Tuesday, June 17, 2008

Remain Calm



I know everyone has a point of view, but some of the criticism directed towards the Liberals yet to be released plan is just over the top, bordering on absurd. I guess, in the end, it will come down to how serious a debate we have, in that sense reservations are entirely justified. The accurate reality, nobody really knows how this plan will fly with the public, there are conflicting signals, and in the end, a lot will depend on events not yet realized. Pre-judging at this point is really just handicapping.


If it's all cartoons, fear mongering and soundbites, the plan will be a disaster. If it's a serious debate, that actually engages people, then it's entirely feasible. The unknown, and the critical factor, we just don't know which path wins the day.

On the serious debate side, it's interesting to read some of the expert opinion, which offers a stark contrast from the superficial. I was reading these comments from Jock Finlayson, vice-president of policy for the Business Council of B.C, who also sits on the Bank of Canada board:
the Business Council of B.C., which had been lukewarm, said the tax will not be hard to bear.

"Households in the province should not be worse off economically," said Jock Finlayson, the council's executive vice-president of policy.

"In fact, I think a lot of them are going to be better off, marginally, with the carbon tax.

"I don't think that message has gotten out, and I say that as somebody who was not a huge proponent of even doing this."

Better off?

I searched for some other opinions from Finlayson, to see if he really wasn't a "proponent" of the carbon tax. The interesting part, it would seem Finlayson's earlier concerns revolved around the idea that a carbon tax disporportionately punished big industry. Don't tell the NDP:
"The concern we have is that although it's revenue-neutral to the government, it will have a fairly significant impact on some major trade-exposed industries," said Jock Finlayson, executive vice-president of policy at the Business Council of B.C., which has led the industry protest efforts.


Jock Finlayson, executive vice-president of policy at the Business Council of B.C.

These are industries that are involved in international business trading, exporting primarily, and they have very limited capacity to pass on higher input costs to their customers," Finlayson said.

The council has calculated that the carbon tax will cost those "trade-exposed" sectors more than $500 million a year once the tax reaches $30 a tonne.

As it is currently structured, 70 per cent of the tax will be paid by businesses, but only 30 per cent will be returned through corporate tax cuts; the rest will go to individuals in the form of personal tax cuts.

Well, isn't that just the argument of the other parties, that it's better to go after the big polluters, rather than target the consumer? Finlayson's criticism is that industry takes the hit under the carbon tax scheme, which is a strange departure from all the political rhetoric we hear. Finlayson also says the average person would be "better off", which again doesn't quite jive with the hysteria.

Again, the only real question, will informed opinion such as this be heard through all the NOISE.

20 comments:

The Grumpy Voter said...

Help me understand how this isn't just a tax grab when Canada is only responsible for less than 2% of CO2 emissions in the world...

Mike said...

Grumpy pay attention, since this has only been explained about 100 times:

1. Personal income taxes are cut (hell why not a cut in the GST or get rid of it?).
2. Taxes on carbon emitting are added or raised.
3. The emitters of carbon are punished, encouraging them to emit less carbon.
4. Consumers either get a break (as Finlayson expects) or come out the same as they are now, because any rise in costs are offset by the drop in taxes. If consumers also choose products and services that do not have the carbon tax, they get lower prices too, so it is an incentive for them as well.
5. The result is lowered carbon emissions with little or no impact on the economy or consumers.

Really this just forces polluting industries to internalize their costs rather than externalizing it (like by say dumping their tailings into a lake).

I'm not a Liberal and I don't like taxes, but it isn't hard to understand this.

And it isn't hard to understand that those CPC radio ads and oily were nothing more than fear mongering propoganda.

Is that clear now?

Anonymous said...

If it was really about the enviroment should it not be a tax on everything?

Is Dion going to say we are going to meet are kyoto targets as per the friends of earth lawsuit?

How does this jive with Dions green budget?

Steve V said...

"Help me understand how this isn't just a tax grab when Canada is only responsible for less than 2% of CO2 emissions in the world..."

What an assinine comment.

Redact Ed said...

"Help me understand how this isn't just a tax grab when Canada is only responsible for less than 2% of CO2 emissions in the world..."

The grumpy amateur troll is at it again...

Obviously, no help is possible, so let's not bother.

On to more serious stuff.

Cap and trade has a place. Since more countries are looking to implement some sort of CO2 emissions trading scheme (or, in the case of the European Union, get there's working), having cap and trade may be essential economically in order to work with the rest of the world.

Of course, the cynic in me says that cap and trade is also so very popular because it is so easy to cheat. To function reliably, it requires considerable auditing of all emissions by third parties, and of offsets, if they are allowed.

Arguably, both a carbon tax and cap and trade are needed.

Steve V said...

ed

Agreed.

magus1290 said...

Out of curiosity...

Garth has been selected to champion this particular new program.

According to some of the reports from Parliament, income splitting would cost roughly 5 billion dollars.

http://www.parl.gc.ca/information/library/PRBpubs/prb0636-e.htm

If this tax is supposed to rake in 12 - 14 billion $, I could definitely see the Liberal brain trust come out with this as part of their tax package, coupled with other income cuts and Corporate Cuts.

I could be dreaming in technicolor... but somehow Garth championing this definitely raises the possibility ! Not to mention it would probably be an easy vote winner among couples / families, a group the Tories have been courting for some time.

catherine said...

Magus1290, while the Green plan contains income splitting (beyond seniors who already have income splitting), it is being reported (by the Star) that the Liberal plan does not.

I happen to agree that income splitting coupled to a carbon plan makes sense since it is family income that determines whether you can afford your heating bill and often whether you can afford a new efficient car. However, I acknowledge that allowing people to consider income as a family rather than as individuals is controversial. There is a simplicity to treating all taxpayers as individuals, independent of their marital status (well, except for seniors, since we already have that.)

Anonymous said...

You guys are funny. You dismiss Grumpy's question like it wont be asked during the next election..it will! You get upset over a very bad ad with an oily spot and call it a negative deceptive ad, yet, a question that will be asked in the next election you call assinine and refuse to answer it. This next election will be about the environment, Mr Dion has committed to it. So if you you think Grumpy's question will not be asked, that ads telling Canadians that the difference between the 2 major party's is an urgency to reduce GHG's or to ease Canada into reduction, well, then your fooling your self. And dont forget, the man selling the urgency is not good with the english language and gets flustered and toungue tied rather easily. Like WK said yesterday, its like watching your son enter the ring against Mike Tyson. billg

catherine said...

Okay, you want Grumpy's question answered. Well, here's just a couple answers. First Canada is a citizen of this planet and we should do what we can to help the planet. Second, by conserving and developing alternatives to fossil fuels, we will position our economy for the future. World oil prices will, no doubt, have fluctuations but the trend is only upwards as demand increases and cheap sources dwindle. We need to position our economy to adapt. Sweden is already exporting green technologies to China. So one smaller country (I didn't check, but my guess is they account for under 1% of CO2 emissions) will eventually impact on CO2 emissions more globablly. Canada could do the same.

JimBobby said...

Whooee! BillG thinks Grumpy's question should be taken seriously. It's one of those questions like "Do you walk to school or do you carry your lunch?"

TGV: "Help me understand how this isn't just a tax grab when Canada is only responsible for less than 2% of CO2 emissions in the world..."

Okay, TGV, I'll try to help you understand. I can see that you really do need help.

This isn't a tac grab because it doesn't raise taxes. It shifts taxes from income to carbon output. It's not a tax grab because it is revenue neutral. If it were a grab, it would mean that the shift would add revenue.

The part about Canada's contribution has absolutely nothing to do with whether this is a tax grab or not. It's sort of like carrying your lunch has nothing to do with whether or not you walk to school.

TGV, I realize your stated raison d'etre in the blogosphere is to fight against Dion's Green Plan. You'll do better if you stick to logical arguments rather than using illogical and, yes, asinine, comparisons. Why not ask yourself how this Jock Finlayson feller can support a carbon tax. He used to be like you but he came around when he took a good, hard look.

Ditto for Dion. He was against carbon tax before he studied it further and came to the same conclusion as plenty of economists, CEO's, business leaders and environmentalists.

Dig deeper, Grumpy. Try to at least understand why so many smart people support this idea. At worst, you'll do a better job of arguing against it. At best, you'll become a convert and use your obvious personal enthusiasm for good rather than for evil. ;-)

JB

Anonymous said...

Sympathetic article in Globe and Mail on the release of Dion's plan.
The launch is being well managed so far.

Anonymous said...

Meanwhile according to Ipsos, opposition to the Carbon Tax is soaring in BC - and it hasn't even been implemented yet.

Interestingly opposition to the tax seems to cross party lines and even a majority of green voters oppose it.

"Six-in-ten (59%) British Columbians say they oppose the introduction of a provincial carbon tax on gasoline and other fossil fuels to curb greenhouse-gas emissions (39% support). Opposition to the new tax includes a majority of BC Liberal supporters (56% opposed), NDP supporters (58% opposed) and Green Party supporters (53% opposed)."

Steve V said...

On thing to add on the "only 2% of the GHG world emissions", is the next step, which is an carbon tariff on imported goods. You already hear countries like France floating the idea, and Rubin from CIBC said it could help to bring jobs back to Canada. You can't speak of such things until you WALK THE WALK, you can't lead, when you don't act on your own (see Baird). If Canada puts forward an ambitious plan, then it gives us credibility on the world stage, and if people ignore the problem, then we have the moral authority to impose a cost on their products. That's the end game here, but it's up to us to get our own house in order first.


billg

I can't wait for all the questions, especially the ones where the government is asked WHO exactly supports their plan, why has it been universally panned, domestically and internationally? Sorry if I don't fear a debate with the paper tiger, in the end, all they have is smear, because they have NOTHING.

Steve V said...

anon

You left out one imporant aspect, actually the bottomline. Support for Campbell remains quite high, the NDP support has dropped slightly, in other words no translation to voting intention.

In fact, the pollster says:

"You shouldn't read too much into the opposition here," he said.

"You could insert any kind of tax and you'd probably see a 40/60 split, maybe even worse."

Show me Campbell paying a political price and it might be relevant. Seems to be the exact opposite, which speaks to the inherent quality of any question on taxes.

Anonymous said...

There are many reasons why people support or oppose a government, but when you are the opposition and you have a grade Z leader and on top of that you propose a tax scheme that takes about three hours to explain - it can only take you on a one way ticket to disaster.

Let's see what happens in BC once people start actually paying the Carbon Tax. Apparently Campbell no longer talks about it because he knows what a big political liability it is likely to be.

Anonymous said...

""You could insert any kind of tax and you'd probably see a 40/60 split, maybe even worse."

That doesn't explain the fact that when the so-called carbon tax was first announced, the same polling company had people split almost 50/50 on it - but as it has been discussed support keeps unravelling and now its 60/40 against and that will probably just keep on unravelling as we go along.

Steve V said...

Oh, the just wait and see argument. That works both ways you know. You could argue, that over time, as people learn the details, which this poll says they don't, they will become more receptive. It's all just speculation, which you can manipulate to suit you personal bent. I'd rather look at the BOTTOMLINE, despite 4 months to digest, Campbell is STRONGER than ever. Period.

Gayle said...

"You guys are funny. You dismiss Grumpy's question like it wont be asked during the next election..it will!"

Sure it will - but the only people who will care about the answer are the ones who will not vote for Dion anyway.

Steve V said...

"Sure it will - but the only people who will care about the answer are the ones who will not vote for Dion anyway."

Like Grumpy for example.