It's not enough to bash in heads, you have to bash in minds
            

The Canadian carbon tax debate

Much of the debate on the recent Liberal announcement, has been a clear demonstration of why politicians have resisted this idea, even as economists and policy wonks from across the political spectrum called for it. A new tax (even if accompanied by equivalent tax cuts elsewhere) is never going to be an easy sell, especially if opposing political parties take the low road and dishonestly attack the proposal.

The current Canadian carbon tax debate is a chilling illustration of how easily political spin can overwhelm serious debate on a complex public policy issue…

The problem, is that the facts of the tax – and the underlying policy consideration it was conceived to address – have been lost in a chorus of simplistic political rhetoric… From the days when we were all trying to read the lips of George Bush Sr., it has been an article of faith that taxes are bad and new taxes are the worst. It was inevitable that if someone tried to follow the advice of the most progressive energy economists [and the most conservative] by instituting a carbon levy, the knee-jerk crowd would kick up a fuss.

The reality of the climate change situation is that we need to put a price on carbon. That is beyond debate, the real question is how to best price carbon, a cap and trade system or a carbon tax, they are both means to the same end.

As linked above economists (they even have a club) from across the political spectrum advocate a carbon tax as a simpler, more transparentless prone to loopholes and abuse method of pricing carbon than a cap and trade system. Even a report commissioned by the Conservatives show that a $50/ton carbon tax ($10 dollars more than the liberal proposal) would only marginal reduce GDP, and by 2020 actually be beneficial.

But even with such widespread agreement that a carbon tax is a better alternative to a cap and trade system, Canadians deserve an ‘adult debate‘ on this very important issue. Unfortunately the Conservatives (and the NDP) have instead decided to take the low road.

“A tax on everything” is mischievous, dishonest and the lowest form of public discourse, but odds are that it will hard for the Liberals to refute

All of us, whether or not you support the carbon tax, deserve better than that from our politicians, we deserve a real debate on the best way to tackle climate change. After all the Liberal plan, while good is far from perfect as the Carbon Tax Center writes:

We applaud Dion’s political courage, but we prefer a higher carbon tax. We fully support the concept of revenue neutrality and like the “shift” and “dividend” language, although we would prefer more direct return of the revenues through a Green Shift/carbon tax dividend or offsetting tax reductions… [Because gasoline prices are not taxed by this plan], a floor on gasoline prices maintained by a revenue-neutral carbon tax might be appropriate.

In fact the Green Party’s proposal is superior as it has a higher tax rate for carbon (a 40 billion Dollar shift vs. the Liberals 15 billion shift), while offering more direct income tax reductions.

Dion has taken a step, albeit a small one, in the right direction, and anyone who disagrees with his proposal should at least read up on the sound economic theory behind such a proposal, and debate his proposal honestly and openly. It is time for all of us to take a stand and demand a proper respectful debate on how to Canada can best tackle climate change, the childish and dishonest attacks on the Liberal’s plan are a disservice to all of us.

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