Another Piece To The Puzzle

I wonder if the Liberals have given consideration to the recent report from CIBC economist Jeff Rubin, who argues that carbon tariffs are the next phase, once a country claims the high ground, with their own domestic plan. If Dion wants another tool to sell his tax shifting plan, then any action must entertain what to do about competitiveness. Adding cost to our domestic production, while certain importers operate without the same standards, creates an uneven playing field. There is a way for Dion to shield the Liberal plan from attacks that it will hurt Canadian industry, in fact what Rubin proposes creates a scenario where action allows for a climate that not only stops outsourcing, but bring manufacturing jobs back home.

I think it's a great concept, hopefully the Liberals will put this out as part of the package:

With some advanced countries enacting carbon taxes, carbon trading systems and other measures to lower emissions, CIBC believes the growing pollution from developing countries will provoke penalties against their exports.

That would benefit the environment, and will also bring certain jobs back to North America, since carbon emission taxes and high oil prices would offset the benefit of cheap labour, Rubin says.

"Chinese goods will have to pay for the carbon that they emitted and they'll pay for that when they enter our market place by paying that tariff," Rubin said in an interview.

"Once we impose the tariff on Chinese goods, some of those industries will be coming home, because . . . energy and carbon efficiency is going to matter more than labour costs."

The political optics of a carbon tariff are a no-brainer. The idea also tells Canadians that if we do actually do "lead", then we have the leverage to demand the same of others, or they will face penalties:

But Rubin sees a shift in sentiment.

"What I'm suggesting is that the minute that we start putting a price on our own domestic emissions, then our tolerance of those who do not is going to fade very quickly," he said.

"What we're going to say is that if you don't play by the same carbon rules, that's an unfair trade subsidy that we're gong to countervail against."

The beauty of endorsing a carbon tariff, once we implement our own plan, is it silences the Baird logic, that Canada can't act "unilaterally", equating such action as economic suicide. It lays out a clear path, it shows Canadians that if we choose a "tough" plan, then others fall in line, which negates any disadvantage, or Canada takes action to ensure our industry remains competitive. On top of that, as Rubin suggests, you have the prospect of returning industry, something that would surely find appeal in vote rich central Canada.

At the very least, I hope the Liberal plan speaks to a carbon tariff, because it will help to ease some concerns, it will demonstrate that leadership doesn't handicap, it allows Canadians to see that our approach will help force other nations to follow. I don't see a downside in endorsing the idea.