The ONW Salon: Is Trudeau's Tough Carbon Pricing Tactic The Right One?
PM Trudeau says the provinces will have to adopt a carbon-pricing plan that aligns with federal targets by 2018 or the federal government will impose it on them. But is it the right approach? Richard Mahoney, John Capobianco and Tom Parkin debate that and more.
Climate change has become the biggest challenge facing the planet and its leaders. By all accounts, the global community and its political leadership are late in taking concrete action to address the existential threat it presents. Spend some time with a climate scientist, or read any of the work done by the international Panel On Climate Change, and you will come away frightened, and possibly, depressed.
There are some credible people who say it is already too late. I think and hope that is not true and that collective creativity and action can mitigate the damage already done, and about to be done.
Canada is guilty of the charge of coming late to the party too. While some important steps have been made that help - the closing of Ontario's coal plants in the last decade is still the biggest single action to reduce emissions taken in North America - we are behind the eight ball, so to speak.
That is why it is so important that the Prime Minister did what he did this week. While provinces have lots of leeway to come up with their own ways of getting there, Canada now has a price on carbon, and a plan to escalate that price. Without that, we can reduce emissions, but certainly cannot meet the commitments all Canadian governments have made - to meet the target of a 30 per cent reduction. Putting a price on carbon is the most important step we will take to get there, although it cannot be the only step.
The Liberals will take heat for this - the Conservatives have already called it a "sledgehammer". But all provinces have already agreed that we need to meet the targets set out in the Paris accord. Many have already put a price on carbon. We now know what that price will be, and that, in the event provinces don't do what they said, we will have taken the steps necessary to get this done. Kudos to the PM and to the Minister of the Environment for showing leadership.
Contrary to what Chantal Hebert has written this week, Trudeau hasn't spent any political capital for progress on climate change. On the contrary, he's built more up and shielded himself from further environmental demands by creating a fictional federal crisis. Let's just review what actually happened.
It's true Trudeau has upset Nova Scotia Premier Stephen McNeil and Saskatchewan Premier Brad Wall. But the Liberals have little play in Saskatchewan and the most urgent Liberal interest in Nova Scotia is the re-election of McNeil. Standing up for Nova Scotia and some feigned outrage helps that.
The only political capital spent has been in blowing up the myth of co-operative federalism Trudeau propagated. But that campaign myth had to go sometime, and earlier is better.
Remember, turkeys don't vote for Christmas.
Trudeau has gained political capital by sending Premier Wall into a frothy fit. After all, to be proclaimed a hero you first need to have a villain. Mr. Wall's acceptance of climate science has always been in question – “misguided dogma” was referenced in his last Throne Speech – so he’s a perfect villain to the majority of Canadians who agree with climate science and believe doing nothing isn't an option. To that group, Mr. Trudeau sending Wall into a froth proves he is progressive – that’s the new capital.
And re-upping his political capital by picking this fight came just in time. On veterans, indigenous communities, adopting Harper’s carbon targets, adopting Harper’s health care formula cuts - a mudslide of negativity was all pointing the needle to "Trudeau not progressive." In one move, Trudeau has forced every progressive Canadian to say he's taken a good first step with this national pricing plan.
But remember, this is a Prime Minister who won on the promised to be more progressive that the NDP. All he's really proved is he’s more progressive than a climate denier. Woo-hoo.
So what Trudeau announced this week may be a first step, but it is a baby step. Harper's carbon targets - the ones the Liberals called "catastrophic" and "the weakest" when they were competing with the NDP for the progressive vote but have now adopted - of 622mT in four years won't be achieved by $10/tonne in 2018 and $20 in 2019.
BC's price is currently at $30/tonne. Alberta is already at $20/tonne. For goodness sakes, in 2008, Stephen Harper said $65/tonne was the right price for carbon.
This may be a good as a baby step, but there are giant steps that need to be taken - and they get bigger with every mega-project Trudeau approves. My fear is baby steps are all we'll get. And that whenever environmentalists and the NDP point at the next big step that must be taken - or the new leaps needed to compensate for mega-projects - the response will be to point at yesterday's carbon pricing dictate and use it as a giant shield against further demands. "I've done all I can at this time" might be Mr. Trudeau's argument, with a tip of the hat to Brad Wall. "Provincial backlash is hurting the federation and I can’t burn anymore political capital, you know."
Some strong words towards our PM from Tom.
Well, at some point the Liberals were going to start governing and making tough policy decisions that would reflect the many election promises made during the long campaign. After almost a year in power, the PM is starting to make some moves domestically – and good on him.
Notwithstanding the international travel and state visits since Mr. Trudeau has become Prime Minister, the really politically sensitive policy issues happen here at home. The PM has made the environment key of recent days – first it was the liquefied natural gas announcement in BC and now the carbon-pricing plan. The question asked of us on this Salon concerns the government’s carbon-pricing plan – so let’s focus on that.
The PM has given provinces two years to come up with a plan to price carbon pollution or risk the feds imposing a price on them. The announcement was made while provincial environment ministers were meeting in Montreal, which was interesting timing. The proposed plan sets out a minimum price on carbon of $50 a tonne by 2022 with a floor price of $10 a tonne in 2018, increasing by $10 a year for the next four years.
This will force provinces to come up with their own plan that falls within the federal limits or they will have these targets imposed on them – no wonder a few ministers walked out of the meeting before it ended. As Nova Scotia’s Environment Minister Margaret Miller said “Today is not a good day for federal-provincial relations.”
Indeed, the Premiers even got involved and started to position themselves and their respective provinces for what is going to be a tough battle on carbon pricing, especially heading to the first minister’s meeting the PM called for December 8th to discuss this issue. The PM has put a stake in the ground on the environment file, fulfilling a campaign promise and a commitment of the Paris agreement.
However, now the real work begins to get the provinces onside. This while the health accord discussions are underway with the provinces.
Tom seems to suggest that the Prime Minister may benefit politically from the battle with provinces resisting federal leadership on climate action. Maybe that is right.
More importantly, Tom and the NDP generally don’t offer anything in the way of an alternative. That said, many of his NDP allies don’t share his negative view. The one NDP government in the country, that of Premier Notley in Alberta, is working closely with the government of Canada and supports this general approach.
Other steps have been taken, including a hard cap on emissions from the oil and gas sector. Labour leaders such as Hassan Yousseff at the CLC agree national pricing is the way to go. I am not sure what alternative Tom and the NDP have in mind, but, if they have one, now would be a good time! See my earlier comments about the country and the world coming late to the party.
To equate this action with the approach of the Harper government is nonsense. The Harper government did nothing. It would occasionally agree to targets, without any plan on how to meet those. So yes, the first job will be to meet targets set long ago and ignored. And then to move beyond them for our collective good. If all they are saying is go harder, go faster, and push the provinces more, that is not such a bad thing. He may wish to talk to some NDP provincial leaders who rail against the cost that putting a price on carbon presents, but that is a topic we can explore on another day.
The important thing is this: Trudeau showed international leadership in helping the world come to an agreement in Paris. China, India, and the US are parties. He showed domestic leadership by then bringing the provinces together, and allowing them to keep the revenues from the levy to help citizens deal with the cost. And he has now laid out the bottom line, indicating what will happen if a province fails to implement either a cap and trade regime or a carbon tax.
That is national leadership, with flexibility that allows the provinces that have not yet come to the table, to do so in their own way. More than a good start, I would say. It is a recipe for action and success.
Do I think Trudeau has benefitted from picking this fight? Absolutely. It's a win anytime Trudeau can shift the frame away from his progressive promises to Canadians and toward "I'm more progressive than a climate denier." As we'll remember, during the campaign the NDP committed to a lower carbon emissions target than Harper. The NDP also agreed to a mandatory national carbon price that provinces could meet in the way they saw fit.
Over and over again, Trudeau tries to reframe this discussion. To him it's good enough to be the second slowest in the race. That's not what he promised.
I don't think anyone can seriously suggest that Notley is railing against the cost. Ms. Notely is already implementing a $20/tonne price on Jan 1, 2017. There is no cost to her. Because she's leading the pack. If she'd done nothing, Trudeau would've let there be no price on Alberta carbon emissions in 2017, only $10/ton in 2018 and $20 in 2019. Notley goes to the polls in 2019. It's Mr. Trudeau who has been playing catch-up.
There any many more big steps that must be made to hit our 2020 goal. I am sure the NDP will be consistently pushing for those. And as we get to 2018 and 2019 we will see if Mr. Trudeau has accomplished what needed to be done.
With respect to Ontario, I don't think Ms. Wynne has a leg to stand on. Her privatized model of "green energy" was a massive transfer of wealth from the public purse to private companies - a terrible scheme of guaranteed 20-year contracts the Auditor-General says has cost Ontario $7 billion. Add that to the "mislaunch" of cap and trade, the Liberal $1 billion to not build a power plant and an electrical planning system that has been destroyed by politics - and we have skyrocketing electricity rates at exactly the time we need an affordable alternative to carbon-based fuels. Is Andrea Horwarth railing about costs - yes and rightfully so!
Over the course of the last few weeks, the media have been picking up on a narrative that is likely driving the PM and his government to distraction - that the Liberals are not much different than the Conservatives they have replaced.
That's true from the health accord announcement on the caps which they have adopted from the Conservatives original plan before their defeat, to adopting the same targets for reducing emissions that Mr. Harper was suggesting – reducing emissions to 30% below 2005 levels by 2030.
Of course Richard would call this “nonsense." My friend will never admit that the Conservatives had solid ideas, and that campaigning on ideas and trying to govern on those ideas are quite different.
I think the vast majority of Canadians have accepted (some more than others, granted) that some measure of thinking needs to happen and a pan-Canadian strategy has to be in place to not only appease the true climate change believers, but the environmentalists in all of us.
The challenges have been the economy, timing and geopolitical consequences such as the dilemma Premier Notley is facing. As an NDPer, she is supportive of the carbon-pricing proposal in concept, but as Premier of Alberta, she needs to do some horse-trading with respect to getting Kinder Morgan’s Trans Mountain pipeline passed. Premier Clark in BC is facing an election soon and everything she does will be studied and reviewed in that context. As for Ontario, the PM will not have a stronger supporter than Premier Wynne - at least for now, as that election is less than two years away, and change is in the air.
The PM started a well-needed discussion on carbon pricing - something that he campaigned on and believes in. It is now up to the provinces to make this easy or difficult for the federal government.
Let the horse-trading begin.
Richard Mahoney is a lawyer with deep experience in politics and governance. He is a former senior advisor to the Rt. Hon Paul Martin, a former Campaign Chair and President of the Ontario Liberal Party. John Capobianco is a Senior Partner and National Public Affairs Lead at FleishmanHillard. He has been a Conservative strategist with over 30 years of political activism at all three levels, including as a former federal Conservative candidate. Tom Parkin is a veteran NDP strategist and a frequent commentator on national issues.