Carbon Tax – Yea or nay?
My almost obligatory reaction to the recently announced BC carbon tax? I’m pretty stoked about it – I hardly expected the BC Libs to take this rather bold step. Despite the harmless nature of this tax, any concept of a new tax tends to get people up in arms before they really know what the implications are, so it’s quite rough political terrain for the Libs to wade into. With that said, I also know there’s a broad current of concern over climate change so I think that once people realize that in effect this will be revenue neutral they will get on board with it.
Some have suggested that the $100 cheque to be mailed out to each adult in BC amounts to little more than pocket money that’ll be spent at the first opportunity on trinkets and consumer goods, and that therefore this will have little to no impact. I disagree – it’s no different than receiving an income tax refund, and many of these same people laud an income tax refund as forced savings because they don’t have the discipline to save this money themselves. This $100 cheque can be considered in the same light – forced savings which people can just as well roll over into a savings or investment account as they can spend it on something trivial.
I’m part of a demographic which is very likely to be supportive of a carbon tax – I bicycle or take transit whenever reasonable, and I combine trips into town when I have to drive, and I really only have an automobile for out of town trips and to generate an income. Now it’s true that I happen to work as a pizza delivery driver, so I use a lot of gas and I’ll be one of the most impacted from that perspective. But that’s a personal lifestyle choice – no one’s forcing me to do that for a living, so I have to live with the consequences and I accept that.
The carbon tax will have an extremely complex effect on the economy (ie. raising food costs and encouraging people to seek out either jobs requiring less mobility and/or less consumptive ways of getting to them). One question I have is whether this will place local shipping companies at a competitive disadvantage, as fuel purchased within BC will be more expensive, especially as the carbon tax increases in size as the years pass as it’s designed to do. Exporting goods may become more expensive and these costs will have to be passed on to the customer, while little impact will be felt on imports. We need a North American carbon tax to level the playing field.
It would also make more sense to levy the tax at the source, rather than just at the pumps, so that industry would feel the pinch as well as the end-consumer. Or would it even make a difference, as the cost of the carbon-tax would eventually be passed onto the consumer anyway, and the economic shift away from carbon consumption will be felt by industry regardless in the form of decreased demand? I’m no economist, and have a basic understanding of supply and demand, but like a natural ecosystem, any kind of price changes, whether applied by social policy or laissez-faire economics has broad economic reverberations which can be extremely difficult to predict. The great conservationist John Muir once said that, “Whenever we try to pick out anything by itself, we find it hitched to everything else.” So it is with nature and so it is with our economic systems.
I strongly recommend the following article by UBC Prof. Dr. William Rees on TheTyee: http://thetyee.ca/Views/2008/02/26/TaxShellGame/
Also, there will be a talk by SFU climate and energy policy expert Dr. Mark Jaccard Tues. March 4 at 7 p.m. at Canadian Memorial United Church at 15th and Burrard. I’m generating carbon emissions that night instead of going to the talk, but there you go. Looks very interesting – visit www.vtacc.org for more info.
