LETTER

Carbon pricing & the election

 

There is pressure for consumer societies to deal with carbon emissions. With variations, there are three plans on the table in Canada.  Each has significant implications on the economy. The Opposition leaders have different views on the subject. Unfortunately, they are too complex to go into detail in a letter but here is a brief description (attached to their "champion").

NDP leader Thomas Mulcair supports the Cap and Trade program.  This is like stock market trading in the right to emit industrial greenhouse gases (GHGs).  Cap and Trade is prone to the same kind of fraud and manipulation that occurred in the 2008 subprime mortgage derivative scandal.  

Liberal leader Justin Trudeau leans toward a Carbon Tax.  Similar to Cap and Trade, this program doesn't require a new and costly bureaucracy.  It is less prone to political corruption and insider trading.  Still, all captured revenues go to the government with no guarantee they will be returned to those who lessen their "carbon footprint".

Green Party leader Elizabeth May is proposing Carbon Fee and Dividend.  Through this plan, the government increases taxes on consumption (but) returns all of the revenue raised to individuals and businesses in the form of lower income and payroll taxes.

Given its high voter visibility, I feel our Conservative PM will have to decide soon.  He backed Obama's choice of Cap and Trade in 2008 (which didn't get past Congress) - but his decision then was for economic and political reasons.   (Overall, I doubt that carbon pricing will be a "game changer" in terms of election results.)

My opinion:  I suspect Harper will adopt a plan similar to Carbon Fee and Dividend.

 

Steve d'Eça,

Aylmer