative “victory” over carbon pricing now looks like something much worse: a defeat for pricing, period. Assuming there are any conservatives who still care.

    This is where I go back to the beginning of my post. The left has become to love market economic forces, the right has abandoned them. We live in bizarro-world now. Rarely has Coyne been so on point.

  3. I am a fan of the carbon tax and do not want it to be repealed. There are minor issues I think with its implementation, but very much minor issues. I do think the Liberals failed to effectively sell it and there are a couple of things they could have done better on that front. Namely that rebate checks should have gone out *in advance* of the tax, that they should be quarterly,(*) and that the tax should have been entirely revenue-neutral rather than ~90% so.

    edit: as people point out below, these are now features of the carbon rebate. They were not prior to 2022

    I don’t think any of these aspects are the core of the problem with the public perception of the carbon tax. On the one hand you have a decent chunk of the populace who are essentially climate change deniers: they fall on a spectrum of what I call *soft denial* (climate change exists, sure, but we can’t do anything about it and what about China?) to *hard denial* (no temperatures are not increasing, and if they are it’s not human activity to blame). These people are always going to reflexively oppose GHG mitigation efforts.

    But there’s a much bigger part of the population which does worry about climate change, and does – albeit often very abstractly – want to see measures to address it. I think here is where the Liberals really failed. By making the carbon tax the central part of their environmental push – policy-wise, rhetorically – they decided to focus on sticks instead of carrots. The carbon tax is after all a tax: as smart or effective or necessary or revenue-neutral as they might be, you will never win any hearts of those you are taxing. On the other hand there were very few policies where Canadians felt they might hope to *gain*. Things like the heat pump rebate should have been pursued much earlier.

    It doesn’t help that apart from the carbon tax the government doesn’t *seem* particularly interested in actually reducing emissions either. The promise is a 45% reduction from 2005 levels by 2030; we’re at like 3 or 4% with a little over 5 years to go. The feds spent $35 billion on a pipeline but closes the purse for green initiatives. I think people intuitively realize that adding over a million new people to the country every year isn’t helping emissions levels. The tree-planting initiative has been a massive failure.

    So at the end of it all you have this: the carbon tax keeps going up and the emissions stay the same. Eventually people are going to decide to axe the tax. Is it smart? No. But the Liberals have this expectation that it just doesn’t matter how well they govern: everyone should just support them anyways.

  4. I would like to see a case study written about this someday. It’s a good example of how politics and policy intertwine, and how the politics has to be carefully managed from the outset.

    From all I’ve read, carbon pricing is a reasonable – even good? – policy.

    However, as the Liberals became more unpopular (not necessarily due to the carbon tax per se, but a litany of other issues), the carbon tax became an easy thing to associate with them. The Cons hammering away at it made it into the symbol of a government the electorate doesn’t like, and so the policy itself became something they don’t like – effectiveness and reason be damned.

    It’s like the psychology of a person just before they break up with someone – it doesn’t matter what that person does, it’s wrong and annoying, just by virtue of that person doing it. Same thing here.

    So how could they have stopped it from becoming that symbol? Political calculations of their own:

    * instead of direct deposit, send out paper cheques quarterly with YOUR CARBON REBATE printed in bold on the envelope.
    * Do constant government advertising on the rebate right from the start of the policy.
    * Keep the price, but pause the hikes in a year in which affordability issues are front of mind for everyone.

    But, since that wasn’t done, a good policy is going to go – because someone else was able to turn it into good politics for themselves.

  5. It’s the absolute pinnacle of the new “own the libs” conservatism.

    It’s not actually built around any specific set of ideas or political principles, it’s just reactionary contrarianism, blind opposition to whatever “the left” wants (big air quotes around that because “the left” to them is basically anyone they don’t like).

  6. It was also a failed campaign policy until the pandemic exacerbated the cost of living crisis, which did the heavy lifting for Poilievre on the policy. Consider that by the 2025 election, the CPC will have been opposing the Liberals carbon pricing platform for at least a decade and prior to this election, it was widely seen as a lost cause for the party since they couldn’t move past it or come up with any real substantial policy rebuttals to the Liberals.

    You could argue that’s still the case now, but tying everything to the cost of living crisis has allowed them to revitalized dated talking points that had failed to get them votes anywhere outside of Western Canada etc.

  7. OttoVonDisraeli on

    It’s paywalled so I can’t exactly respond to what he’s saying, but I can the headline. Carbon pricing is often called conservative because it’s market-based, but I actually consider it to be more of a neo-liberal policy than I do a true Tory or conservative policy in the traditional sense.

    I would personally prefer the Tories take a regulatory approach to tackling environmental issues, but I’m often in the minority on these things as more of an old school Tory.

  8. Carbon tax is a logical, market-based solution, but if we don’t apply it to things we import from China etc. and just essentially export the emissions to a different country it’s kind of pointless and just makes things in Canada more expensive and less competitive for no good reason.

    Plus it’s kind of obvious that they are not actually that interested in reducing emissions. We have Atlantic Canada heating oil exempt from the tax, and tariffs on Chinese-made electric vehicles, and really minimal programs that will help reduce emissions. We did have the greener homes grant, but that is over now and was such an administrative pain for homeowners that I don’t think uptick was very good.

  9. I knew right from the headline that this was going to be Coyne, and that I’d agree with it.

    It’s insane how the slapstick soundbites and ridiculous hyperbole about how we’re just one carbon tax away from 3rd world poverty have become normalized. Were people always this stupid?

    It’s like if you can’t give it an aliterative nickname, people’s eyes just glaze over. We’ve regressed to the average attention span of a 5 year old.

  10. The carbon tax is a good wedge because for some people transportation modes and costs are inelastic. People living rurally just get owned here. Which is normal for gift services. Best example is how much better healthcare the average Toronto resident had access to compared to any other Canadian is fucking crazy.

  11. Very true. “Axe the tax” is seen by them as a path to victory and nothing else.

    They don’t have to believe it, it can fly in the face of literally everything they believe in. It can hurt us economically and not even change prices of anything a fraction of what the carbon tax actually cost us.

    We hurt ourselves falling for slogans and lacking critical thinking and will deserve losing the rebates and prices not dropping when he get rid of the carbon tax (private companies will not give that cash up and will still charge the similar prices)

  12. WeightImaginary2632 on

    Unfortunately we have been lied to, it is not revenue neutral. According to this:

    [https://www.ourcommons.ca/DocumentViewer/en/44-1/PACP/report-20/page-99](https://www.ourcommons.ca/DocumentViewer/en/44-1/PACP/report-20/page-99)

    “The Department of Finance also confirmed that $98 million dollars collected under the carbon tax was not returned to Canadian families.”

    As well as

    The Parliamentary Budget Officer’s report from March 2022 offered this estimate:

    “The Government will also collect revenue from GST on its carbon levy. We estimate that $239 million in GST revenue from carbon pricing will be collected in 2021-22, increasing to $837 million in 2030-31 under HEHE carbon pricing.”[^(ii)](https://www.ourcommons.ca/DocumentViewer/en/44-1/PACP/report-20/page-99#_ftn2)

    So we are also getting taxed GST on top of the carbon tax. That GST will of course not go back to people since it is considered GST and not the carbon tax.

    Look I know we need to try and be better when it comes to the environment and all of that. Unfortunately this government hasn’t been transparent how much money is coming in and going out. I’ve watched talks with Chrystia Freeland in committees and she was being asked about the Carbon Tax and where it is all going, she would sidestep the question and not answer it. It’s the same with Justin Trudeau about the tax.

    My problem is that with this tax is we drive away potential investors in our country for manufacturing and such and they go overseas to a country that doesn’t have the same high standards as we do here in Canada. More pollution is created because of it, namely China and India. I’d bet a good 50% of the stuff in your house was made in China and India if not more.

    Furthermore if they were really concerned about the environment, they wouldn’t of slapped on a 100% tariff on Chinese EVs. If it is really about the environment they wouldn’t care where the EVs come from, they should just be happy that more people would actually be able to afford EVs. Not to mention though, most provinces don’t have the infrastructure setup for EVs, unless you are in a major metropolitan area like Vancouver or Toronto, even then its not great and wouldn’t be able to handle everyone driving EVs.

    I just want complete transparency from any government that is in power, whether it be the Liberals, Conservatives or the NDP.

  13. Carbon pricing is a super distortionary mechanism which I believe is more cost effective than many other policies to reduce carbon emissions.

    However, I do not believe Canada should prioritize reducing the said emissions above our economic competitiveness and the average Canadian wallet.

  14. I am glad someone brought this up. To me, NDP is left wing, and liberals have surprisingly taken some of the center right positions. Usually, they play center left. PPC is too naive, and Conservatives have lost their core values instead of just opposing liberals for just everything. Majority liberal government seems more balanced. 2015-19 were good years relatively due to the fact
    – Canadians were doing better
    was not terrible
    – immigration was controlled and Canada was becoming like US with skilled immigration and genuinely competing with the US due to Trump being there.

    Post covid, due to CERB and minority government situation, NDP dictated some of the policies leading to skewed demographic that favours Jagmeet singh. We took more immigrants from relatively rural and uncivilized part of India instead of the cream educated and civilized parts including urban north west and techie southern part. The patterns are evident now with demographic in the US v Canada. This is precisely because corporations wanted cheap labour leading to wage suppressions.

    Also note that CPC is stressing too much on inflation. The data suggests otherwise. Canadian housing and inflation was in line with global issues. US saw bad housing run too. Inflation was higher in the US. If you go to Europe with lower incomes, housing and inflation was higher in the same time. Canada actually did better in those parameters. Where Canada lost precisely is on income growth. Corporations in US and EU started raising incomes, Canada on the other hand raised for semi skilled but professionals, the backbone of middle class did not see wage growth. This is where Canada lags behind. CPC is not hitting chord with this demographic yet.

  15. Ok_Yogurtcloset3267 on

    I don’t think carbon pricing has been particularly successful for economics or the environment.

    Artificially inflating the cost of virtually everything with limited alternatives. I still have to heat my home in -30 and drive to work. If the goal is to make it so expensive that I’m forced to buy an EV and retrofit my house or discontinue sports or other activities with the family, then I think we’ve lost the script. This isn’t a win.

    If green options are the truly better product and more cost effective people will transition naturally.

  16. Tasty_Delivery283 on

    It’s only a defeat of conservatism if the goal is to curb carbon emissions and address climate change. If that were the intent, then obviously a carbon tax is quite literally a conservative idea.

    This column misses a central and obvious point: the current conservative — or should I say capital-C Conservative — position is that governments need not actually do anything to meaningfully address climate change and certainly no to reduce emissions.

    So arguing over which response is the most authentically Conservative is a bit like arguing that there’s an obviously Conservative approach to harm reduction, since the reality is, likewise, that Conservatives don’t believe it’s a problem that deserves _any_ response in the first place

  17. What even is the conservatives plan ?!?! All I hear PP say is cut carbon tax and end crime and build houses… WTF 😒 HOW WILL HE DO THIS ? Other then cutting a tax that is utterly peanuts compared to houseing costs and food costs wtf will he do ?

    Sounds like he will be all talk to action he is just good at complaining but not building anything just taking down 👇

  18. An absolutely ridiculous piece. The tax had so many exemptions and loopholes that it was hardly a free-market solution of any kind. It was an arbitrary assortment of carrots and sticks that had dubious results on our actual emissions, and clearly deleterious results for our economy.

    The Liberals absolutely bungled the implementation and the argument, and have only themselves to blame. 

  19. Many people are just opposed to government intervention and taxation when they decide to drive their car or heat their home. If you’re calling it an economic issue you’re assuming no one thinks this way.

  20. Why post an article with a pay wall? One would have to assume most people commenting here haven’t even read the article.

  21. Conservatives have no morals, look at the Republicans. ACA was a Republican idea before they branded it Obamacare

    But let’s be realistic for a moment as well. When this tax was being proposed that tax would have been miniscule. The conservative BC Liberals rolled it out at $10 a tonne 8n 2008 , it’s $80 now and expected to be double that by 2030

    I don’t think any democratic institution can easily manage or withstand that kind of tax Increase without coming under attack or scrutiny by someone. I also recall when the BC NDP coined axe the tax before PP and before they were for it.

    This is all politics. No one has a monopoly on virtue
    Except I think we can agree the right is especially bad at being for something before they were against it once they opponents adopt their ideas.

  22. Small wonder that as a nation we’re considered quaint. We’re rage walking ourselves into our own Brexit. Being bad at maths is one thing but not knowing how to split a pot evenly? No wonder the rich are still packing our lunch

  23. people just want ragebait.

    conservatives in modern times (in every country) have no policy and no direction. they just prey on ragebait.

  24. This is a win for the pocket books of hard working Canadians. Time to stop hindering our economy with carbon pricing while China and India pollute at an incomparable scale to that of Canada. We are already a world leader in terms of having a clean economy, no need to inflict further self-flagellation due to liberal white guilt.

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