Climate policy: contradiction #1

I don’t know if BC’s current approach to climate change is ironic, paradoxical, or just plain crazy, but whatever it is, it is desperately in need of revision. As it stands, existing policies virtually negate each other. It is even possible that overall, they make the problem worse.

Consider BC’s contentious “carbon tax”. However meager an attempt to limit emissions, it is the province’s flagship climate change program. The program is supposed to work like any other tax—if you make something more expensive, people should use less of it. But the carbon tax messes with this formula, since it is “revenue neutral“. In other words, since these days no government wants to introduce taxes, the consumer of fuel gets their carbon tax money back. Indeed, it appears that the net effect is to increase after tax incomes–and, apparently, the richer you are, the more you benefit.

How do you figure we’ll spend this cash? On carbon offsets? Sure, some folks do, but for most of us it’s a small windfall. Maybe we use it to go out for dinner, maybe even to fill up the gas tank. Perhaps, as a hockey team-mate of mine did, we put it toward a plane trip to Vegas, pulling off, as Bill Rees points out here, a really impressive climate change trick: using the carbon tax as a way to increase our emissions-per-dollar, lowering the cost of greenhouse gas production.

Presently, neither of the main contenders in the provincial election have anything useful to say about the carbon tax. I am nervous about the February 17 provincial budget, since it is highly unlikely to tackle the problem with the election looming. The only choice on the table is keep it or cut it. Neither is enough of an answer. We need to fix it, so it can help us do what we must do: lower emissions dramatically.

Topics: Climate change & energy policy, Taxes