So Mr. Oliver, what are the other options?

On hearing that Ontario was joining a cap and trade system with Quebec and California to set a price on carbon, our finance Minister, Joe Oliver, reacted predictably.  He described cap and trade as effectively a tax. Horrors!

Oliver objected to cap and trade as it would raise the price of everything for hard working Canadian families, and would be negative for the economy.

Oliver did not back up this claim or give any details of his criticisms at the time. We suspect it will be sometime before any attempt is made to justify the substance of his remarks.  And tactically it is best to limit one’s comments to words like his that make good electoral slogans.

We know that the Federal Conservative Party is adamantly opposed to the other option of putting a price on carbon: a direct tax on carbon.  So what is left?

The Federal Government refers to its approach to GHG emissions as sector-by-sector regulation (often referred to as “command and control”).  The first objection to command and control is that many studies by economists establish that this method of reducing emissions is the most costly of all the alternatives. 

And so it is not “appreciated” by the target industry!

Secondly, a government oriented towards business interests will be less likely to move quickly, effectively and impartially.  Consider the performance of our Federal Government: it promised regulation of the fossil fuel industry nearly eight years ago, but has done nothing.

After assuring Parliament that it was drafting regulations, our Government came up with an excuse:  it would not move until the United States took steps directed at its fossil fuel industry.

The fossil fuel industry is not the largest source of GHG emissions in the US.  That honour goes to the many electrical generating plans that burn coal. The US Environmental Protection Agency sensibly moved to limit emissions from these plants, but this will be a long and complicated process, involving many legal challenges.

Until this process is complete, the US Environmental Protection Agency will not turn its attention to the fossil fuel industry. That is many years off – which means that our Government can continue doing nothing during a critical period.

Our Government knows that under its preferred business as usual philosophy Canada will not meet its Copenhagen 2020 reduction target.   Yet the Federal Minister for the Environment is pushing the Provinces to come up with reduction targets, particularly for 2025 and beyond.  The Minister is not providing leadership in sensible ways, such as participating in discussions for setting national emission guidelines.

Canada’s indifference to the need to limit climate change is well known in the United Nations.  Canada will be one of the principal non-performers at the Paris Conference.  Right up there with Russia!

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