Canada needs investment and innovation, not taxation and regulation
Even if one is not inclined to “market” approaches, a limited role of government, low levels of subsidies or taxation, there are a few simple facts that suggest that the dominant taxation and regulation policy mix on climate and the environment is left wanting. Andrew Scheer’s proposal, released yesterday, aims to change that. Though it is short on detail in parts, the overall approach is reasonable, and friendly to growth and innovation—the keys to success in climate and environmental policy.
First of all, Canada’s emissions are a small fraction of global GHG totals. What amount to small-impact taxation initiatives are not the most effective way to bring down global emissions levels, though economists agree, that if designed correctly, carbon taxes are effective ways to reduce emissions without harming growth. The problem is that most taxation schemes do not meet these standards.
Secondly, Canada has seen improvements in environmental indices, most notably air quality since the 70s, and declining levels of GHG emissions per person, and relative to GDP increases since 1990. The United States has seen recent improvements in GHG emissions due to a mix of factors, though many agree that the main ones include fracking and natural gas use.
One of the main problems with punitive measures is that consumers and producers find ways to circumvent the impositions against carbon emitting practices, known as “carbon leakage.” Producers can rejig their supply chain so as to absorb the cost imposed by the regulation. This can mean more carbon-intensive production of a good somewhere in the supply chain outside of the reach of the regulation, or higher emissions levels due to longer transportation routes if inputs are sought from places with lower prices and environmental standards, for example.
Hypothetically, there are ways around this—designing policies that mitigate the ability of companies to do this. Though this is easier said than done, as the level of complexity increases as the number of variables that must be accounted for and controlled multiplies. Like the global taxation and regulation proposals, the sheer complexity and cost makes the efforts to control for all possible avoidance measures largely futile.
Regulation and taxation are important, but at the end of the day, technological improvements allow wealth to increase and emissions to decrease in tandem. The way forward from a policy perspective should be to focus on investment in technology and innovation.
It is often said that the problem is so dire that major interventions are required. The fact of the matter is, climate change and its effects are but one group among many problems and threats that the human species faces at any given time. Developments in artificial intelligence, geopolitical instability, privacy threats, poverty, disease, weapons development, and genetic engineering are just some on the long list of existential threats to consider.
One need not be an expert in modelling and forecasting to recognize that the ability to predict—and to specify that prediction—decreases with the size, scope, number of variables, and time scale that must be taken into account in a predictive model. Forecasting in the realm of human action is notoriously difficult, and social scientists rarely keep their long-term forecasts within a standard deviation of accuracy. The climate is, along with the human brain, one of the most complex “systems” in the known world, and to think that we can project what the effects of temperature increases will be in the long run with precise levels of confidence and specificity is hubristic to say the least.
We can clearly see that there is a problem and that something should be done about it, but this is very different from blanket statements about emergency and crisis that have been made repeatedly, and have failed to materialize since the environmental movement began in the 70s.
Forecasting techniques can take into account general trends that are expected to continue, increase, or decrease into the future. They cannot adequately take into account the many unforeseen variables that only seem to have been predictable in hindsight.
Who predicted on the basis of strong, empirically-based reasoning and theoretical modelling the development of the steam or the combustion engine, DNA sequencing, the internet, mobile phones, election results, etc.? The answer is no one because the concept of a highly predictive model about complex systems, years into the future is a contradiction in terms.
What the best climate scientists and environmental researchers are saying on the basis of good evidence is that there is a problem, and that it is wise to do something about it. The forecasts, when done well, are up front about the variables and assumptions in the models, and include scenarios with different assumptions about what will change and what won’t in the future.
In the public debate, there is seldom much consideration of costs relative to the benefits of different approaches, the role of increasing prosperity in mitigating damages, and the relative value of climate and environmental initiatives compared to efforts to deal with many other current and future problems that we may face.
The IPCC engages in this sort of cost-benefit analysis about climate change and the strategies designed to mitigate it.
William Nordhaus, co-recipient of the 2018 prize in economics, drew attention to the fact that climate change policies must be attentive to economics and cost, and that carbon taxes could be effective, though under certain conditions. He developed models to show the cost of climate change and policies designed to mitigate it relative to GDP growth projections.
Bjorn Lomborg has been working with over 300 economists from around the world to compare the costs and benefits of different strategies aimed at mitigating climate change and dealing with its effects, as well as ranking and prioritizing them in comparison to the UN Millennium Development Goals and Sustainable Development Goals.
What is clear is that the ability to deal with large-scale problems increases with higher levels of wealth, where “wealth” in this case just serves as an indicator of the collective human capacity to mobilize resources to meet challenges.
The Liberal environmental strategy was high on moral rhetoric and “emergency” talk, but lacking on practicality and effectiveness, focused as it is primarily on taxation and regulation.
The focus on investment and innovation in lieu of ineffective punitive approaches is sensible. The measures designed to incentivize investment in green tech on the part of consumers and producers are potentially positive-sum, and likely to result in positive feedback loops if done well—consumers and producers can have a mutually beneficial interest in green products and services.
One might yet wonder how much innovation Canada can foster, how effective the home tax and patent credits, and regulation focused on major emitters will be, and for good reason. The plan lays out a trajectory, and not too many specifics.
There is, in my view, one significant problem, albeit only from the “purist” perspective—the interventionist taxation and subsidy approach. When you tax everyone to subsidize a small group—or vice-versa—and do it frequently and with large sums of money, special interest lobbying becomes the norm. This is already business as usual in the Western democracies, but has arguably worsened under the tenure of consecutive regimes of all political stripes who have enacted the same type of special interest policies for different agendas.
From the perspective of politicians, interest group support is crucial to electoral success; from the perspective of businesses, once a certain scale is achieved, the marginal value of dollars spent on lobbying is higher than that spent on capital, labour, or technological innovations. The policies should be designed in ways that limit interest group politics and reduce the incentive to lobby rather than innovate.
Whether or not the plan can be effective if turned into a reality, it is a good start and a welcome addition to the public conversation. I’d wager most moderate voters see the proposal as reasonable and better than what they might have expected from the Conservatives.
A trial underway in a Nanaimo B.C. courtroom this week is attracting controversy and strong opinions on both sides of the issue, as it forces school officials, the media and the public to reluctantly confront the question of what constitutes “religion” in the public sphere. The case of Candice Servatius v. School District No. 70 (Alberni) is about whether a public school can require children to participate in a spiritual ceremony, or in a ritual that appeals to the supernatural realm.
In September of 2015, Candice Servatius received a letter from the principal of John Howitt Elementary School (JHES) in Port Alberni, B.C., stating that JHES would be hosting a Student/Classroom “Cleansing” performed by a member of the Nuu-chah-nulth, a term used to describe fifteen related First Nation tribes who live on the southwest coast of Vancouver Island. The school’s letter described in detail how the cleansing ritual would “cleanse” the classroom of “energy” and cleanse the “spirits” of the students. The letter claimed that without cleansing, the classroom and even the furniture would harbour negative “energy” and would not be safe until the “energy” was “released”. Smoke from sage was fanned over the bodies of children, including Mrs. Servatius’ daughter, who was required to participate in this ritual against her will. Several months later, an aboriginal prayer was offered to a “god” at a school assembly that children were required to attend.
Skye Ryan, a reporter with CBC affiliate CHEK news, writes that the practice of Nuu-chah-nulth spirituality is “on trial” and implies that Mrs. Servatius is opposed to aboriginal spirituality. Ms. Ryan’s story largely ignores the court documents, which make it abundantly clear that the only issue on trial is whether public schools can impose spiritual rituals on children in the classroom.
If Mrs. Servatius is successful in her court action, the Nuu-chah-nulth will not lose any freedom to practice their spirituality, ceremonies and rituals, nor will public schools cease to teach about aboriginal history, culture and practices, including aboriginal beliefs. If the court rules in favour of Mrs. Servatius, the only difference will be that children are no longer compelled by the state to be present and participate in spiritual ceremonies, prayers or rituals. This is the only just result in a pluralistic society that includes a wide variety of spiritual beliefs and practices, including the complete absence of such beliefs.
In her story, Ms. Ryan quotes Nuu-chah-nulth Tribal Council President Judith Sayers complaining about smudging being banned from schools. But Ms. Sayers herself has given evidence that in Nuu-chah-nulth practice, smudging is always entered into by consent. Neither Mrs. Servatius nor her daughter consented to this young girl participating in the ritual in the classroom.
Another aboriginal leader, Harry Cadwallader, testified that learning about smudging is different than being smudged. Mr. Cadwallader agrees that children can learn about smudging in a number of different ways: “You can be shown a demonstration. You can be shown a video. You can be read a description.” Mr. Cadwallader has testified that “the infusion of aboriginal culture, content, language, history, of understanding, as a methodology to improve the success of aboriginal students and raise awareness of all students about aboriginal people” can be accomplished without compelling children to be smudged against their will. This evidence was entirely absent from Ms. Ryan’s story, although it was publicly available in filed court documents.
Ms. Ryan further reports that the Justice Centre for Constitutional Freedoms is a “right-wing” organization, perhaps hoping this might somehow make Ms. Servatius’ claim worth dismissing out of hand. The Canadian Charter of Rights and Freedoms is not a “right-wing” document, and the Justice Centre works to uphold the Charter freedoms of all Canadians, regardless of where on the political spectrum they might reside.
If Ms. Ryan believes that defending freedom of religion (which includes the right not to be compelled to participate in spiritual practices) is “right-wing”, she is fully entitled to express that opinion. But Ms. Ryan should do so by way of an opinion editorial, and not insert her personal beliefs into what is supposed to be a straight news story. As the Canadian Association of Journalists Ethics Guidelines puts it: “We clearly identify news and opinion so that the audience knows which is which”.
The two Justice Centre lawyers in court in Nanaimo this week, Jay Cameron and James Kitchen, were not available to be interviewed for Ms. Ryan’s story, and they referred Ms. Ryan to me, also a lawyer. Ms. Ryan did not contact me, yet claims in her story that “Neither Servatius or her lawyers would be interviewed.” I was, and remain, available to be interviewed, but as of this writing Ms. Ryan has declined to contact me for comment.
Court cases, by definition, involve two competing “sides.” It behooves an objective media to remember that.
Lawyer John Carpay is president of the Justice Centre for Constitutional Freedoms (JCCF.ca), which represents Mrs. Servatius in her court action against School District 70.
Toronto Maple Leafs coach Mike Babcock has been fired.
The Leafs have hired Sheldon Keefe, who worked as head coach of the Maple Leafs’ American Hockey League affiliate in Toronto as head coach.
“Today, we made the decision to relieve Mike Babcock of his coaching duties and named Sheldon Keefe our new head coach,” said President Brendan Shanahan in the press release. “Over parts of the last five seasons, Mike has played an integral role in changing the direction of our franchise.”
Babcock was hired by the Maple Leafs in May 2015.
“Mike’s commitment and tireless work ethic has put our organization in a better place and we are extremely grateful and appreciative of the foundation he has helped us build here,” said Shanahan.
The Maple Leafs went 173-133-45 in 351 over five seasons with Babcock as coach. He also went 8-12 in three consecutive post-season appearances.
Babcock had originally signed an eight-year contract worth $50 million—an average of $6.25 million per season—making him the highest-paid coach in NHL history.
British Columbia politicians are investigating their options in ticketing individuals who engage in racist behaviour.
Delta North NDP MLA Ravi Kahlon submitted a letter to Public Safety Minister Mike Farnworth requesting that the province crack down on “racist and hateful behaviour,” by measures that would include financial repercussions.
“I understand that some jurisdictions have implemented new, non-criminal sanctions to deter this behaviour such as ticketing,” reads the letter. “I would be grateful if your ministry could determine what options might be available to better deter perpetrators.”
Kahlon’s letter comes from what he says is a perceived rise in racist groups such as the Soldiers of Odin, an anti-immigrant and white supremacist group founded in Kemi, Finland that has groups across North America—though Canada’s chapter claims they have substantial differences than the original group.
“People are afraid in their communities. They know that these hate groups are organizing in communities,” Kahlon said in an interview with Global News.
“My request to the solicitor general was to do a scan of what other jurisdictions are doing to address public hate speech.”
Kahlon says communities he’s spoken with have expressed concern regarding the rise of new hate groups in B.C.—groups attempting to legitimize themselves by registering as societies under the Societies Act.
Kahlon is turning to CSIS in hopes that the government agency is doing everything possible to stop the growth of these groups.
“We aren’t the only jurisdictions dealing with this, but we have to start,” Kahlon said.
As the country faces serious challenges at home and abroad, the proof will be in the pudding for Prime Minister Justin Trudeau’s minority government cabinet picks, who were sworn in at Rideau Hall in Ottawa Wednesday.
To address growing discontent in the West, whose voters denied Liberals seats in Saskatchewan and Alberta, Trudeau has tapped Winnipeg MP and former Natural Resources Minister Jim Carr to serve as “special representative to the Prairies.”
While Bill Morneau stays in his Finance portfolio, Catherine McKenna has been shuffled out of the Environment and will take on the role of Minister of Infrastructure.
Chrystia Freeland was also shuffled from Foreign Affairs and will now serve as Deputy Prime Minister and Minister of Intergovernmental Affairs.
Québec MP and former Infrastructure minister François-Philippe Champagne assumes Freeland’s portfolio as minister of Foreign Affairs.
Other notables include Ottawa-Vanier MP Mona Fortier’s cabinet posting to a new portfolio: Minister of Middle Class and Prosperity.
And the Ministry of Democratic Institutions appears to have gone the way of the dodo and its previous minister Karina Gould, shuffled to International Development.
The following is the new “gender-balanced” cabinet of 36 ministers in alphabetical order, as issued by the Prime Minister’s Office today:
Anita Anand becomes Minister of Public Services and Procurement
Navdeep Bains becomes Minister of Innovation, Science and Industry
Carolyn Bennett remains Minister of Crown-Indigenous Relations
Marie-Claude Bibeau remains Minister of Agriculture and Agri-Food
Bill Blair becomes Minister of Public Safety and Emergency Preparedness
Bardish Chagger becomes Minister of Diversity and Inclusion and Youth
Jean-Yves Duclos becomes President of the Treasury Board
Mona Fortier becomes Minister of Middle-Class Prosperity and Associate
Minister of Finance
Marc Garneau remains Minister of Transport
Karina Gould becomes Minister of International Development
Steven Guilbeault becomes Minister of Canadian Heritage
Patty Hajdu becomes Minister of Health
Ahmed Hussen becomes Minister of Families, Children and Social Development
Mélanie Joly becomes Minister of Economic Development and Official
Bernadette Jordan becomes Minister of Fisheries, Oceans and the Canadian Coast Guard
David Lametti remains Minister of Justice and Attorney General of Canada
Dominic LeBlanc becomes President of the Queen’s Privy Council for Canada
Diane Lebouthillier remains Minister of National Revenue
Lawrence MacAulay remains Minister of Veterans Affairs and Associate
Minister of National Defence
Catherine McKenna becomes Minister of Infrastructure and Communities
Marco E. L. Mendicino becomes Minister of Immigration, Refugees and
Marc Miller becomes Minister of Indigenous Services
Maryam Monsef becomes Minister for Women and Gender Equality and Rural Economic Development
Bill Morneau remains Minister of Finance
Joyce Murray becomes Minister of Digital Government
Mary Ng becomes Minister of Small Business, Export Promotion and
Seamus O’Regan becomes Minister of Natural Resources
Carla Qualtrough becomes Minister of Employment, Workforce Development and Disability Inclusion
Pablo Rodriguez becomes Leader of the Government in the House of
Commons and the party’s Québec Lieutenant
Harjit Sajjan remains Minister of National Defence
Deb Schulte becomes Minister of Seniors
Filomena Tassi becomes Minister of Labour
Dan Vandal becomes Minister of Northern Affairs
Jonathan Wilkinson becomes Minister of Environment and Climate Change
Kirsty Duncan will serve as Deputy Leader of the Government in the House of Commons
Mark Holland will serve as Chief Government Whip
Ginette Petitpas Taylor will serve as Deputy Government Whip
Kevin Lamoureux will serve as Parliamentary Secretary to the Leader of the Government in the House of Commons