Campbell – A carbon tax is good, but the NDP is going about it the wrong way

Climate and Energy

by Gordon Campbell

All Canadians depend on energy for jobs, for public services, and for transfer payments. Energy is about the value of the Canadian dollar and about how much things cost to buy. We all fall prey to the tired dogmas that suggest a strong energy industry prevents us from being environmentally responsible. The argument is tiresome, predictable and wrong.

In short, energy is about our quality of life.

Do you know anyone who doesn’t want to leave a better world to their grandchildren? I don’t.

Do you know anyone who, as a responsible driver, would drive without automobile insurance?

Most people pay $1,000 a year or more (after tax) in Canada. That is not because they think they are going to have an accident. In fact, they hope they won’t. But the evidence is that accidents happen.

Most of us understand that they could — not that they will — happen to us. So, we consider things and we pay. Some pay for more insurance coverage than others, but we all pay.

Finally, how many people do you know that think their taxes are just too low? No one I know feels that way.

What does this have to do with energy?

Energy demands are growing around the world, not shrinking. Meeting the challenge of lowering carbon emissions, while meeting growing energy demands cost effectively, requires ingenuity, creativity and clear foresight. The challenge will not be met with political dogma, willful blindness and wishful thinking. But it can be met with thoughtful action.

It may mean changing our cities and creating new integrated zoning so people can walk to work, or building transit the way we built highways in the 1950s. We need neighbourhoods where people can live in homes built around transit stops and where they can walk to the store, the rec centre, the library and to where we work. We need to stop city sprawl.

We also need a simple, revenue neutral tax on carbon that is predictable and allows no free loaders. To work properly, it must be revenue neutral. For every dollar that is placed on carbon, a dollar must be removed from either corporate or personal income tax. Politicians should not use the environment as an excuse to take more money out of our pockets. Any tax on carbon should explicitly reduce corporate or personal income taxes, dollar for dollar.

This allows markets to encourage industry to be more productive while lowering carbon emissions. Cleaner energy will pay lower carbon tax and lower income tax. Lower prices will encourage consumers to use cleaner energy. That in turn, will encourage more traditional suppliers to find new ways to lower emissions and move ahead. Each of us also can choose to reduce our tax burden.

Alberta’s energy industry is one of the most technologically advanced and innovative in the world. Taxing carbon emissions while reducing income tax would create an engine that strives for improvements, including emission reductions, process changes and productivity gains. The status quo would become a burden and people would act to create a better future, both financially and environmentally.

We do not need government to make our choices. Be a high emitter or low. Buy a big car that emits more than a small car. It’s your choice. Higher emissions will cost marginally more. Just like your insurance. Buy a bigger, more expensive car and you pay higher insurance.

Premier Rachel Notley has been right to put a price on Alberta’s carbon emissions — it is like an insurance premium to guard against the cost of climate change. But she is wrong to take your money on the pretence that she knows better than you, how to use it.

She should tax carbon, but she should give all that tax back to the Albertans and the industries that have made Alberta’s economy the envy of the country. Albertans can do this. They can turn their backs on the past and lead the way to a lower carbon, energy rich future, but the premier and her government should give you the tools to do that.

Put bluntly, a carbon tax is just another tax. But a revenue neutral carbon tax is a step in what will be a long road to a stronger and more diverse Alberta economy that will once again lead the country, not just in productivity, but in public policy and quality of life. And, in doing so, will strengthen Canada and set an example for the world.


1 comment

  1. Doug Sanden

    Gordon as you know AB doesn’t have a provincial sales tax like BC. Historically resource revenues did the heavy lifting. But I suspect they are spread too thin now. Result: deficits (public debt is a generational externality: current generation of voters is having a party and leaving the dirty dishes for the next generation). Solutions: Option 1: PST like BC (and return ctax directly like you say Gordon) Option 2: Use (some of) ctax to substitute for/in place of PST (is this what Notley NDP are doing?) Option 3: raise income tax (but I suspect AB is a bit higher than neighbors already) Option 4: cut spending (but health care is over 50% of budget and AB likes its health care).

Comments are closed.