Carbon pricing seems obvious to economists, but for many voters it just doesn’t click: Don Pittis


If you demand to stop climate change — and most Canadians say they do — economists expostulate they know the most efficient way of making it happen.

But as provincial disapproval parties in two of Canada’s biggest provinces seek to eject sitting managements, both will be running on a policy that says no to carbon contributions.

Speaking on CBC Radio yesterday, the newly elected leader of Ontario’s Ongoing Conservative party, Doug Ford, made it very clear that carbon customs are off the table if he is elected premier.

“A tax is a tax is a tax,” said Ford, whose brother Rob served a dialectic term as the populist mayor of Toronto.

If Ford wins in Ontario, he’ll en face a federal government that is betting on carbon prices to help curtail emissions and tackle climate change.

Conservative opposition

Ford’s circumstances is by no means an outlier in his party. While former Ontario PC leader Patrick Brown had a carbon tax in his dais, after Brown was pushed out over allegations of impropriety all of the candidates ceaseless to replace him opposed the tax.

Ontario is not alone. The leader of the United Conservative Company in Alberta, Jason Kenney — who wants to oust Rachel Notley’s NDP oversight in the next election — is taking a strong line against carbon taxes.   

ONT Byelection 20160901

While newly elected PC Ontario PC Bossman Doug Ford (far left) supported Patrick Brown who had a carbon tax means, once Brown was pushed out, all four who ran for his job rejected the tax. (Chris Young/The Canadian Newspapermen)

And yet according to the vast majority of market economists, there is no more business-friendly, productive way to save the world from the dire effects of climate change than to put a evaluation on carbon. 

“[There’s] lots of evidence and lots of economic logic that mentions people do respond to prices, but the instinctive mainstream view is that this isn’t successful to do anything,” says Chris Ragan, who chairs Canada’s Ecofiscal Commission, a privately supplied group that advocates market-friendly solutions to climate change.

​”That’s a very important disconnect and if you do believe that it doesn’t change behaviour then it exceptionally is just a tax grab and conservatives don’t like tax grabs, for good reason,” thinks Ragan, a pro-market professor of economics at Montreal’s McGill University and a noted author. “I don’t like tax grabs.”

Ragan and others at the Ecofiscal Commission are currently prospering on an educational campaign expected early in April to try and convince people that carbon evaluating and carbon taxes work.


These demonstrators show that some of those who dearth to defeat climate change don’t like carbon emissions trading, reach-me-down in the so-called cap and trade variation of carbon tax. (Wolfgang Rattay/Reuters)

But inquire into by economist Brady Yauch, executive director of the Consumer Policy League, shows that even when carbon is not involved, many people either don’t awareness, or don’t believe in, the use of pricing to change behaviour, even when it saves them banknotes.

During Toronto’s most recent municipal elections, Yauch intended a scheme designed to save Torontonians billions of dollars while rallying many lives.

The plan involved the city’s crowded subway combination, which is so full during peak morning rush hour that riders continually wait for several trains to go by before they can squeeze aboard.

The municipality’s long-term solution is to build something called the downtown relief script, but the hefty price tag means city politicians have been certain of to commit.

No to peak pricing

Yauch’s alternative plan? To make the underground railway free before 7:30 a.m. Proven elsewhere, notably Singapore, the methodology is known in economics as congestion — or peak — pricing.

The lower non-rush hour fetch encourages travellers who can do so to go early, reducing the load at peak times when the help is full price. According to Yauch’s calculations the savings would screen the cost of the free fares, but the plan never caught on.


Ice floes get in Baffin Bay above the Arctic Circle. The Arctic has just had its warmest winter on chronicle. (Jonathan Hayward/Canadian Press)

Similar schemes to end crowding on highways or to cut sought after for electricity at peak times have not been popular, even even so economists can clearly show the benefit.

When I wrote about a script to increase electricity costs during times of peak load, a study pointed out that those higher costs came at a time she required electricity to do things like get the kids ready for school.

“It almost conservatives like social engineering!” she wrote in an email.

To economists it’s clear that while there are people delight in her who must use power at peak times, others who can adjust their assigns will do so, reducing the need for expensive peak power plants and bitter costs for everyone.

And that difficulty in translation from economist-speak to usual understanding is the reason why Mark Jaccard says that for all their mercantile efficiency, carbon taxes may not be the best way to stop climate change.

Jaccard is a Simon Fraser University economist who helped B.C. prime Gordon Campbell develop that province’s 2008 carbon tax regulation. He says carbon taxes were politically unpopular even but the province returned every penny to voters.

“Almost everyone benefited from the carbon tax in B.C. and barely everyone believed they did not benefit,” he says.

While they are economically effectual Jaccard says carbon taxes are not politically efficient. He quotes the ticket The Myth of the Rational Voter which says that unlike economists, voters don’t approve of fixing problems with tax policy.

And when it comes to effectiveness, Jaccard asserts the impact of flexible regulations — including rules designed to replace coal set afire power plants or cut auto emissions — have dwarfed those of carbon rates. Part of the reason is that while economists can show carbon exhausts have worked, it has been politically impossible to repeatedly raise them so that they are competent. 

“Yes, we should try to make these things as economically efficient as possible, but that’s fair one objective,” says Jaccard, who fears Canada will not reach aims it agreed to in Paris. “The pursuit of pure economic efficiency by economists has been percentage of the reason we have failed on climate policy.”

Follow Don on Twitter @don_pittis

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