June 28, 2008

I want my carbon-funded tax reduction

It’s been the best piece of public policy in years: more tax on what we want less of; less tax on what we want more of. 

Yes, the carbon tax – on which a short-term political price must be paid, for long-term benefits.  How often do you see politicians taking that kind of risk?

Gordon Campbell’s courage in this case makes the hypocrisy of the NDP all the more appalling.  Carole Jame’s pretense (“deception” is a better word) is that taxing the major emitters won’t impact downstream users directly, i.e. the people opposed to the ‘gas tax’ – another misnomer.   Somehow, it’s implied, carbon will be reduced but the consumer won’t have to pay.

One way or the other, carbon must be priced so that it affects behaviour.  The virtue of the carbon tax is that consumers get to make decisions to avoid or reduce the tax in the first place.  

Most offensively, the  NDP ignores the redistribution of benefit to low-income people.  The tax cuts and dividends disproportionately go to lower income people, many of whom probably don’t drive. How extraordinarily rare to see a right-wing government engage in economic redistribution.

Many in the media are doing the same thing to the carbon tax – emphasizing only the tax increase, not the tax cut – that happened to the vehicle levy.  After weighing the costs and benefits, TransLink chose the option that made the most sense.  Then the media weighed in, reframed the issue (a ‘tax grab’) and amplified the critics, without fairly discussing either the options or the consequences. After the levy was killed, tax increases went on to the property tax and the benefits – more transit – were reduced – the lose-lose option. (And, to note, it was the NDP provincial government that killed it.)

If the carbon tax were delayed or rejected, we’d not only lose the momentum of carbon reduction (which would likely be reimposed inthe future in some more draconian and inefficient form), but also the benefits of tax reductions on income and the redistribution of the benefits.   

And the political message would be clear: don’t take the risk to do something sensible, long-term and principled if your opponents can discredit your message and take political advantage. 

 

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Comments

  1. Nice take on the poor media response to this. At the end of the day 3c a litre in tax would work out to $1.80 difference to fill my mini van. Roughly $86.80 instead of $85. Cut out one starbucks drink a week and that’s more than paid for!

    In return for this I get the rebate cheque and a tax break — I’ll take it.

    We’ve already made family choices to avoid driving so much by choosing to live close to where we work and play. So I appreciate finally getting a financial break for making this choice.

    I don’t get the NDP stance here. Are they saying if elected they’d repeal the carbon tax? yeah right.

  2. Well put, Gordon. I definitely could not have worded it so well. I normally support the NDP given their usual social justice and environmental stance, but I am definitely having second thoughts in the light of this particular political opportunism by the NDP. The carbon tax is the only thing that will help adjust behaviour. Hidden taxes that trickle down from industry to the consumer will not change behaviour.

  3. Maybe I have it wrong, as I think the NDP have done as bad a job communicating their plan in their rabid anti-tax campaign as the Liberals have communicating theirs, but from what I understand the NDP would expand the tax to include all business emissions, i.e. the emissions from lime to make concrete, from smeltering aluminum such as in Kitimat, etc., but take it away from the pumps? A price signal in those processes might have an even bigger effect than the pumps, especially considering the massive price increases already taking place in oil. Now, I agree with the consumer aspect of the tax – Im probably one of only a handful where I live in the northeast of the province – but I dont understand why not all emissions sources arent covered as well.

    But its good to keep in mind that Carole James has said she supports *a* carbon tax, just not *this* carbon tax, even if it is likely political posturing.

  4. Who’s being dishonest, Mr Price? Where do you and others, like Mark Jaccard and Andrew Weaver, get the idea that you can use cowardly smear tactics like that and still claim to be non-partisan?

    When all the feather-preening, luxury import driving Yuppies are lined up in support of a Liberal government policy, as they were with Paul Martin’s debt and deficit reduction strategies of the 1990s, and they are all claiming that it will actually benefit middle and lower income people, and that anyone critiquing that policy is dishonest, every thinking Canadian knows who’s really being deceitful.

  5. Hear hear, Gord.

    I don’t know what to say about the NDP and its most visible media operative Bill Tieleman on this “counter campaign” to pander for votes, except that it makes me ill.

    As for someone blasting you on being “non-partisan,” what a hoot! As if greenhouse gases care how you vote.

    Gordon Campbell is doing one thing only, spending some of his political capital and lead in the polls to do the right thing for BC, and to set an example for other political leaders in the continent. The Premier will pay for it in votes next year, but hopefully Instant Karma straightens out James and Tieleman.

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