Carbon taxes take a beating—north and south

One hopes that Premier Notley and Prime Minister Trudeau have been watching events south of the border, where carbon taxes and wind/solar power advocates have taken major hits, and it’s clear Canada will go it alone on carbon taxes for many years to come, putting us at a tax disadvantage compared to our competitors in our largest market.

In the U.S. midterms earlier this month, a number of ballot proposals on wind and solar power went down to defeat, none more striking than in Washington State—a state with environmental values second to none—where voters rejected carbon taxes for the second time including once in a legislative effort to impose a tax on greenhouse gas emissions. The battle over the tax was the most expensive (US$45 million) in state history for a ballot measure. And this was a proposal for a US$15 per tonne tax in 2020, rising only US$2 per year above the rate of inflation until the state achieves its emission goals (which may or may not be affected by the tax at that lower rate).

Here in Alberta, we’re already paying $30/tonne of GHG emissions, and most likely, will be forced to bump that in $10 increments to $50/tonne in 2022. Clearly, jurisdictions in the U.S. will not impose similar taxes on themselves.

But it wasn’t only the Washington State rejection that brought the pain on climate change to U.S. politicians. The pro-carbon tax Republicans in the U.S. House of Representatives, known as the Climate Solutions Caucus, was decimated at the polls. Carlos Curbelo, an up-and-coming congressman from Florida lost his reelection bid in part because of his support for a carbon tax. Grover Norquist, the head of the influential Americans for Tax Reform, said “Curbelo could and should have been reelected, but he was talked into pushing an energy tax on all Americans—the so-called carbon tax—and as a result, voters kicked him out of office.”

Again, Curbelo’s proposed tax of US$23/tonne of GHG emissions is equivalent to what Alberta pays today, before the federal price escalator catches up to us in 2021. Others beside Curbelo got the hook as well: Barbara Comstock (VA), Scott Taylor (VA), Daniel Donovan (NY) and Peter Roskam (IL) all lost their races. Conservative members of the Climate Solutions Caucus went down with Curbelo.

In another telling loss to the “tax carbon crowd and build renewables,” a proposition in Arizona (Proposition 127) fell on election day, despite millions in backing from billionaire environmental activist Tom Steyer. That proposition would have mandated the growth of renewable energy sources (wind and solar) to 50 per cent of energy production by 2030.

And here at home, carbon tax conflict has escalated to nearly unbelievable levels, with Maclean's calling the five leading opponents of carbon taxation “The Resistance.”

“There used to be Conservatives who favoured putting a price on carbon,” wrote Paul Wells. “They have lost in a rout.”

There’s a good reason for that, as Canadian jurisdictions have been utterly unwilling to enact anything close to theoretically-sound carbon tax, turning virtually all of them into government cash grabs.

One hopes Premier Notley and Prime Minister Trudeau are paying attention and learning just how many people dislike their carbon taxes. Hopefully, they’ll consider lift this yoke from the Canadian economy—a yoke that will not be borne in the United States.