Economy
Politics the only consistency in carbon tax policy
From the Frontier Centre for Public Policy
By Lee Harding
Never mind that there is no easy connection between CO2 and temperatures, except in […]
The misplaced idea that carbon dioxide is pollution undergirds the dubious concept of the carbon tax. Never mind that there is no easy connection between CO2 and temperatures, except in the easily questioned computer models created by climate change proponents. Nevertheless, the carbon tax policy is the signature climate change policy of the Trudeau Government. This tax has raised energy prices across the country and supercharged inflation without any impact on reducing harmless carbon dioxide emissions.
The main impact of the carbon tax is to reduce of everybody’s living standards just a bit more each year. Finally, it seems to have succeeded in doing something else: undermining Liberal support. The awkward attempt to solve this political and policy problem sent federal arguments for the carbon tax into complete contradiction last week.
On October 26 Prime Minister Justin Trudeau announced a three-year moratorium on carbon taxes for home heating oil, a move that was good politics but curious policy.
“We’ve heard clearly from Atlantic Canadians through our amazing Atlantic MPs that since the federal pollution price came into force … certain features of that pollution price needed adjusting to work for everyone,” said Trudeau.
You see, last July Atlantic provinces had to give Ottawa worthy proposals to keep themselves out of Ottawa’s carbon pricing scheme. They failed, so their citizens have felt the pinch. Forty percent of Atlantic Canadians, but only three percent of all Canadians use fuel oil.
This reality facilitated a political solution–a national policy with mostly regional consequences for Liberal support. The problem was how to spin it.
“We are doubling down on our fight against climate change and…supporting Canadians while we fight climate change,” the PM said.
“Economists and experts around the world have long known that putting a price on carbon emissions is the best way to drive down those emissions that cause climate change, is the cheapest, most efficient and most impactful way and it’s working,” the PM insisted.
This circle can’t be squared, except politically. The fuel oil announcement was made hours before Conservative Leader Pierre Poilievre held his scheduled “Axe the Tax” rally against carbon taxes in Windsor, N.S., the riding of Liberal Atlantic Caucus chair Kody Blois.
Put together, this is a national but regional policy to adjust a carbon tax that works but does not work. It’s doubtful that taxes or grants will change the weather, of course, but fuel oil was unworthy of an exemption.
The heat output per gallon of fuel oil is 138,690 British Thermal Units and almost equal to that of natural gas (139,050 BTU). However, natural gas only produces 117 lbs of CO2 per million BTU, whereas distillate fuel oil produces more than 160 lbs. The worst “polluters” just got a break.
Meanwhile, residents west of Quebec, where natural gas use ranges from 49 to 77 per cent, will pay carbon taxes, as they always have–and more so as they increase every April. It’s moves like this that have allowed a federal government to maintain power that hasn’t won the popular vote since 2015.
Poilievre’s plan to end the carbon tax is a winner for policy sanity.
Lee Harding is a Research Fellow at the Frontier Centre for Public Policy.
From LifeSiteNews
Canadians’ disinterest in electric vehicles comes as the Trudeau government recently mandated that all new light-duty vehicles in Canada are zero emission by 2035.
Research has revealed that Canadians are increasingly unwilling to purchase an electric vehicle (EV).
According to an April 22 survey from AutoTrader, Canadians remain skeptical of Prime Minister Justin Trudeau’s electric vehicle mandate and ongoing advertisement surrounding electric vehicles, as interest in owning one dropped for a second year in a row.
“Overall, while almost half of non-EV owners are open to buying an EV for their next vehicle, interest in EVs has declined for the second year in a row,” reported Tiffany Ding, director of insights and intelligence at AutoTrader.
In 2022, at least 68 percent of Canadians were interested in buying an electric vehicle. However, by 2023, the number declined to 56 percent. So far in 2024, there is even less interest, with only 46 percent saying they were open to purchasing one.
“AutoTrader data shows a direct correlation to gas prices and EV interest, and since gas prices have normalized from their peak in 2022, EV interest has also dropped,” a summary of the survey explained.
However, Canadians did show a slight increase of interest in hybrid vehicles, with 62 percent of those looking to purchase an electric vehicle saying they would look at a gas-electric hybrid, compared with 60 percent in 2023.
The survey also questioned Canadians regarding Trudeau’s Zero Emission Vehicle (ZEV) mandate, which requires all new light-duty vehicles in Canada are zero-emission by 2035, essentially banning the sale of new gasoline/diesel-only powered cars.
The mandate comes despite warnings that it would cause massive chaos by threatening to collapse the nation’s power grids.
“Over 75 percent of respondents are aware of the federal government’s ZEV mandate, which requires all new light-duty vehicles sold in Canada to be zero-emission by 2035,” the survey found.
However, the respondents revealed that they believe it’s “unlikely that Canada will be able to meet the federal government’s ZEV target due to the current inadequate charging infrastructure or a change in political power that could revoke or amend the ZEV mandate timeline.”
Canadians’ concerns in buying an electric vehicle include limited travel range/distance, inadequate availability of charging stations, higher purchasing costs, and concerns that they do not perform well in cold weather.
Indeed, this winter, western Canadians experienced firsthand the unreliability of Trudeau’s “renewable” energy scheme as Alberta’s power grid nearly collapsed due to a failure of wind and solar power.
Trudeau’s plan has been roundly condemned by Canadians, including Alberta Premier Danielle Smith. In 2022, Smith denounced a federal mandate that will require all new cars sold after 2035 to be “zero emission” electric (EVs) vehicles and promised that Albertans will always have the choice to buy gasoline-powered cars.
Since taking office in 2015, Trudeau has continued to push a radical environmental agenda similar to the agendas being pushed the World Economic Forum’s “Great Reset” and the United Nations’ “Sustainable Development Goals.”
The reduction and eventual elimination of the use of so-called “fossil fuels” and a transition to unreliable “green” energy has also been pushed by the World Economic Forum (WEF) – the globalist group behind the socialist “Great Reset” agenda – an organization in which Trudeau and some of his cabinet are involved.
The Trudeau government’s electric vehicle plan comes despite the fact Canada has the third largest oil reserves in the world. Electric cars cost thousands more to make and buy, are largely considered unsuitable for Canada’s climate as they offer poor range and long charging times during cold winters and have batteries that take tremendous resources to make and are difficult to recycle.
From the Fraser Institute
By Tegan Hill and Jake Fuss
From 2014 to 2022, inflation-adjusted total business investment (in plants, machinery, equipment and new technologies but excluding residential construction) in Canada declined by C$34 billion. During the same period, after adjusting for inflation, business investment declined by a total of $3,748 per worker
According to the recent federal budget, the Trudeau government plans to increase the inclusion rate from 50 per cent to 66.7 per cent on capital gains over $250,000 for individuals and on all capital gains realized by corporations and trusts. Unfortunately, this tax hike will be the final nail in the coffin for business investment in Canada, which likely means even harder economic times ahead.
Canada already faces a business investment crisis. From 2014 to 2022, inflation-adjusted total business investment (in plants, machinery, equipment and new technologies but excluding residential construction) in Canada declined by C$34 billion. During the same period, after adjusting for inflation, business investment declined by a total of $3,748 per worker—from $20,264 per worker in 2014 to $16,515 per worker in 2022.
While business investment has declined in Canada since 2014, in other countries, including the United States, it’s continued to grow. This isn’t a post-COVID problem—this is a Canada problem.
And Canadians should be worried. Businesses investment is key for strong economic growth and higher living standards because when businesses invest in physical and intellectual capital they equip workers with the tools and technology (e.g. machinery, computer programs, artificial intelligence) to produce more and provide higher quality goods and services, which fuels innovation and higher productivity. And as firms become more efficient and increase profits, they’re able to pay higher wages, which is why business investment remains a key factor for higher incomes and living standards.
The Trudeau government’s policies—increased regulation, particularly in the energy and mining sectors (which makes Canada a relatively unattractive place to do business), higher and uncompetitive taxes, and massive federal deficits (which imply future tax increases)—have damaged business investment.
Unsurprisingly, weak business investment has correlated with a weak economy. In the fourth quarter of 2023, real economic growth per person ($58,111) officially fell below 2014 levels ($58,162). In other words, Canadian living standards have completely stagnated. In fact, over the last decade economic growth per person has been the weakest on record since the 1930s.
Instead of helping fix the problem, the Trudeau government’s capital gains tax hike will further damage Canada’s economy by reducing the return on investment and encouraging an exodus of capital from the country. Indeed, capital gains taxes are among the most economically-damaging forms of taxation because they reduce the incentive to invest.
Once again, the Trudeau government has enacted a policy that will deter business investment, which Canada desperately needs for strong economic growth. The key takeaway for Canadians? Barring a change in policy, you can expect harder times ahead.
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